CHANGES

from page 5

notice may be accompanied by an interpreter. The request should specify the language required. 6.3.4. Observers A MEMBER or QPR appealing a CRV violation notice can be accompanied by a single observer who cannot participate in the appellant’s defense beyond their stated role as observer or interpreter. 6.3.5. A MEMBER or QPR appealing a CRV violation notice can be accompanied and assisted during the hearing process by the MEMBER’s agent or attorney-in-fact whom the MEMBER or QPR has designated to serve as their representative in such disciplinary matters. 7. RESOLUTION 7.1. If, without prior notification to the CRV panel, the person who requested the appeal does not appear at the scheduled meeting or provide a written defense, the panel will assess the validity of the citation based upon the evidence or testimony the panel has received. 7.2. Notice of Decision 7.2.1. The CRV panel shall make "findings" to support the panel’s decision regarding the alleged violation. Findings may allow for issuing a warning letter or upholding, amending, or vacating the citation. 7.2.2. Notice of the panel's decision must be issued by first- class mail within 15 business days following the CRVPANEL’s decision (Civ. Code §5855(c); Corp. Code §7341(c)(2).) The letter of decision shall identify the violation by date and/or number, the panel's findings, and the results of the hearing.

8. FINAL APPEAL 8.1. A person may appeal, in writing, the CRV PANEL’s decision to the GRF BOD. The BOD must receive the request for a final appeal within 25 days after the scheduled date of the initial appeal hearing.

8.1.1. The Appeals Panel of the GRF BOD will comprise a quorum of the BOD. The Appeals panel will be moderated by the GRF PRESIDENT. 8.1.2.Amajority of the GRF BOD of Directors, or the majority of the quorum reviewing a case, shall be necessary to confirm the judgment of the CRV PANEL.

8.2. The BOD Appeals Hearing will be conducted using the procedure listed in sections 6 and 7 above. 8.3. The BOD’s decision to uphold, alter, or waive any sanction will be final. 8.4. Notice of the BOD's decision must be issued by first-class mail to the appealing MEMBER or QPR within 15 business days following their appeal hearing date. 9. FAILURE TO RESPOND 9.1. A failure to respond to a properly adjudicated VIOLATION OF COMMUNITY RULES judgment may be cited as an additional violation: 9.2. It is a failure to respond when a violator, who within 10 days from the date of the CRV violation, has not: 9.2.1. Paid the resulting fine; or 9.2.2. Submitted a written request for any remaining appeal within the provisions of this rule; 9.3. It is also deemed a failure to respond when a MEMBER or QPR: 9.3.1. Has not paid any resulting fine; or requested a final appeal in writing to the BOD within 25 days after the CRV’s initial appeal hearing; or 9.3.2. Within 25 days after the BOD has issued a final decision on an appeal, has not paid the fine affirmed by the CRV PANEL. 9.4. A MEMBER or QPR deemed to have failed to respond will be issued a letter by first-class mail calling them to attend an additional hearing before the CRV PANEL. 9.5. A MEMBER or QPR cited for failure to respond will have the same capacity to respond to the CRV PANEL in person, or in writing, as outlined in Section 6 above. However, the MEMBER or QPR’s statements shall only address issues involved with their failure to respond. 9.6. The CRV PANEL shall assess the failure-to-respond charge using the same criteria as outlined in Section 7 above. 9.7. The CRV PANEL shall provide the non-responding MEMBER or QPR who has failed to respond with written notice of its decision within fifteen (15) days following the hearing.

9.8. Sanctions for Failure to Respond The MEMBER or QPR who has completed the appeal processes within the procedures and time periods defined and has not paid any resulting fines shall be liable for additional sanctions.

9.8.1. The CRV PANEL, at its discretion, may determine to impose on the non-respondent an additional monetary fine, of no more than 50 percent of the unpaid fine at the time of the failure-to-respond hearing. 9.8.2. To avoid the imposition of these sanctions, all outstand- ing fines imposed by the CRV panel, and liable to be collected under the due process outlined above, must be paid within 25 days after the date of the CRV hearing on the MEMBER or QPR’s failure to respond. 9.8.3. If the non-respondent has not paid the total fines by that date, the CRV PANEL may issue an additional letter citing the MEMBER or QRV’s failure to respond, and the MEMBER or QPR may be subject to further penalties.

9.8.4. The judgment of the CRV PANEL concerning sanctions for failure to respond will be considered final.

Document history Keywords: Rules of Conduct, Fine, Appeal, Parking Violation.

