HOA Board Election Procedures

The following election procedures for CROWN BAY OWNERS ASSOCIATION (“Association”) are updated pursuant to California Civil Code Sections 5100, 5105, 5110, 5115, 5125, 5145 and 5200. The Association shall retain candidate registration lists and voter lists for the requisite statutory time period. Members shall be allowed to inspect the aforementioned lists at least 30 days before ballots are distributed.

Pursuant to California Civil Code Section 5105(h), these election operating rules shall not be amended less than ninety (90) days prior to an election.

I. EQUAL ACCESS

1.1 Definition of Association Media

“Association Media” means the Association's newsletters, internet websites and/or Association cable channel or any other form of global communication with the membership.

1.2 Equal Access to Association Media

If any candidate or member advocating a point of view is provided access to Association Media, all candidates or members advocating a point of view will be granted equal access to Association Media for purposes reasonably related to the election.

1.3 Equal Access to Common Area Meeting Space

All candidates will be granted equal access to the Association’s Common Area meeting space, if any exists, during a campaign at no cost, including those candidates who are not incumbents and to all members advocating a point of view, including those not endorsed by the board, for purposes reasonably related to the election.

1.4 No Alteration of Candidate Communications

The Association may not edit or change the content of any candidate's message, but may include a statement disclaiming responsibility for the content.

II. QUALIFICATIONS AND NOMINATION OF DIRECTORS

2.1 Qualifications of Directors

2.1.1 Mandatory Membership

Only Members of the Association are eligible to be nominated or nominate himself or herself for a position on the Board if he/she is a Member of the Association at the time of nomination and is not disqualified under Section 2.1.2 below. Non-Members of the Association are not eligible to be nominated or to serve on the Board.

(a)

If title to a property is held by a legal entity that is not a natural person, the governing authority of that legal entity shall have the power to appoint a natural person to be a Member for purposes of candidate nomination. If the legal entity is a Trust, a trustee of the Trust shall be the designated person for nomination.

2.1.2 Disqualification

A Member is not eligible to serve on or be nominated or to nominate himself or herself for a position on the Board if he or she:

(a)

Is not current in the payment of his/her regular or special assessments, but they may not be disqualified for nonpayment of fines, fines renamed as assessments, collection charges, late charges, or costs levied by a third party. However, a Member shall not be disqualified for failure to be current in payment of regular and special assessments if either:

1. The Member has paid the regular or special assessment under protest pursuant to Civil Code Section 5658;
2. The Member has entered into a payment plan pursuant to Civil Code Section 5665; or
3. The Member has requested or is participating in internal dispute resolution pursuant to Article 2 (commencing with Section 5900) of Chapter 10 of the Civil Code.

All Directors must also be current in the payment of regular and special assessments during their Board tenure.

(b)

If elected, would be serving on the Board at the same time as another person who holds a joint ownership interest in the same separate interest unit and the other person is either properly nominated for the current election or an incumbent director.

(c)

Has been a Member of the Association for less than one (1) year.

(d)

Has a past criminal conviction that would, if the Member was elected, either prevent the Association from purchasing the fidelity bond coverage required by Civil Code Section 5806 or terminate the Association’s existing fidelity bond coverage.

2.2 Notice and Nomination Procedures

2.2.1 Notice of Procedure and Nomination Deadline

The Association shall provide individual notice of the procedure and deadline for submitting a nomination at least thirty (30) days before the deadline for submitting nominations.

2.2.2 Notice Before Ballot Distribution

The Association shall provide general notice of all of the following at least thirty (30) days before the ballots are distributed:

(a)

The date and time by which, and the physical address where, ballots are to be returned by electronic internet-based submission, mail or handed to the inspector or inspectors of elections;

(b)

The date, time, and location of the meeting at which a quorum will be determined, if the Association’s governing documents require a quorum, and at which ballots will be counted; and

(c)

The list of all candidates’ names that will appear on the ballot.

(d)

Individual notice of the above paragraphs shall be delivered pursuant to Section 4040 if individual notice is requested by a member.

(e)

If the Association’s governing documents require a quorum for election of directors, a statement that the Board of Directors may call a subsequent meeting at least twenty (20) days after a scheduled election if the required quorum is not reached, at which time the quorum of the membership to elect directors will be 20 percent (20%) of the Association’s members voting in person, by proxy, or by secret ballot.

