20210226_Modification Bond Request 47-16_all

ROY COOPER
Governor
MICHAEL S.REGAN
Secretary
Q AM VIOL
BRIAN WRENN NORTH CAROLINA
Director Environmental Quality
February 26, 2021
Certified Mail
Return Receipt Requested
7019 1120 0000 5072 4632
Mr. John A. Lindsay
401 Sand Company LLC.
PO Box 122
Raeford,North Carolina 28376
RE: A&H Mine
Mining Permit No. 47-16
Hoke County
Cape Fear River Basin
Dear Mr. Lindsay:
Your application for a modification of the above referenced mining permit,has been reviewed but not yet approved,
as we have not received the required surety in an amount sufficient to cover the present operation.
The reclamation bond has been calculated for this site using the information submitted in the application (see
enclosed worksheet). The bond amount for this site is$741,300.00. The calculation worksheet is enclosed for your
review and the new bond will be required before the permit can be issued. In addition,a review of your company's
reclamation bond file indicates that your company is not bonded sufficiently. The required bonds are as follows:
' 1 PELN R111 '
26-26 401 Mine $252,300
47-13 McNeil Mine $159,200
47-16 $741,300
Total $1,152,800
Currently, a maximum bond amount for operators in good standing with the Department is $1,000,000.00. You
must immediately increase your bond total to $1,000,000.00. Failure to do so may result in permit revocation and
bond forfeiture of your company's permitted mine sites.
For your convenience, I have enclosed a bond form, an assignment of a savings account form and an irrevocable
standby letter of credit form. The name on the security form must be the same as the name appearing on the permit,
i.e., 401 Sand Company LLC. In addition to one of these alternatives you may, upon request, substitute a cash
deposit.
Please review the reclamation bond worksheet and contact this office should you have any objections or questions
concerning the permit conditions. G.S. §74-51 provides that the operator has sixty(60)days following the mailing
of a notice of the required bond in which to file the required surety.
Q E Q2� North Carolina Department of Environmental Quality I Division of Energy.Mineral and Land Resources
512 North Salisbury Street 1 1612 Mail Service Center I Raleigh,North Carolina 27699-1612
919.707.9200

Certified Mail
Mr. Lindsay
Page 2
The permit cannot be issued until the required security has been received. No mining may be conducted until the
permit is issued. G.S. §74-65 states that the issuance of a mining permit does not supersede or otherwise affect or
prevent the enforcement of any zoning regulation or ordinance duly adopted by an incorporated city or county or
by any agency or department of the State of North Carolina.
Again, if you should have any questions on this matter please contact me,at(919) 707-9220.
Sincerely,
14da m,/"z"t
Adam Parr
Assistant State Mining Engineer
Enclosures
cc: Mr. Tim LaBounty,PE

E.DETERMINATION OF AFFECTED ACREAGE AND BOND 47-16-A&H Mine
The following bond calculation worksheet is to be used to establish an appropriate bond(based upon a range of$500 to$5,000 per affected acre)
for each permitted mine site based upon the acreage approved by the Department to be affected during the life of the mining permit. Please insert
the approximate acreage,for each affect the mining aeration,that intend to a ect during the lie-fthis mining ep rmit in addition. Ip ease
insert the appropriate reclamation cost/acres each category from the Schedule Reclamation Costs provided with this lication form)OR you
can defer to the Department to calculate your bond for you based upon your maps and standard reclamation costs:
AFFECTED
CATEGORY ACREAGE RECLAMATION COST/ACRE RECLAMATION COST
Tailings/Sediment Ponds 5.90 Ac. X $ 1,500 /Ac. _ $ 8,850.00
Stockpiles 0.00 Ac. X $ 1,800 /Ac. _ $ -
Wastepiles 12.70 Ac. X $ 2,000 /Ac. _ $ 25,400.00
Processing Area/Haul Roads 7.20 Ac. X $ 1,800 /Ac. _ $ 12,960.00
Mine Excavation 223.50 Ac. X $ 2,000 /Ac. _ $ 447,000.00
Other X = $ -
TOTAL AFFECTED AC.: 249.30 Ae.
TOTAL PERMITTED AC.: 324.70 Ae.
Temporary&Permanent Sedimentation&Erosion Control Measures:
Divide the TOTAL AFFECTED AC. above into the following two categories: a) affected acres that drain into proposed/existing
excavation and/or b) affected acres that will be graded for positive drainage where measures will be needed to prevent offsite
sedimentation and sedimentation to onsite watercourses and wetlands.
a)Internal Drainage 249.30 Ac.
b)Positive Drainage 0.00 Ac. X $ 1,500.00 = $ -
SUBTOTAL COST: $ 494,210.00
Inflation Factor
0.02 X SUBTOTAL COST: $ 9,884.20 X Permit Life Provided by Applicant(Life of the Mining Operation or
Life of Lease from Public Entity(in Years)): 25
INFLATION COST: $ 247,105.00
SUBTOTAL COST+INFLATION COST: $ 741,315.00
Total Reclamation Bond Cost: $ 741,300.00
(round down to the nearest$100.00)
(NOTE: The reclamation bond cannot exceed$1 million per GS 74-54)

