MINUTES OF THE ANNUAL SHAREHOLDERS' MEETINGSEAL BEACH MUTUAL TWELVE

June 14, 2018

The Annual Meeting of the Shareholders of Seal Beach Mutual Twelve, a Californiacorporation, was called to order by President Gillon at 10:02 a.m. on Thursday, June 14,2018, in Clubhouse 4.

PLEDGE OF ALLEGIANCE

President Gillon led the Pledge of Allegiance.

QUORUM

President Gillon advised that a quorum was present, either in person or by ballot, and shedeclared the meeting officially in session.

SHAREHOLDER DECLARATION

Darlene Milek of Unit 78-E, declared her intent to vote cumulatively at this AnnualShareholders' Meeting.

CERTIFICATION OF NOTICE OF MEETING

Secretary Sprague read the Certification Notice:

I, Rose Marie Sprague, Secretary for Seal Beach Mutual No. Twelve,hereby certify that the Notice of Stockholders' Meeting and Ballots weremailed in accordance with Article IV, Section 4, of the Bylaws of saidCorporation to all subscribers of common stock as of June 14,2018.

FURTHER, IN ACCORDANCE WITH THE BYLAWS, THE CUMULATIVEVOTING PROCEDURE WILL BE USED.

EXPLANATION OF WRITE-IN CANDIDATE

Ms. Cheryl Wilson, Accurate Voting Services, Inc. explained the process of a write-incandidate and nomination of that write-in candidate.

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ANNUAL SHAREHOLDERS' MEETINGSEAL BEACH MUTUAL TWELVE

June 14, 2018

INTRODUCTION OF CANDIDATES

The following nominated candidates were introduced as follows:

Richard CarsonTony AndersonSusan Ferraro

Rose Sprague

(Incumbent)(Incumbent)(Incumbent)(Incumbent)

President Gillon called for nominations from the floor. The following people werenominated from the floor:

Darlene Milek, 78-E (Director At Large)Richard Taylor - declinedBetty Hie, 6K (Parcel 4)Cindy Mortesen, 58-B (Parcel 8)

There being no further nominations, President Gillon requested a motion to close thenominations. Upon a MOTION duly made by Gary Sprague, Unit 35-H, and seconded byPhyllisKale, Unit 37-E, it was

RESOLVED, That the nominations be closed.

The MOTION passed.

BALLOTING

Ms. Cheryl Wilson from Accurate Voting Services thanked the Mutual for the opportunityto provide this election procedure for the Mutual. They are the outside independentelection service company that was selected to create the ballot, mail the ballot to theshareholders, and receive the return ballots to be opened today to determine MutualTwelve's new Directors.

President Gillon announced that the ballot boxes were closed and instructed anyinterested shareholders to accompany Accurate Voting Services to the counting area toobserve the counting of the ballots. When the counting is completed, the newly-electedBoard will hold its Organizational Meeting to elect officers. The results of the election willbe posted on the main doors of all the clubhouses.

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ANNUAL SHAREHOLDERS' MEETINGSEAL BEACH MUTUAL TWELVE

MINUTES

June 14, 2018

President Gillon asked for a motion to dispense with reading the minutes of the lastAnnual Shareholders' Meeting held on June 8, 2017, and that they be approved as printedand distributed. Upon a MOTION duly made by Bill Frambach, Unit 34-G and secondedby Ann Frambach, Unit 34-G, it was

RESOLVED, That the Annual Shareholders' Meeting minutesof June 8, 2017 be approved as printed and distributed.

The MOTION passed.

INTRODUCTION OF CURRENT BOARD MEMBERS AND GUESTS

President Gillon introduced the current 2017-2018 Board members:

Margaret Gillon, PresidentRichard Carson, Vice President

Rose Sprague, SecretarySusan Ferraro, Chief Financial Officer

Sharon Woodruff, Director (absent)Tony Anderson, DirectorBrian Harmon, Director (absent)

President Gillon then introduced the Golden Rain Foundation Representative CaroleDamoci (absent); Executive Director, Randy Ankeny; and Mutual Administration Director,Jodi Hopkins.

PRESIDENT'S REPORT

Mrs. Gillon presented her report (attached).

VICE PRESIDENT'S REPORT

Mr. Carson read his report.

SECRETARY'S REPORT

Mrs. Sprague presented her report (attached).

CHIEF FINANCIAL OFFICER'S REPORT

Mrs. Ferraro presented her report (attached).

GOLDEN RAIN FOUNDATION REPRESENTATIVE'S REPORT

No report - Mrs. Damoci was absent.

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ANNUAL SHAREHOLDERS' MEETINGSEAL BEACH MUTUAL TWELVE

June 14, 2018

EXECUTIVE DIRECTOR'S REPORT

Mr. Ankeny presented his report (attached).

