STOCK PURCHASE AGREEMENT by and among JAMES RIVER COAL COMPANY, INC., TRIAD MINING, INC. and THE STOCKHOLDERS OF TRIAD MINING, INC. dated as of March 30, 2005

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TABLE OF CONTENTS

1.   DEFINITIONS*									1
2.   SALE AND TRANSFER OF SHARES; CLOSING*									9
2.1				SHARES					9
2.2				PURCHASE PRICE					9
2.3				CLOSING					9
2.4				CLOSING OBLIGATIONS					9
2.5				NET WORKING CAPITAL ADJUSTMENT					10
3.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SELLERS*									11
3.1				ORGANIZATION AND GOOD STANDING					11
3.2				AUTHORITY; NO CONFLICT					11
3.3				CAPITALIZATION					12
3.4				FINANCIAL STATEMENTS					12
3.5				BOOKS AND RECORDS					13
3.6				TITLE TO PROPERTIES; ENCUMBRANCES; PERSONAL PROPERTY; REAL PROPERTY					13
3.7				CONDITION AND SUFFICIENCY OF ASSETS					15
3.8				ACCOUNTS RECEIVABLE					15
3.9				INVENTORY					16
3.10				NO UNDISCLOSED LIABILITIES					16
3.11				TAXES					16
3.12				BANK ACCOUNTS					18
3.13				EMPLOYEE BENEFITS					18
3.14				COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS					23
3.15				LEGAL PROCEEDINGS; ORDERS					25
3.16				ABSENCE OF CERTAIN CHANGES AND EVENTS					26
3.17				CONTRACTS; NO DEFAULTS					27
3.18				INSURANCE					29
3.19				ENVIRONMENTAL AND SMCRA MATTERS					30
3.20				EMPLOYEES					31
3.21				LABOR RELATIONS; COMPLIANCE					32
3.22				INTELLECTUAL PROPERTY					32
3.23				CERTAIN PAYMENTS					32
3.24				CUSTOMERS AND SUPPLIERS					33
3.25				SOLVENCY					33
3.26				OFFERS					33
3.27				DEBT; SECURITY INTERESTS					33
3.28				GRANTS AND ALLOWANCES					33
3.29				RELATIONSHIPS WITH RELATED PERSONS					34

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3.30				BROKERS OR FINDERS					34
3.31				DISCLOSURE					34
3.32				INFORMATION IN REGISTRATION STATEMENT					34
3A.   REPRESENTATIONS AND WARRANTIES OF EACH SELLER*									34
3A.1				STOCKHOLDERS TITLE					34
3A.2				AUTHORITY; NO CONFLICT					35
3A.3				INVESTMENT INTENT					35
3A.4				DISCLOSURE					35
4.   REPRESENTATIONS AND WARRANTIES OF BUYER*									36
4.1				ORGANIZATION AND GOOD STANDING					36
4.2				AUTHORITY; NO CONFLICT					36
4.3				INVESTMENT INTENT					36
4.4				CERTAIN PROCEEDINGS					36
4.5				SEC REPORTS					37
4.6				BROKERS OR FINDERS					37
4.7				SHARES OF BUYERS STOCK					37
4.8				BUYER’S INVESTIGATION OF COMPANY					37
4.9				DISCLOSURE					37
4.10				SHAREHOLDER APPROVAL					37
4.11				NO MATERIAL ADVERSE CHANGE					38
5.   COVENANTS OF SELLERS AND THE COMPANY*									38
5.1				ACCESS AND INVESTIGATION					38
5.2				OPERATION OF THE BUSINESSES OF THE ACQUIRED COMPANIES					38
5.3				NEGATIVE COVENANT					39
5.4				REQUIRED APPROVALS					39
5.5				NOTIFICATION					39
5.6				PAYMENT OF INDEBTEDNESS BY RELATED PERSONS					39
5.7				NO NEGOTIATION					39
5.8				BEST EFFORTS					39
5.9				RESIGNATIONS					40
5.10				COOPERATION IN FINANCING					40
5.11				NONCOMPETITION AND NONSOLICITATION					40
5.12				TAX MATTERS					41
5.13				PLANT REPAIRS					43
6.   COVENANTS OF BUYER*									43
6.1				APPROVALS OF GOVERNMENTAL BODIES					43
6.2				EFFORTS					43
6.3				SELLER GUARANTEES; BONDS					43
6.4				ACCESS					45