E.DETERMINATION OF AFFECTED ACREAGE AND BOND 26-26-401 Mine
The following bond calculation worksheet is to be used to establish an appropriate bond(based upon a range of$500 to$5,000 per affected acre)
for each permitted mine site based upon the acreage approved by the Department to be affected during the life of the mining permit. Please insert
the approximate acreage,for each affect the mining aeration,that intend to a ect during the lie-fthis mining ep rmit in addition. Ip ease
insert the appropriate reclamation cost/acres each category from the Schedule Reclamation Costs provided with this lication form)OR you
can defer to the Department to calculate your bond for you based upon your maps and standard reclamation costs:
AFFECTED
CATEGORY ACREAGE RECLAMATION COST/ACRE RECLAMATION COST
Tailings/Sediment Ponds 0.00 Ac. X $ 1,500 /Ac. _ $
Stockpiles X $ 1,800 /Ac. _ $ -
Wastepiles 10.50 Ac. X $ 2,000 /Ac. _ $ 21,000.00
Processing Area/Haul Roads 2.00 Ac. X $ 1,800 /Ac. _ $ 3,600.00
Mine Excavation 92.85 Ac. X $ 2,000 /Ac. _ $ 185,700.00
Other X = $ -
TOTAL AFFECTED AC.: 105.35 Ac.
TOTAL PERMITTED AC.: 110.80 Ae.
Temporary&Permanent Sedimentation&Erosion Control Measures:
Divide the TOTAL AFFECTED AC. above into the following two categories: a) affected acres that drain into proposed/existing
excavation and/or b) affected acres that will be graded for positive drainage where measures will be needed to prevent offsite
sedimentation and sedimentation to onsite watercourses and wetlands.
a)Internal Drainage 105.35 Ac.
b)Positive Drainage X $ 1,500.00 = $ -
SUBTOTAL COST: $ 210,300.00
Inflation Factor
0.02 X SUBTOTAL COST: $ 4,206.00 X Permit Life Provided by Applicant(Life of the Mining Operation or
Life of Lease from Public Entity(in Years)): 10
INFLATION COST: $ 42,060.00
SUBTOTAL COST+INFLATION COST: $ 252,360.00
Total Reclamation Bond Cost: $ 2529300.00
(round down to the nearest$100.00)
(NOTE: The reclamation bond cannot exceed$1 million per GS 74-54)