MUTUAL ADMINISTRATION DIRECTOR'S REPORT

Ms. Hopkins presented her report (attached).

GUEST SPEAKER

Ms. Katherine Brennan spoke at the meeting.

RECESS

President Gillon called a break at 10:57 a.m. to 11:06 a.m..which was necessary to finishthe counting of the ballots.

ELECTION RESULTS

Ms. Cheryl Wilson of Accurate Voting Service, Inc., reported the following results of theelection: Richard Carson, elected with 249 votes for a 1-year term; Tony Anderson,elected with 268 votes for a 1-year term; Betty Hie, elected with 17 votes for a 1-yearterm; Cindy Mortesen, elected with 20 votes for a 1-year term; Susan Ferraro, electedwith 379 votes for a 1-year term; Rose Sprague, elected with 258 votes for a 1-year term;Dartene Milek, elected with 35 votes for a 1-year term.

ADJOURNMENT

There being no further business to conduct, the meeting was adjourned at 11:10 a.m.

<;0^^/M^^^Attest, Rose Marie'Spr^ue,

iO^fl^^jue, Secretary

SEAL BEACH MUTUAL TWELVEIh: 6/15/18

Attachments

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SEAL BEACH MUTUAL NO. TWELVE

2017/2018 Annual Summary Report

Directors: (use ID card photograph for each director)

President Margaret GillonVice President Richard CarsonSecretary Rose Marie SpragueChief Financial Officer Susan FerraroDirector Sharon WoodruffDirector Tony AndersonDirector Brian Harmon

It has been a busy term for Mutual Twelve in 2017-2018 with several large projects beinglaunched and completed.

In 2016 the board voted to replace all water distribution systems in our units. While replacing

the piping with copper we also replaced any water heaters that were over ten years old. The

copper repiping project was completed in November 2017. As part of the repiping a water

shut-off valve was installed in every unit. Now if there is a leak in a unit the water for that unit

can be shut off without the water for the whole building being turned off.

Fire inspections were done in July of 2017. Mutual Twelve does fire inspections every two

years. As well as updating fire alarms, checking for other safety issues, and replacing the

water alarm batteries on all water heaters, we were checking for old fixtures that do not meet

the current water conservation rules. Fixtures that did not meet current conservation

standards were replaced.

The Leisure World ID replacement card program that was completed in August 2017 with the

help of many board members and mutual volunteers made access to our community stricter.

The new ID cards must be returned to Stock Transfer when shareholders move out of the

mutual or there is a $500 fine for each card not returned. Collecting the cards as shareholders

sell their units and move away has stopped access by people who move out but still try to

sneak in and use our clubhouses and recreational facilities.

In March of 2018 we began our Sprinkler Rehabilitation project. The first stage of this project

was de-thatching all the grass to remove the under-layer of thatch that had gotten so tall the

sprinkler heads were blocked from spraying correctly. After de-thatching is completed all our

sprinklers will be replaced with new water-wise sprinklers. Sprinkler head replacement should

be completed by September 2018.

The mutual roofs are old. Bids are going out in May 2018 to hire contractors who will re-roof

our buildings. We will be re-roofing eight buildings per year. The first eight roofs should be

completed by December 2018.

Carports 145 and 146 on Del Monte use to have grass at the ends. In March 2018 we had the

grass removed and installed a drip system for water. Lovely drought tolerant plants were

selected to brighten the area. The new plants included Milkweed to nourish butterflies and

Cape Honeysuckle to feed hummingbirds. The Little Gem Magnolia tree we planted has

flowers. Neighbors have enjoyed watching the plants bloom and spread.

Just as our buildings are old and need maintenance some of our policies and governing

documents have become outdated. We updated over twenty policies in 2017-2018 and are

currently working with our attorney to review and update our Occupancy Agreement.

Mutual Twelve runs well because we have volunteers willing to give their time to support the

community. As the 2018-2019 term begins our challenge is to recruit new volunteers to

replace those retiring. I would like to thank all the volunteers - board of directors, building

captains, cert captain, and committee members - for their generous support of Mutual Twelve

in the 2017-2018 term.

Regards, Margaret Gillon, President 2017-2018

Good morning everyone. Thank you for coming today. I am amazedhow fast this year went by. I have enjoyed working on the landscapeand luncheon committees, as well as assisting the Shareholders inParcel 10 this past fiscal year.

I want to thank my fellow Board members for working along side mefor the benefit of Mutual 12. A special thanks to our GRFrepresentative, Carole Damoci, for her many years of service on theGRF Board and our President, Margaret Gillon, for the last two years oftremendous service to our Mutual. You both will be missed.

