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<br />MINING LEASE FOR "CENTRAL" KOENIG PROPERTY FOR SAND GRAVEL AND AGGREGATE
<br />THIS LEASE made the 13°i day of October, 1998 between GROUND WATER MANAGEMENT
<br />SUBDISTRICT OF THE CENTRAL COLORADO WATER CONSERVANCY DISTRICT, hereinafter referred
<br />to as "CENTRAL," and BOARD OF COUNTY COMMISSIONERS OF WELD COUNTY, COLORADO, a
<br />body corporate and politic operating pursuant to the laws of the State of Colorado and the Weld County Home
<br />Rule Charter, doing business at 915 Tenth Street, City of Greeley, County of Weld, State of Colorado,
<br />hereinafter referred to as "COUNTY." CENTRAL, in consideration of the Agreement set forth herein to be kept
<br />and performed by COUNTY, and in furtherance of the of agreement of July 6, 1998 as provided herein, and
<br />subject to the terns, conditions, and provisions, contained herein, leases to COUNTY that certain tract of land
<br />situated in Weld County, State of Colorado, which is particularly described in Exhibit "A" attached hereto and
<br />made a part hereof, for the purposes of mining, removing, processing, storing, and marketing therefrom all
<br />sand, gravel, and aggregate, all of which are herein referred to as materials.
<br />TERM OF LEASE =Weld County agrees that it will complete mining of the Koenig Pit, so that a
<br />minimum 900 acre foot space is available far storage of water by CENTRAL, no later than September
<br />30, 2011. In the event Weld County is unable to completely excavate the Koenig Pit by this date, it
<br />may obtain a five year extension by written notice to CENTRAL before the expiration of the term.
<br />Weld County shall be entitled to a total of three such five-year extensions. If Weld County does not
<br />excavate the pit fully by September 30, 2011, or any extensions taken by Weld County, CENTRAL
<br />shall have the right io pursue any remedies available to it by law to enforce the terms of this
<br />agreement, and CENTRAL shall have all right, title and interest in and to the sand, gravel and
<br />aggregate on the property. Nothing in this lease shall be interpreted to preclude COUNTY from
<br />excavating in excess of 900 acre feet within the term of the lease as it may be eMended
<br />2. CONSIDERATION -Consideration for this lease in hand paid is hereby acknowledged in the form of
<br />the mutual obligations contained in INTERGOVERNMENTAL AGREEMENT, dated July 6, 1998 by
<br />and between Weld County by and through its Board of County Commissioners hereinafter
<br />refered to as "Weld County," and the Ground Water Management Subdistrict of the Central Colorado
<br />Water Conservancy District.
<br />3. SURFACE RIGHTS OF COUNTY -COUNTY may clear brush, trees, undergrowth, fences internal
<br />to the property, corrals, and other improvements, as may be reasonably necessary to explore for
<br />materials or to locate pits and stockpile in processing areas and in order to obtain access to these
<br />premises, and to tarty on its operations hereunder. COUNTY shall have the right to make use of all
<br />roadways presently existing on. the leased premises, and shall have the further right to build such
<br />additional roads as may be necessary for the production and removal of materials hereunder subject
<br />to a limitation as to the point at which COUNTY may cross the slurry wall as described in paragraph
<br />2 of the July 6, 1998 Agreement. In building such roads, COUNTY may use materials from the teased
<br />area, and shall not be required to pay any royalties for materials so used. COUNTY may maintain and
<br />operate rock crushing and screening equipment on the leased premises, if it should so desire, to
<br />process materials thereon. This right shall not include the right to operate or maintain any concrete
<br />or asphalt batch plant on the premises. COUNTY may, subject to the provisions contained herein,
<br />also erect such buildings and install such machinery and equipment as my be useful in connection
<br />with its operations hereunder.
<br />4. Weld County owns 60 shares of the Lupton Meadows Ditch Company that will be transferred to
<br />CENTRAL at dosing. Once the slurry wall liner is complete, there will be no evaporation
<br />augmentation obligation from the pit, but there may be some obligation until that time. CENTRAL
<br />agrees to assume all obligation for augmentation from the Koenig Pit after October 13, 1998. After
<br />the slung wall liner is complete, the2 may still be augmentation obligation associated with water used
<br />in the mining operation for redamation, gravel washing, dust suppression, and by exporting the gravel
<br />F:NCIM\CCWC\KOENIG\CENGRAV. WPD
<br />Mining Lease, Page 1 of 5
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