2.2.3 Qualifications for Nomination

In order to be nominated to the Board of Directors, all nominees must meet the qualifications as set forth in Section 2.1.1 of these Rules and not be disqualified under Section 2.1.2.

2.2.4 Self-Nomination

Any Member may nominate himself or herself for election to the Board of Directors, as long as he or she is qualified under Section 2.1 and not disqualified under Section 2.1.2.

2.2.5 Nomination by Nominating Committee

The Association's Bylaws, Article 5, Section 5.1 provides that nominations for election to the Board of Directors shall be made by a Nominating Committee. Notice to the Members of the Association of the meeting shall include the names of all those who are nominees at the time the notice is sent. Nominations may also be made from the floor at the annual meeting.

The Nominating Committee shall consist of a chairman, who shall be a director, and two (2) or more Members of the Association. The Nominating Committee shall be appointed by the Board of Directors to serve for a period of one (1) year, and vacancies thereon shall be filled by the Board.

Notwithstanding the foregoing, the initial Nominating Committee shall be appointed by Declarant and its members need not be Members of the Association.

The Nominating Committee shall make as many nominations for election to the Board of Directors as it shall in its discretion determine, but not less than the number of vacancies that are to be filled.

All candidates shall have reasonable opportunity to communicate their qualifications to Members and to solicit votes.

III. VOTING

3.1 Voting

Each Member is entitled to a vote if he/she/it is a Member at the time that ballots are distributed. Each Member has the right to cast one vote per separate interest owned on each matter submitted to Members for voting. Note that each director vacancy counts as one matter.

Votes may be cast by members in person, by proxy subject to the terms in 3.1.1, or in specific instances designated by the Board of Directors. All elections/votes, except for those relating to regular and special assessments, shall be conducted by electronic secret ballot.

3.1.1 Voting by Proxy

The Association’s Bylaws, Article 3, Section 3.5 provides that voting may be accomplished by proxy provided that the proxy holder presents to the Board of Directors a document executed by the Voting Member authorizing the proxy. In no event shall a proxy be valid for a period in excess of eleven (11) months from the date of execution thereof.

In any election or voting procedure in which proxies are authorized, the Inspector of Elections shall be responsible to authenticate and determine the validity and effect of any submitted proxy.

3.1.2 Voting Rights

The Association is prohibited from denying a ballot to:

(a)

A Member for any reason other than not being a Member at the time when ballots are distributed; and

(b)

A person with general power of attorney for a Member. The ballot of a person with general power of attorney for a Member shall be counted if returned in a timely manner.

3.2 Cumulative Voting

The Association's Bylaws, Article 5, Section 5.2 provides that every Member entitled to vote may cumulate his/her/its votes during any election of the Board of Directors where more than two Directors are to be elected.

A Member may give one candidate a number of votes equal to the number of such members to be elected multiplied by the number of votes to which such Member is otherwise entitled, or distribute such votes on the same principle among more than one candidate.

The candidates receiving the highest number of votes, up to the number of members of the Board of Directors to be elected, shall be deemed elected.

3.3 Non-Revocable Ballots

Both electronic and written ballots may not be revoked once they are submitted to the Inspector(s) of Elections. Once electronic secret ballots are transmitted via the internet-based voting system and once written ballots are deposited in the U.S. mail to the Inspector(s) of Elections, they are considered non-revocable.

3.4 Loss of Ballot

If a Member loses his/her written ballot prior to the annual meeting, they may request another ballot, along with the appropriate envelopes from the Inspector(s) of Elections but they must sign a statement that the original ballot was lost, destroyed or never received.

The Inspector(s) of Elections shall maintain a record of each request and, if it is determined that the Member voted twice, even by mistake, neither ballot will be counted.

Additional ballots cannot be obtained from a member of the Board. Only the Inspector of Elections will provide additional ballots.

3.5 Secrecy of Ballots

A Member who signs or otherwise marks his/her written ballot with an identifying mark, waives his/her right to secrecy. The Association is not responsible for redacting personal information that is added to the ballots by a Member.

