2007-09-07_REVISION - M2002094 (3)

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. _2- WHEREAS, in the application for the pemtit, the Operator has agreed with the Boazd to provide for reclamation of the Affected Lands that are now, or may become, subject to the permit, as required by law WHEREAS, the Boazd has determined, in accordance with the Act, that the estimated costs ofreclamation of the Affected Lands are those amounts for the stated periods of time as set forth herein. Said amount maybe amended from time to time to reflect revised estimates of said costs of reclamation. WHEREAS, the Operator, in accordance with the Act, has promised and herebypromtses the Boazd that it will be responsible far all the estimated costs of reclamation with regard to the Affected Lands. WHEREAS, the Board has determined that the Financial Warranty by the Operator equals the estimated costs of reclamation, as approved by the $oazd, with regard to the Affected Lands. WHEREAS, as proof of its financial responsibility. the Operator has proceeded pursuant to Section 34-32-117(3xa)(III) of the Act and has caused the WestStar _ Bank of Norwood ,State of Colorado (the'Bank") to issue a Certificate of Deposit, No. 6026636 ,dated November 16 , 20_04 `~ payable to the Board in the amount of five thousand Dollars ($ 5,000 )for the life of the mine or the period from through ,and has delivereditto the State, to be held by the State as proof of the Operator's financial responsibility under this Financial Warranty. The Bank is not a party to this agreement. Its obligations are set forth in its Certificate of Deposit. Nothing frr this Financial Warranty diminishes or qualifies the Bank's obligations under its Certificate of Deposit. NO W, THEREFORE, the Operator is held hereby firmly unto the State of Colorado in the amount ofthose sums for those periods of time as sei forth herein, until this Financial Warranty is amended or released in accordance with applicable law. The Board may, for good cause shown, increase or decrease the amount and duration of this Financial Warranty. The Operator shall have sixty (60) days after the date of rotice of any such adjustment to fulfill all new requirements. The Operator shall notify the Board immediately of any event which may impair this Financial Warranty. If the Board receives such notice, or otherwise has reason to believe that this Financial Warranty has been materially impaired, it may convene a heating in accordance with the Act for the purpose of determining whether impairment has occwred. The obligation of the Bank shall continue until released in writing by the Board in accordance with applicable laws specifying Financial Warranty release procedures. The Boazd may present for payment any Certificate of Deposit held hereunder and convert the same to cash if the Board determines that reclamation which ought to have been performed by the Operator, or its successors or assigns, remuns unperformed. No other condition precedent need be fulfilled to entitle the Boazd to receive the amount of any such Certificate. However, if, upon completion of such reclamation by the Board, the cost ofreclamation shall be less than the amount received from the Bank, the excess shall be promptly refunded to the Operator. The obligation of the Operator shall continue until the Boazd has released this Financial Warranty, or has ordered it forfeited in accordance with applicable provisions of the Act. It is understood that periods of years may necessarily be required before determination can be made that reclamation of the Affected Lands has been satisfactorily completed. It is also recognized that, as reclamation is accomplished, the amount of this Financial Warranty maybe reduced with the approval of the Boazd so that it reflects the then current estimated cost of the remaining reclamation ofthe Affected Lands. No revision, extension, or renewal of the permit or of the time allowed to complete reclamation shall diminish the Operator's obligation under this Financial Warranty. In any single year duringthe life of thepermit, the amount oftheFinancial Warranty shallnot exccedthe estimated cost of fully reclaiming al] lands to be affected in said year, plus all lands affected in previous permit years and not yet fully