BY-LAWS OF COLORADO HEALTH INSURANCE COOPERATIVE, INC. Doing Business As: Colorado HealthOP

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1 BY-LAWS OF COLORADO HEALTH INSURANCE COOPERATIVE, INC. Doing Business As: Colorado HealthOP PREAMBLE. The Cooperative shall serve as a qualified nonprofit health insurance issuer under Section 1322(c)(1) of the Patient Protection and Affordable Care Act (the "Affordable Care Act"), Pub. L. No , and operate a Consumer Operated and Oriented Plan ("CO-OP") as set forth in the Affordable Care Act. This Cooperative intends to offer qualified health plans as described in the Affordable Care Act in individual and small group markets in the State of Colorado in such counties and at such times as determined by the Board of Directors ( Board ). The Cooperative intends to obtain the necessary licenses and approvals under Colorado law, including the regulations governing the Division of Insurance. The Cooperative's primary purpose will be to improve access to quality and affordable health care for all Colorado residents built upon improved management of population health and patient medical conditions and risk factors, expanding medical homes, and improving the coordination of care among all health providers. The Cooperative will also strive to improve access to health resources in rural communities within Colorado by piloting rural health, transportation and telemedicine initiatives. This Cooperative is committed to providing affordable, quality health insurance coverage for persons contracting for such coverage with this Cooperative or its affiliates. This Cooperative intends to be responsive to consumers' need for health care coverage reform by providing an integrated system of health insurance, health care and health care administration and by furthering the role of this Cooperative and its affiliates in their collective mission of service to the community. The Cooperative may also sponsor or affiliate with CO-OPs in adjacent states or regions within such states. ARTICLE I CORPORATE IDENTITY AND PURPOSE Section 1. The name of this Cooperative is Colorado Health Insurance Cooperative, Inc., doing business as Colorado HealthOp. Section 2. The principal offices of this Cooperative shall initially be at 7900 East Union Ave., Suite 250, Denver CO Section 3. The registered agent of this Cooperative shall be determined by the Board of Directors from time to time and filed with the Secretary of State. The Cooperative shall have and continuously maintain in the State of Colorado a registered office and a registered agent. Section 4. The Cooperative is organized exclusively for the following purpose: to serve as a qualified non-profit health insurance issuer under Section 1322(c)(1) of the Affordable Care Act and Section 501(c)(29) of the Internal Revenue Code, or corresponding section of any future federal tax code. In furtherance of this purpose, the Cooperative shall have and may exercise all of the rights, powers, privileges and immunities now or subsequently conferred upon nonprofit Bylaws, Page 1 Rev: August 2015

2 cooperative corporations organized under the laws of the State of Colorado. Section 5. All income of the Cooperative, after paying the costs of operation and making provision for adequate reserves, shall be devoted to the provision of affordable quality health insurance coverage to its Members. No part of the net earnings of the organization shall inure to the benefit of, or be distributable to its members, trustees, officers, or other private persons, except as provided in Section 1322(c)(4) of the Affordable Care Act (which requires profits to be used to lower premiums, improve benefits, or for other programs intended to improve the quality of health care delivered to the organization's members). No substantial part of the organization's activities shall consist of carrying on propaganda, or otherwise attempting, to influence legislation. The organization will not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office. Notwithstanding any other provision of these bylaws, the organization shall not carry on any activities not permitted to be carried on (a) by a qualified non-profit health insurance issuer under the Affordable Care Act, or (b) by an organization except from federal income tax under section 501(c)(29) of the Internal Revenue Code, or corresponding section of any future federal tax code. Section 6. Upon the dissolution or winding up of this Cooperative, its assets remaining after payment, or provision for payment, of all debts and liabilities of this Cooperative shall be distributed to a nonprofit fund, foundation or Cooperative which is organized and operated in Colorado exclusively for charitable, scientific or educational purposes and which has established its tax exempt status under Section 501(c) (3) or (29) of the Internal Revenue Code. Section 7. It is the intention of the Cooperative to conduct its affairs in such a manner as to maximize the opportunity for input by the membership and utilize the talents and abilities of each to the greatest extent possible. Notwithstanding the foregoing, the liabilities and responsibilities of the Board shall not be diminished, delegated or abdicated. ARTICLE II MEMBERSHIP Section 1. The Members of this Cooperative shall have those rights described in Articles II and III hereof and as otherwise set forth in the Affordable Care Act and final regulations promulgated thereunder. The rights of the Members include the determination of qualifications for membership, the election and removal of members of the Board, adoption of resolutions that are advisory to the Board, and approval of extraordinary actions listed in Section 4 of this Article V hereof. Section 2. The Rocky Mountain Farmers Union Educational and Charitable Foundation, Inc. ("RMFU Foundation ), as the Cooperative's initial Sponsor (as that term is defined under the Affordable Care Act), shall act as the "Initial Member" of the Cooperative. The Initial Member is admitted to the Cooperative as its sole member effective contemporaneously with formation of the Cooperative. Upon the admission to the Cooperative of additional Members meeting the qualifications set forth in Section 3 of Article II hereof and the occurrence of 2014 annual meeting Bylaws, Page 2 Rev: August 2015

