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HomeMy WebLinkAbout20042687.tiff Pleldwo0 pewaa0 !oN pal7.wgns uo(teallddy PLANNED UNIT DEVELOPMENT (PUD) CHANGE OF ZONE APPLICATION HOOZ c i. AVM FOR PLANNING DEPARTMENT USE DATE RECEIVED: RECEIPT#/AMOUNT# /$ CASE#ASSIGNED: APPLICATION RECEIVED BY PLANNER ASSIGNED: 331110 A313389 1uJw4JVt au 1uluuvid A}unu'3 plight Parcel Number: 1467 05 000030 Legal Description: Lot B of RE-3105, Section: Pt. of the N2NW4 of Section 5, Township: 1 North, Range 68 West Existing Zone District : A (Agricultural); Proposed Zone Dstrict: PUD; Total Acreage: 56; Proposed#/Lots: 9 Average Lot Size: 1.89 acres; Minimum Lot Size: 1.71 acre; Proposed Subdivision Name: Highland Farms Proposed Area (Acres) Open Space: 12.8 acres Are you applying for Conceptual or Specific Guilt? Specific FEE OWNER(S) OF THE PROPERTY(If additional space is required,attach an additional sheet) Name: Highland Acquisition Group, LLC c/o Robert Bulthaup Work Phone#: (303) 748-9445 Address: 6297 S. Potomac Way Centennial, CO 80111 APPLICANT OR AUTHORIZED AGENT(See Below:Authorization must accompany applications signed by Authorized Agent) Name: Lauren Light/Matt Cain, LANDPROfessionals LLC Phone: (970) 5359318 Address: 4311 Highway 66, Suite 4, Longmont, CO 80504 Email: Llight@agpros.com Mcain@agpros.com UTILITIES: Water: Left Hand Water District Sewer: Engineer Designed Septic Systems Gas: Kinder-Morgan Electric:United Power Phone: Qwest DISTRICTS: School: RE-1J; St. Vrain School District Fire: Mountain View Fire Protection District Post: Erie I(We) hereby depose and state under penalties of perjury that all statements,proposals,and/or plans submitted with or contained within the application are true and correct to the best of my(our)knowledge. Signatures of all fee owners of property must sign this application. If an Authorized Agent signs, a letter of authorization from all fee owners must be included with the application. If a corporation is the fee owner, notarized evidence must be included indicating the signatory has the legal authority to sign for the corporation. I (we),the undersigned, hereby request hearings before the Weld County Planning Commission and the Board of County Commissioners concerning the proposed Change of Zone for the above described unincorporated area of Weld County, Colorado: 4 ;1/11Signature: Owner or uth ed Agent D e g EXHIBIT 2004-2687 4J H rr1gnway 00, .Saxe 4 Longmont, CO 80504 Office (970) 535-9318 Metro (303) 485-7838 Fax: (970) 535-9854 /'. -h : L s' LANDPROfessionals, LLC June 6, 2003 Weld County Planning Department 1551 N. 17th Avenue Greeley, CO 80631 To Whom it May Concern, I have contracted with LANDPROfessionals, LLC to process all work related to a Planned Unit Development application to be filed at Weld County. LANDPROfessionals, LLC is authorized to represent Highland Acquisition Group LLC, c/o Robert Bulthaup throughout this process. Robert Bulthaup is authorized to represent Highland Acquisition Group. Sincerely, R Bulthaup ---.4311 Highway 66, Suite 4 Longmont, CO 80504 Office (970) 535-9318 Metro (303) 485-7838 Fax: (970) 535-9854 waif LANDPROfessionals, LLC May 13, 2004 Dear Ms. Hatch: The following information addresses the concerns that were presented at the sketch plan phase of the Highland Estates development. A. The use of the agricultural outlot will be limited to agricultural uses and will be non-residential buildable. The agricultural outlot may be offered for sale, when the individual buildable lots are sold, to which ever lot owner is interested in purchasing the agricultural outlot. B. The water agreement has been approved by the County Attorney. C. The access to the southern property has been removed and a utility and emergency access easement has been added. D. Mountain View Fire Protection District concerns will be addressed through covenants and plan review as requested by the District. We met with the Fire District and they approved the emergency accesses. E. An agreement with School District RE-1J, regarding the school bus pull-out, has been completed. The location that has been approved by the District is shown on the change of zone plat. F. The location of the cluster mail box has been approved by the post office. G. Public Works concerns will be addressed on the change of zone plat and the final plat as requested. The access to the mobile home will be removed. A public road improvements agreement has been submitted. An access permit from CDOT will be provided at the appropriate time. H. CDOT concerns have been addressed and an application for an access permit is in process. I. Documentation has been submitted regarding an agreement with the Lower Boulder Ditch Company. J. Mineral owners and lessors will be notified via certified mail. In addition, surface use agreements have been submitted with this application. February 10, 2003 Page 2 K. The concerns of the Colorado Geological Survey will be addressed at the time of building permit application when a lot specific geotechnical engineering investigation as well as an ISDS investigation will be completed for each lot. L. The Boulder Valley Conservation District concerns are addressed through the Lower Boulder Ditch Company agreement. In addition, no landscaping is proposed along the banks of the ditch. M. The Town of Eries referral response referred to their comprehensive plan requirement of 1 dwelling unit per 5 acres in this vicinity. However, Erie does not have an IGA with Weld County. Highland Farms could support 11 lots if 1 dwelling unit per 5 acres was adhered to as per Eries comprehensive plan. N. All items identified through Weld County Department of Building Inspection will be addressed through the building permit application process. O. Weld County Department of Public Health and Environment had no concerns with this development when additional information was submitted to the department. Their recommendations will be incorporated into the covenants and on the plat as stipulated. If you have any questions please contact us. Sincerely, 41-t-S'AN\ • Lauren Light Matt Cain Planner Civil Engineer LANDPROfessionals, LLC (970) 535-9318 Office (970) 535-9854 Fax (303) 485-7838 Metro 4311 Highway 66, Suite 4 Longmont, CO 80504 Ilight(Wagpros.corn cocain@agpros.com SITE SPECIFIC DEVELOPMENT GUIDE FOR HIGHLAND ESTATES PUD COMPONENT ONE-ENVIRONMENTAL IMPACTS 1. Noise and Vibration— Highland Farms is a residential development and as such there will be no adverse impacts from noise or vibration. 2. Smoke, dust and odors—As this is a residential development there will not be any impact to the environment from smoke, dust or odors. 3. Heat, light and glare—Lighting will be typical for a residential development. There will not be an adverse impact from heat, light or glare. 4. Visual/aesthetic impacts—Lots and houses will be oriented to take advantage of the views to the west. 5. Electrical interference—There will not be any equipment which will cause undue electrical interference. 6. Water pollution—There will be no activities which will cause water pollution. 7. Wastewater disposal— Individual septic systems will be utilized for wastewater disposal. 8. Wetland removal —There are no jurisdictional wetlands located onsite. 9. Erosion and sedimentation— Construction activities will be conducted in a manner as to reduce potential erosion concerns. 10. Excavation, filling and grading—Construction of foundations and roads will be closely monitored and all regulations will be adhered to. 11. Drilling, ditching and dredging—Will not occur onsite. 12. Air pollution—Is not an issue in a residential development. 13. Solid waste—Individual homeowners will be responsible to remove household trash. 14. Wildlife removal—There are no existing colonies of wildlife that will be disturbed. 15. Natural vegetation removal —Homeowners will be encouraged to leave as much natural vegetation as possible on their lots. 16. Radiation/radioactive material—None. 17. Drinking water source—Left Hand Water District. 18. Traffic impacts—As the development is for only nine lots, impacts to traffic will be minimal. COMPONENT TWO— SERVICE PROVISION IMPACTS 1. Schools—There will be an impact of 6 additional students. The school district has indicated that cash-in-lieu will need to be paid. The District has approved the location of the school bus stop. 2. Law enforcement—The sheriff's office recommendations will be taken into account and will be adhered to when applicable. 