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MONADNOCK MINERAL SERVICES <br />Professional Geologists /Land Surveyors <br />P.O. Box 85-342 7`~ Ave. <br />Ouray, CO 81427 <br />Phone/Fax (970) 325-4600 <br />August 23, 2007 <br />Mined Land Reclamation Division <br />13 ] 3 Sherman Street, Room 215 <br />Denver, CO 80203 <br />RE: Permit No. M-91-146 <br />Operation Name: SAKO Pit (formerly ZMK Gravel Pit) <br />Anniversary Date: August 27 <br />Dear Sirs: <br />The enclosed is to satisfy the Annua] Report requirements for the Permit No. <br />M-91-146 for the ZMK Gravel Pit. <br />ANNUAL REPORT INCLUSIONS 1.15(1) <br />110(2) Annual Repor[ Form <br />Topographic Plan Map showing 6,59 acres of area that was disturbed this past <br />yeaz. <br />ANNUAL REPORT INCLUSIONS 1.15(1) (A) <br />The Financial Warranty $3750 is in affect as of this date. <br />ANNUAL REPORT INCLUSIONS 1.15(1) (C) <br />Monthly Water Well measurements as requested in stipulation No. 03 of the <br />Permit No. M-91-146 are attached. <br />ANNUAL REPORT INCLUSIONS 1.15(3) <br />The estimated material extraction for this annual report is 16,087.5 tons. This is <br />all of the material extracted. <br />TECHNICAL REVISIONS: <br />1. Baseline Channel Geometry Data is shown on the attached River Channel <br />Profiles Map. Location of the profiles is shown on the enclosed Topographic Plan Map. <br />