3 of the Members in accordance with Section 1 of Article III hereof, the Initial Member shall, without any further action, cease to be a member of the Cooperative. Section 3. Upon grant of authority by the State of Colorado to the Cooperative to issue health insurance policies to Colorado residents and upon the occurrence of the 2014 annual meeting of the Members held pursuant to Section 1 of Article III hereof there shall be one class of Members with voting rights. A Member shall be any individual at least eighteen (18) years of age covered under a health insurance policy issued by the Cooperative. A Member shall be entitled to one vote. Members shall be entitled to vote only upon those matters specified in these Bylaws or the Affordable Care Act, or as required by law. A Member's membership in the Cooperative shall terminate if the individual fails to meet the requirements for membership. Membership in this Cooperative may also be terminated in accordance with terms of the contract applicable to the Member. Membership in the Cooperative may not be transferred or assigned. ARTICLE III MEETINGS OF THE MEMBERS Section 1. The annual meeting of the Members of this Cooperative shall be held at such time and place as the Board may determine. The Cooperative shall hold an annual meeting within one (1) year after the effective date on which the Cooperative first makes available medical health insurance coverage to consumers. Section 2. A special meeting of the Members may be called by (a) the President of the Cooperative in response to a written request of at least a majority of the Members or the Board, (b) the Board upon receipt of a petition for the removal of a Director, a petition to amend these Bylaws, or a request to hold a special meeting for any other lawful specified business purpose signed by at least ten percent (10%) of the Members and filed with Secretary in accordance with Section 4 hereof, or (c) as otherwise provided by law. Special meetings of the Members shall be held at such time and place as the Board may determine. The agenda of a special meeting of the Members shall be limited to the matters described in the notice of such special meeting. Section 3. The Secretary will mail proper notice of any annual or special meeting to the last known postal or electronic mail address of each Member of the Cooperative no fewer than ten (10) days, or if notice is mailed by other than electronic, first class or registered mail, no fewer than thirty (30) days, nor more than sixty (60) days before the meeting date. The notice will specify the time and place of the meeting, and if for the annual meeting a description of any matter or matters that must be approved by the members under the Colorado Cooperative Law. Notice for a special meeting will include a description of the reason for which the meeting is called. The notice of any meeting at which Directors are to be elected shall include the names of all those who are nominees at the time the notice is given to Members. Notice shall also include a description of a matter a Member intends to raise at the meeting if: a) requested in writing to do so by a person entitled to call a special meeting; and b) the request is received by the Secretary or President of the Cooperative at least ten (10) days prior to the mailing of the notice of the meeting. A Member may waive notice to the extent allowed by law and consent to all business coming before such meeting. The attendance of a Member at any meeting shall constitute a waiver of notice of such Bylaws, Page 3 Rev: August 2015