3. Fire protection—Mountain View Fire Protection District will provide service and this development will adhere to their rules and regulations when applicable. 4. Ambulance—Emergency service will be available through the fire district and Weld County. 5. Transportation—The interior roadway will be constructed to county standards and will be collateralized in an improvements agreement as necessary. 6. Traffic impact analysis—Not required by Weld County Department of Public Works. 7. Storm drainage—A final drainage report will be submitted with the final plat application and will adhere to Weld County regulations. 8. Utility provisions—All utility providers have been contacted and utilities are available to the site. 9. Water provisions—Left Hand Water District will provide water to the site. 10. Sewage disposal system— Individual sewage disposal systems will be designed and constructed to Weld County standards. 11. Structural Road Improvements Plan—Roads will be constructed to Weld County specifications. COMPONENT THREE -LANDSCAPING ELEMENTS 1. A landscape plan has been submitted as a separate document. The homeowners association will be responsible for maintenance of landscaping. The improvements agreement will identify landscaping as needed. Irrigation water will be provided with a tap from Left Hand Water District. COMPONENT FOUR— SITE DESIGN 1. There is one irrigation ditch that borders the property on the western boundary. The location is noted on the change of zone plat and the ditch company has been contacted and is aware of the development. An agreement with the ditch company has been submitted with the change of zone application. 2. Section 22-2-60.C (A.Goal.3) "Provide mechanisms for the division of land which is agriculturally zoned. Options for division shall be provided to ensure the continuation of agricultural production and accommodate low intensity development." A nine-lot subdivision is a low intensity development. The Right- to-Farm note will be included on the change of zone as well as final plat documentation in order to notify potential purchasers that agricultural uses can occur on adjacent properties. The plat notes will ensure the continuation of agricultural production on adjacent properties. Section 22-2-60.D (A.Goal.4) "Conversion of agricultural land to nonurban residential use will be accommodated when the subject site is in an area that can support such development." The proposed PUD is for a nine-lot subdivision that is defined as nonurban in the Weld County Code. Services are currently available or reasonably obtainable for this site. Section 22-2-60.C (A.Policy.3.1) "Options for the division of agriculturally zoned land are available in Chapters 24 and 27 of this Code" Chapter 27 allows for a PUD process to divide agriculturally zoned properties. 3. As this is a residential development, there will not be any conflicting uses. 4. The Right-to-Farm statement will be provided on plats to insure compatibility with adjacent farm ground. The development is located in an area which is conducive to residential uses. 5. The development is located in the geological hazard overlay district. However, the area is designated as "low potential" so a geological hazard permit is not required. Individual site assessments will be conducted at the time of building permit application. COMPONENT F IVE— COMMON OPEN SPACE USAGE Common open space of approximately 12 acres (22%) will be provided. The open space will be owned and maintained by the Homeowners Association. The covenants for Highland Farms will address all aspects of the open space such as maintenance, taxes and use restrictions. Homeowners will be required to join the homeowners association and the covenants will be established prior to the sale of lots. The ownership of the agricultural outlot will be retained by the developer until such time the individual lots are sold, at that time the agricultural outlot may be offered for sale to which ever lot owner is interested. The outlot will be retained by that party as a non-residential buildable parcel. COMPONENT SIX- SIGNAGE Individual signs will adhere to the requirements of the Estate Zone District. A subdivision sign will be constructed and located near the entrance but not in an area which restricts visibility to either incoming or outgoing traffic. The location will be noted on the plat. COMPONENT SEVEN—MUD IMPACT This component is not applicable as the subdivision is not located in the MUD. COMPONENT EIGHT— INTERGOVERNMENTAL AGREEMENT IMPACTS This component is not applicable as the subdivision is not located in any IGA area. VARIANCE FROM REQUIREMENTS OF ESTATE ZONE DISTRICT Highland Farms will adhere to the requirements of the Estate Zone District except for the following items: Lot sizes will be an average of 1.8 acres in size. Two equine per lot will be allowed. APPENDIX B WELD COUNTY ROAD ACCESS INFORMATION SHEET ,d County Public Works Department Date: May 13,2004 1 I I I H Street,P.O. Box 758, Greeley,CO 80632 Phone: (970 )356-4000, Ext. 3750 Fax: (970)304-6497 I. Applicant Name: Robert Bulthaup Phone: 303-748-9445 Address: 6297 S. Potomac Way, Centennial,CO 80111 2. Address or location of access: 1328 Highway 52 Section 5 Township IN Range 68W Weld County Road: 3 1/4 extended south of SH 52 Side of Road: East Distance from nearest intersection: SE corner of WCR 3 Sb and SH 52 3. Is there an existing access to the property? Yes, it will be closed 4. Proposed Use: Residential subdivision 5. Site Sketch a1 ~ RAY L.NELSON.CO LIP N Legend for Access Description: , , AGR= Agricultural ""'A' . (4' RES = Residential $ or cuePAIS ,e'WP p-CYP1Y .SO' 'Y '0 f] G= Oil &Gas lir:.'s * o . = Ditch Road ���� � c S*N e S ��■, "n" '0104• E ,3a"„", 1 4 Li °IE ,l�1 F� ` —' M [+:---gyp r.-- ' - :-:1 OFFICE USE ONLY: Road ADT Date Accidents Date Road ADT Date Accidents Date Drainage Requirement Culvert Size Length Special Conditions ,.-. ************************************************************************************************Install ation authorized ❑ Information Insufficient Reviewed By: Title: Iluv i.J uJ uC : a.7R+ LeT tnanowatGr'vxs r 1cL JUJOJU.7C.7C V. EXHIBIT A Legal Description of -lighland Farms PU0 Lot B of 8E-310'.:; located in the N 'k of the NW Y•, Section 5, T1 h!, R68W, 6th P.M., County of Weld, State of Colorado. (it DEPARTMENT OF PLANNING SERVICES 1555 N. 17`h AVENUE 'pee GREELEY, COLORADO 80631 WEBSITE: www.co.weld.co.us E-MAIL: co.weld.co.us PHONE 970)t30, EXT. 3540 FAX O70) 304-6498 COLORADO April 8, 2004 Robb Casseday/Lauren Light, LANDPROfessionals, LLC 4311 Highway 66, Suite 4 Longmont, CO 80504 RE: Highland Estates Planned Unit Development Sketch Plan for 9 residential lots on 18.97 acres along with 9.66 acres of open space and an agricultural outlot of 28.27 acres. The property is described as Lot B of RE-3105; Pt. of the N2 NW4 of Section 5, T1N, R68W of the 6th P.M., Weld County, Colorado Dear Mr. Casseday, The Department of Planning Services has reviewed the information provided at this time regarding the ditch agreement for the Highland Farms PUD. Staff has determined that a signed agreement between the property owners and the ditch company should accompany the Change of Zone application. If the signed agreement is not submitted with the Change of Zone application it will be a required prior to scheduling the Board of County Commissioners hearing for the Change of Zone. Please contact me at the above address or call (970) 353-6100 ext. 3540 if you have any questions. Sincerely, Jacqueline Hatch, Planner M WPFIEES\JACQUELINE\Lctcrs\pk I045coz.doc Aqua Engineering, Inc. MEMORANDUM )Vi'' '' '; 4803 Innovation Drive MEMORANDUM ;Y,, a:5 Fort Collins,Colorado 80525 6 Office; 970.229.9668 FAX: 970.226.3855 February 16, 2004 TO; Eric Dunker FAX: 970-535-9854 LANOPROfessionals, LLC FROM; Amy L. Johnson 2 Pages Stephen W. Smith CC: David Yardley, Lower Boulder Ditch Co. FAX: 303-465-9461 RE: Highland Estates PUD, Storm Drainage On behalf of the New Consolidated Lower Boulder Reservoir& Ditch Co.,Aqua Engineering, Inc. met with LandProfessionals, LLC(Eric Dunker, Robb Casseday) and the developer, Rob Buithaup, on