Common use of Purchase Price Reset Clause in Contracts

Purchase Price Reset. Effective January 1, 2019, the parties shall reset the Tier 1 and Tier 2 Purchase Prices based on Seller's actual mining costs for the prior year. Seller's mining costs shall be determined using generally accepted accounting principles consistently applied and shall be allocated in a manner consistent with the components and allocations used to generate Seller's mining costs shown on Exhibit F, unless otherwise agreed in writing by the Parties. Seller shall provide its mining costs for the calendar year 2018 to Buyer on or before January 15, 2019. The total actual mining costs shall be divided by actual tons sold by the Mine in calendar year 2018 to establish the per ton cost. The escalated corporate overhead component and the escalated return component, as illustrated on Exhibit C, Schedule 3, will be added to the cost per ton calculated above as part of the average per ton cost. In addition, the recovery charge for the relocation of the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ will be $****** at the time of price reset and will be added to the average per ton cost. This total average per ton cost will then be multiplied by ****** and then divided by actual BTUs per ton delivered to all customers in calendar year 2018 to determine the total mine cost in dollars per ton (described as ''Total Mine Cost $/ton for ****** Btu/lb Coal" on Exhibit C Schedule 3). The difference between the total mine cost in dollars per ton and the Escalated Average Purchase Price (as described on Exhibit C, Schedule 1) as of January 1 of the year of the reset shall be used to calculate a new component which shall be used to determine the adjustment of the Purchase Price, as illustrated on Exhibit C, Schedules 1and 4 (the ''Price Reset Component"). The 2019 reset price shall not be subject to any maximum or minimum.

Purchase Price Reset. Effective January 1, 20191 of calendar year 2016, the parties shall reset the Tier 1 and Tier 2 Purchase Prices based on Seller's actual mining costs for the prior calendar year. Seller's mining costs shall be determined using generally accepted accounting principles consistently applied and shall be allocated in a manner consistent with the components and allocations used to generate Seller's mining costs shown on Exhibit F, unless otherwise agreed in writing by the Parties. Seller shall provide its mining costs for the previous calendar year 2018 (i.e., calendar year 2015) to Buyer on or before January 15, 20192016. The total actual mining costs shall be divided by actual tons sold by the Mine in that prior calendar year 2018 to establish the per ton cost. The escalated corporate overhead component and the escalated return component, component as illustrated on Exhibit C, Schedule 3, will be added to the cost per ton calculated above as part of the average per ton costcost described on Exhibit C, Schedule 3, as Subtotal Cost 2015. In addition, the recovery charge for the relocation of the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Tipple will be $****** at the time of price reset and will be added to the average per ton cost. This total average per ton cost will then be multiplied by ****** and then divided by actual BTUs per ton delivered to all customers in that prior calendar year 2018 to determine the total mine cost in dollars per ton (described as ''"Total Mine Cost $/ton for ****** Btu/lb Coal" on Exhibit C Schedule 3). The difference between the total mine cost in dollars per ton and the Escalated Average Purchase Price (as described on Exhibit C, Schedule 1Schedules 1 and 2) as of January 1 of the year of the reset shall be used to calculate a new component which shall be used to determine the adjustment of the Purchase Price, as illustrated on Exhibit C, Schedules 1and 1 and 4 (the ''"Price Reset Component"). As an example, the EXHIBIT 10.3 reset Purchase Price will be determined for Tier 1 and the Tier 2 price as illustrated on Exhibit C, Schedule 4. The 2019 reset price Purchase Price Reset for 2016 shall not be subject to any maximum or minimum. At the time of the 2016 Purchase Price Reset, Seller shall have the right to reweigh the indexed components in order to more accurately reflect Seller's changed or reasonably anticipated change in cost structure. If, upon receipt of mine cost information from Seller in 2016, Buyer reasonably determines either (i) that the Purchase Price established through the Purchase Price Reset provision in this Section 5.07 is not competitive on a BTU delivered basis with other coal of comparable quality or (ii) that Seller's mining costs have unreasonably increased, then Buyer shall have an option of terminating the 2017 Agreement as of December 31, 2016. Buyer will provide to Seller evidence to support Buyer's determination. Any dispute concerning the reasonableness of Buyer's determination will be resolved pursuant to Article XII of this Agreement. Buyer must exercise this option on or before March 31, 2016. If Buyer exercises its option to terminate the 2017 Agreement, the Tier 1 and Tier 2 Purchase Prices for calendar year 2016 shall be adjusted through the entirety of calendar year 2016 pursuant to Section 5.03. If the Buyer exercises its option to terminate the 2017 Agreement, then the Stub Year shall be treated as one-half a Contract Year, and December 31, 2016 shall be treated as the end of a Contract Year. All obligations, calculation, and numeric standards shall be prorated for one-half a Contract Year for the Stub Year. 2. Exhibit C -Schedule 3 is amended by changing the reference to "Example of Methodology Used to Calculate ▇▇▇▇▇▇▇▇ Mine Cost for Calendar Year 2012" to read "Example of Methodology Used to Calculate ▇▇▇▇▇▇▇▇ Mine Cost for Calendar Year 2015." Internal references in the exhibit to 2012 are similarly changed to 2015.