4 meeting, except when the Member objects, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Attendance at a meeting is not a waiver of any right to object to the consideration of matters required by this Section 3 to be included in the notice but not so included, if such objection is expressly made at the meeting. Section 4. Members may place a resolution to remove a Director, to amend these Bylaws, to call a special meeting of the members for any other lawful purpose or to provide an advisory resolution on any other matter on the agenda for consideration at an annual meeting pursuant to this Section. In order for the Board to promptly and directly address matters that may become the topic of such a resolution, the sponsors of a proposed resolution shall first present the resolution to the Board for consideration and possible solution of the issue without the need for a vote of the Members. The sponsors of a proposed resolution shall not be required to obtain signatures of Members prior to taking the matter to the Board, but must file such proposed resolution with the Secretary not less than one hundred twenty (120) days prior to the annual meeting or ninety (90) days prior to the proposed special meeting. The Secretary shall present the proposed resolution to the Board for consideration within ten (10) days after receipt of the resolution. The Board shall consider the resolution and provide the resolution sponsors with a response to the resolution within thirty (30) days of the meeting at which the Board considers the resolution. If, after receipt of the Board's response, the resolution sponsors still wish to place the resolution on the agenda of the annual meeting or to call a special meeting, they may file a request to do so with the Secretary not less than sixty (60) days prior the date of the annual meeting or thirty five (35) days prior to the date of the proposed special meeting. The request shall (a) be in the form of a resolution signed by ten percent (10%) or more of the Members eligible to vote on the date that the resolution is filed, (b) identify three individual members as the resolution sponsors, and (c) be submitted in accordance with rules and procedures established by the Board. The Secretary shall provide notice of any special meeting called pursuant to this Section 4 in accordance with Section 3 hereof, within thirty (30) days of receipt of the applicable resolution signed by ten percent (10%) or more of the Members eligible to vote. Resolutions submitted to the Members in accordance with this Section may be discussed and amended at the applicable annual or special meeting. A vote of the Members shall be conducted at the applicable annual or special meeting in accordance with Sections 5 and 6 hereof. Submission of a resolution to the Members for a vote pursuant to this Section shall not derogate from the duty and authority of the Board to manage the affairs of the Cooperative, and the vote of Members on any such matter shall be advisory to the Board and shall not be binding or determinative. Section 5. A quorum of five percent (5%) of the Members in person, by mail or electronic ballot, or by any other lawful means approved by the Board shall be required to transact business at any annual or special meeting of the Members. Any amendment to these Bylaws to increase the quorum may be adopted only by approval of the Members pursuant to Section 6 hereof. A mail or electronic ballot shall only be valid if a means is provided to verify that the Member so voting has received the exact wording of the matter upon which the vote is to be taken. Other means of Member attendance, as approved by the Board, shall only be valid if all persons in the meeting may communicate with each other during the meeting. Section 6. Action of the Members shall be by majority vote of a quorum of the Members, unless otherwise required by law or these Bylaws. Only eligible Members are entitled to vote in the Bylaws, Page 4 Rev: August 2015