E.DETERMINATION OF AFFECTED ACREAGE AND BOND 47-13-McNeil Mine
The following bond calculation worksheet is to be used to establish an appropriate bond(based upon a range of$500 to$5,000 per affected acre)
for each permitted mine site based upon the acreage approved by the Department to be affected during the life of the mining permit. Please insert
the approximate acreage,for each affect the mining aeration,that intend to a ect during the lie-fthis mining ep rmit in addition. Ip ease
insert the appropriate reclamation cost/acres each category from the Schedule Reclamation Costs provided with this lication form)OR you
can defer to the Department to calculate your bond for you based upon your maps and standard reclamation costs:
AFFECTED
CATEGORY ACREAGE RECLAMATION COST/ACRE RECLAMATION COST
Tailings/Sediment Ponds 0.25 Ac. X $ 1,500 /Ac. _ $ 375.00
Stockpiles 0.50 Ac. X $ 1,800 /Ac. _ $ 900.00
Wastepiles X $ 2,000 /Ac. _ $ -
Processing Area/Haul Roads 3.00 Ac. X $ 1,800 /Ac. _ $ 5,400.00
Mine Excavation 63.00 Ac. X $ 2,000 /Ac. _ $ 126,000.00
Other X = $ -
TOTAL AFFECTED AC.: 66.75 Ac.
TOTAL PERMITTED AC.: 66.75 Ae.
Temporary&Permanent Sedimentation&Erosion Control Measures:
Divide the TOTAL AFFECTED AC. above into the following two categories: a) affected acres that drain into proposed/existing
excavation and/or b) affected acres that will be graded for positive drainage where measures will be needed to prevent offsite
sedimentation and sedimentation to onsite watercourses and wetlands.
a)Internal Drainage 66.75 Ac.
b)Positive Drainage X $ 1,500.00 = $ -
SUBTOTAL COST: $ 132,675.00
Inflation Factor
0.02 X SUBTOTAL COST: $ 2,653.50 X Permit Life Provided by Applicant(Life of the Mining Operation or
Life of Lease from Public Entity(in Years)): 10
INFLATION COST: $ 26,535.00
SUBTOTAL COST+INFLATION COST: $ 159,210.00
Total Reclamation Bond Cost: $ 1599200.00
(round down to the nearest$100.00)
(NOTE: The reclamation bond cannot exceed$1 million per GS 74-54)

ASSIGNMENT OF SAVINGS ACCOUNT
This Assignment, made and entered into the day of , 20_7 by
and between of
(applicant) (address)
City of , County of State of
North Carolina and the North Carolina Department of Environmental Quality; and
WHEREAS, The undersigned
(applicant)
(hereinafter referred to as "Operator") is desirous of engaging in mining operations in the State of
North Carolina and such mining operations are subject to the provisions of the Mining Act of 1971,
Article 7, Chapter 74 of the General Statutes of North Carolina; and
WHEREAS, NCGS 74-50 requires that mine operators obtain a permit from the Department
of Environmental Quality (hereinafter referred to as "Department") before engaging in mining
operations, and NCGS 74-54 requires that a surety bond in favor of the State be maintained or
other security be filed with the Department, in connection
with said permit; and
WHEREAS, Operator has a savings account in
(bank name)
at , City of , County of
(address)
State of North Carolina, Savings Account No. ;
and
WHEREAS, NCGS 74-54 authorizes the Department to accept from Operator an
assignment of a savings account in a North Carolina bank, in lieu of a surety bond;
NOW, THEREFORE, in consideration of the premises and the Department accepting an
assignment of said savings account in lieu of a surety bond, the undersigned Operator does
hereby sell, assign, transfer, set over to the Department of Environmental Quality
dollars ($ ) of the sums on
(dollar amount written)
deposit in his name in , City of
(bank name)
County of , State of North Carolina, Savings Account No.
and further authorizes
(bank name)
to pay over to the Department of Environmental Quality the above sum of
dollars ($ )
(dollar amount written)
out of the above money deposit in the above account in his name.
Rev. Oct. 2017

The condition of the foregoing assignment is that if the assignor Operator conducts the
mining operations faithfully, honestly, and lawfully and in compliance with the requirements of the
Mining Act of 1971 and applicable Rules and Regulations adopted pursuant thereto, then this
assignment shall be null and void; otherwise it shall remain in full force and effect. Compliance with
the requirement of the Mining Act of 1971 and applicable Rules and Regulations shall be
determined by the Department.
This assignment is made and the
(passbook, deposit book, etc.)
is to be held by the Department as collateral security for all direct or indirect liabilities of the
assignor Operator to the assignee Department that may arise by reason of the Mining Act 1971,
Article 7, Chapter 74 of the General Statutes of North Carolina.
This assignment shall be direct authorization to
(bank name)
to pay said sum to Department on demand by Department.
(Signature of Applicant)
Sworn to before me this
day of , 20_
Notary Public
My Commission Expires
(Affix Seal)
ACKNOWLEDGEMENT BY BANK
The foregoing Assignment of Savings Account is hereby acknowledged this _ day of
, 20_. It is further acknowledged that funds in the above mentioned
account shall not be disbursed except to the assignee, Department of EQ while the assignment
remains in effect.
This the day of , 20_ by
(authorized agent for bank)
(mailing address of bank)
Sworn to before me this day of , 20
Notary Public
My Commission Expires
(Affix Seal)
PLEASE MAIL THIS FORM AND THE ATTACHED INSTRUMENT TO THE FOLLOWING
ADDRESS:
Division of Energy, Mineral and Land Resources
1612 Mail Service Center
Raleigh, NC 27699-1612
Rev. Oct. 2017

