Bylaws of Crown Bay Owners Association

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Article I - Name and Location

The name of the corporation is CROWN BAY OWNERS ASSOCIATION, hereinafter referred to as the "Association." The principal office of the Association shall initially be located at 600 B Street, Suite 1500, San Diego, California, but meetings of Members shall be held at such places as are mandated by the provisions of Article III, paragraph 1 of these Bylaws. The principal office of the Association may be changed at any time by the Board of Directors.

Article II - Definitions

"Association" shall mean and refer to CROWN BAY OWNERS ASSOCIATION, a California nonprofit mutual benefit corporation, its successors and assigns.
"Board" or "Board of Directors" shall mean and refer to the governing body of the Association.
"Commercial Unit" shall be as defined in the Declaration.
"Common Area" shall be as defined in the Declaration.
"Condominium Documents" shall be as defined in the Declaration.
"Condominium" shall be as defined in the Declaration.
"Declarant" shall mean and refer to CROWN BAY LLC, a Delaware limited liability company, subject to assignment and succession as set forth in the Declaration.
"Declaration" shall mean and refer to the Declaration of Covenants, Conditions and Restrictions applicable to the Project and recorded in the Office of the San Diego County, California, Recorder, and all amendments thereto.
"Institutional Lender" shall be as defined in the Declaration.
"Member" shall be as defined in the Declaration. Whenever Member or Membership is used in these Bylaws for the purpose of determining quorums, percentages or minimum or maximum numbers for voting as specified in these Bylaws, all persons who are Members because of their joint ownership of a particular Condominium shall be counted as one (1).
"Owner" shall be as defined in the Declaration. Whenever Owner is used in these Bylaws for the purpose of determining quorums, percentages or minimum or maximum numbers for voting as specified in these Bylaws, all the Owners of a particular Condominium shall be counted as one (1).
"Project" shall be as defined in the Declaration.
"Unit" shall be as defined in the Declaration.

Article III - Meeting of Members

Annual Meetings. Meetings of the Association shall be conducted in accordance with a recognized system of parliamentary procedure or such parliamentary procedures as the Association may adopt. The first meeting of the Association, whether a regular or special meeting, shall be held within forty-five (45) days after the closing of the sale of the Condominium which represents the 51st percentile interest authorized for sale under the first subdivision public report for the Project, but in no event shall the first meeting of the Association be held later than six (6) months after the closing of the sale of the first Condominium. Thereafter regular meetings of the Association shall be held annually, commencing one (1) year after the first meeting, at such reasonable time, place (either at the Project itself or at another meeting place located as near as is possible to the Project) and date (not exceeding thirty (30) days before or after the anniversary date of the first regular meeting) as may be designated by the Board of Directors. Unless unusual conditions exist, meetings shall not be held outside of the county in which the Project is situated.
Special Meetings. Special meetings of the Members shall be promptly called by the Board of Directors upon: (a) the vote for such a meeting by a majority of a quorum of the Board of Directors; or (b) receipt by the Board of Directors of a Written request for such a meeting signed by Members representing at least five percent (5%) of the total voting power of the Association. Special meetings shall be conducted according to the same system of parliamentary procedure as the Association has adopted for annual meetings.
Notice of Meetings. Except as otherwise provided in the Declaration, written notice of each meeting of the Members shall be given by the Board of Directors by mailing a copy of such notice, postage prepaid, not less than ten (ten days nor more than ninety (90) days before such meeting to each Member entitled to vote at such meeting. The notice shall be addressed to the Member's address last appearing on the books of the Association or supplied by such Member for the purpose of notice. Such notice shall specify the place, day and hour of the meeting, and, in the case of a special meeting, the notice shall specify those matters the Board intends to present for action by the Members, but, except as otherwise provided by law, any proper matter may be presented at the meeting for action.
Quorum. Except as otherwise provided in the Declaration, a quorum for the transaction of business at a meeting of the Members of the Association shall be deemed to exist through the presence in person or by proxy of a majority of the total voting power of the Association, In the absence of a quorum at a meeting, a majority of the Owners present in person or by proxy may adjourn the meeting to another time, but may not transact any other business. An adjournment for lack of a quorum shall be to a date not less than five (5) days and not more than thirty (30) days from the original meeting date, and a quorum for such resumed meeting shall be deemed to exist through the presence in person or by a proxy of twenty-five percent (25%) of the total voting power of the Association. If a time and place for the adjourned meeting is not fixed by those in attendance at the original meeting, Or if for any reason anew date is fixed for the adjourned meeting after adjournment, notice of the time and place of the adjourned meeting shall be given to Members in accordance with the provisions of Article III, paragraph 3 of these Bylaws.
Voting; Proxies. At all meetings of Members, each vote entitled to be cast may be cast in person or by proxy. All proxies shall be in writing and filed with the secretary. Every proxy shall be revocable and shall automatically cease upon conveyance by the Member of his Condominium. The form of proxy or written ballot distributed by any person to the membership of the Association shall afford the opportunity to specify a choice between approval and disapproval of each matter or group of matters to be acted upon, except it shall not be mandatory that a candidate for election to the governing body be named in the proxy or written ballot. The proxy or written ballot shall provide that, where the member specifies a choice, the vote shall be cast in accordance with that choice. The proxy shall also identify the person or persons authorized to exercise the proxy and the length of time it will be valid.
Action Without Meeting. Any action which may be taken by the vote of Members at a regular or special meeting, except the election of Board members where cumulative voting is a requirement, may be taken without a meeting, if done in compliance with the provisions of California Corporations Code Section 7513.