5 election of directors and on other matters submitted to a vote of Members at a meeting. Only those who are valid Members at least thirty (30) days before the date of a meeting, or the closing date of an election otherwise held, are eligible to vote at such meeting. Each member shall have one vote. Cumulative and proxy voting shall not be allowed. Votes may be solicited in advance of a meeting and a Member's presence at a meeting shall not be required in order to count a vote for or against any proposition including the election of Directors. Section 7. Actions taken by Members at any meeting, however called and noticed, and wherever held, are as valid as though had at a meeting duly held after regular call and notice, if a quorum is present either in person or other means, and if, either before or after the meeting, each of the persons entitled to vote, not present in person, provides a waiver of notice or consent to the holding of the meeting or an approval of the minutes thereof in writing. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting. Section 8. Election of directors shall be by mail or electronic ballot voting of Members before the annual meeting or through voting by ballot at the annual meeting, or by any combination of these means of voting, as determined by the Board. Written or electronic ballots with respect to the election of directors shall: (a) set forth a list of candidates nominated by the Nominating and Member Outreach Committee; and (b) provide an opportunity to vote for or against each candidate. A member may cast as many votes as there are vacancies for directors on the Board, but there shall not be cumulative voting. Mail ballots for this purpose shall be prepared and distributed with the notice of the meeting and shall be made available to all eligible Members. Members will be notified by electronic or regular mail within three (3) months of the election of the names of the persons elected. Section 9. The Members may, by affirmative vote of not less than two thirds of the votes cast, remove any director with or without cause at any annual meeting or a special meeting called for the purpose of such a vote, pursuant to this Section. A petition for the removal signed by at least one third of the Members must be filed with the Secretary. The petition shall be submitted in accordance with rules and procedures established by the Board. If the petition is filed not less than sixty (60) nor more than one hundred twenty (120) days before the annual meeting, the Secretary shall place the matter of removal on the annual meeting agenda. If the petition is filed at another time, the Board shall call a special meeting for the purpose of considering the matter of removal within ninety (90) days of receipt of the petition. Section 10. After nominations by the Nominating and Member Outreach Committee for directors have been completed, Members may nominate additional candidates by petition signed by ten percent (10%) or more Members, if filed with the Secretary not fewer than forty-five (45) days before the annual meeting of the Members. Section 11. Any action which may be taken at any regular or special meeting of Members may be taken without a meeting if the Cooperative distributes a written ballot to every Member entitled to vote on the matter. If approved by the Board, that ballot and any related material may be sent by mail or electronic transmission by the Cooperative and responses may be returned to the Cooperative by mail or electronic transmission. That ballot shall set forth the proposed action, provide an opportunity to specify approval or disapproval of any proposal, and provide a Bylaws, Page 5 Rev: August 2015

6 reasonable time within which to return the ballot to the Cooperative. Approval by written ballot pursuant to this Section 11 shall be valid only when the number of votes cast by ballot within the time period specified equals or exceeds the quorum required to be present at a meeting authorizing the action, and the number of approvals equals or exceeds the number of votes that would be required to approve at a meeting at which the total number of votes cast was the same as the number of votes cast by ballot. Ballots shall be solicited in a manner consistent with the notice requirements of Section 3 above. All such solicitations shall indicate the number of responses needed to meet the quorum requirement, shall state the percentage of approvals necessary to pass the measure submitted and shall be accompanied by written information sufficient to permit each person casting such ballot to reach an informed decision on the matter. The solicitation must specify the time by which the ballot must be received in order to be counted. Section 12. Any action required or permitted to be taken by the Members may be taken without a meeting, if all members shall individually or collectively consent in writing to the action. The written consent or consents shall be filed with the minutes of the proceedings of the Members. The action by written consent shall have the same force and effect as the unanimous vote of the Members. ARTICLE IV BOARD OF DIRECTORS Section 1. The business and affairs of this Cooperative shall be managed by a board of directors (the "Board"). The Board is specifically authorized to further the purposes of the Cooperative as set forth in the Preamble, including the creation of a CO-OP plan and the application for a Startup Loan and a Solvency Loan (as those terms are defined under the Affordable Care Act). In addition to the powers conferred on the Board by these Bylaws, the Board may exercise all powers of the Cooperative and perform all acts which are not prohibited to it by law, by the Articles of Incorporation or by these Bylaws, all as may be amended. Section 2. The Initial Member shall appoint the members of the initial Board which will consist of not fewer than five (5) nor more than seven (7) directors (the "Formation Board"). The Formation Board, by action of the Formation Board, shall be increased to a minimum of seven (7) and a maximum of (11) at any time prior to January 1, Effective January 1, 2014, provided that the Cooperative has a license to operate as a health insurance provider granted by the state of Colorado and has issued at least one policy, the number of voting directors shall not be fewer than eleven (11) nor exceed fifteen (15). The exact number for any given year shall be determined by the Board of Directors. The Nominating and Member Outreach Committee, as part of its nominations report, shall recommend the number of voting directors for the next election year. A simple majority of the Formation Board, as those directors are determined by the Formation Board, will serve until members of the Board are first elected at the annual meeting of the Members held in 2014 pursuant to Section 3 of this Article IV. All remaining directors of the Formation Board will serve until all remaining members of the Board are elected at the annual meeting of the Members held in 2015 pursuant to Section 3 of this Article IV. Bylaws, Page 6 Rev: August 2015

