Abandonment Letter

1505 Whalebone Drive

Kalispell, MT  59901

Linda McCulloch, Secretary of State

P.O. Box 202801

Helena, MT 59620

December 17, 2009

Dear Ms. McCulloch:

Our family currently holds Lease #3060352 at Lot 6 Placid Lake and that land has been in our family’s care since the 1940’s.  We are extremely disappointed by your recent action changing the fee structure for leases, but still not basing the fees on fair market value for like properties. Your action will result in exponentially increasing lease fees that are neither legitimate nor reasonable. We believe the fees should be based on fair/full market value for LEASED property.  This could be achieved by determining the values compared to other leased properties or by putting the properties up for bid when the lease comes available. Not only will we not be able to afford the increased rates over time, we believe this rate does not represent a fair value for what we receive.  Therefore, we are submitting this “Conditional Abandonment Notice”.

In the event the future lease payments due from this lessee are not suspended, revised or reduced or in the event that the DNRC imposes fees based upon Alternative 3 B as presented to the Land Board at their meeting on October 19, 2009 and approved for the commencement of rule making, we provide this notice that the lessee signatory to this Notice intends to abandon their state lease with the Department of Natural Resources and Conservation of the State of Montana.

We will continue to attempt to make lease payments, under protest, for the upcoming two year period and will remain lessees for all occupancy purposes. We will attempt to sell the leasehold interest and improvements during the next two years, after which time, if the lease payments remain as expressed above, we will physically abandon the lease, retaining all rights to pursue all legal remedies should we not be compensated for our improvements through sale of the leasehold interest and improvements at market value.

Sincerely,

Ron and Merna Terry