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August 22, 2014 <br />Mr. Rick Wolney, Mine Manager <br />Western Fuels - Colorado, LLC <br />P.O. Box 628 <br />Nucla, CO 81424 <br />email: rwolney @tristategt.org <br />Certified Mail #70062150000246443983 <br />RE: Mining Lease dated May 01, 1956 <br />Dear Rick: <br />By ASSIGNMENT OF MINING LEASE with the effective date of February 2nd, 2012 by <br />and between San Miguel Power Association, Inc., a Colorado corporation, as Assignor <br />and 4/7, LLC a Colorado limited liability company as Assignee, together with the <br />AMENDMENT TO ASSIGNMENT OF MINING LEASE (copies made by you on <br />07/28/14), this is to notify you that Western Fuels — Colorado, LLC is in default of its <br />obligations under the Mining Lease contract as a result of the terms and conditions <br />contained on Page 2., Paragraph 5., of the Mining Lease dated May 01, 1956 and <br />recorded with the Montrose County Recorder on April 14, 1959 at Reception No. <br />349355. <br />Please see attached Exhibit A, for the estimated amount due, which includes past due <br />royalties and interest (for interest allowed, refer to Colorado Revised Statutes, Title 5, <br />Article 12 (CRS 5 -12 -101 & CRS 5 -12 -102). <br />The remedies to cure this default, can be found on Page 4., Paragraph 12 of the May 01, <br />1956 Mining Lease. If you do not remedy the default within the allotted time, we will <br />take further action to protect our rights as allowed in the Mining Lease and by Law. All <br />our rights are reserved under this notice. <br />You may contact us if you have any questions. <br />Sinc , <br />oseAnne Guire <br />4/7, LLC <br />P.O. Box 550 <br />Nucla, CO 81424 <br />4slash7La)gmail.com <br />cc: Mr. David Berry (w /o Exhibit A) <br />Colorado Division of Reclamation, Mining and Safety (DRMS) <br />by email: david.berry@state.co.us <br />