7 Section 3. At the annual meeting of the Members held in 2014, and pursuant to Section 1 of Article III hereof, the Members shall elect such number of members to the Board as there are expired terms of Formation Board members plus any vacancies. At the annual meeting of the Members held in 2015, the Members shall elect the number of directors necessary to fill the seats of any Formation Board member whose term is expiring plus or minus any increase or decrease in the number of directors approved by the Board. As of the 2015 annual meeting at least eighty percent of the Board members must be Members of the Cooperative entitled to vote at an annual or special meeting who are at least eighteen (18) years of age or older. Any person elected to serve on the Board who is not also a Member of the Cooperative must be elected by a two-thirds vote of the Members, and such persons may not constitute more than twenty percent of the Board. In addition, the following individuals may not serve as members of the Board): (a) representatives of any Federal, State or local government; or (b) representatives of any "pre-existing issuer, any trade association whose members consist of pre-existing issuers, a "related entity" or a "predecessor" of either (as those terms are defined by the Affordable Care Act). Section 4. Members of the Board elected by the Members shall have staggered three year terms. To accomplish this, as stated above, the terms of a simple majority of the members of the Formation Board shall expire at the first annual meeting of the Members after January 1, Directors elected at such meeting will be elected to serve two or three-year terms, as determined by the Board of Directors. The terms of the remaining members of the Formation Board shall expire at the annual meeting of the Members held in Prior to the 2015 annual meeting the Board of Directors, based on the recommendations of the Nominating and Member Outreach Committee, shall determine the number of Directors to be elected at that meeting for three- and one-year terms. At the third annual meeting of the Members and thereafter, the Members will elect directors for the number of seats that are vacant. The terms of the board members shall be staggered, as determined by the Nominating and Member Outreach Committee, such that at no point are more than five (5) directors being elected at any annual meeting after the third meeting of members except to fill vacancies and as to such director the term shall expire as of the term of the seat left vacant. Section 5. No member of the Board shall serve more than two consecutive three-year terms. Terms served by appointment or on the Formation Board shall not count in the determination of term limits. A member of the Board who has served two consecutive three-year terms shall be eligible for re-nomination after a minimum one year absence from the Board. Section 6. The Board shall have at least four (4) regularly scheduled Board meetings per year. Section 7. Any director may resign at any time by delivering his or her resignation in writing to the President, the Vice President or the Secretary. Such resignation shall be effect upon receipt unless specified to be effective at some later time. Section 8. Any director may be removed for failure to meet the qualifications of board membership as stated in the Articles of Incorporation or these Bylaws by affirmative vote of a majority of the Board of Directors, excluding the director in question. Bylaws, Page 7 Rev: August 2015

