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Item 9: 9a: Fremont and SSQ respectfully request phased bonding for the life of the mine. 9b: Prior to mining, bond will be posted for interim reclamation (Table 1) of the area to be mined and any other area affected by mining operations. Parcels 1, 2, and 3 are production and stockpile areas. The use of these parcels will remain consistent through the life of the mine and they are currently included in the bond. Final reclamation of these parcels will commence when Phase III is mined out, no sooner than ten years from the date of this correspondence. Upon removal of equipment and stockpiles, SSQ will submit a third party bond for interim reclamation costs to replace Fremont's bond. Within approximately 90 days of the third party bond submission, SSQ will submit a request to bond for final reclamation. Parcel 4 of Phase 1 will be mined out within the next 90 days. Upon completion of 3HAV slopes and pit floor back backfilling to three (3) feet above the Pierre Shale, SSQ will post a third party bond for interim reclamation to replace Fremont's bond. Within 180 days, SSQ and ASI will acquire appropriate permits and approvals for final reclamation as lined reservoir. Final reclamation bond will be posted during this time. Parcel 5 is in queue for mining upon completion of mining in Parcel 4 of Phase I, anticipated in Spring 2014. Final reclamation of this parcel is backfilled concurrent with mining to a level above static groundwater to vegetate as open space. Upon completion of mining and backfilling, SSQ will submit a third party bond for interim reclamation to replace Fremont's bond. Within 180 days, SSQ will submit a request to move to final reclamation. Mining of Phase III is anticipated in approximately two (2) years. Phase III will proceed as Parcel 4 of Phase I mining from south to north. Slopes will be constructed 3H:1V and the floor backfilled to three (3) feet above the Pierre Shale concurrently with mining. Upon completion of slope and floor construction, SSQ will post a third party bond for interim reclamation to replace Fremont's bond. Within 180 days, SSQ and ASI will acquire appropriate permits and approvals for final reclamation as lined reservoir. Final reclamation bond will be posted during this time. Item 10: Material will be extract to Pierre shale and backfilled to a working floor three (3) feet above the shale in Parcel 4 and Phase III. Pierre shale is bedrock and below groundwater elevation. Parcels 1, 2, 3 and 5 will be mined to Pierre Shale and backfilled to no less than three (3) feet above prevailing groundwater elevation. Survey control points exist, are maintained and will be established in future parcels. Er-gVilrronrgenLca11 ,\I IWrrnnaItch eS I Inn c„ Page 2 of 7 1107 Main Street, Canon City, CO 81212 www.envalternatives.com • e -mail: eai @bresnan.net Phone: 719 - 275 -8951 • Fax: 719 - 275 -1715