Resolution of the Board of Directors

                    Remedy for Default in Payment of Annual Assessments

           WHEREAS, Chapter 26 of Title 55 of the Code of Virginia sets forth the Property Owners' Association Act which governs the operation of homeowners' associations; and

           WHEREAS, section 55-513 of Chapter 26 specifies a board of directors shall have the power to establish, adopt and enforce rules and regulations with respect to areas of responsibility assigned to the association by the Declaration of Covenants; and

           WHEREAS, Section 55-513 of Chapter 26 further provides that rules and regulations established by the board of directors may be adopted by resolution; and

          WHEREAS, Article V, Section 7 of the Declaration of Covenants, Conditions and Restrictions ("Declaration") provides that the Board of Directors shall fix the amount of the annual assessment at least thirty (30) days in advance of each annual assessment period and establish the due dates for the payment of said assessment; and

         WHEREAS, Article V, Section 8 of the Declaration provides remedies of the Association in the event of default in the payment of any assessment; and

         WHEREAS, Article V, Section 8(a) of the Declaration further provides that the Association may establish by rule a penalty to be imposed in the event of default by a homeowner to pay any assessment within thirty days (30) after the due date; and

         WHEREAS, the Board of Directors believes that it is in the best interest of the Association to establish a rule setting forth a late fee which may be imposed, in its discretion. upon a member in the event any assessment is not paid within thirty (30) days after the due date in order that the Association will be able to maintain its fiscal operations and integrity in the operation of its day-to-day business.

         NOW, THEREFORE, BE IT RESOLVED THAT:

         A late fee of twenty-five (25%) of an annual assessment may be imposed, in the discretion of the Board of Directors, against any member who has not paid an assessment within the thirty (30) days after the due date established by the Board, provided that the member received written notice of the amount of the annual assessment and its due date at least thirty (30) days in advance of the annual assessment period. Any such late fee imposed shall be added to the outstanding assessment and may be secured by a lien or collected in any other fashion as permitted by the Declaration, Bylaws, rules of the association or other applicable legal principles or statutes.

         Resolution approved and adopted by the Board of Directors of the Fair Oaks Estates Homeowners Association this 7th day of August 2002.

                                                                    FAIR OAKS ESTATES HOMEOWNERS ASSOCIATION

                                                                   /S/  Kathy Briggs, President and Director

                                                                  /S/  Kevin Keating, Vice-President and Director

                                                                 /S/  Mark MacDonald, Director

           The Secretary, Patricia A. McGarry, hereby attests that this resolution of the Board of Directors was mailed, first-class postage prepaid, to the addressees of record of the lot owners of Fair Oaks Estates Homeowners Association this 26th day of August 2002.

/S/  Patricia A. McGarry, Secretary                                                                                             8/26/02