January 30th regarding the intended plans to discharge stormwater from the proposed Highland Estates PUD development Into the Lower Boulder Ditch. We have reviewed the Sketch Plan Drainage Report dated June 17, 2003. This memorandum summarizes our understanding of the development intentions and recommends actions necessary for the Lower Boulder Ditch Company to accept the storm drainage flows. In the report, the development is divided into three basins; two of which will not have any construction or development, and therefore, the historical flows and paths are not affected. Basin#1 consists of 40 acres and will include development that affects the stormwater discharge to the Lower Boulder Ditch on the west side of the property. The report states the historical flows In Basin #1 are 10 CFS for the 5-year storm event end 84.6 CFS for the 100-year storm event. The calculated allowable discharge rate was 0.25 CFS per acre. After development, the flows from Basin#1 are calculated to be 15 CFS far the 5-year storm event and 91.6 CFS for the 100-year storm event. The increase In flow rates is approximately 50% for the 5-year and just over 8%for the 100-year storm event. The total flow will be increased from 10 CFS to 15 CFS during a 5-year storm event. Therefore, the capacity of the Lower Boulder Ditch, downstream of this development, will have to be reviewed to confirm whether or not the additional flow can be handled in the existing ditch. Further analysis of stormwater flows was provided and Includes: Historical flow of 2.54 CFS for a 2-year event Developed flow of 4.27 CFS for a 2-year event Historical flow of 21.32 CFS for a 10-year event Developed flow of 33.72 CFS for a 10-year event The stormwater will be discharged into the ditch at a single point, rather than along the ditch banks as sheet flow as it historically has.The developer intends to construct a detention basin Page 1 o;tNCPe Bouldgr1M1.mnPro 2.1fi+Root Memorandum—Lower Boulder Ditch February 18, 2004 along the west side of the property to detain the water and then release it into the ditch at the historical rate of 0.25 CFS/acre-A"typical"outlet structure, grate, and pipe are planned. The Lower Boulder Ditch Company has a current policy(in accordance with Northern Colorado Water Conservancy District)to not accept any storm water flows from developments, The Company is considering amending the current policy and setting requirements to be met prior to accepting stormwater flows. Historically, the stormwater on this property traveled over irrigated or non-irrigated farm land with zero impervious areas. With development, impervious areas are being created that can reduce the quality of stormwater entering the ditch. Although the water will theoretically"settle" in the detention pond prior to entering the ditch, the water quality may still be degraded. Possible pollutants brought with development include oils, gas, lawn fertilizers, landscape herbicides, and paint to name a few. Many of these pollutants may not be screened out or otherwise removed prior to entering the ditch. The Lower Boulder Ditch Company will require methods of treating the storm water prior to entering the ditch.The developer must develop a storm water system that treats the Water Quality Capture Volume as defined by the Urban Drainage and Flood Control District. Primary and/or pretreatment methods such as the Vortechnics Vortechs system may also be considered. Ideally, the complete stormwater system will Include methods to remove 80% of.tha _net_annual_totaLsu5pended solids ITSS and revent the re-entrainment of trapped floating_ contaminants(IncludIn oils A maintenance Plan must be_prepared to_shoW how!the development will execute the required maintenanotereeram.to.ensurg_the-tile givepO§$Qf the sforjut!ater tysietraompenenLs_ _beyond_installetion.The maintenance program shall also Include periodic water quality testing to be determined by the Company. In order to handle the additional capacity in the ditch, the Lower Boulder Ditch Company will require funding for automation_of water level monitoring.and.gatq.QQeratiQrn$. A reduction in the -all-charge to the ditch(differential 6r6 CF5j is requested. Perhaps this can be accomplished by increasing the size of the detention pond. The Company requests a formal submittal by the developer to address and incorporate the above modifications to the current stormwater drainage plan. Upon review of this plan, the Company will have to gain approval of the Northern Colorado Water Conservancy District as well. In summary, the Lower Boulder Ditch Company makes the following requests of the Highland Estates PUD project developers to consider allowing stormwater discharges into the ditch system: • Implement a best management practice (BMP)to capture 80% TSS and floating pollutants • Prepare a maintenance plan and water quality testing program for the stormwater system • Reduce the discharge to the ditch to a flow closer to the historical levels :•' Fund the automation upgrades required to handle additional capacity • Submit revised stormwater drainage plan to the Company for further review Page 2 Aqua Enjineering, Inc. MEMORANDUM i c' 4803 Innovation Drive MEMORANDUM 6 {� Fort Collins, Colorado 80525 :b. Office: 970.229,9668 FAX: 970.226.3855 March 8, 2004 TO: Eric Dunker FAX: 970.535-9854 LANDPROfessionals, LLD FROM: Amy L. Johnson 1 Pages Stephen W. Smith CC: David Yardley, Lower Boulder Ditch Co. FAX: 303.485-9461 RE: Highland Estates PUD, Storm Drainage After receiving the Final Drainage Report (February 29, 2004)and Storm Drainage Plan from LandProfessionals, we requested the technical assistance of RTW Engineers to conduct an Intensive check of the assumptions and calculations as requested by the Lower Boulder Ditch Company.While we appreciate the well written and organized document presented, RTW did find presumed errors in some of the calculations which affect the drainage plans and thus the operation of the canal. Following is a summary of the RTW review comments which need to be addressed. 1) The methods used by LandProfessionals were all appropriate for this size of development. 2) The assumptions for impervious areas In Basin 1A appear to be underestimated (the streets themselves do not appear to be included). Making this correction, the discharge from Basin 1A would be Increased to 10.65 CFS (rather than 9.22 CFS)for the 5-year storm and 45.17 CFS (rather than 42.76)for the 100-year storm. The increased discharge will affect the size of the detention pond and the outlet structures. 3) The submitted details are appropriate and in accordance with UDFCD guidelines, however, the discharge changes will require these details to be modified. 4) The reported "historical"discharge to the ditch was 0.25 CFS/acre, and LandProfessionals Intends to discharge from the detention pond into the ditch at that same rate. However, continuing to follow the UDFCD guidelines, the recommended discharge rate from a detention pond is 0.13 CFS/acre. This change will reduce the peak flow Into the ditch and require an Increased pond volume. (Reference Is attached.) Please address the suspected errors and redesign accordingly. We will complete a final review of the pond sizing and outlet details when we receive your changes. Please call if you have questions or comments. Page 1 0 MORDAL-BooldetJA-LnnclPro Pe 04 nc Property Tax Information Page 1 of 1 tack% a liletti county colorca,io O. 1 K` Home Ii Services Departments About Weld Property information Contra. Home > Departments > Treasurer's Office > Tax Search > Tax Search Results > Tax Detail Tax Search Details Information for tax year: 2003 payable in 2004 Property Information Owner Name: Highland Acquisition Group Llc Address: 1328 52 HWY City: Weld Account Number: R0945201 Parcel Number: 146705000030 Legal Address: pt n2nw4 5-1-68 lot b rec exempt re-3105 (.44d) Payment Information Total Tax Amount: $77.20 Actual Land Value $3,578.00 First Half Amount: $0.00 Actual Improved Value $0.00 Second Half Amount: $0.00 Actual Total Value $3,578.00 SR. Exemption: $0.00 Assessed Land Value $1,040.00 Full Amount Paid: ($77.20) Assessed Improved Value $0.00 Current Balance: $0.00 Assessed Total Value $1,040.00 IF any of the following fields are "YES" please contact the Treasurer's Office for more information. Tax Status Tax Liens: No Senior Homestead Exemption: No Prior Taxes Due: No Tax Area 2390 Special Improvement Tax: No Mill Levy 74.214 Database Last Updated at: 11:28 PM on May 10, 2004 http://www.co.weld.co.us/departments/treasurer/tax/tax info.cfm?ACCOUNTNO=R0945... 