Purchase Price Reset. Effective January 1, 20191 of calendar years 2013 and 2016, the parties shall reset the Tier 1 and Tier 2 Purchase Prices based on Seller's actual mining costs for the prior calendar year. Seller's mining costs shall be determined using generally accepted accounting principles consistently applied and shall be allocated in a manner consistent with the components and allocations used to generate Seller's mining costs shown on Exhibit FP, unless otherwise agreed in writing by the Parties. Seller shall provide its mining costs for the previous calendar year 2018 (i.e., calendar years 2012 or 2015, as the case may be) to Buyer on or before January 15, 201915 of 2013 and 2016. The total actual mining costs shall be divided by actual tons sold by the Mine in that prior calendar year 2018 to establish the per ton cost. The escalated corporate overhead component and the escalated return component, component as illustrated on Exhibit C, Schedule 3, will be added to the cost per ton calculated above as part of the average per ton costcost described on Exhibit C, Schedule 3 as Subtotal Cost 2012. In addition, the recovery charge for the relocation of the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ will be $****** at the time of price reset and will be added to the average per ton cost. This total average per ton cost will then be multiplied by ****** and then divided by actual BTUs per ton delivered to all customers in that prior calendar year 2018 to determine the total mine cost in dollars per ton (described as ''"Total Mine Cost $/ton /Ton for ****** Btu/lb Coal" on Exhibit C Schedule 3). The difference between the total mine cost in dollars per ton and the Escalated Average Purchase Price (as described on Exhibit C, Schedule 1Schedules 1 and 2) as of January 1 of 1of the year of the reset shall be used to calculate a new component which shall be used to determine the adjustment of the Purchase Price, as illustrated on Exhibit C, Schedules 1and 1 and 4 (the ''"Price Reset Component"). For the January 1, 2013 reset, the maximum Average Purchase Price shall not exceed 108 percent of the Escalated Average Purchase Price that would otherwise apply as of January l, 2013 through the quarterly adjustments, as described on Exhibit C, Schedules 1 and 2. The 2019 minimum average Purchase Price before apportioning it to the Tier 1 and Tier 2 tons shall be $******. As an example, the reset Purchase Price will be determined for Tier 1and the Tier 2 price as illustrated on Exhibit C, Schedule 4. The Purchase Price Reset for 2016 shall be determined using the same methodology as the 2013 reset, but the 2016 reset price shall not be subject to any maximum or minimum. At the time of the 2016 Purchase Price Reset, Seller shall have the right to reweigh the indexed components in order to more accurately reflect Seller's changed or reasonably anticipated change in cost structure. If, upon receipt of mine cost information from Seller in 2016, Buyer reasonably determines either (i) that the Purchase Price established through the Purchase Price Reset provision in this Section 5.07 is not competitive on a BTU delivered basis with other coal of comparable quality or (ii) that Seller's mining costs have unreasonably increased, then Buyer shall have an option of terminating the 2017 Agreement as of December 31, 2016. Buyer will provide to Seller evidence to support Buyer's determination. Any dispute concerning the reasonableness of Buyer's determination will be resolved pursuant to Article XII of this Agreement. Buyer must exercise this option on or before March 31, 2016. If Buyer exercises its option to terminate the 2017 Agreement, the Tier 1 and Tier 2 Purchase Prices for calendar year 2016 shall be adjusted through the entirety of calendar year 2016 pursuant to Section 5.03. If the Buyer exercises its option to terminate the 2017 Agreement, then the Stub Year shall be treated as one-half a Contract Year, and December 31, 2016 shall be treated as the end of a Contract Year. All obligations, calculations, and numeric standards shall be prorated for one-half a Contract Year for the Stub Year.