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6.5				NOTIFICATION					45
6.6				DIRECTOR AND OFFICER LIABILITY AND INDEMNIFICATION					45
6.7				INSURANCE					45
6.8				TREATMENT OF TRIAD MINING INC. PROFIT SHARING PLAN					45
7.   CONDITIONS PRECEDENT TO BUYER’S OBLIGATION TO CLOSE*									46
7.1				ACCURACY OF REPRESENTATIONS					46
7.2				SELLERS’ PERFORMANCE					46
7.3				CONSENTS					46
7.4				ADDITIONAL DOCUMENTS					46
7.5				NO PROCEEDINGS					47
7.6				NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS					47
7.7				NO PROHIBITION					47
7.8				FINANCING					47
8.   CONDITIONS PRECEDENT TO SELLERS’ OBLIGATION TO CLOSE*									48
8.1				ACCURACY OF REPRESENTATIONS					48
8.2				BUYER’S PERFORMANCE					48
8.3				[INTENTIONALLY OMITTED]					48
8.4				ADDITIONAL DOCUMENTS					48
8.5				NO INJUNCTION					48
9.   TERMINATION*									49
9.1				TERMINATION EVENTS					49
9.2				EFFECT OF TERMINATION					49
10.   INDEMNIFICATION; REMEDIES*									49
10.1				SURVIVAL					49
10.2				INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLERS					49
10.3				INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLERS— ENVIRONMENTAL MATTERS					50
10.4				INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER					51
10.5				TIME LIMITATIONS					51
10.6				LIMITATIONS ON AMOUNT—SELLERS					51
10.7				LIMITATIONS ON AMOUNT—BUYER					52
10.8				PROCEDURE FOR INDEMNIFICATION—THIRD PARTY CLAIMS					52
10.9				PROCEDURE FOR INDEMNIFICATION —OTHER CLAIMS					53
10.10				INSURANCE COVERAGE					53
10.11				RIGHT TO SET OFF					53
11.   GENERAL PROVISIONS*									53
11.1				EXPENSES					53
11.2				PUBLIC ANNOUNCEMENTS					54
11.3				CONFIDENTIALITY					54

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11.4				NOTICES					54
11.5				JURISDICTION; SERVICE OF PROCESS					55
11.6				FURTHER ASSURANCES					55
11.7				WAIVER					55
11.8				ENTIRE AGREEMENT AND MODIFICATION					56
11.9				DISCLOSURE LETTER					56
11.10				ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS					56
11.11				SEVERABILITY					56
11.12				SECTION HEADINGS, CONSTRUCTION					56
11.13				TIME OF ESSENCE					56
11.14				GOVERNING LAW					56
11.15				SELLERS’ AGENT; POWER OF ATTORNEY					56
11.16				COUNTERPARTS					57

 

Exhibits

Exhibit 2.4(a)(ii)				Form of Sellers’ Releases
Exhibit 2.4(a)(iii)				Form of Consulting Agreements
Exhibit 2.4(a)(iv)				Form of Lease Agreement
Exhibit 2.4(b)(iii)				Form of Registration Rights Agreement
Exhibit 5.13				Form of Warranty Agreement
Exhibit 7.4(a)				Form of Sellers’ Counsel’s Opinion
Exhibit 8.4(a)				Form of Buyer’s Counsels’ Opinions
Sellers Disclosure Letter
Schedule 4.2				Buyer’s Consents
Schedule 5.11				Midwestern Coal Basin
Schedule 5.13				Plant Repairs

 

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STOCK PURCHASE AGREEMENT

RECITALS

AGREEMENT

1.

DEFINITIONS

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(a)

the sale of the Shares held by each Seller to Buyer;

(b)

the execution, delivery, and performance of the Consulting Agreements, the Lease, the Sellers’ Releases and the Registration Rights Agreement;

(c)

the performance by Buyer and Sellers of their respective covenants and obligations under this Agreement; and

(d)

Buyer’s acquisition and ownership of the Shares and exercise of control over the Acquired Companies.

(a)

all indebtedness for borrowed money, including, all principal, interest or other obligations evidenced by or under a note, bond, debenture, letter of credit, draft or similar instrument;

(b)

that portion of obligations with respect to capitalized or synthetic leases that is properly classified as a liability on a balance sheet in accordance with GAAP;

(c)

liabilities under or pursuant to interest rate cap contracts, swap contracts, foreign currency exchange contracts and other hedging or similar contracts (including breakage or associated fees);

(d)

all obligations to pay the deferred purchase price of property or services (including the earned portion of any so-called “earn-out” obligations);

(e)

all indebtedness created or arising under any conditional sale or other title retention agreement with respect to acquired property;

(f)

all indebtedness and obligations of the types described in the foregoing clauses (a) through (e) to the extent secured by any Encumbrance on any property or asset owned or held by that Person, regardless of whether the indebtedness secured thereby shall have been incurred or assumed by that Person or is otherwise nonrecourse to the credit of that Person; and

(g)

all guarantees of any of the foregoing.

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(a)

any environmental, health, or safety matters or conditions (including on-site or off-site contamination, occupational safety and health, and regulation of chemical substances or products) other than routine compliance;

(b)

fines, penalties, judgments, awards, settlements, legal or administrative proceedings, damages, losses, claims, demands and response, investigative, remedial, or inspection costs and expenses arising under Environmental Law or Occupational Safety and Health Law;

(c)

financial responsibility under Environmental Law or Occupational Safety and Health Law for cleanup costs or corrective action, including any investigation, cleanup, removal, containment, or other remediation or response actions (“Cleanup”) required by applicable Environmental Law or Occupational Safety and Health Law (whether or not such Cleanup has been required or requested by any Governmental Body or any other Person) and for any natural resource damages; or

(d)

any other compliance, corrective, investigative, or remedial measures required under Environmental Law or Occupational Safety and Health Law, other than routine compliance;

provided, however, that reclamation activities required solely under SMCRA are excluded from the foregoing.

