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<br />Le[ter to Chris Freeman 2 June 23.2000 <br />Bondine to be Held by BLM <br />If American Soda will be taking advantage of the bonding option provided by Rule 4?.1(8}, the minimum <br />amount of bond to be held by the Colorado Mined Land Reclamation Board is $210,424.00, which covers the <br />State's cost for reclamation management and administration after a bond forfeiture. This amount of bond must <br />be submitted and accepted by the DMG prior to any drilling of commercial phase solution mining wells. This <br />bond may be provided as a rider to the existing $26,000.00 Corporate Surety held by the Board, or may be <br />submitted as a replacement bond. Anew Corporate Surety form is enclosed for your use if a replacement bond it <br />[o be submitted. <br />!n addition, American Soda must provide documentation that the remaining required bond in the amount of <br />$4,208,482.00 has been posted and accepted by BLM. If BLM requires a lease bond and a production bond, the <br />amount of these bonds is in addition to the $4,208,482.00 reclamation bond. The documentation that BLM has <br />the bond should be a document signed by BLM personnel stating the amount of bond posted, the amount <br />dedicated to the lease and production bonds, and the dates when the bond was posted and accepted. A letter from <br />American Soda stating that a bond has been posted with BLM is not acceptable. <br />In order to post the bulk of the bond with BLM under Rule 4.2.1(8), a permit commitment must be in place <br />stating that American Soda will not accept bond release from BLM without prior DMG approval. To meet this <br />requirement, DMG suggests that a notarized letter be prepared with the following statement: <br />In the event that the Bureau of Land Management (BLM) makes a decision to reduce or release the <br />Financial Warranty held for the Yankee Gulch Sodium Minerals Project, American Soda, LLC (the <br />Operator) or their successor will post an acceptable replacement Warranty with the Colorado Mined <br />Land Reclamation Board (Board) prior to any release or reduction action by the BLM. The replacement <br />Financial Warranty posted with the Board will be in an amount equal to the amount to be released by <br />BLM unless the Board or the Division of Minerals and Geology conducts an inspection of the Yankee <br />Gulch Project permit area and issues a finding of concurrence or partial concurtence with the Financial <br />Warranty release or reduction decision of the BLM. <br />This statement must be on American Soda letterhead and signed by a person authorized to bind the Company to <br />the commitments contained therein. <br />If you have any questions, please contact me. <br />Sincer <br />Allen C. Sorens~ <br />Reclamation Specialist <br />enclosure(s) <br />ce: Paul Dagge[t, BLM (w/enclosures) <br />c:\windows\personal\nmencan soda bond.doc <br />