5/11O004 Property Tax Information ^ ^ Page 1 of 1 ' I 1�CGCOtTtE' tl �_ Welt CouxcColorado 4,c,-. Home I Services Departments II About Weld I, Property information II Conte. Home > Departments > Treasurer's Office > Tax Search > Tax Search Results > Tax Detail Tax Search Details Information for tax year: 2003 payable in 2004 Property Information Owner Name: Highland Acquistition Group Llc Address: 1328 52 HWY City: Weld Account M0070595 Number: Parcel Number: 146705000030 Legal Address: 24783 pt n2nw4 5 1 68 lot b rec exempt re-3105 (.44d)imps only mh medallion 79-5203n 1328 52 hwy weld 80516 Payment Information Total Tax Amount: $118.00 Actual Land Value $0.00 First Half Amount: $0.00 Actual Improved Value $19,956.00 Second Half Amount: $0.00 Actual Total Value $19,956.00 SR. Exemption: $0.00 Assessed Land Value $0.00 Full Amount Paid: ($118.00) Assessed Improved Value $1,590.00 Current Balance: $0.00 Assessed Total Value $1,590.00 IF any of the following fields are "YES" please contact the Treasurer's Office for more information. Tax Status Tax Liens: No Senior Homestead Exemption: No Prior Taxes Due: No Tax Area 2390 Special Improvement Tax: No Mill Levy 74.214 Database Last Updated at: 11:28 PM on May 10, 2004 http://www.co.weld.co.us/departments/treasurer/tax/tax info.cfm?ACCOUNTNO=M0070... 5/11/2004 OPERATING AGREEMENT HIGHLAND ACQUISITION GROUP, L.L.C. A COLORADO LIMITED LIABILITY COMPANY THIS AGREEMENT. is made by and between HIGHLAND ACQUISITION GROUP, L.L.C. , a Colorado limited liability company (the "Company") and its "Members . " WITNESSETH: IT IS AGREED, in consideration of the promises, covenants, performance, and mutual consideration herein as follows : The Members of the Company are: H. GENE BULTHAUP ROBERT M. BULTHAUP WILFRED J. ALBRACHT JERALD D. WILTS NORMAN K. HUXMAN I FORMATION OF COMPANY 1. 1 Articles of Organization. This Company is organized pursuant to the provisions of the Limited Liability Company Laws of the State of Colorado and pursuant to Articles of Organization filed with the Secretary of State on the 5th day of May, 1998 . The rights and obligations of the Company and the Members shall be provided in the Articles of Organization and this Operating Agreement . 1 . 2 Conflict between Articles of Organization and this Agreement. If there is any conflict between the provisions of the Articles of Organization and this Operating Agreement, the terms of this Operating Agreement shall control . II CAPITAL CONTRIBUTIONS 2 . 1 Contributions. The capital contributions to be made by the Members and with which the Company shall begin business are as follows : Member Name Contribution H. GENE BULTHAUP $ 1, 000 . 00 ROBERT M. BULTHAUP $ 1, 000 . 00 WILFRED J. ALBRACHT $ 1, 000 . 00 JERALD D. WILTS $ 1, 000 . 00 NORMAN K. HUXMAN $ 1, 000 . 00 2 .2 Additional Capital Contributions . In the event that the cash funds of the Company are insufficient to meet its operating expenses or to finance new investments deemed appropriate to the scope and purpose of the Company as determined by the unanimous vote of the Managers, the Members shall make additional capital contributions, in the percentages set forth in Paragraph 3 . 3 . The amount of the additional capital required by the Company and the period during which such additional capital shall be retained by the Company shall be determined by the unanimous vote of the Managers. 2 . 3 Loans. In lieu of voting an additional assessment of capital to meet operating expenses or to finance new investments, the Company may, as determined by the Managers, borrow money from one or any of the Managers, Members, or third persons. In the event that a loan agreement is negotiated with a Manager or Member, he or she- shall be entitled to receive interest at a rate and upon such terms to be determined by the Managers, excluding the Manager making said loan, if applicable, and said loan shall be repaid to the Manager or Member, with unpaid interest, if any, as soon as the affairs of the Company will permit. The loan shall be evidenced by a promissory note obligating the assets of the Company. Such interest and repayment of the amounts so loaned are to be entitled to priority of payment over the division and distribution of capital contributions and profit among Members . III MEMBERS' ACCOUNTS, ALLOCATION OF PROFIT AND LOSS; DISTRIBUTIONS 3 . 1 Capital Accounts. A separate capital account shall be maintained for each member. The capital accounts of each Member shall initially reflect the amounts specified in Section 2 . 1, and, if a Member has merely promised to contribute the amount specified in Section 2 . 1, the Company shall maintain a corresponding subscription receivable on behalf of that Member. No Member shall withdraw any part of his or her capital account, except upon the approval of the Manager (s) . If the capital account of a Member becomes impaired, or if a member withdraws said capital account with approval of the Manager (s) , the member' s share of subsequent Company profits shall be credited first to the member' s capital account until that account has been restored, before such profits are credited to the member' s income account. If, during the period when a Member' s capital account is impaired or the member has withdrawn funds therefrom as hereinbefore provided, and an additional contribution is required of the Members for the purposes specified in Section 2 .2, then the Member with such withdrawn or impaired capital account shall be required to contribute the Member' s proportionate share of the additional capital contribution and the deficiency then existing in the Member' s capital account, so as to return the capital account to the same proportion existing as of the date of the additional contribution. No interest shall be paid on any capital contributions to the Company. 3 .2 Income Accounts. A separate income account shall be maintained for each Member. Company profits, losses, gains, deductions, and credits shall be charged or credited to the separate income accounts annually unless a Member has no credit balance in his or her income account, in which event losses shall be charged to the Member' s capital account, except as provided in Section 3 . 1 . The profits, losses, gains, deductions, and credits of the Company shall be distributed or charged to the Members as provided in Section 3 . 3 . No interest shall be paid on any credit balance in an income account. 3 . 3 Allocations Among Members of Income and Gains . (A) The profits, losses, and gains of the Company shall be distributable to the Members according to their proportion to their capital accounts . At the time of organization, the Members proportions are: H. GENE BULTHAUP 20 % ROBERT M. BULTHAUP 20 1 WILFRED J. ALBRACHT 20 % JERALD D. WILTS 20 % NORMAN K. HUXMAN 20 1 3 . 4 Disproportionate Capital Accounts . No interest or additional allocation of profits, losses, gains, deductions, and credits shall inure to any Member by reason of the member' s capital account being proportionately in excess of the capital accounts of the other Members . • 3 . 5 Distributions of Assets . 3 . 5 . 1 . All distributions of assets of the Company, including cash, shall be made in the same allocations among Members as described in Section 3 .3 . However, any distributions in liquidation of the business shall be made in proportion to the capital accounts of the members . 3 . 5 . 2 . The Managers shall determine, in the Managers' discretion, whether distributions of assets of the Company should be made to the Members; provided, however, that no distribution of assets may be made to a Member if, after giving effect to the distribution, all liabilities of the Company, other than liabilities to Members on account of their capital and income accounts, would exceed the fair value of the Company assets . 3 . 5 . 3 . A Member has no right to demand and receive any distribution from the Company in any form other than cash. 3 . 6 Liability of Member to the Company. A Member who receives any distribution is liable to the Company only to the extent now or hereafter provided by the Colorado Act . IV RULES RELATING TO THE MEMBERS 4 . 