3.6 Voting Period

The polls will open when the ballots are sent to the members and will close at the commencement of the annual meeting, or any adjournment thereof, or the final collection of ballots for counting, whichever occurs first.

3.7 Electronic Voting

The Association may elect to utilize an inspector of elections to conduct elections, other than elections relating to regular or special assessments, by way of electronic secret ballot. Should electronic secret ballots be utilized, the following additional rules shall apply:

3.7.1

A member shall be allowed to change their preferred method of voting from electronic secret ballot to written ballot or written ballot to electronic secret ballot no later than 90 days before an election.

3.7.2

An electronic secret ballot and written ballot shall contain the same list of items being voted on.

3.7.3

A member must opt-out of voting by electronic secret ballot to vote by written ballot which shall require the Association to mail a written ballot only to a member who has opted-out of voting by electronic secret ballot or for whom the Association does not have an e-mail address required to vote by electronic secret ballot.

3.7.4

The Association shall maintain a voting list identifying which members will vote by electronic secret ballot and which members will vote by written ballot. The Association shall also include information on the procedures opt-out of electronic secret ballot voting in the annual disclosure statement.

3.7.5

All members who wish to vote by electronic secret balloting must provide a valid e-mail address to the Association.

3.7.6

If electronic secret balloting is utilized, nominations of candidates from the floor is expressly prohibited.

3.7.7

Notice of the electronic secret ballot shall be delivered at least 30 days before the election/vote and shall contain the following:

1. How to obtain access to that internet-based voting system; and
2. How to vote by electronic secret ballot.

3.7.8

At least 30 days before the deadline to opt-out of voting by electronic secret ballot the Association shall provide notice to the membership of all of the following:

1. The member’s current voting method;
2. If the member’s current voting method is by electronic secret ballot and the Association has an e-mail address for the member, the e-mail address of the member that will be used for voting by electronic secret ballot;
3. An explanation that the member is required to opt-out of voting by electronic secret ballot if the member elects to vote by written secret ballot;
4. An explanation of how a member may opt-out of voting by electronic secret ballot; and
5. The deadline by which the member is required to opt-out of voting by electronic secret ballot if the member elects to exercise that right.

3.7.9

A vote made by electronic secret ballot is effective when it is electronically transmitted and shall not be revoked.

3.7.10

If the Association does not have a member’s e-mail address by the time ballots are to be distributed, the Association shall send the member a written secret ballot.

IV. INSPECTORS OF ELECTION

4.1 Inspectors of Elections

The number of Inspectors of Elections shall be one (1) or three (3). The Association shall select an independent third party or parties as an Inspector of Elections.

An independent third party may not be a person, business entity, or subdivision of a business entity who is currently employed or under contract to the Association for any compensable services other than serving as an Inspector of Elections.

The Association’s current management, attorney(s) and any other person or entity under contract with the Association for compensation are hereby prohibited from serving as an Inspector of Elections.

4.1.1 Duties of Inspector(s) of Elections

The Inspector(s) shall be responsible to:

(a)

Determine the number of Members entitled to vote and voting power of each said Member;

(b)

Determine the authenticity, validity, and effect of proxies, if any;

(c)

Provide each member voting electronically the following:

1. A method to authenticate the member’s identity to the internet-based voting system;
2. A method to transmit an electronic secret ballot to the internet-based voting system that ensures secrecy and integrity of each ballot; and
3. A method to confirm at least thirty (30) days before the voting deadline, that the member’s electronic device can successfully communicate with the internet-based voting system.

(d)

Ensure that the internet-based voting system shall have the ability to:

1. Authenticate a member’s identity;
2. Authenticate the validity of each electronic secret ballot to ensure that the electronic secret ballot is not altered in transit;
3. Transmit a receipt from the internet-based voting system to each member who casts an electronic secret ballot;
4. Permanently separate any authenticating or identifying information from the electronic secret ballot, rendering it impossible to connect an election ballot to a specific member; and
5. Store and keep electronic secret ballots accessible to elections officials or their authorized representatives for recount, inspection, and review purposes.