ADMINISTRATION 13-5025-3 Golden Rain Foundation Election Rules

The following will be in effect for the election of directors to the Golden Rain Foundation (GRF) Board of Directors (BOD): 1. ELECTIONS 1.1. ANNUAL ELECTION The election of directors for odd-numbered Mutuals will occur during odd-numbered years and the election of directors for even-numbered Mutuals will occur during even-numbered years. Each director shall serve a two-year term. One (1) director will be elected from each Mutual except for Mutuals One (1) and Two (2) where there will be two (2) Directors. 1.2. SPECIAL ELECTIONS Upon the occurrence of a vacancy on the BOD representing an odd- or even- numbered Mutuals, the process for a special election will begin within ten (10) days after the Secretary of the Board is notified of the vacancy.

2. VOTING 2.1. QUALIFICATION FOR VOTING Members must vote by using the secret ballot. It may be mailed or handed in at the Annual Meeting prior to poll closing. Members may cast one (1) vote, except on the ballots of Mutuals One (1) and Two (2), members may cast two (2) votes, but they may not be cast cumulatively. Members may obtain replacement ballots by contacting the Inspector of Elections. 2.2. CUMULATIVE VOTING Pursuant to the Bylaws, cumulative voting is not permitted. 2.3. VOTING BY ACCLAMATION To the extent permitted by law, in the event the number of candidates at the close of nominations is the same as the number of open positions on the Board, those candidates shall be automatically elected, by acclamation, without further action, and the results shall be announced as required by these Rules and applicable law. 3. CANDIDATES 3.1. CANDIDATE ELIGIBILITY AND QUALIFICATIONS All candidates must be members of GRF for at least one (1) year, at the time of nomination.

3.1.1. Only members who meet the following criteria are qualified to be elected to the BOD: 3.1.1.1. Candidates and Directors may not have been convicted of a crime that would either prevent GRF from purchasing fidelity bond coverage or terminate GRF's existing coverage. 3.1.1.2. Candidates and Directors must be current in the payment of carrying charges. Note, this does not include non-payment of collection charges, late charges, fines, fines renamed as assessments, costs levied by a third party, or if the member has (1) paid under protest per Civil Code Section 5658; (2) has entered into and is current in a payment plan (defined as a signed written agreement between the Board and the Owner) per Section 5665, and is current and in compliance will all terms thereof; or (3) if the member has not been provided the opportunity to engage in Internal Dispute Resolution (“IDR”). All members of GRF have the right to engage in Internal Dispute Resolution (“IDR”) and/or Alternative Dispute Resolution (“ADR”), pursuant to the Civil Code. A member may contact the Board, in writing, to initiate IDR/ADR. Note, if IDR/ADR is not scheduled and completed prior to the nomination deadline, candidates may be disqualified for non-payment of carrying charges. 3.1.1.3. Candidates must have been a member of GRF for at least one (1) year.

3.1.2. In addition to the foregoing qualifications, any member who is (a) an officer or director of a Mutual Corporation at Seal Beach Leisure World; (b) a member of any City Council; (c) a member of the Board of Supervisors of the County of Orange, California; (d) a member of the Planning Commission for the City of Seal Beach, California, or the County of Orange, California; (e) an elected official of any city, county, governmental body or political subdivision thereof; (f) an individual, a member of any entity or partnership, or an officer or director of any other corporation engaged in supplying material, services or labor to the Golden Rain Foundation, is strongly discouraged from running for the BOD, as such action creates a substantial time commitment and causes a potential conflict of interest. Further, such action may expose any individual member and/ or the Board to unnecessary liability, including, but not lim- ited to, breaching fiduciary duties. The Corporate Secretary is authorized to determine the qualifications of a Director, pursuant to the terms of all GRF Governing Documents and applicable State laws. 3.1.3. Serving on both a Mutual Board and the GRF Board may require you to recuse yourself from some issues brought before the Board. 3.2. CANDIDATE APPLICATION MATERIALS Candidates shall turn in the following materials prior to the

CHANGES, page 7 CHANGES

from page 6

deadline set by the GRF.

3.2.1. Application for Candidacy as a GRF Director 3.2.2. Signed Candidate Eligibility Disclaimer (set forth below) 3.2.3. Signed Candidate Statement (set forth below) At the time of turning in candidate materials, candidates must present current GRF identification card. Candidates will receive a receipt for their application.

3.3. CANDIDATE ELIGIBILITY DISCLAIMER Refer to GRF By-laws, Article Six, Section 1. Candidates shall complete an Eligibility Disclaimer to set forth that they are qualified to serve on the GRF Board of Directors.