1 Admission of New Members . Additional Members may be admitted upon the unanimous written consent of all Members . Any transferee' s interest shall be subject to the terms of this Agreement . 4 .2 Voting of Members. A Member shall be entitled to one vote on any matter for which Members are required to vote. A member may vote in person or by proxy at any meeting of Members. All decisions of the members shall be made by the majority vote of the members at a properly called meeting of the Members at which a quorum is present, or by the unanimous written consent of the Members . 4 .3 Meetings of Members . 4 .3 . 1. Meetings of Members may be held at such time and place; either within or without the State of Colorado, as may be determined by the Managers or the person or persons calling the meeting. 4 . 3 . 2 . Special meetings of the Members may be called by any Manager or by at least one Member entitled to vote at the meeting. 4 .3 .3 . Written notice stating the place, day, and hour of the meeting and, in the case of a special meeting, the purpose for which the meeting is called, shall be delivered not less than ten (10) days nor more than fifty (50) days before the date of the meeting, either personally or by mail, by or at the direction of the Manager or any other person calling the meeting, to each Member of record entitled to vote at such meeting. A waiver of notice in writing, signed by the Member before, at, or after the time of the meeting stated in the notice shall be equivalent to the giving of such notice. 4 . 3 .4 . By attending a meeting, a Member waives objection to the lack of notice or defective notice unless the Member, at the beginning of the meeting, objects to the holding of the meeting or the transacting of business at the meeting. A Member who attends a meeting also waives objection to consideration at such meeting of a particular matter not within the purpose described in the notice unless the Member objects to considering the matter when it is presented. 4 .4 Quorum and Adjournment. A majority of the Members entitled to vote shall constitute a quorum at the meeting of Members. If a quorum is not represented at any meeting of the Members, such meeting may be adjourned for a period not to exceed sixty (60) days at any one adjournment; provided, however, that if the adjournment is for more than thirty (30) days, a notice of the adjourned meeting shall be given to each Member entitled to vote at the meeting. V RULES RELATING TO MANAGEMENT 5 . 1 General Powers. Management and the conduct of the business of the Company shall be vested in the Managers. The Members may elect certain Members to serve as Managers for certain Company dirties . The Managers may adopt resolutions to govern their activities and the manner in which they shall perform their duties to the Company. At anytime there is more than one Manager, any one Manager may take any action permitted to be taken by the Managers with the written resolution of the Mangers . 5 . 2 Qualifications of Manager. 5 .2 . 1 . Managers shall be the Members and shall be natural persons eighteen (18) years of age or older, and such other qualifications as may be determined by the Members . 5 . 2 .2 . A Manager must be a member of the Company who holds more than merely an "economic interest" as defined in Section 10 . 2 of this Agreement . 5 . 3 Number. The number of Managers shall be increased or decreased by the vote or consent of the Members . 5 . 4 Meetings and Voting. 5 .4 . 1 . Meetings of the Managers may be held at such time and place as the Managers by resolution shall determine. 5. 4 .2 . Written notice of meetings of the Managers shall be delivered at least twenty-four (24) hours before the meeting personally, by telecopier, or by mail actually delivered to the Managers within the twenty-four (24) hour period. A waiver of notice in writing, signed by a Manager before, at, or after the time of the meeting stated in the notice, shall be equivalent to the giving of such notice. 5 .4 .3 . By attending a meeting, a Manager waives objection to the lack of notice or defective notice unless, at the beginning of the meeting, the Manager objects to the holding of the meeting or the transacting of business at the meeting . 5 .4 .4 . A majority of the Manager(s) entitled to vote shall constitute a quorum at the meeting of Manager (s) . 5 .4 . 5 . All decisions of the Managers shall be made by the majority vote of the Managers at a properly called meeting of the Managers at which a quorum is present, or by unanimous written consent of the Managers . 5 . 5 Duties of Manager. 5 . 5 . 1 . The Managers shall have the duties and responsibilities as described in the Colorado Limited Liability Company Act, as amended from time to time. 5 . 5 .2 . The Managers, or any one of the Managers who are designated by resolution of the Managers, shall execute any instruments or documents providing for the acquisition, mortgage, or disposition of the property of the Company. 5 . 5 .3 . Any debt contracted or liability incurred by the Company shall be authorized only by a resolution of the Managers, and any instruments or documents required to be executed by the Company shall be signed by the Managers or any one of the Managers as designated by resolution of the Managers . 5 . 5 .4 . The Managers may designate any one of the Managers or delegate an employee or agent to be responsible for the daily and continuing operations of the business affairs of the Company. All decisions affecting the policy and management of the Company, including the control, employment, compensation, and discharge of employees; the employment of contractors and subcontractors; and the control and operation of the premises and property, including the improvement, rental, lease, maintenance, and all other matters pertaining to the operation of the property of the business shall be made by the Manager. 5 . 5 . 5 . If approved by the Company, any Manager may draw checks upon the bank accounts of the Company and may make, deliver, accept or endorse any commercial paper in connection with the business affairs of the Company. 5 . 5 . 6 . To purchase liability and other insurance to protect the Company' s property and business . 5 . 5 . 7 To invest any Company funds temporarily (by way of example but not limitation) in time deposits, short term governmental obligations, commercial paper or other investments. 5 .5 . 8 Upon the affirmative vote of the Members entitled to all of the profits, to sell or otherwise dispose of all or substantially all of the assets of the Company as part of a single transaction or plan so long as such disposition is not in violation of or a cause of a default under any other agreement to ^ which the Company may be bound, provided, however, that the affirmative vote of the Members shall not be required with respect to any sale or disposition of the Company's assets in the ordinary course of the Company' s business. 5 . 6 Restrictions on Authority of Manager(s) . A Manager shall not have the authority to, and it shall not, do any of the following acts without the unanimous consent of the Managers : A. Cause or permit the Company to engage in any activity that is not consistent with the purposes of the Company. B. Knowingly do any act in contravention of this Operating Agreement . C. Knowingly do any act which would make it impossible to carry on the ordinary business of the Company, except as otherwise provided in this Operating Agreement . D. Confess judgment against the Company. E. Possess property, or assign rights in specific property for other than a Company purpose. 5 . 7 Devotion to Duty. At all times during the term of a Manager, the Manager shall give reasonable time, attention, and attendance to, and use reasonable efforts in the business of the said Company; and shall, with reasonable skill and power, exert himself or herself for the joint interest, benefit, and advantage of said Company; and shall truly and diligently pursue the Company objectives . 5 . 8 Indemnification. Manager, employees, and agents of the Company shall be entitled to be indemnified by the Company to the extent provided in the Colorado Limited Liability Company Act, as amended from time to time, and shall be entitled to the advance of expenses, including attorney' s fees in the defense or prosecution of a claim against him or her in the capacity of Manager, employee, or agent . VI BOOKS 6 . 