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<br />'- ~" GRAVEL LEASE <br />This Lease i" s made and entered into as of the ~ da of 2002, b and <br />Y ~~~ Y <br />between Robert Corey and Lavelle Corey, Lessors and Western Grave , Lessee, witnesseth: <br />Lessors are the owners of certain real property located in Montrose County described on <br />Schedule "A" hereto attached. The said property holds a valuable deposit of gravel aggregate, <br />the type of material useful and necessary in the business of Lessee. Lessors desire to lease the <br />said property to Lessee to mine the gravel there located, and Lessee desires to lease the said <br />property upon the terms and conditions as herein stated. It is therefor agreed as follows: <br />1. Lessors hereby lease and remit unto Lessee the said property for a period of ten yeazs. <br />2. During the term of this Lease, or any extension thereof, as herein provided, Lessee <br />shall have the right to mine and purchase gavel aggregate from the said property, with associated <br />activities such as crushing and stockpiling. <br />3. Lessee agrees to pay to Lessors the sum of $0.50 per ton far gravel removed from the <br />said property. This rate may be renegotiated upon an annual basis as requested by Lessors, but <br />the rate shall not unreasonably exceed the prevailing rate in the geographical area for a similar <br />type of deposit. If the parties are unable to agree upon a rate, they shall each appoint an <br />arbitrator, and the appointed arbitrators will appoint a third arbitrator. Within thirty days <br />thereafter the arbitrators will establish a rate. If arbitration is required, the rate shall not be again <br />renegotiated for a period ofthree years. The fees ofthe arbitrators will be shared equally between <br />the parties. <br />4. All grave! aggregate will be paid for within ten days following the month of removal <br />from the property. An}~ gravel crushed and stored upon the property shall be paid for within ten <br />days following the month when the gravel is crushed and stored on the property, Gravel crushed <br />and stored on the property shall be paid for based upon the belt scale of the crusher. Gravel <br />aggregate removed or gravel crushed and removed without stockpiling for more than ten days will <br />be paid for based upon licensed scale weight. <br />5. Lessee shall have the responsibility to license the said property with the State of <br />Colorado and any other necessary authorities. The MLRB permit shall be obtained in the name of <br />Lessee. It is anticipated that Lessee will apply fora 112 permit, and that ail licensing expenses <br />shall be paid by Lessee. Lessee shall file necessary applications, and will process the applications <br />in a seasonable manner. All reclamation of the pit will be performed by Lessee as required by the <br />MLRB permit. The parties understand however that adjacent property has been previously <br />permitted and is in the process of reclamation by another company. Lessee shall not be obligated <br />Western Gravel, Inc. -Robert Corey Lease <br />Page 1 <br />