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09/26/08 09:28 FAX 970 946 9777 <br />09/26/2009 09:22 FAX 972 980 8420 <br />BATAA OIL <br />3dERIT SNSRGY CO <br />SURFACE USE AGItF~ZENT <br />~u~[iuru <br />This Surface Use Agreemem ("Agreemeat'~ is made this day of March, 2003, and <br />is among MERIT E1VLrRG~' COMPANY, a Delaware corpora[ian (` 1Vlerit°~, with an address of <br />13727 Noel Road, Spite 500, Dallas, Tx 75240, and iL4LLIRW,f/V CORPORATION <br />("Hall-lr~w~ln"), with as address of 3026 4th Ave., Greeley, Colorado 80631. Merit and HaU-Irwin <br />are sometimes jointly referred tv heroin as the "Parties." <br />A Hall-Irw'ia is the cna~ent owner of a sand, gravel and aggregate mining lease <br />covering a parcel of land located in the S/2 of SootioII 1, Township 4 North, Range <br />67 West of the 6a' P.M,, Weld County, Colorado ("Property', more particularly <br />described in Eadr~it A attached hereto and incorporated herein by this xefesence. <br />B. Srnface ov~nership is sabject to the rights of an oil and gas leasehold estate owned <br />by Merit, covering a portioa of the Property; <br />C. Hall-Irwin has submitted to the Stets of Colorado Division of Minerals ~ Geology <br />("DMG") its 112c Permit Application, File No. M-2002-120, for approval of <br />mining permits for a sand and gravel mining and processing operatioa known as the <br />`Bernhardt Resorace" ("M+n~ Pernrit'~, <br />D, Merit currently operates the oil and gas wells desenl~ed on Exhibit S attached <br />hereto and made a part hereof (the "Wells' on a portion of the Property. <br />E. This Agreemem sets forth the parries' rights and obligations regarding the <br />relationship betweea the mining and future development of the Property by <br />Hall-Trwin and Merit's operation of the Wells and development of its oil and gas <br />leasehold estate. <br />AGgF~'~riy~' <br />In consideration of the mutual oovenants contained herein„ and other good and valuable <br />consideration, the receipt sad sufficiency of which is hereby aclmowledged, the parties agree as <br />follows: <br />RESERVED OII, AND GA5 OPERATIONS AREAS, <br />a. Hall-Irwin shall provide Merit with a flat area amend each ofthe Wells (the "oil <br />and C}as Qperarions At+eas") as described on Exhibit C attached hereto for the <br />Wells and for any operations coaflucted by Merit ni cannectioa with the 'Wells , <br />Page 1 of 1Z <br />