3.4. CANDIDATE STATEMENT Prior to the deadline established by the GRF, each candidate shall submit a Statement containing up to 300 words (no less than 12-point type, single sided). The statement shall be mailed with the ballot.

3.4.1. The statement shall contain the candidate’s background, qualifications and platform, and shall not contain any dispar aging or defamatory content.

3.5. NOTIFICATION OF NOMINATIONS FOR ELECTION OF DIRECTORS As prescribed by law, at least thirty (30) days before the close of nominations, GRF will provide individual notice of the election and the procedure for nominating candidates. Additionally, the GRF shall place a notice in the Community newspaper not less than ninety (90) days prior to the election counting meeting that any member may place his or her name into nomination for the director position representing the Mutual in which they reside.

The notice shall be published in the Community newspaper every week thereafter until the closure of the nominating period.

3.6. SELF-NOMINATION BY MEMBERS Members who wish to nominate themselves as a candidate for election to the BOD must do so in writing to the Stock Transfer Office prior to the closing of the application deadline.

3.6.1. All candidates shall be provided candidate instructions upon submitting their name for nomination.

3.7. A Mutual BOD may appoint a nominating committee for the purpose of recommending a candidate for the election. Any candidates who are recommended by their Mutual BOD or nominating committee will be given candidate instructions by the Stock Transfer Office.

3.8. Nominations from the floor or write-ins.

3.8.1. Nominations from the floor and write-ins are prohibited.

3.9. Campaign Cycle 3.9.1. The campaign cycle shall begin in February and end with the closing of the polls.

3.10. Equal Access to GRF Media 3.10.1. Candidates advocating a point of view for purposes reasonably related to the election shall be provided one-time access to the GRF’s website (LWSB website) during the campaign cycle as follows: 3.10.1.1. Submissions shall be posted on the election bulletin board on the LWSB website during the campaign cycle.

3.10.1.2. Submissions shall be limited to 300 words and shall not contain disparaging or defamatory content.

3.10.1.3. One submission shall be accepted from each candidate for posting on the LWSB website.

3.10.2. Candidates advocating a point of view for purposes reasonably related to the election may purchase, subject to space availability and advertising guidelines established by the News Office, a maximum of a half-page of space in an edition of the Community newspaper at regular advertising rates during the campaign cycle. No other access to the Community newspaper will be granted. 3.10.3. Equal access to clubhouse meeting spaces shall be provided at no cost to all candidates, including those who are not incumbents, and to all members advocating a point of view for purposes reasonably related to the election. The clubhouses are subject to availability by reservation only on a first-come, first-serve basis.

3.10.4. In the event that incumbent director makes any statements or take any actions, solely in the context of those directors’ performance of their duties as directors, any and all such statements or actions shall not constitute provision by the GRF of access to its media for campaign purposes.

3.10.5. In the event that GRF’s media reports any candidates’ statements or actions that are reasonably unrelated to the election, the reporting of such shall not constitute provision by GRF to its media for campaign purposes.

3.10.6. In accordance with Civil Code 5135, no GRF funds shall be used for campaign purposes, except to the extent necessary for the GRF to comply with the duties imposed upon it by law.

3.10.7. Campaign Restrictions 3.10.7.1. Candidates are entitled to purchase labels for the addresses in their Mutual at a FLAT RATE OF $10 PER REQUEST, PLUS $0.25 PER SHEET. This is to be paid at the time the labels are ordered. Labels can be ordered by completing an “Access to Documents” form in theAccounting Department. This list will not contain all addresses as some Shareholders have opted out of receiving campaign correspondence.

3.10.7.2. Candidates MAYNOT use a Mutual e-mail contact list to send campaign related correspondence. If a candidate violate this Campaign Rule, you will be liable for reimbursing GRF for the cost of the election and candidate may be removed as a candidate.

3.10.8. Non-Responsibility for Statements and Actions Neither GRF or its officers, directors or employees shall be responsible for any claims, damages, injuries, judgments, orders or settlements, including attorney’s fees, arising from a candidate’s statement or actions made in connection with an election.

4. ELECTION MEETINGS The GRF BOD will convene a special meeting one week prior to the Annual Meeting for the purpose of the Inspector of Election counting secret ballots. All members are welcome to attend the special meeting. In the case of a special election, the GRF BOD will convene a special meeting approximately thirty (30) days after the ballots are mailed for the purpose of the Inspector of Election counting ballots. All members are welcome to attend the special meeting.