Article IV - Board of Directors: Selection: Term of Office

Number. The affairs of this Association shall be managed by a Board of five (5) directors, who need not be Members of the Association; provided, however, that all directors who are elected when there is no Class B Member must be Members of the Association.
Term of Office. Until the first meeting of the Members, the Board shall be appointed by the Declarant. At its first meeting, the Members shall elect three (3) directors for a term of one (1) year and two (2) directors for a term of two (2) years and at each annual meeting thereafter the Members shall elect such number of directors as may be necessary to maintain during the next year five (5) Members of the Board of Directors; provided, however, that, one (1) director shall be selected exclusively by the vote of the Owners of the Commercial Units.
Removal. The entire Board of Directors or any individual director may be removed from the Board by a vote-of Members holding a majority of the Memberships entitled to vote at an election of directors, by secret written ballot. However, unless the entire Board of Directors is removed, an individual director shall not be removed prior to the expiration of his term of office if the votes cast against removal would be sufficient to elect such director if voted cumulatively at an election at which the same total number of votes were cast and the entire number of directors authorized at the time of the most recent election of the Board of Directors were then being elected. If anyone (1) or all of the directors are so removed, new directors may be elected at the same meeting. Irrespective of the number of Class A Members' and Class B Members at any time, the Class A Members shall in all events be entitled to elect at least twenty percent (20%) of the total Membership of the Board of Directors. In the event that at any election no member of the Board of Directors could have been elected solely by the votes of Owners other than Declarant (through the cumulating of all of their votes), the elected director having received the smallest number of votes shall be eliminated (and if more than one (1) elected director shall fall in that category, one (1) of the elected directors shall be eliminated by lot), and nominations and elections of a director shall be forth with accomplished with only Owners other than Declarant being entitled to vote in such election. A director who has been elected to office solely by the votes of Owners other than Declarant may be removed from office prior to the expiration of his term of office only by the-vote of at least a simple majority of the voting power of Owners other than Declarant.
Compensation. No director shall receive compensation for any service he may render to the Association. However, any director may be reimbursed for his actual expenses incurred in the performance of his duties.
Vacancies. Vacancies in the Board created by death or resignation may be filled by a majority of the remaining directors, though less than a quorum, and each director so elected shall hold office until his successor is elected at an annual meeting of Members or a special meeting called for that purpose. If any director tenders his resignation to the Board, the Board shall have the power to elect a successor to take office at such time as the resignation shall become effective. No reduction of the number of directors shall have the effect of removing any director prior to the expiration of his term of office.

Article V - Nomination and Election of Directors

Nomination. Nomination for election to the Board of Directors shall be made by a Nominating Committee. Nominations may also be made from the floor at the annual meeting. The Nominating Committee shall consist of a Chairman, who shall be a Member of the Board of Directors, and two (2) or more Members of the Association. The Nominating Committee shall be appointed by the Board of Directors prior to each annual meeting of the Members, to serve from the close of such annual meeting until the close of the next annual meeting, and such appointment shall be announced at each annual meeting. 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. Such nominations may be made from among Members or non-members, except that directors must be Members of the Association when there is no Class B Membership.
Voting. Voting of the Members may be by viva voce or by ballot All elections for directors shall be by secret written ballot. One (1) director shall be selected exclusively by the vote' of the Owners of the Commercial Units, The other four (4) directors shall be selected based on the votes of all Owners. Cumulative voting is required for all elections in which more than two (2) directors are to be elected. No Member shall be entitled to cumulate votes for a candidate or candidates unless such candidates' names have been placed in nomination prior to the voting and the Member has given-notice at the meeting prior to the voting of the Member's intention to cumulate votes. If anyone (1) Member has given such notice, all Members at any election for directors, subject to the foregoing, shall have the right to cumulate votes and give one (1) candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which he is entitled, or to distribute his votes on the same principle among as many candidates as he shall think fit. The candidates receiving the highest number of votes up to the number of directors to be elected shall be elected. If there is a deadlock among the Owners of the Commercial Units in selecting their one director, then the votes of each such Owner of'a Commercial Unit shall be based proportionately upon the relative amount of square footage of each Commercial Unit Owner's Commercial Unit.