1 Location of Records. The books of the Company shall be maintained at the principal office of the Company or at such other place as the Managers by vote or consent shall designate. 6 . 2 Access to Records and Accounting. Each Member shall at all times have access to the books and records of the Company for inspection and copying. Each Member shall also be entitled: 6 .2 . 1 . To obtain from the Manager upon reasonable demand for any purpose such information reasonably relating to the Member' s Membership Interest in the Company; 6 . 2 . 2 . •To have true and full information regarding the state of the business and financial condition and any other information regarding the affairs of the Company; 6 .2 . 3 . To have a copy of the Company' s federal, state, and local income tax returns for each year promptly after they are available to the Company; and 6. 2 .4 . To have formal accounting of the Company affairs whenever circumstances render an accounting just and reasonable. 6 . 3" -Accounting Rules. The books shall be maintained on a cash basis. The fiscal year of the Company shall be the calendar year. Distributions to income accounts shall be made annually. The books shall be closed and balanced at the end of each calendar year and, if an audit is determined to be necessary by vote or consent of the Manager, it shall be made as of the closing date. The Manager may authorize the preparation of year-end profit-and-loss statements, balance sheet, and tax returns by a public accountant . VII DISSOLUTION 7 . 1 Causes of Dissolution. The Company shall be dissolved upon the occurrence of any of the following events : • 7 . 1 . 1 . At any time by unanimous agreement of the Members; 7 . 1 .2 . Upon the expiration of the period fixed for the duration of the Company in its Articles of Organization; or 7 . 1 .3 . Upon the death, retirement, resignation, expulsion, bankruptcy, or disassociation of a Member which shall be termed as "Disassociation. " 7 . 2 Continuation of Business. Notwithstanding the disassociation of a Member under Section 7 . 1 .3 , the Members may elect to continue the business of the Company by the unanimous consent of the remaining Members within ninety (90) days after disassociation and by purchasing the deceased, retired, resigned, expelled, or bankrupt Member' s (referred to as "Withdrawn Member" or "Disassociated Member' s") Membership Interest . 7 . 3 Purchase of Withdrawn Member' s Membership Interest. 7 .3 . 1 . If the Members elect to continue the business under Section 7 .2, the purchase price of the Withdrawn Member' s Membership Interest shall be equal to the Withdrawn Member' s "pro rata" interest in the Company based on the valuation of the Company, as determined in section 7 .3 .2 . "Pro rata" shall be defined as the fraction determined by dividing the value of the Withdrawn Member' s capital account by the total value of all Members' capital accounts. The purchase price is subject to setoff for any damages incurred as the result of the Withdrawn Member' s actions, and nothing in this paragraph is intended to impair the Company' s right to recover damages for the Withdrawn Member' s wrongful dissolution of the Company by reason of the Withdrawn Member' s expulsion, retirement, resignation or bankruptcy. 7 .3 . 2 Unless otherwise determined by the mutual agreement of all of the Members, the valuation of the Company shall be determined by appraisal . A. In the case of valuation by mutual agreement, the Members shall vote on the value of the Company at a meeting of Members. Any valuation shall be attached to the minutes of the meeting. Any valuation made shall remain effective for 1 year. Any valuation more than 2 years' old shall become null and void. B. In case valuation of the Company must be determined by appraisal , the appraised value of the Company shall be determined by a qualified independent appraiser acceptable to both the Withdrawn Member and the Company (as determined by the non-withdrawing Members) . If the parties are unable to agree upon an appraiser, the Withdrawn Member and the Company shall each select one qualified appraiser and the two thus selected shall select a third appraiser. If the appraisers cannot agree on a value, the appraised value of the Company shall be the average of the appraisals made. Copies of the appraisals shall be delivered to the Withdrawn Member and the Company. The cost of appraisal shall be divided equally between the Withdrawn Member and the Company. 7 .3 .3 Except as provided in Article XI , the purchase price determined under Section 7 .3 .2 . shall be paid to the Withdrawn Member in 60 monthly installments of principal and interest, interest being the prime interest rate as published in the Wall Street Journal as of the next business day following the "Effective Date" (as defined in Section 7 . 3 .4) of the event causing the Disassociation. The Purchaser' s obligation to pay the purchase price shall be evidenced by the Purchaser' s promissory note. 7. 3 .4 . The Effective Date shall be the date of death of a deceased Member; the date personal notice is received, .or the date the certified mail is postmarked, in the case of a retired, resigned, or expelled Member; or the date the notice is delivered to the Withdrawn or Disassociated Member or to the place of business of the Company, in case of bankruptcy of a Member. 7 .4 Distribution of Assets If Business Is Not Continued. In the event of dissolution of the Company and if the Members do not elect to or are unable to continue the business of the Company under Section 7 . 3 , the Manager shall proceed with reasonable promptness to sell the real and personal property owned by the Company and to liquidate the business of the Company. Upon dissolution, the assets of the Company business shall be used and distributed in the following order: - - 7 . 4 . 1 . Any liabilities and liquidating expenses of the Company will first be paid; 7 . 4 . 2 . The reasonable compensation and expenses of the managers in liquidation shall be paid; 7 .4 . 3 . The amount then remaining shall be paid to and divided among the Members in accordance with the statutory scheme for distribution and liquidation of the Company under the Colorado Limited Liability Company Act, as amended from time to time, or if the terms of this agreement differ from the statutory scheme in the Act, the terms of this Agreement shall control . VIII EXPULSION OF A MEMBER • 8 . 1 Causes of Expulsion. A Member may be expelled from the Company upon the occurrence of any of the following events : 8 . 1 . 1 . If a Member shall violate any of the provisions of this Agreement; or 8 . 1 .2 . If a Member' s Membership Interest shall be subject to a charging order or tax lien, which is not dismissed or resolved to the satisfaction of the Manager of the Company within thirty (30) days after assessment or attachment . 8 . 2 Notice of Expulsion. Upon the occurrence of an event described in Section 8 . 1, written notice of expulsion shall be given to the violating Member either by serving the same by personal delivery or by mailing the same by certified mail to his or her last known place of residence, as shown on the books of said Company. Upon the receipt of personal notice, or the date of the postmark for certified mail, the violating Member shall be considered expelled, and shall have no further rights as a Member of the Company, except to receive the amounts to which he or she is entitled under Sections 7 .3 or 7 .4 . Ix BANKRUPTCY OF A MEMBER 9 . 1 Bankruptcy Defined. A Member shall be considered bankrupt if the Member files a petition in bankruptcy (or an involuntary petition in bankruptcy is filed against the Member and the petition is not dismissed within sixty (60) days) or makes an assignment for the benefit of creditors or otherwise takes any proceeding or enters into any agreement for compounding his or her debts other than by the payment of them in the full amount thereof, or is otherwise regarded as insolvent under any Colorado insolvency act . 