2012-05-03_APPLICATION CORRESPONDENCE - C2010089 (2)

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Name of Operation — New Horizon Mine Violation No. — CV- 2010 -002 Date of Issuance — May 3, 2010 Name of Person Violation was issued to _.. Ross Gubka Violation Issuing Agency --- Colorado Division of Reclamation, Mining and Safety Reason for Issuance ---- Failure to use approved seed mix for the dry land pasture; failure to report the species planted during 2009 in the Annual Report; and failure to provide specific seed mix, seed tag, invoice or other comparable documents Current Status — WFC submitted the required information on the seed mix and document. WFC also submitted an application for minor revision committing to provide the required information on species in the Annual Reclamation report. WFC was assessed, and paid, a civil penalty of $500.00. Name of Operation — New Horizon Mine Violation No. — CV -2010 -003 Date of Issuance ...,. June 17, 2010 Name of Person Violation was issued to -- Ross Gubka Violation Issuing Agency — Colorado Division of Reclamation, Mining and Safety Reason. for Issuance — Failure to conduct sampling and analysis of re- distributed subsoil and topsoil in accordance with the approved permit Current Status — WFC submitted the required information on the subsoil and topsoil. WFC was assessed, and paid, a civil penalty of $1,200.00. 2.03.6 Right of Entry and Operation Information The area to be mined consists of three parcels located in the W %2 of Section 25, bounded by Montrose County Roads Z, 2600, AA, and 2650. The permit area also includes an equipment corridor connecting the NHN permit area to the New Horizon Mine permit area, crossing lands own by WFC 2.03.6 -1 Appendix 2.03.6 -1(a) through 2.03.6 -1(f) at the end of this section give the following information to evidence right of entry for mining: Appendix 2.03.6 -1(a). Memorandum of Surface Lease and Purchase Agreement dated August 7, 2009 between Garvey & Co., a Colorado General Partnership and Western Fuels - Colorado, a Limited Liability Company. The lease pertains to the surface at SWI /4, Section 25, T47N, R16W, NMPM. The lease gives WFC right to enter and mine the property. Garvey & Co. has subsequently changed the name to Garvey & Co. LLC. A letter informing of the change is attached behind the lease agreement. 2. Appendix 2.03.6 -1(b). This Appendix includes two documents; (1) Memorandum of Escrow Purchase Agreement dated June 27, 1978 between Donald J. Rice and Marianna Rice ( "Sellers ") and Peabody Coal Company Section 2.03 Page 11 November 2011