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RECEIVED DEC t 6 2002 AGREEMENT REGARDING SAND ANU GRAVEL MINING Division of Minerals andGeolosr AND AUGMENTATION PLAN PERTAINING THERETO 1. PARTIES. The parties to this Agreement are WESTERN PAVING CON- STRUCTION COMPANY, a Colorado corporation ("Western Paving"), THE WATER USERS ASSOCIATION OF DISTRICT NO. 6, a Colorado nonprofit corporation ("Water Users"), THE RURAL DITCH COMPANY, a Colorado mutual ditch com- pany ("Rural"), THE GODDING DITCH COMPANY, a Colorado mutual ditch com- pany ("Godding"), and THE SMITH AND EMMONS DITCH COMPANY, a Colorado mutual ditch company ("Smith and Emmons"). The reference to "Water Users" as used in this Agreement shall be interpreted to include the Water Users, member ditches of the Water Users, and the Rural, Godding and Smith and Emmons ditch companies, unless the context indicates otherwise. 2. RECITALS. Western Paving owns the property described on Exhibit A (the "Cottonwood Farm") and has applied to Weld County for a special use permit and the Colorado Mined Land Reclamation Board for a mining per- mit, to permit it to conduct sand and gravel mining activities on the Cottonwood Farm property. The mining operations as contemplated by Western Paving will necessitate the relocation of the Rural and Smith and Emmons ditches which presently cross the Cottonwood Farm property. It is also anticipated by the Water Users that the mining operations contemplated by Western Paving may have an impact on historical surface and ground water patterns on and in the vicinity of the Cottonwood Farm property, may affect the flow water in the Rural and Smith and Emmons ditches as relocated and may increase the risk of ditch washout from flooding. Furthermore, the parties acknowledge that the construction of lakes, which are part of Western Paving's reclamation plan, will result in additional evaporation from open water surfaces which will adversely affect Water Users unless augmented. The Water Users have no objection to Western Paving's mining operations and reclamation of the Cottonwood Farm property if the concerns ex- pressed above are addressed and the interests of the Water Users are satisfactorily protected. Western Paving has agreed to protect those interests and the purpose of this Agreement is to set forth the specific agreements of the parties. 3. WESTERN PAVING'S AGREEMENTS. Western Paving agrees as follows: a. To conduct its mining operations on the Cottonwood Farm in accordance with the Mining and Reclamation Plan as finally approved by Weld County and the Colorado Mined Land Reclamation Board. b. That it will file an Application for Water Rights, in- cluding storage rights, claiming that it has an appropriation of water by virtue of the contemplated mining operation and reclamation plan, subject, however, to this Agreement.