Article II ASSOCIATION OF OWNERS

SECTION 1. Annual Meetings.

The Developer shall call a meeting of the Apartment Owners, and give Apartment Owners thirty (30) days prior written notice of the date thereof, within six (6) months from the "effective date" (as that term is defined by Chapter 514, Hawaii Revised Statutes) of the first sale of an Apartment in the Project. At such meeting the Apartment Owners shall elect a Board of Directors. Thereafter, the annual meetings of the Apartment Owners shall be held on the first Monday of March of each succeeding year or at such other time as the Board of Directors may designate. At such meetings the Board of Directors shall be elected by ballot of the Apartment Owners in accordance with the requirements of Section 4 of ARTICLE III of these Bylaws. The Apartment Owners may transact such other business at such meetings as may properly come before them.

SECTION 2. Place of Meetings.

Meetings of the Apartment Owners shall be held at the address of the Project, or elsewhere within the State of Hawaii as determined by the Board of Directors. (prior amendment)

SECTION 3. Special Meetings.

Special meetings of the Owners of the Apartments may be held at any time upon the call of the President or of any three (3) Directors, or upon the written request of not less than forty percent (40%) of the Owners.

SECTION 4. Notice of Meetings and Other Notices.

Written notice of all meetings, annual or special, stating the place, day and hour of the meeting and whether it is annual or special and stating the items on the agenda for such meeting and containing a standard proxy form, if any, authorized by the Association, and any other notices permitted or required to be delivered by these Bylaws shall be given by mailing such notice, postage prepaid, at least thirty (30) days before the date assigned for the meeting, to the Owners of the Apartments at their address at the property or at the address given to the Board for the purpose of service of such notices.

Upon written request for notices delivered to the Board, the holder of any duly recorded mortgage or deed of trust from any Owner of an Apartment may obtain a copy of any and all notices permitted or required to be given to the Owner of an Apartment, whose interest is subject to said mortgage or deed of trust. Upon notice being given in accordance with the provisions hereof, the failure of any Owner of an Apartment to receive actual notice of any meeting shall not in any way invalidate the meeting or proceedings thereat. Each such Owner shall keep the Board informed of any changes in address. (prior amendment)

SECTION 5. Adjournment of Meetings.

If any meeting of Apartment Owners cannot be held because a quorum has not attended, a majority in common interest of the Apartment Owners who are present at such meeting, either in person or by proxy, may adjourn the meeting to a time not less than forty-eight (48) hours from the time the original meeting was called.

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SECTION 6.

(a) Voting. Voting shall be on a percentage basis, and the percentage of the total vote to which each Apartment is entitled shall be the percentage of the common interests assigned to such Apartment in the Declaration. Votes may be cast in person or by proxy by the respective Apartment Owners. An executor, administrator, guardian or trustee may vote in person or by proxy at any meeting of the Association, the percentage of vote for any Apartment owned or controlled by him in such capacity, provided that he shall first present evidence satisfactory to the Secretary that he owns or controls such Apartment in such capacity.

The vote for any Apartment owned of record by two or more persons may be exercised by any one of them present at any meeting in the absence of protest by the other or others, and in case of protest each co-tenant shall be entitled to only a share of such vote in proportion to his share of ownership in such Apartment.

(b) Proxies and Pledges.

     (i) Requirements The authority given by any owner to another person to represent him at meetings of the Association must be in writing and contain at least the following: the name of the Association, the date of the meeting of the Association, the printed name and signature of the person or persons giving the authority, the apartment or apartments for which the proxy is given, the printed name of the person to whom the proxy is given, and the date the proxy is given. (Hawaii Revised Statutes "HRS" S 514A-83.2(a)) The proxy form prepared by the Association also shall contain a box wherein the owner may indicate that the owner wishes to obtain either a summary of the Association's annual audit report, or an unabridged copy of the annual audit report. (HRS S 514A-96)

A proxy may designate any person or the Board of Directors as an entity as proxy and may be limited as the owner indicates; provided, however, that a proxy given to the Board of Directors shall contain a box wherein the owner may indicate that the owner wishes the vote to be shared with each Board member present at the meeting receiving an equal percentage, and provided further however that a proxy given to the Board of Directors which is not marked shall be considered a choice by the owner that the vote be made on the basis of the preference of the majority of the Board. (HRS S 514A-83.2(c)) To be valid, a proxy must be delivered to the secretary of the Association or the managing agent, if any, no later than 4:30 p.m. on the second business day prior to the date of the meeting to which it pertains. (HRS S 514A-83.2(a))

