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ebster Sand & Gravel <br />145 S. Toledo <br />~iYl- <br />/ 9~/- z35 <br />Leadville, CO 80461 <br />(719) 486-0427 <br />E~(~iVED <br />Attenfion: Erica Crosby <br />Division Of Minerals And Geology FEB 0 9 2006 <br />Department of Natural Resources <br />1313 Sherman St., Room215 Dimsion of Minerals and Geology <br />Denver, Colorado 80203 <br />January 26, 2006 <br />Re: Request of an Extension of Deadline for Warranty Letter of Credit t/ S~ ~~ ~ <br />Deaz Erica: <br />As we discussed in our phone conversation earlier today, I would Tike to request an extension of the <br />deadline for our bond increase to cover future reclamation. The reason for this request is due to <br />unexpected problems with our bank in Leadville (Peoples Bank), which holds the current letter of credit <br />for $33,500.00. My grandfather who started the business in 1946 had done his banking business with <br />them as had my dad done his whole life. My dad had used the same piece of equipment as collateral the <br />entire time he had his warranty letter of credit. The past couple of years we had been working with <br />Willie Bologh who I believe was a vice president at the bank in charge of loans. During the last year and <br />a half, we were told that the bank had a problem with writing a letter of credit for the original increase of <br />over $358,000.00. However, last summer Keith Moffett, the president of Peoples Bank told my step- <br />mother, Lydia (also co-representative of the estate), that as long as we could get the amount of the bond <br />lowered, he did not see a problem issuing a new letter of credit. On December 30`", I found out that <br />Willie Bologh was resigning and we would be dealing with Mr. Moffett on our renewal. Approximately <br />two weeks ago, he informed us that the only way he would issue the letter of credit was if we put up all <br />of the land and both Lydia and I personally guarantee the loan. We had not signed personal guarantees <br />for the $33,500.00 warranty bond; we signed as co-representatives of the Charles J. Webster Estate. We <br />feel that our equipment, valued at over five times the required bond amount should have been satisfactory <br />collateral. Also, we have registered the business as an LLC and will be operating as such as soon as the <br />trusts which own the LLC are fully funded. Our attorneys have told us not to personally sign as this may <br />legally undo the LLC. <br />We are currently working with Wells Fargo bank on getting the letter of credit. They do not seem to <br />have a problem with using our equipment for collateral but we are working on the personal guarantees <br />which they may require. Another option for us is to liquidate some equipment and set up the bond as a <br />certificate of deposit. In either case we will need more time. l had mentioned to you an extension of the <br />deadline to April 1, 2006. Our current bond will expire on April 19,2006. I would like to request the <br />deadline of April 19, 2006. This will give us time to sell some equipment if necessary. As you know <br />from last year, the amount of snowfall in Leadville does not allow us to mine sand and gravel until the <br />middle of May. We only sell out of our stockpiles during the winter. If you have any questions, please <br />give me a call. I appreciate all of your help in this matter. <br />Bess Regards, <br />PJa Web~r <br />