8 Section 9. Vacancies occurring on the Board for any reason other than by expiration of a Board member's term shall be filled by election by the remainder of the Board, and such successor will serve until the expiration of the remaining term of the Board member who caused the vacancy. Section 10. The Board may, in its governing policies and as a qualification of membership on the Board, establish an attendance requirement applicable to regularly scheduled meetings. The term of a director may be declared vacant by the Board by virtue of that director's absence from more than the allotted absences from regularly scheduled Board meetings in a twelve-month period, or for violation of other Board governing policies. ARTICLE V CORPORATE ACTION Section 1. The act of the majority of directors present at a meeting at which a quorum is present shall be the act of the Board. Section 2. A simple majority of the directors shall constitute a quorum for the transaction of business at any meeting of the Board, except that if less than such number of directors is present at such meeting, a majority of the directors present may adjourn the meeting from time to time without further notice until a quorum is present. Section 3. No action of the Board shall be valid unless taken at a meeting at which a quorum is present except that any action which may be taken at a meeting may be taken as provided in Section 9 below. Section 4. The President, or in his or her absence, the Vice-President, shall preside at meetings of the Board and of the Members. The Board may adopt its own rules of procedure which shall not be inconsistent with these Bylaws. Roberts Rules of Order (latest edition) shall govern any questions at Board and Member meetings not addressed by these bylaws or other higher law. Section 5. Regular meetings of the Board may be held at such places and such times as the Board may determine. Section 6. Special meetings of the Board may be called at any time by the President or the Vice- President or by a majority of the Board. Section 7. The Secretary will provide notice of any special meeting of the Board to the last known electronic mail or postal address of each member of the Board for receipt at least two (2) days before the meeting is to be held. The notice will specify the time and place of the meeting and the item(s) of business to be considered, if required by law. A director may waive notice to the extent allowed by law and consent to all business coming before such meeting. The attendance of a director at any meeting shall constitute a waiver of notice of such meeting. With the exception of a meeting at which notice has been waived by all directors, actions of the board of directors at special meetings shall be limited to those relating to items posted in the notice or agenda for said meetings. Bylaws, Page 8 Rev: August 2015

9 Section 8. Meetings of the Board may be held in person, by telephone conference or by electronic means, so long as all members of the Board may communicate with each other simultaneously during the meeting. Section 9. Any action required to be taken, or which may be taken, at a meeting of the board of directors may be taken without a meeting if all voting directors unanimously consent in signed writings to that action. Such action by unanimous written consent shall have the same force and effect as an affirmative vote of the board of directors. Any such signed writing may be received by the Cooperative by facsimile, electronic mail, or other form of wire or wireless communication permitted by the Colorado Cooperative Act. Such written consent or consents shall be filed with the minutes of the subsequent board meeting. Section 10. Minutes of the proceedings of the Board and other corporate records will be open to inspection by any Member of the Cooperative pursuant to a lawful policy adopted by the Board. Section 11. The Board shall make available a written report annually to all Members of the Cooperative and the public. Section 12. The following actions shall require the affirmative vote of a majority of the Members at a duly-constituted meeting: (i) amendments to the Articles of Incorporation ( Articles ) of the Cooperative, or (ii) the sale of substantially all of the assets of the Cooperative. ARTICLE VI BOARD OFFICERS Section 1. The elected officers of the Cooperative shall be President, Vice-President, Secretary and Treasurer. Section 2. The elected officers of the Cooperative shall be elected annually by the Board, immediately following the election of directors at or prior to the regular annual meeting. Vacancies may be filled at any meeting of the Board. Each officer shall hold office until his successor shall have been duly elected and qualified. The Formation Board may elect officers to serve until such time as the regular Board is able to elect officers. The President shall serve no more than three consecutive one year terms. Section 3. President. Subject to the control of the Board, the President shall preside at all meetings of the Board and of the Members, shall be responsible for assurance that the Board fulfills its governance duties as stipulated in these Bylaws and the Board s governing policies then in-effect, shall act as the Cooperative s chief member representative, and shall have such other duties as may be prescribed by the Board. Section 4. Vice-President. The Vice-President shall perform the duties of the Board President in the event of his or her absence, disability or refusal to act, and shall have such other duties as may be assigned by the Board. Bylaws, Page 9 Rev: August 2015