IRREVOCABLE STANDBY LETTER OF CREDIT
LETTER OF CREDIT NO.:
EFFECTIVE DATE:
AMOUNT:
ISSUING INSTITUTION:
Name
Address
City State Zip Code
County
BENEFICIARY:
State of North Carolina
Department of Environmental Quality
1612 Mail Service Center
Raleigh, North Carolina 27699-1612
APPLICANT/OPERATOR:
Name
Address
City State Zip Code
County
Rev. February 2018 Page 1

Dear Sir or Madam:
(1) The APPLICANT/OPERATOR desires to engage in mining operations within the State of
North Carolina, under the provisions of the Mining Act of 1971, N.C. General Statute 74-46, et seq.,
and the administrative rules promulgated there under.
(2) N.C. General Statute �174-50 requires that operators engaged in mining shall first obtain
an operating permit from the N. C. Department of Environmental Quality ("DEQ") which covers the
affected land and which has not terminated, been revoked, been suspended for the period in
question, or otherwise become invalid. N.C. General Statute 074-54 requires that each applicant for
an operating permit, or for the renewal thereof, shall file with DEQ, and shall thereafter maintain in
force, a bond in favor of the State of North Carolina in an amount as prescribed by Title 15A N.C.
Administrative Code Subchapter 5B. 0003. N.C. General Statute 174-54 further provides that in lieu
of the surety bond, an applicant or operator may file with DEQ a cash deposit, negotiable securities,
or an assignment of a savings account in a North Carolina bank.
(3) Thus, this IRREVOCABLE STANDBY LETTER OF CREDIT is issued to DEQ, in lieu of
the surety bond required to be filed by the APPLICANT/OPERATOR, as provided by N.C. General
Statute 74-54.
(4) The undersigned hereby establishes its IRREVOCABLE STANDBY LETTER OF CREDIT
in favor of DEQ, for the account of:
(APPLICANT/OPERATOR)
for the amount of dollars and no
100's ($ ), available by DEQ's draft(s) drawn on sight.
(5) This IRREVOCABLE STANDBY LETTER OF CREDIT shall expire
on
(date at least one (1) year from effective date)
The expiration date shall be extended automatically for a period
of on and
(one year or more) (expiration date)
on each successive expiration date, unless, at least sixty (60) days prior to the expiration date, the
undersigned notifies DEQ and the OPERATOR by certified mail, return receipt requested that the
undersigned will not extend this letter of credit beyond the current expiration date. If the undersigned
Rev. February 2018 Page 2

notifies DEQ that this letter of credit will not be extended, any unused portion of the credit shall be
available upon presentation of DEQ's sight draft within sixty (60) days after DEQ's or the
OPERATOR'S receipt of such notification, whichever is later.
(6) This IRREVOCABLE STANDBY LETTER OF CREDIT is non-transferable.
(7) Draft(s) shall be marked "Drawn Under
Credit No. "
(Issuing Institution)
and shall include the following documentation:
(a) A signed certificate by DEQ, referring to the effective date and Number of this
IRREVOCABLE STANDBY LETTER OF CREDIT, and stating that:
"In accordance with N. C. Gen. Stat. 174-59, we have received a notice of forfeiture
of part or all of the Bond Amount. The amount of our drawing does not exceed the
amount of the forfeiture as set forth in such notice.";
-or-
(b) A signed certificate by DEQ, referring to the effective date and Number of this
IRREVOCABLE STANDBY LETTER OF CREDIT, and stating that:
"We have received from (Issuing
Institution)
written notice stating (1)that this IRREVOCABLE STANDBY LETTER OF CREDIT
has not been renewed; and, (2)that the amount of our drawing does not exceed the
Bond Amount, less any previous forfeitures thereunder, pursuant to notices received
in accordance with N.C. General Statute -174-59.";
-or-
(c) A signed certificate by DEQ, referring to the effective date and Number of this
IRREVOCABLE STANDBY LETTER OF CREDIT, and stating that:
"We have received from (Issuing
Institution)
written notice stating (1) that there exists an Event of Default under the Credit
Agreement (as defined in the IRREVOCABLE STANDBY LETTER OF CREDIT); (2)
that a drawing should be made under this IRREVOCABLE STANDBY LETTER OF
CREDIT; and, (3)that the amount of the drawing does not exceed the bond amount,
Rev. February 2018 Page 3