(e)

Receive ballots;

(f)

Hear and determine the outcome of all challenges and questions regarding a Member of the Association’s right to vote in the election;

(g)

Count and tabulate all votes submitted;

(h)

Determine the hours of operation of any polling facilities;

(i)

Determine and announce the result of the election based on the ballots received and votes tabulated; and

(j)

Perform any acts as may be proper to conduct the election with fairness to all Members of the Association in accordance with these election procedures and all applicable rules of the Association regarding the conduct of the election that are not in conflict with these procedures; and

(k)

Deliver, or cause to be delivered, at least thirty (30) days before an election, to each Member: the ballot(s) and a copy of the election rules.

Delivery of the election operating rules may be accomplished by either of the following methods:

1. Posting the election operating rules to an internet website and including the corresponding internet website address on the ballot together with the phrase, in at least 12-point font: “the rules governing this election may be found here:”; or
2. Individual delivery.

(l)

Make corrections to the candidate registration and voter list within two (2) business days of receipt of notice from the Association or one of its members.

4.1.2 Good Faith of Inspector(s) of Elections

Every Inspector of Elections shall perform his or her duties impartially, in good faith, to the best of his or her ability, as expeditiously as is practical, and in a manner that protects the interest of all Members of the Association.

The Inspector of Elections may appoint and oversee additional persons to verify signatures and to count and tabulate votes as the inspector or inspectors deem appropriate, provided that the persons are independent third parties who meet the requirements outlined in Section 4.1 above.

4.1.3 Decision

The decision or act of a majority of the Inspector(s) of Elections shall be effective in all respects as the decision or act of all.

4.1.4 Report

Any report made or issued by the Inspector(s) of Elections is prima facie evidence of the facts stated in the report.

4.2 Removal of Inspectors of Elections

The Board of Directors may remove and replace any Inspector of Elections prior to the tabulation of votes if an Inspector resigns or if the Board reasonably determines that an Inspector will not be able to perform his or her duties impartially and in good faith.

V. ELECTION BY ACCLAMATION

5.1 Availability

If the Association has held a regular election for the directors in the last three (3) years and the number of qualified candidates is not more than the number of vacancies to be elected, as determined by the inspector or inspectors of the elections, the Association may, but is not required to, consider the qualified candidates elected by acclamation so long as the Association complies with the following procedures.

5.2 Notice and Nomination Procedures

5.2.1 Initial Notice of Procedure and Nomination Deadline

The Association shall provide initial notice of the procedure and nomination deadline at least ninety (90) days before the deadline for submitting nominations.

The initial notice shall include the following:

(a)

The number of board positions that will be filled at the election;

(b)

The deadline for submitting nominations;

(c)

The manner in which nominations can be submitted; and

(d)

A statement informing members that if, at the close of the time period for making nominations, there are the same number or fewer qualified candidates as there are board positions to be filled, then the board of directors may, after voting to do so, seat the qualified candidates by acclamation without balloting.

5.2.2 Reminder Notice

Seven (7) to thirty (30) days before the deadline for submitting nominations, the Association shall provide a reminder notice that includes all of the following:

(a)

The number of board positions that will be filled at the election;

(b)

The deadline for submitting nominations;

(c)

The manner in which nominations can be submitted;

(d)

The list of the names of all of the qualified candidates to fill the board positions as of the date of the reminder notice; and

(e)

A statement reminding members that if, at the close of the time period for making nominations, there are the same number or fewer qualified candidates as there are board positions to be filled, then the board of directors may, after voting to do so, seat the qualified candidates by acclamation without balloting.

5.2.3 Nomination Notification

Within seven (7) business days of receiving a nomination, the Association shall provide the following:

(a)

A written or electronic communication acknowledging the receipt of the nomination to the member who submitted the nomination.

(b)

A written or electronic communication indicating the nominee is a qualified candidate for the board of directors or the nominee is not a qualified candidate for the board of directors.

(c)

The Association may combine the notifications in (a) and (b) if the nominee and the nominator are the same person.

5.3 Voting to Elect by Acclamation

If voting by acclamation is possible, the Board shall meet after the close of nominations but before the deadline to send out ballots and shall vote to consider the qualified candidates elected by acclamation at the meeting for which the agenda item reflects the name of each qualified candidate that will be seated by acclamation if the item is approved.

5.4 No Write-In Candidates

If the Association Board elects to proceed with a vote by acclamation, no write-in candidates will be permitted.