10 Section 5. Secretary. The Secretary shall prepare and maintain, or cause to be prepared and maintained, records of all proceedings of the Members and the Board in a book or series of books kept for that purpose, which book or books shall be kept at the principal office of the Cooperative. Such book or books shall also contain the original or attested copies of the Articles and Bylaws of the Cooperative. The Secretary shall perform such additional duties as may be assigned by the Board. Section 6. Treasurer. The Treasurer shall advise the Board on matters of fiscal policy, and shall serve as the chairperson of a finance committee, as may be established by the Board. The Treasurer shall perform such additional duties as may be assigned by the Board. Section 7. The officers of the Cooperative shall each hold office for one year or until his or her successor is chosen and qualified, unless a shorter period shall have been specified by the terms of his or her election, or until he or she sooner dies, resigns, is removed or becomes disqualified. Section 8. The Board may establish the qualification, duties, authority, titles and terms of additional officers not inconsistent with these. Section 9. Any officer may resign at any time by delivering his or her resignation in writing to the President, the Vice-President or the Secretary. Such resignation shall be effective upon receipt unless specified to be effective at some other time. Section 10. The Board may, by a majority vote of all directors, remove any officer with or without cause. The Board shall elect a successor if the office of the President, Vice-President, Secretary, Treasurer or any other office becomes vacant. ARTICLE VII CHIEF EXECUTIVE OFFICER Section 1. The Board shall employ a chief executive officer of the Cooperative, with such duties and title, for such length of time, and at such compensation as the Board may determine. The chief executive officer shall serve as a non-voting ex officio member of the board of directors. Section 2. The chief executive officer shall be responsible for general and active management of the business of the Cooperative in accordance with the governing policies as adopted by the Board. Except as may be explicitly stipulated by the Board, the chief executive officer shall have the authority to hire and discharge agents, contractors, and employees and shall oversee and direct their activities in carrying out the work of the Cooperative. ARTICLE VIII COMPENSATION Bylaws, Page 10 Rev: August 2015

11 Neither the Members of the Board, nor elected officers of the Cooperative, shall receive, directly or indirectly, any compensation for her or his service as an officer or director except in accordance with conflicts of interest policy and based upon approval of the Board. Nothing herein shall prevent reimbursement for reasonable expenses incurred on behalf of the Cooperative or per meeting payments for board meetings as may be recommended by a Compensation Committee and approved by the Board. ARTICLE IX COMMITTEES Section 1. The Board may authorize the establishment of and assign duties to committees, subcommittees, advisory committees or task forces (collectively referred to as Board Committees ) from time to time. The policy, resolution or charter establishing such Board Committees shall state the purpose, composition guidelines, timeline and authority of each committee. Such committees shall have the authority of the Board in the management of the business of the Cooperative to the extent provided in such policy, resolution or charter and as otherwise permitted by law and approved by the Board. Such committees, therefore, shall at all times be subject to the direction and control of the Board. Section 2. Except as otherwise provided, the Board shall appoint members, remove members and designate the chair of all Board Committees. Members of Board Committees need not all be directors, so long as at least one or more member is a director. Committees shall serve at the pleasure of the Board under such rules and regulations as the Board may approve. Unless stipulated otherwise in the resolution or charter establishing such committee s composition, the Cooperative s Chief Executive Officer may serve as an ex officio, non-voting member of any committee and attend committees meetings. Section 3. Each Board committee and subcommittee, if and as authorized to take action on behalf of the Board, including but not limited to bringing formal recommendations for Board consideration, shall maintain a written record of its procedures and activities, including minutes of meetings at which actions are taken. Minutes of such meeting shall be submitted to the Board within two weeks of all such meetings, and such committees shall submit a written summary report of their procedures and activities at least annually to the Board. Section 4. The act of the majority of the Board Committee members present at a meeting in person or by proper telephonic or electronic means in which a quorum is present shall be the act of the committee. No Board Committee member may act by proxy on any matter. Section 5. A quorum of any Board Committee is defined as fifty percent (50%) of its membership; provided however, at least one director must be present. Bylaws, Page 11 Rev: August 2015