Thank you to my building captains, Ann Frambach, Pautette Trabue,Carol Price, Carol Andre, Florence Conley and last but not least myhusband, Gary, who not only is a building captain, the CertRepresentative, and my endless helper with delivering the minutes andmany postings with me.

Thank you to Rosemary Peterson, Phyllis Kale, Elinore Petoletti, Lucitle

Findlay, Carol Burgener, Darlene Brideau, Anita Miller, and YoshikoKishi, for volunteering to help with this year's Tropical Luncheon. I hope

all the Shareholders who attended the luncheon had a good time.

Lastly, I wish to thank the GRF support staff and the Service

Maintenance department for taking care of all those calls I made thispast fiscal year on behalf of the Shareholders in Parcel 10.

I hope to have an opportunity this coming year to meet more of theShareholders and to continue to make Mutual 12 a safe and enjoyable

place to live. Thank you.

Respectfully submitted,

Kaf^Mcu'ie/Spra^u^/

CHIEF FINANCIAL OFFICER (CFO) REPORTANNUAL MEETING JUNE 14, 2018

WELCOME MUTUAL 12 SHAREHOLDERS AND GOLDEN RAIN FOUNDATION STAFF.

THE INTENT OF MY REPORT IS TO IDENTIFY PROJECTS THAT WERE COMPLETEDIN THE LAST YEAR, OR HAVE BEEN APPROVED TO BE DONE IN THE COMING FEWMONTHS. THE PURPOSE IS TO SHOW HOW THE RESOURCES OF MUTUAL 12 AREBEING UTILIZED FOR THE MAINTENANCE OR IMPROVEMENT OF MUTUAL 12.

THE INFORMATION IN THIS SUMMARY REPORT CAN BE FOUND IN THERESOLUTIONS OF MWUTES OF BOARD MEETWGS. THE MINUTES ARECIRCULATED AT EACH BUILDING AND ARE POSTED ON-LINE, AS WELL AS IN THELAUNDRY ROOMS.

PROJECTS:

COPPER RE-PIPE ALL 44 BLDGS AND 11 LAUNDRY ROOMSINCLUDES ASBESTOS ABATEMENT AND PARTING.$1,678,154

HOT WATER HEATERS OLDER THAN 10 YEARS WERE REPLACED DURWG RE-PIPECOST OF MATERIALS ONLY.$64,004 LABOR COST SAVINGS ESTIMATE $16,050 (107 EACH)

SEWERS - PARTIAL RELINE AT 3 BUILDINGS AND FULL RELINING AT 1 BUILDING,REPLACEMENT OF 1 LATERAL$120,991

WALKLIGHTS (150 TOTAL) NEW POWDER- COATED POSTS AND GLOBESREPLACED USING LED BULBS.$33,112

CONCRETE DRIVEWAYS REPLACING ASPHALT AT CARPORTS 138, 139, 140$153,000

TURF DETHATCH AND AERIFICATION RENOVATION - 187,960 sq. ft. (4.32) acres$45,000

TURF IRRIGATION SYSTEM RENOVATION INCLUDING NEW SMART SPRINKLERHEADS THROUGHOUT$248,450

TURF AND IRRIGATION SYSTEM PROJECT MANAGEMENT$38,630

BATHROOM HEATER FANS REPLACED$32,782

Page 1 Of 2

CARPORT ENDS 145, 146 BEAUTIFICATION WITH DRIP IRRIGATION - DROUGHTTOLERANT PLANTS REPLACING TURF$8,910

16 NEW TREES PLANTED$6370

THE ABOVE REPRESENTS VALUE ADDED TO MUTUAL 12 OF $2,470,090

OTHER ITEMS:DRY ROT WOOD REPAIRS:CARPORTS AND BUILDINGS COMBINED$40,687

LAUNDRY ROOM 4-YEAR AVERAGE COST FOR REPAIRS AND REPLACEMENTS;WASHERS— $3,695 equals 68 cents per month per aptDRYERS -— $3,387 equals 62 cents per month per apt

A COMPAmSON OF CASH AVAILABLE FOR REGULAR OPERATIONS AY THEBEGINNINING OF 2017 AND APRIL 2018REMAINS STABLE WITH BALANCES IN THE LOW TO MID $300,000

AS OF APRIL 2018 CASH DEPOSITS FOR REQUIRED RESERVE ACCOUNTS OFPAINTENfG, ROOFING, AND INFRASTRUCTURE IS $1,411,696. THIS IS ON TRACKWITH THE RESERVE STUDY PREPARED BY OUTSIDE PROFESSIONALCONSULTANTS.

WE HAVE SUFFICIENT CASH TO BEGIN THE RE-ROOFING OF 44 BUILDINGS AND 11CARPORTS OVER THE NEXT 6 YEARS.