5. ELECTION PROCESS 5.1. The GRF Administration Committee shall review the election materials and the election process and recommend approval to the GRF BOD.

5.2. GRF shall contract with an independent third-party vendor to perform all election services as Inspector(s) of Election. The vendor will be directed to conduct the election and be accountable for the conduct of the election in accordance with this policy, all applicable codes, GRF By-Laws, and state laws.

5.3. During its meeting in February, the GRF Administration Committee of the GRF BOD will recommend that the Board appoint the election services company as its Inspector(s) of Election. 5.4. During its meeting in February, the BOD will appoint the election services company as its Inspector of Election.

6. ELECTION MATERIALS 6.1. Notice of Election At least thirty (30) days before the ballots are distributed, GRF will provide general notice of (1) the date and time by which, and address where, ballots are to be returned; (2) the date, time and location of the meeting to tabulate the ballots; and (3) the list of all candidates names that will appear on the ballot.

6.2. Verification of Election Material GRF shall permit members to verify the accuracy of their individual information on the Election Material at least thirty (30) days before the ballots are distributed. GRF or any member shall report any errors or omissions for either list to the inspector(s) of election who shall make the corrections within two (2) business days.

“Election Material” means the following documents: returned ballots, signed voter envelopes, Candidate Registration List and the Voter List. The Candidate Registration List means the list of qualified candidates existing as of the close of nominations. The Voter List may include: the name, voting power and either the physical address of the member’s separate interest or the parcel number, or both; and the mailing address of the member (if different from the physical address or if the parcel number is used).

6.3. Ballot Packet The ballot packet will consist only of a secret ballot, voting instructions, any candidate statements/resumes, a copy of the election rules, two return envelopes, and mailing instructions for the election. The ballot packet will be mailed no less than thirty (30) days prior to the ballot counting meeting. Note, the election rules may be provided by individual delivery or by posting same on an internet site and providing the corresponding internet.

6.4. Secret Ballots Returned by Mail 6.4.1.The secret ballot is required to be mailed to the Inspector(s) of the Election for proper verification and validation and must be received before noon on the date established on the ballot.

6.4.1.1. Ballot can also be delivered to the Special Election Meeting prior to poll closing.

6.4.2. The mail-in secret ballot is irrevocable once received by the Inspector(s) of the Election.

6.4.3. The denial of a ballot to a person with general power of attorney for a member is prohibited. (Civil Code Section 5105(g)(2).) A ballot submitted for a member by an individual with general power of attorney is valid so long as it is submitted in a timely fashion.

6.4.4. The Inspectors of Election will open and process, in public view, the mail-in secret ballots on the day of the special meeting held for the purpose of counting ballots as outlined under Section 7.

6.4.4.1. If a secret ballot is compromised or improperly sealed or addressed, or has any identifying marks, it will be invalidated by the Inspector(s) of the Election.

7. INSPECTOR(S) OF THE ELECTION 7.1. Inspector(s) of the Elections shall perform the following: 7.1.1. Determine the number of shareholders entitled to vote and the voting power of each.

7.1.2. Establish a mailing address for mail-in ballots, and the contact phone number for members’ questions.

7.1.3. Prepare and mail to all members in the odd- or evennumbered Mutuals, no later than thirty (30) days prior to the election meeting, the notice letter, mail-in secret ballot, any candidate statements/resumes, voting instructions, the election rules, two envelopes, and mailing instructions for the GRF