9.2 Effective Date for Bankruptcy. The Effective Date of a Member' s bankruptcy shall be the date that the Manager, having learned of the Member' s bankruptcy, give notice in writing stating that the Member is regarded as bankrupt under this Agreement, such notice to be served personally or by leaving the same at the place of business of the Company. As of the Effective Date, the bankrupt Member shall have no further rights as a member of the Company, except to receive the amounts to which he or she is entitled under Sections 7 .3 or 7 .4 . X RETIREMENT OR RESIGNATION OF A MEMBER 10 . 1 Right to Retire or Resign. A Member shall have the right, at any time, to retire or resign as a Member of the Company by giving three (3) months' notice to the Company at the Company' s place of business . 10 .2 Consequences of Retirement or Resignation If the Business Is Continued. Upon giving notice of an intention to retire or resign, the Withdrawing Member shall be entitled to have his or her Membership interest purchased as provided in Section 7 . 3 if the remaining Members elect to continue the business of the Company under Section 7.2 . Upon the receipt of notice of the remaining Members' election to continue the business, the Membership interest of the Withdrawing Member in the Company shall cease and terminate, and the Withdrawing Member shall become an Economic Interest Owner. For purposes of this Agreement, an Economic Interest Owner shall share the Company' s net profits, net losses and distribution of the Company' s assets pursuant to this Agreement and Colorado Act, but shall not include the right to participate in the management or affairs of the Company, including the right to vote on, consent to or otherwise participate in any decision of the Members or Manager. 10 . 3 Consequences of Retirement or Resignation If the Business Is Not Continued. If the remaining Members elect not to continue the business upon retirement or resignation of a member, or are unable to do so by ldw, the Withdrawn Member shall only be entitled to his or her interest in liquidation, as stated in Section 7 .4 , subject to any setoff for damages caused by the Member' s retirement or resignation. XI DEATH OF A MEMBER 11 . 1 Death of a Member. Upon the death of a Member, the deceased Member' s rights as Member of the Company shall cease and terminate except as provided in this Article XI . 11 .2-Consequences of Death If Business Is Continued. If the surviving Members elect to continue the business as provided in Section 7 .2, the managers shall serve notice in writing of such election, within three (3) months after the death of the decedent, upon the executor or administrator of the decedent, or, if at the time of such election no legal representative has been appointed, upon any one of the known legal heirs of the decedent at the last known address of such heir. The Company shall purchase the Membership Interest of the deceased Member as provided in Section 7 .3 , and the closing of such purchase shall be within thirty (30) days of the notice of such election, except in the event the Company has life insurance on the decedent, in which event the amount and method of payment for the Membership Interest of the deceased Member will be as provided in Section 11 . 3 . 11 . 3 Insurance. The Company may contract • for life insurance on the lives of each of the Members, in any amount not disproportionate to the value of each Member' s Membership Interest . In the event of death of a Member, insurance proceeds paid to the Company will be used to purchase the Membership Interest of the deceased Member. The purchase price shall be the greater of the amount determined under Section 7.2 or the amount of insurance proceeds received by the Company. The payment of the purchase price to the decedent' s representatives or heirs shall be made within thirty (30) days following receipt of the insurance proceeds by the Company. If the surviving Members do not elect to continue the business of the Company, or are unable to do so by law, the proceeds of any life insurance shall be treated as an asset of the Company for liquidation. 11 .4 Consequences of Death If the Business Is Not Continued. If the surviving Members do not elect to continue the business, or are unable to do so by law, the deceased Member shall only be entitled to his or her interest in liquidation as stated in Section 7 .4 . • xII TRANSFER OF A MEMBER'S INTEREST In the event that a Member desires to sell, assign, or otherwise transfer his or her Membership Interest in the Company and has obtained a bona fide offer for the sale thereof made by some person not a member of this Company, he or she shall first offer to sell, assign, or otherwise transfer the Membership Interest to the other Members at the price and on the same terms as previously offered him or her, and each of the other Members shall have the right to purchase his or her proportionate share of the selling Member' s Membership Interest . If any Member does not desire to purchase the Membership Interest on such terms or at such price and the entire Membership Interest is not purchased by the other Members, no other Member may purchase any part of the Membership Interest, and the selling Member may then sell, assign, or otherwise transfer his or her entire Membership Interest in the Company to the person making the said offer at the price offered. The intent of this provision is to require that the entire Membership Interest of a Member be sold intact, without fractionalization. If less than all of the remaining Members desire to purchase the Membership Interest which is being offered for sale, each such Member may purchase a fractional share, the numerator being the value of such Member' s capital account and the denominator being the total value of all capital accounts owned by -- the purchasing Members. If a purchasing Member does not elect to purchase the entire interest to which he/she is entitled, the remaining purchasing Member(s) may purchase the interest not so purchased, using the foregoing formula to calculate the portion to which each is entitled. Notwithstanding the foregoing, in no event may the purchasing Members purchase less than the entire Membership Interest being offered for sale. The other Members shall have thirty (30) days from the date they receive a copy of the bona fide offer within which to match said offer. The Closing of the sale and purchase by the purchasing Members shall occur within ninety (90) days after the purchasing Members give the selling Member notice of their intent to purchase the Membership Interest. The purchase price shall be paid, at the discretion of the purchasing Members, in accordance with (a) the terms of the bona fide offer; or (b) the terms of paragraph 7.3 .2 above. A non-Member purchaser of a Membership Interest of the Company shall not become a Member without the unanimous consent of the non-selling Members, but shall become the owner of an "Economic Interest" and be entitled to receive the benefits of such owner. XIII MEMBERS' COVENANTS 13 . 1 Member' s Personal Debts. In order to protect the property and assets of the Company from any claim against any Member for personal debts owed by such Member, each Member shall promptly pay all debts owing by him or her and shall indemnify the Company from any claim that might be made to the detriment of the Company by•any personal creditor of such Member. 13 . 2 Alienation of Membership Interest. No Member shall, except as provided in Article XII, sell, assign, mortgage, or otherwise encumber his or her Membership Interest in the Company or in its capital assets or property; or enter into any agreement of any kind that will result in any person; firm, or other organization becoming interested with him or her in the Company; or do any act detrimental to the best interests of the Company. XIV ARBITRATION Any dispute, claim, or controversy arising out of or relating to this Agreement or the breach thereof shall be settled by arbitration in accordance with the rules then obtaining of the American Arbitration Association. Judgment upon the award rendered by said arbitration may be entered in any court having jurisdiction thereof . Costs of arbitration shall be paid by the loser. If one Member notifies the other Members in writing of a dispute, claim, or controversy within six (6) months of the arising of such dispute, claim, or controversy and requests that the same be arbitrated, no "legal action may then be commenced thereon, except to obtain judgment on the arbitration award. XV MISCELLANEOUS PROVISIONS 15 . 