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<br />. <br /> <br />. <br /> <br />ARTICLE V - SHAREHOLDERS <br /> <br />5.1 V otin~ of Shares. Each holder of record of Class A Series 1 and Class A Series 2 <br />common stock shall have one vote for each share of such stock standing in its name on the books <br />of the Corporation. Each holder of record of Class B common stock shall have one vote for each <br />share of such stock standing in its name on the books of the Corporation and entitled to vote. <br />Notwithstanding the foregoing, the holder of Class A common stock shall not be entitled to vote <br />on assessments for the Homestake Reservoir water, and the holder of Class B common stock <br />shall not be entitled to vote on assessments for any ordinary repair, maintenance, operation or <br />capital improvements of Eagle Park Reservoir, as such assessments for Eagle Park Reservoir and <br />Homestake Reservoir water are more particularly set forth in Section 8.1. In the election of <br />directors, each shareholder shall have the right to vote that shareholder's nwnber of shares for as <br />many persons as there are directors to be elected. Cwnulative voting of shares of stock is not <br />authorized for any purposes. <br /> <br />5.2 Quorum. At all meetings of shareholders, except as provided in Section 5.4 <br />below, 50% of the total votes entitled to vote at such meeting, represented in person or by proxy, <br />shall constitute a quorum; and at any such meeting at which a quorum is present the affirmative <br />vote of 51 % of the votes represented at such meeting and entitled to vote on the subject matter <br />shall be the act of the shareholders, unless the vote of a greater proportion or nwnber is required <br />by these Articles of Incorporation or the laws of Colorado. <br /> <br />5.3. Preemptive Rights. Except as may be granted by the Letter ofIntent dated <br />April 30, 1996, and the Homestake Reservoir Agreement dated April 21, 1998, both among the <br />Corporation's initial shareholders, no shareholder of the Corporation shall have any preemptive <br />or similar right to acquire or subscribe for any additional unissued or treasury shares of stock, or . <br />other securities of any class, or rights, warrants or options to purchase stock or scrip. <br /> <br />5.4 Additional Voting Requirements. (a) At any meeting of shareholders called for <br />the purposes of (i) approving capital improvements (as defmed in Section 8.1 (b) below) to the <br />assets of the Corporation, (ii) authorizing borrowings of the Corporation in excess of an annual <br />aggregate of $20,000, or (iii) amending these Articles ofIncorporation, except as provided in <br />Section 5.4(b) below, 67% of the total votes entitled to vote at such meeting shall constitute a <br />quorum, and at any such meeting at which a quorum is present the affirmative vote of 67% of the <br />total votes of the Corporation entitled to vote on the subject matter shall be the act of the <br />shareholders. <br /> <br />(b) At any meeting called for purposes of amending the terms of Sections 4.1, <br />4.2 or 4.3 of these Articles ofIncorporation or for approval to sell, transfer or convey all or any <br />portion of Eagle Park Reservoir or the Corporation's associated water rights (other than a sale of <br />shares of the Corporation entitling the holder thereof to use such assets), the affirmative vote of <br />90% of the total votes of the Corporation entitled to vote on the subject matter shall be the act of <br />the shareholders. <br /> <br />fd0984 <br /> <br />-4- <br />