Article VI - Meetings of Board of Directors

Regular Meetings. Meetings of the Board shall be conducted in accordance with a recognized system of parliamentary procedure or such parliamentary procedures as the Board may adopt. Regular meetings of the Board of Directors shall be held monthly, or an alternative schedule as determined by the Board, at a time and place within the Project fixed by resolution of the Board. Notice of the time and place of such meeting shall be posted at a prominent place or places within the Common Area and shall be communicated to Board members not less than four (4) days prior to the specified meeting unless the time and place of the meeting is otherwise fixed by these Bylaws; provided, however, that notice of a meeting need not be given to any Board member who has signed a waiver of notice or a written consent to holding of the meeting.
Special Meeting. Special meetings of the Board of Directors for any purpose or purposes shall be called at any time by the president, or by any two (2) directors other than the president. Written notice of the time and place of special meetings and the nature of any special business to be considered shall be posted in the manner prescribed for notice of regular meetings and shall be sent to all directors by first class mail not less than four (4) days prior to the scheduled time of the meeting or such notice shall be delivered personally or by telephone or telegraph not less than forty-eight (48) hours prior to the scheduled time of the meeting; provided, however. notice- of the meeting need not be given to any director who has signed a waiver of notice or a written consent to the holding of the meeting.
Open Meetings. Regular and special meetings of the Board shall be open to all Members of the Association; provided, however, that Association Members who are not on the Board may not participate in any deliberation or discussion unless expressly so authorized by the vote of a majority of a quorum of the Board. The Board may, with the approval of a majority of a quorum of the Board, adjourn a meeting and reconvene in executive session to discuss and vote upon matters that relate to the formation of contracts with third parties, litigation in which the Association is or may become involved, personnel matters, and business of a similarly sensitive nature. The nature of all business to be considered in executive session shall first be announced in open session and shall be noted in the minutes of the Board. In any matter relating to the discipline of a Member, the Board shall meet in executive session if requested by that Member, and the Member shall be entitled to attend the executive session. If the Association consolidates any of its functions under a joint neighborhood association or similar organization, Members or each participating association shall be entitled to attend all meetings of the joint association other than executive sessions, shall be given reasonable opportunity for participation in those meetings, and shall be entitled to the same access to the joint association's records as they are to the records of the Association.
Quorum. A majority of the number of the directors shall constitute a quorum for the transaction of business. Every act or decision done or made by a majority of the directors present at a duly held meeting at which a quorum is present shall be regarded as the act of the Board.
Minutes. The minutes, minutes proposed for adoption that are marked to indicate draft status, or a summary of the minutes, of any meeting of the Board, other than an executive session, shall be available to Members within thirty (30) days of the meeting. The minutes shall be distributed to any Member of the Association upon request and upon reimbursement of the Association's cost in making such distribution. Members shall be notified, in writing, of their right to receive copies of the minutes of Board meetings and how and where such minutes may be obtained at the time the Board distributes the pro forma budget, as required by the Declaration, or at the time of any general mailing to the Members.
Action Without Meeting. Any action which may be taken by the vote of members of the Board of Directors at a regular or special meeting may be taken without a meeting if all members of the Board of Directors shall individually or collectively consent in writing to such action.

Article VII - Officers and Their Duties

Enumeration of Offices. The officers of this Association shall be a president and vice-president, who shall at all times be Members of the Board of Directors, a secretary and a chief financial officer, and such other officers as the Board may from time to time by resolution create.
Election of Officers. The election of officers shall take place at the first meeting of the Board of Directors immediately following each annual meeting of the Members.
Term. The officers of this Association shall be elected annually by the Board and each shall hold office for one (1) year unless he shall sooner resign, or shall be removed, or otherwise become disqualified to serve.
Special Appointments. The Board may elect such other officers as the affairs of the Association may require, each of whom shall hold office for such period, have such authority, and perform such duties as the Board may, from time to time, determine.
Resignation and Removal. Any officer may be removed from office with or without cause by the Board, Any officer may resign at any time by giving written notice to the Board, the president or the secretary. Such resignation shall take effect on the date of receipt of such notice or at any later time specified therein, and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Vacancies. A vacancy in any office may be filled by appointment by the Board. The officer appointed to such vacancy shall serve for the remainder of the term of the officer he replaces.
Multiple Offices. The offices of secretary and chief financial officer may be held by the same person. No person shall simultaneously hold more than one (1) of any of the other offices except in the case of special offices created pursuant to paragraph 4 of this Article.
Duties of Officers. The duties of the officers shall be as follows:

a. The president shall preside at all meetings of the Board of Directors and the Members; see that orders and resolutions of the Board are carried out; and, sign documents and written instruments on behalf of Association, including, without limitation, leases, mortgages, deeds and other instruments, and co-sign all checks and promissory notes of the Association.