THE BOARD IS CLOSELY WATCHING THE DETERORATION OF SEWERS ANDLATERALS THROUGHOUT LEISURE WORLD. THE RESERVE STUDY INCLUDES$100,000 PER YEAR FOR POSSIBLE NEEDS. BE AWARE THAT THIS SUM MAYREQUIRE ADJUSTMENT DEPENDING UPON WHAT OCCURS.

D4 CONCLUSION, I WANT TO THANK THE MUTUAL ADMINISTRATION STAFF ANDTHE ACCOUNTING DEPARTMENT STAFF FOR THEIR ASSISTANCE. I ALSO WANTTO THANK OUR GRF REPRESENTATFVE, CAROLE DOMACI, FOR HER SERVICE ANDEFFORTS ON BEHALF OF MUTUAL 12, AND WISH HER WELL ON HER FUTUREENDEAVORS. I APPRECIATE MY FELLOW BOARD MEMBERS, AS WELL AS THECAPTAINS OF BUILDINGS 40-47 IN PARCEL 9 FOR THEIR HELP IN KEEPING OURSHAREHOLDERS INFORMED.

FINALLY, I THANK YOU FOR YOUR ATTENTION.

RESPECTFULLY SUBMITTEDSUSAN FERRAROCFO

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GRF&i;d*r '<e:nF3und«Lci

Executive Director's Annual Meeting Report

To the President, Directors, and Shareholders of Mutual 12,

It's been five years since I joined the Golden Rain Foundation of Seal Beach (GRF). I am trulyhonored and delighted to report our community is running well, and our over 230 staff membersare working diligently to insure smooth and fully transparent operations of GRF and the 16 MutualCorporations to whom we provide service. This is due to our collective commitment to protect thevalue of Trust property and the enhancement of lifestyle. We collectively strive to create afoundation of accountability, responsible partnership and leadership. At its most basic, weendeavor to do truly meaningful work for our community, our Shareholder/Members, our Boards.We are committed as an organization to serving our community the highest ethical standards,finding thoughtful, effective and innovative ways to support the varied and diverse communityneeds, while retaining focus on efficiency, respect, teamwork, innovation, and integrity.

The strength of our community continues to come through, by collectively working together with afirm commitment to safety and risk mitigation. Our efforts have been recognized again with anotice of achievement by Philadelphia Insurance Companies for "Outstanding Risk Management";this recognition is evident in the reduction (emphasis added) in insurance premiums for this policyperiod.

This speaks highly of everyone who unselfishly volunteers their time to serve on a Board.The compassion you show to those we serve, is an inspiration for us all. I've noticed how youtreat everyone with respect and kindness, no matter what the situation is. We both know howstressful it can be at times; however, your words and actions have gone a long way in yourcollective accomplishments in helping and serving our community. Your work does not gounnoticed. The key to our success rests in you, who embody the spirit of community byunselfishly saying "what may I do for you". You are the heart and soul of Seal Beach LeisureWorld.

Community means strength that joins our strength to do the workthat needs to be done. Arms to holds us when we falter. A circle ofhealing. A circle of Friends. Someplace where we can be free.

Starhawk

We look forward to working with the Boards to ensure that our community continues to prosperand thrive for the mutual benefit of all Shareholders and Members.

Thank you for allowing my staff and I to be part of your community and your lives.

Respectfully submitted,

Randy Ankeny,Executive Directorfor the Golden Rain Foundation

Annual Mutual Shareholders' Meeting 2018

Mutual Administration Director's Report

It has been a great year, all thanks to everyone's talent and unwavering effort. One of thegreatest gifts you can give is your time. A Mutual nurtures the community spirit throughit's volunteers. Volunteers are the lifeblood of any community. The work you haveaccomplished emphasizes the values and priorities of your community.

Thank you to this Mutual Board of Directors. We know that for you this is an add-on to themany things you do including your career, your family, other volunteer opportunities andyour social life. Thank you for always taking our calls, answering our emails and bringingyour passion, intellect, insight, experience and resources to the job of making life betterfor all of us.

Please join our team of staff members, along with the new or returning Mutual Directors,in continuing the legacy that was set by others many years ago. Let us also continue thegrowth of our community by incorporating everyone and working for the good of all.

Thank you to the Golden Rain Foundation (GRF) Board of Directors, more specificallyyour GRF Representative.

Thank you to our Executive Director, Randy Ankeny - working with you is a privilege. Withyour leadership, we look forward to the next year working with the Board to continue toprovide an outstanding community.

Thank you to everyone for your part in our journey.

Respectfully,

/%<

Jodi HopkinsMutual Administration Director