12 Section 6. Each Board Committee will complete a periodic and/or an annual written evaluation of its performance. This evaluation will assess the performance of the committee in fulfilling its roles and expectations as approved by the Board. Section 7. As stipulated above in Article III, Sections 8 and 10, and Article IV, Sections 2 and 4, there shall be a Nominating and Member Outreach Committee, comprised of members selected according to these Bylaws. The Nominating and Member Outreach Committee shall advise and make recommendations on member participation in the Cooperative and ways to strengthen the Cooperative s relationship with it members, including ways to ensure consumer governance of the Cooperative. The Committee shall also advise and assist staff in planning for membership meetings. The Committee shall interact with and respond to requests and suggestions from member groups. The Cooperative Nominating and Member Outreach Committee, further, shall be responsible for nominating candidates for the Board not less than ninety (60) days prior to the annual meeting of the Members. The Committee shall be responsible for ensuring that all elections are contested elections. In considering and nominating persons for the Board, the Committee shall use best efforts to ensure that one or more elected Directors are also providers of covered benefits to the Cooperative s Members, including at least one medical doctor. The Nominating and Member Outreach Committee, through an outreach and recruitment process, shall strive to ensure election of Board Members representing different constituencies. The Committee shall seek to ensure diversity in ethnicity and race, geography (rural and urban), gender, sexual orientation and age. Beginning in 2015, the Nominating and Member Outreach Committee shall be comprised of not fewer than five (5) persons, appointed by the Board. Beginning in 2015, the majority of appointees to the Nominating and Member Outreach Committee must be non-board member Members of the Cooperative. The Board will also appoint a Committee chairperson and one or more additional Board members, neither of whom may be eligible for or seeking nominating for election in the upcoming nominations and elections cycle. Nominating and Member Outreach Committee members shall serve a maximum of three one-year terms. Members of the Committee shall not be eligible to serve on the Committee until after the expiration of one year from the completion of three successive terms, if served. ARTICLE X CONFLICTS OF INTEREST AND PROHIBITED TRANSACTIONS Section 1. Each member of the Board shall be required to certify to the Cooperative that no conflict of interest exists which would impair that member's ability to serve on the Board, and shall comply with the Cooperative's Conflict of Interest Policy and Conflicts of Interest Statement that will be Bylaws, Page 12 Rev: August 2015

13 binding on all directors. The aforementioned documents shall be incorporated into the Board s governing policies, and such documents may be changed from time to time by the Board in its sole discretion. Section 2. The Cooperative shall not make any loan of money or property to, or guarantee the obligation of, any director, officer, or employee. Section 3. The Cooperative shall not allow any person, entity or related entity prohibited by the Affordable Care Act or regulations adopted thereunder to serve on the Board of Directors or otherwise to disqualify or jeopardize the Cooperative s status as a CO-OP under the Affordable Care Act. ARTICLE XI AMENDMENTS TO THE BYLAWS The Bylaws may be amended or repealed and new Bylaws may be adopted pursuant to Section 4 of Article III hereof. These Bylaws may also be amended or repealed and new Bylaws may be adopted at any regular or special meeting of the Board by the affirmative vote of a two-thirds majority of the directors present at such meeting, provided that the proposed amendments were included in the meeting notice. The Members of this Cooperative, by action of a majority of Members present and voting at a duly authorized meeting, may change or override the action of the Board regarding amendments to these Bylaws. The Members, by such action, may also adopt new or amended Bylaws. ARTICLE XII STANDARDS OF CONDUCT Each director and officer shall discharge his or her duties as a director or officer in good faith, in a manner which the director or officer reasonably believes to be in the best interests of the Cooperative, and with the care an ordinarily prudent person in a like position would exercise under similar conditions. Each director, officer and key employee shall comply with applicable standards in the Affordable Care Act, the Colorado Cooperative Act and Section of the Colorado Revised Nonprofit Corporation Act, as may be amended. Bylaws, Page 13 Rev: August 2015

14 ARTICLE XIII INDEMNIFICATION The Cooperative shall indemnify each director, officer, manager, employee or agent of this Cooperative, and any person serving at the request of this Cooperative as a director, officer, manager, employee, or agent of another organization, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her to the fullest extent to which such directors, officers, managers, employees and agents of a cooperative may be indemnified under the laws of the State of Colorado, as amended from time to time. The foregoing Bylaws, after having been read, article by article, were adopted with amendments by the Formation Board and certified by the Secretary of the Cooperative at the meeting held on the 17th day of July, The Formation Board pledges that these Bylaws shall be submitted for ratification by the duly elected Board as early as practicable. s/ Charles Holum Secretary Bylaws, Page 14 Rev: August 2015

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