less any previous forfeitures there under, pursuant to notices received in
accordance with N.C. General Statute 1174-59."
(8) This IRREVOCABLE STANDBY LETTER OF CREDIT is subject to the Uniform Customs
and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication
No. 600 and the laws of the State of North Carolina. In the event of any conflict, the laws of the State of
North Carolina will control.
(9) hereby agrees
(Issuing Institution)
with the drawers, endorsers, and bona fide holders that all drafts drawn under and in compliance with the
terms of this IRREVOCABLE STANDBY LETTER OF CREDIT will be duly honored upon presentation to
this bank/issuing institution.
Very truly yours,
(Issuing Institution)
BY:
TITLE:
DATE:
Sworn and subscribed to before me this
the day of 120
Notary Public
My Commission Expires: (Seal)
Date
"PLEASE MAIL THIS FORM TO:
LAND QUALITY SECTION, 1612 Mail Service Center, Raleigh, NC 27699-1612
Rev. February 2018 Page 4

STATE OF NORTH CAROLINA
DEPARTMENT OF ENVIRONMENTAL QUALITY
Land Quality Section
Bond Pursuant to "The Mining Act of 1971"
(G.S. 74-46 through G.S. 74-68)
KNOW ALL MEN BY THESE PRESENTS, that
a and having its principal office at
in the State of , as principal, and
a corporation organized under the laws of the State of and duly authorized bythe
Insurance Commissioner of North Carolina to do business in North Carolina, with an office located at
, in the City of North Carolina, as surety, are held and firmly bound
unto the State of North Carolina in the sum of Bond No.
lawful money of the United States of America, to the payment of which will and truly be made, we bind
ourselves, our heirs, administrators and successors jointly and severally, firmly by these presents.
Signed, sealed and delivered this day of , 20_
THE CONDITIONS OF THIS BOND ARE SUCH, That Whereas, the said
conducts or will conduct mining operations in North Carolina as described in the application for an operating
permit which includes a Reclamation Plan as provided in G.S. 74-53 and has obtained approval of this
application on the day of 20 , from the Department of Environmental Quality.
Rev. Dec 2006

NOW THEREFORE, if the said
shall comply with the requirements set forth in "The Mining Act of 1971"(G.S. 74-46 through 74-68)and with
the rules and regulations adopted pursuant thereto and faithfully perform all obligations under his approved
Reclamation Plan then this obligation shall be null and void; otherwise to be and remain in full force and
effect until released by the Department of Environmental Quality in accordance with G.S.74-56 or canceled
by the surety. Cancellation by the surety shall be effectuated only upon 60 days written notice thereof to the
Department of Environmental Quality and the operator as provided in G.S. 74-54.
ATTEST:
Secretary or Principal
Assistant Secretary
( Attach ) By
( Corporate Seal ) President, Vice President,
( here of Corporation ) Partners, or Owner
S u rety
Countersigned at North Carolina
By:
Resident Agent of NC Agent and Attorney in Fact
*PLEASE MAIL THIS FORM AND THE ATTACHED INSTRUMENT
TO THE FOLLOWING ADDRESS:
LAND QUALITY SECTION
1612 MAIL SERVICE CENTER
RALEIGH, NC 27699
Page 2 of 2
Rev. Dec 2006