CHANGES, page 10 election, in a manner consistent with providing and ensuring that the member’s vote will be by “secret ballot.” 7.1.4. Receive secret ballots, which can be mailed in, or hand delivered to the Special Election Meeting prior to poll closing. 7.1.5. Open secret ballots at the special meeting for the purpose of counting ballots. 7.1.6. Count and tabulate all votes. 7.1.7. Determine the results of the election. 7.1.8. Certify, in writing, that the election was held in accordance with this policy and Section 5110 of the Davis-Stirling Common Interest Development Act (the Act). 7.1.9. Consult with GRF's legal counsel, if necessary, to fulfill the Inspector(s)’ obligations under the law. 8. OBSERVERS OF THE ELECTION Any candidate or member of the GRF may witness the counting and tabulation of the votes. However, the Inspector(s) of Election may establish reasonable guidelines for candidates and members for the observing of the counting and tabulation of ballots, including guidelines on distance from which observers may stand. 9. BALLOT RETENTION 9.1. The sealed ballots at all times shall be in the custody of the Inspector or Inspectors of election or at a location designated by the inspector or inspectors until the vote tabulation is completed, and until the time allowed by Section 5145 of the Civil Code (twelve months) for challenging the election has expired, at which time custody will be transferred to GRF, or by the Inspector of Election if requested by the GRF Board. 9.2. The ballots shall be stored in a secure place for no less than one year after the date of the election. 10. ACCLAMATION 10.1. In the event the number of candidates at the close of nominations is the same as the number of open positions on the Board, those candidates shall be automatically elected, by acclamation. Pursuant to Civil Code Section 5103, election by acclamation shall be permitted if the following conditions are satisfied: 10.1.1. GRF has held a regular election for the directors in the last three years. The three-year time period shall be calculated from the date ballots were due in the last full election to the start of voting for the proposed election. 10.1.2. GRF provided individual notice of the election and the procedure for nominating the candidate as follows: (1) initial notice at least ninety (90) days before the deadline for submitting nominations which includes (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 may seat the qualified candidates by acclamation without balloting; and (2) a reminder notice between seven (7) and thirty (30) days before the deadline for submitting nominations which includes those items listed in the initial notice under (1) above, in addi tion to a list of the names of all of the qualified candidates to fill the Board positions as of the date of the reminder notice. 10.1.3. GRF provides, within seven (7) business days of receiving a nomination: (1) a written or electronic communication acknowledging the nomination to the member who submitted the nomination; and (2) a written or electronic communica tion to the nominee indicating the nominee is qualified for the Board; or the nominee is not qualified and the basis for said disqualification, including procedures by which the nominee may appeal the disqualification. 10.1.4. GRF permits all candidates to run if nominated, except for nominees disqualified for running as allowed or required pursuant to Civil Code Section 5105(b)-(e). To the extent that term limits are enforceable by applicable law, a nominee or director who has served the maximum number of terms or sequential terms allowed in the governing documents may be disqualified. 10.1.5. The Board votes to consider the qualified candidates elected by acclamation at a duly noticed meeting. The meet ing notice shall include an agenda item reflecting the name of each qualified candidate that will be seated by acclamation, if approved at the meeting. Document History Keywords: GRF, Administration Committee, Election, Candidate, Voting, GRF Board.

ADMINISTRATION 30-5093-2 Authorized Resident (AR) Rules of Conduct, Non Compliance with Rules of Conduct—Fines and Penalties

1. PURPOSE The purpose of implementing fines and penalties for non-compliance with Authorized Resident (AR) Rules of Conduct violations listed in 13-5093-1 governing abusive, threatening and harassing behavior toward GRF staff, GRF directors, and GRF-contracted service providers is to: 1.1. Encourage voluntary compliance. 1.2. Enforce the Golden Rain Foundation’s (GRF) obligation to adhere to California and federal mandates protecting workers from experiencing a hostile work environment. 1.3. Penalize violators who do not comply with the Rules of Conduct. 1.4. Protect GRF Trust Property and assets, GRF Staff, GRF Directors, GRF-contracted service providers, Authorized Residents, caregivers and visitors. 2. NON-COMPLIANCE FINES AND PENALTIES For each offense, violators may be subject to one of the fines defined below, and/or one or more of the non-financial penalties.

2.1. Fine Schedule 2.1.1. First Offense $100.00 2.1.2. Second Offense $200.00 2.1.3. Third Offense $500.00 and violators suspension of access to GRF Trust Property amenities usage for 60 days. 2.1.4. Fines and Penalties for further offenses will be subject to the GRF Board of Directors’discretion and dependent upon the severity of the infraction. 2.1.5. Egregious offenses will be reviewed by the Board of Directors and appropriate fines, or penalties will be assessed by Board of Director action, under applicable terms of the California Civil Code.

2.2. Non-Financial Penalties 2.2.1. Suspension of defined Trust property use privileges. 2.2.2. Banning the offender temporarily or permanently from interactions with defined GRF staff members, GRF Directors, or GRF-contracted employers. 2.2.3. Suspension, either temporarily or permanently, of access to GRF contract work, or receiving defined GRF services. 2.3. Legal Action 2.3.1. For infractions that rise to a criminal level as stated in City, State or Federal laws, the appropriate authorities will be notified. 2.3.2. GRF will seek legal action when necessary to protect GRF Trust Property assets, GRF staff, GRF-contracted service providers, GRF directors, and volunteers on Trust Property or while working in Mutuals. 2.3.3. The prevailing party may be entitled to recover reasonable legal costs. Document History Keywords: Rules of Conduct, Fines, Penalty, Authorized Resident (AR).