1 Inurement. This Agreement shall be binding upon the parties hereto and their respective heirs, executors, administra- tors, successors, and assigns, and each person entering into this Agreement acknowledges that this Agreement constitutes the sole and complete representation made to him or her regarding the Company, its purpose and business, and that no oral or written representations or warranties of any kind or nature have been made regarding the proposed investments, nor any promises, guarantees, or representations regarding income or profit to be derived from any future investment . 15 . 2 Modification. This Agreement may be modified from time to time as necessary, only by the written agreement of the Company, acting through the unanimous vote or consent of its Managers, and the Members . 15 . 3 Severability. The provisions of this Agreement are severable and separate, and if one or more is voidable or void by statute or rule of law, the remaining provisions shall be severed therefrom and shall remain in full force and effect . 15 . 4 Governing Law. This Agreement and its terms are to be construed according to the laws of the State of Colorado. 15 . 5 Counterparts . This Agreement has been executed in counterparts and each such counterpart shall be deemed an original of the Agreement for all purposes. Dated this o1/ r day of \7i/4/ 1998 . MEMBER', i�74,Lc t. Tee64722 H. GE B y/ �R08ER THAUP J. TITACHT JERALD D. WILTS NORMAN HUXMAN C:\WPOOCS\LTOLIAO\BULTIIAUP.OA 0 .rte 1 � \/ � .1'.. / •r.{YI�`'�I �IXni'I r • _. ��......i , � \ N-, � S '.te • a r J 1 '-_._ y v1. / 1111, (tlA� j � �,( 1 „. RAC ,�P¢ '" ! � �._ ` �� r a y Ja nA, • .r` fir - 1 "$- J _.w .. et ♦, L.( f �, c A ✓[M.j'-Y '.r .. mil f-• 4AtRe.Ilk A•.•.-----• YT. ,yl-y 11. hr.rn ���yr �7 •'6 NYMOE i . `' .c° 1 ry 1-,Z`+ as 1 y ,Z' `_�' 'n'^ . iwn ♦ _ ., ..,�,.. � C \,, i-4��.' 4' .,... yF �,, ,A ORGANIZED UNDER THE LAWS OF THE STATE OF COLORADO Yt i\ b { £3'1 l ' ':s�c Est�- '`•\ -as t tir r - s t 1 F{ '' .. ♦ rte, 1 �` l •,�J-rFr f.lp y ) - vlii �... a SPECIMEN r. is the owner of Units of the above G v Limited Liability Company transferable only on the books of the Limited Liability Company by the holder hereof in person " or by duly authorized Attorney upon surrender of this Certificate properly endorsed. 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N Sy �' 'x, �` Si �.}}7' zz' % to J ^� - y".- n-zi ry relS 164 f v r 1t•Ti77 T,'�{.. -- .1 0'Ar ,7�'1 Vii, xr,'p rf "''e rr4 vii,4d, ,- fvw.Tt r n ._ t ✓,.polo tiri .'di '" rn I. e�„ ..+ n-'fl .rk y...� r y 4 F.it.j." .r d'..,.rAfr7 s"• w=:Sis•sc,.. .--'v.' 1{y+4tm y�• ''S.f�lti .'N.w �*',av h �.4r,h: .0. .:-pr ' ,4 y .r.,� .y T/•®yam \" ♦ ag .n iFyeN1 fryer';:J W l7 or ".' d- 7'r ISSI-f7.4,I7 lvyC„ . „3yfr�'iFl� 41-kv.tFitit40 -..n0.0.....,,,-Y".1 '�vs,1 i`fly, S 7th r '1� � �+'� ,-- f'�. �s+`� .n r v r••'v ,+, + / ' ��r � Yh I yr, 4. • �1uA 1. ".�JIdr 11 J AI'4;,,"' �1 .'A�,,�„'"" �' 'h. "� r�. t"� _ d"',+� i• r„ µ s r � `� .e yPo `d �.n.r�, r^, Amendment Number 1 to the Operating Agreement of the Highland Acquisition Group, LLC A Colorado Limited Liability Company This Amendment Number 1 is to the Operating Agreement of Highland Acquisition Group, LLC dated June 21,1998 (the "Agreement')and is penned due to the death of H. Gene Bulthaup, a Member of the Company. Whereas,this Amendment Number 1 to the Agreement is made by and between the following Members, who hereinafter are referred to as the Surviving Members: Wilfred J.Albracht Norman L. Huxman Robert M. Bulthaup Jerald D.Wilts Whereas, Robert M. Bulthaup is the Personal Representative of the Estate of H. Gene Bulthaup, is a Member of the Company and is the inheritor of the ownership interest in the Company of H. Gene Buithaup. Therefore, as evidenced by their signatures below,the Surviving Members agree that the following is in the best interest of each of the Surviving Members and the Company, is equitable and states the intent of the parties: Pursuant to Article 7.2 of the Agreement,the Surviving Members, by their unanimous consent, wish to continue the operations of the Company. For purposes of this Amendment,the requirement of Article 7.3 of the Agreement of an appraisal is hereby waived. In addition,the requirement of Section 7.3.3 of the Agreement relating to the distribution of the appraised value of the Company to the Estate of H.Gene Bulthaup is hereby waived in exchange for a revised ownership percentage,which is defined in the Agreement as the proportion of capital account.The revised Surviving Member's proportions in the capital account shall be: Wilfred J. Albracht 20% Norman L. Huxman 20% Robert M. Bulthaup 40% Jerald D.Wilts 20% This revised Surviving Member's proportion of the capital account shall apply in all determination of profit, losses, gains, deductions, assets, voting rights or any other items relating to equity in the Company. Upon execution of this Amendment,Articles 7.2, 7.3 and in particular 7.3.3 will again be in full force and effect for the Surviving Members.As of the signing of this Amendment,the Surviving Members shall become the new Members of the Company. Sent By: SWISS RE DENVER; 303 741 0300; 1 Apr'02 10:43^ Job 860;Pege 3/3 •• Alnsockeset Number 1 to Ma Operating Agreement of tM Highland Sibs Group,LLC A Colorado Limited Liability Company Signature page. • Dated this 16-; day of ken—,2002. Msmbare: • I Norman L.. Huwnan • Robert M Butaup • Jerald O.Wilts Amendment Number 1 to•the Operating Agreement of the Highland Acquisition Group,LLC A Colorado Limdsd Liability Company Signature page. -Dated this -.44O day of st„ 2002. Member.: Wilfred J.Albrecht SitsitkiN Nan L.Huainan Robert M.Statham Jerald D.Wilts Amendment Number 1 to the Operating Agreement of the Highland Acquisition Group, LLC A Colorado Limited Liability Company Signature page. Dated this fl day of fy_L'i- 2002. Members: Wilfred J. Albrecht Norman L. Huxman bert M. Bu l aup Jerald D.Wilts r-. Highland Acquisition Group,LLC Meeting of Members September 15,2002 A meeting of the members of Highland Acquisition Group,LLC was held on September 15,2002 via mail. Robert Bulthaup was elected to remtas the sole manager of the LLC. Submitted October 8,20081by Robert M.Bulthaup,Manager ert But up ra t Norman > ' Jerald Wilts FEB-0^-°" TUC nun -AM-TRANSNAT-laL 'I_TLE_GRLSL_ FAX N0, 9703522312 P. 01/02 111111111111111111111111111111111111111 III IIIII IIII IIII (0P_12-. 324 3031324 02/10/2003 09:25A Weld County, Co 1 of 1 R 6.00 0 0.00 Steve Moreno Clerk& Recorder STATEMENT OF AUTHORITY #441/44616 , 1. This Statement of Authority relates to an entity named #4sc 1 t Ac4j ttnod 6;ei. Liz. I. The type if entity is a ❑ corporation O registered limited liability limited partnership ❑ nonprofit corporation O limited partnership association limited liability company O unincorporated nonprofit association ❑ general partnership O government or governmental subdivision or agency ❑ limited partnership O business trust ❑- registered-limited liability partnership --❑-trust ❑ //1� 3. The entity is formed under the laws of Co tall 1+f'90 y 4. The mailing address for the entity is CA /r-o3C'IU MOLT cd 6'07 S ^'Ar-W,d/ N7rNN My/ moo. roll / 5. The 0 name, or position of each person authorized to execute instruments conveying, encumbering,.or otherwise affectin title to real property on behalf of the entity is Ni-/144 EA. . (Optional) The authority of the foregoing person(s) to bind the entity isii not limited 0 limited as follows: 7. (Optional) Other matters concerning the manner in which the entity deals with interests in real property: A/Oge- 8. This Statement of Authority is executed on behalf of the entity pursuant to the provisions of Section 38- 30-172, C.R.S. ``- _//.-----___-- Executed this di-I- day of it -tca4 q , �o ,itiz Name f'cnte►2T- /11 . r s. 1-14u1° (type or print) State of eoc_orz_F o o ) - ss. a S. C ,�� County of 4P1440G- ) NOTARY t1 the foregoo/ g instrument was acknowledged// before me this elf_.. day of ?�; . mews . i --by A .-.7/ N. L�cc View, yj Wale �Q F c OF CO‘" Witness my hand and official seal. My commission expires: I/z VA? &7 01if�., ,/.� `es 8/L.4 c,3 Hello