     (ii) Limitations On Proxy Votes A director who uses Association funds to solicit proxies shall not cast any of these proxy votes for the election or reelection of directors at any Association meeting unless the proxy form specifically authorizes such a vote, and the Board first posts notice of its intent to solicit proxies in prominent locations within the project at least thirty (30) days prior to its solicitation of proxies. Any owner has seven (7) days from the time the Board posts notice to request Association funds to solicit proxies accompanied by a statement. The statement shall not exceed one hundred words and shall disclose the owner's qualifications to serve on the Board and the reasons for wanting proxies.

The Board shall promptly mail to all owners a proxy form containing either (i) the names of all owners who requested the use of Association funds to solicit proxies, together with their statements, or (ii) without any names but accompanied by a list of names of all owners who have requested the use of Association funds for soliciting proxies and their statements. (HRS S 514A-82(b)(4))

No officer of the Board shall use Association funds to solicit proxies; but this prohibition shall not prevent an officer from exercising his right as an owner under this Section 8. (HRS S 514A-83.2(d)) Nothing in this Section 8 shall affect the holder of any proxy under a first mortgage of record encumbering an apartment or under an agreement of sale affecting an apartment. (HRS S 514A-83.2(e))

     (iii) Termination A proxy shall only be valid for the meeting to which the proxy pertains and its adjournments; provided that no proxy shall be irrevocable unless coupled with a financial interest in the unit. (HRS S 514A-83.2(b))

Voting rights transferred or pledged by mortgage, deed of trust or agreement of sale of any apartment or interest therein, a true copy of which is filed with the Board through the Secretary or Managing Agent, shall be exercised only by the person designated in the instrument until the written release or other termination thereof is filed with the Board in like manner.

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SECTION 7. Order of Business.

The order of business at all meetings of the Apartment Owners shall be as follows:

1. Roll Call
2. Proof of Notice of Meeting
3. Reading of Minutes of preceding meeting
4. Reports of Officers
5. Report of Board of Directors
6. Reports of committees
7. Election of inspectors of election (when so required)
8. Election of members of the Board of Directors (when so required)
9. Unfinished business
10. New business

SECTION 8. Cumulative Voting.

Election of Directors shall be by cumulative voting and each Owner may cast for any one or more nominees to the Board of Directors a vote equivalent to the votes which such Owner is entitled to multiplied by the number of Directors to be elected. Each Owner shall be entitled to cumulate his votes and give all thereof to one nominee or to distribute his votes in such manner as he shall determine among any or all of the nominees, and the nominees receiving the highest number of votes on the foregoing basis, up to the total number of Directors to be elected, shall be deemed elected.

SECTION 9. Quorum.

Except as otherwise provided in these Bylaws, the presence in person or by proxy of Owners having one-half (1/2) of the total authorized votes of all Apartment Owners shall constitute a quorum at all meetings of the Apartment Owners.

SECTION 10. Majority Vote.

The vote of a majority of Apartment Owners at a meeting at which a quorum shall be present shall be binding upon all Apartment Owners for all purposes except where in the Declaration or these Bylaws or by law, a higher percentage vote is required.

SECTION 11. Majority of Apartment Owners.

As used in these Bylaws, the term "majority of Apartment Owners" shall mean those Apartment Owners having more than fifty percent (50%) of the total authorized votes present at any meeting of the Apartment Owners, and any specified percentage of the Owners means Owners having the specified percentage of the total votes.

SECTION 12. List of Members.

The Resident Manager or Managing Agent or Board of Directors shall keep an accurate and current list of members of the Association and their current addresses and the names and addresses of the vendees under an Agreement of Sale, if any. The list shall be maintained at a place designated by the Board of Directors and a copy shall be available at cost to any member of the Association who furnishes to the managing agent or the Board of Directors an affidavit stating that the list will be used by the owner personally and only for the purpose of soliciting votes or proxies or providing information to other owners with respect to Association matters and that the list will not be used or furnished to any other person for any other purpose. (HRS S 514A-83.3)

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