b. The vice-president shall act in the place and stead of the president in the event of his absence, inability or refusal to act, and shall exercise and discharge such other duties as may be required of him by the Board.

c. The secretary shall record the votes and keep the minutes of all meetings and proceedings of the Board and of the Members; serve notice of meetings of the Board and of the Members; keep appropriate current records showing the Members of the Association together with their addresses; and, perform such other duties as required by the Board.

d. The chief financial officer (or at the option of the Board of Directors, a professional property manager) shall receive and deposit in appropriate bank accounts all monies of the Association and shall disburse such funds as directed by resolution of the Board of Directors, co-sign checks and promissory notes of the Association; and, keep proper books of account.

e. Association Responsibilities. In accordance with the provisions of the Declaration, the Association shall have the responsibility of administering and maintaining the Common Area, approving the annual budget, establishing and collecting all Assessments authorized pursuant to the Declaration.

Article VIII - Committees

The Association shall appoint a Nominating Committee, as provided in these Bylaws. In addition, the Board of Directors shall appoint other committees as it deems appropriate in carrying out its purpose.

Article IX - Books and Records

The Membership register, including mailing addresses and telephone numbers, books of account, and minutes of meetings of the Members, Board of Directors and of committees of the Board of Directors shall be made available for inspection and copying by any Member of the Association (or by his duly appointed representative) and, upon request, by Institutional Lenders, for all purposes reasonably related to such Member's or Institutional Lender's interest as a Member or lender. The place where said items shall be available for inspection shall be the principal office of the Association or such other place within the Project as the Board of Directors may prescribe. The Member or Institutional Lender desiring to make the inspection shall give at least twenty-four (24) hours notice to the secretary of the Association of the records desired to be inspected. The hours and days of the week when an inspection may be made are Monday through Friday (except legal holidays) from 9:00 a.m. to 3:00 p.m. Each Member or Institutional Lender requesting copies of documents shall pay the cost of reproducing the copies upon receipt thereof.

Every director shall have the absolute right at any reasonable time to inspect all books, records and documents of the Association, and the physical properties owned or controlled by the Association. Such right of inspection shall include the right to make extracts and copies of documents.

Article X - Amendments and Conflicts

Amendments. During a period of time prior to the conversion of the Class B Membership in the Association to Class A Membership, new Bylaws may be adopted or these Bylaws may be amended or repealed by the vote of the Members entitled to exercise at least 75% or more of the total voting power of each class of Members of the Association or by written assent of such Members; provided, however, that so long as there is a Class B Membership any amendment to these Bylaws shall be submitted to and approved by the VA (as defined in the Declaration) prior to approval by the Members. After the conversion of the Class B Membership to Class A Membership in the Association, these Bylaws may be amended or repealed by the vote of (a) Members entitled to exercise at least 51 % of the total voting power of the Association, and (b) at least 51% of the total voting power of Members of the Association other than Declarant.

Notwithstanding the above, the percentage of a quorum or of the voting power of the Association or of Members other than the Declarant necessary to amend a specific clause 'or provision in these Bylaws shall not be less than the prescribed percentage of affirmative votes required for action to be taken under that clause or provision.
Conflict. In the case of any conflict between the Articles of Incorporation and these Bylaws, the Articles shall control; and in the case of any conflict between the Declaration and these Bylaws, the Declaration shall control.

Article XI - Indemnification

The Association shall, to the maximum extent permitted by the California law, indemnify each of its agents against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact that any such person is or was an agent of the Association. For purposes of this Article, an "agent" of the Association includes any person who is or was a director, officer, employee or other agent of the Association.

Article XII - Disciplinary Action

Notwithstanding anything in the Condominium Documents to the contrary, neither the Association, the Board of Directors nor any other Committee acting on their behalf shall be entitled to impose monetary penalties, temporary suspensions of an Owner's rights as a member of the Association or other appropriate discipline for failure to comply with the provisions of the governing instruments of the Association unless the following procedures are followed with respect to the accused Member before a decision to impose discipline is reached.

a. Fifteen (15) days prior notice of the proposed disciplinary action and the reasons therefor shall be given to the Member(s) (potentially) subject thereto; and,

b. The affected Member(s) shall have an opportunity to be heard, orally or in writing, not less than five (5) days before the effective date of the discipline, before the body seeking to impose such sanction.

Any notice required under this Article shall be given by a method reasonably calculated to provide actual notice. Any notice given by mail must be given by first-class or registered mail sent to the last address of the affected Member shown on the Association's records.

Dated: February 28, 2001.