(a)

advising appropriate authorities, employees, and the public of intended or actual releases of Hazardous Materials, violations of discharge limits, or other prohibitions and of the commencements of activities, such as resource extraction or construction, that could have significant impact on the Environment;

(b)

preventing or reducing to acceptable levels the release of Hazardous Materials into the Environment;

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(c)

reducing the quantities, preventing the release, or minimizing the hazardous characteristics of wastes that are generated;

(d)

protecting natural resources or species;

(e)

reducing to acceptable levels the risks inherent in the transportation of Hazardous Materials;

(f)

cleaning up Hazardous Materials that have been released, preventing the threat of release, or paying the costs of such clean up or prevention;

(g)

making responsible parties pay private parties, or groups of them, for damages done to human health from Hazardous Materials, for damages done to the Environment, or permitting self-appointed representatives of the public interest to recover for injuries done to natural resources; or

(h)

protecting human health from Hazardous Materials or protecting the Environment;

provided, however, that the term “Environmental Law” shall not include reclamation requirements under SMCRA.

(a)

nation, state, county, city, town, village, district, or other jurisdiction of any nature;

(b)

federal, state, local, municipal, foreign, or other government;

(c)

governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal);

(d)

multi-national organization or body; or

(e)

body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature.

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and all derivatives thereof or synthetic substitutes therefor and asbestos or asbestos-containing materials; provided, however, that “Hazardous Materials” (i) does not include coal mined and managed in the Ordinary Course of Business, but (ii) does include coal dust, runoff and leachate from coal piles, and similar substances if they otherwise meet this definition of “Hazardous Materials.”

(a)

such individual is actually aware of such fact or other matter; or

(b)

a prudent individual could be expected to discover or otherwise become aware of such fact or other matter in the course of conducting a reasonably comprehensive investigation concerning the existence of such fact or other matter.

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(a)

such action is consistent with the past practices of such Person and is taken in the ordinary course of the normal day-to-day operations of such Person;

(b)

such action is not required to be authorized by the board of directors of such Person (or by any Person or group of Persons exercising similar authority); and

(c)

such action is similar in nature and magnitude to actions customarily taken, without any authorization by the board of directors (or by any Person or group of Persons exercising similar authority), in the ordinary course of the normal day-to-day operations of other Persons that are in the same line of business as such Person.

(a)

Encumbrances arising by operation of law in the Ordinary Course of Business, such as mechanics’ liens, materialmen’s liens, carriers’ liens, warehousemen’s liens, and similar liens, none of which materially detract from the value or materially interfere with the present use of the asset to which such Encumbrance attaches;

(b)

pledges or deposits under worker’s compensation (or similar) laws, unemployment insurance or other types of insurance or compensation plans participation in which is mandatory in connection with the operation of the business of any of the Acquired Companies;

(c)

pledges or deposits which secure the performance of tenders, statutory obligations, bonds, bids, leases, Contracts and similar obligations;

(d)

with respect to any lease, Encumbrances arising pursuant to the terms of the applicable lease;

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(e)

minor imperfections of title and Encumbrances, if any, which (i) do not materially detract from the value of the property subject thereto, impair the operations of the business of any of the Acquired Companies, or the use or license of certain of the assets of the Acquired Companies, and (ii) have arisen in the Ordinary Course of Business;

(f)

ad valorem taxes not yet due and payable; and

(g)

zoning laws and other land use restrictions that do not impair the present or anticipated use of the property subject thereto or that do not have a material adverse effect on the ownership, operation or maintenance of such property or the conduct of Mining Activities thereon.

(a)

each other member of such individual’s Family;

(b)

any Person that is directly or indirectly controlled by such individual or one or more members of such individual’s Family;

(c)

any Person in which such individual or members of such individual’s Family hold (individually or in the aggregate) a Material Interest; and

(d)

any Person with respect to which such individual or one or more members of such individual’s Family serves as a director, officer, partner, executor, or trustee (or in a similar capacity).

(a)

any Person that directly or indirectly controls, is directly or indirectly controlled by, or is directly or indirectly under common control with such specified Person;

(b)

any Person that holds a Material Interest in such specified Person;

(c)

each Person that serves as a director, officer, partner, executor, or trustee of such specified Person (or in a similar capacity);

(d)

any Person in which such specified Person holds a Material Interest;

(e)

any Person with respect to which such specified Person serves as a general partner or a trustee (or in a similar capacity); and

(f)

any Related Person of any individual described in clause (b) or (c).

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2.

SALE AND TRANSFER OF SHARES; CLOSING

2.1

SHARES

2.2

PURCHASE PRICE

(a)

Sixty Four Million Dollars ($64,000,000) of the Purchase Price shall be paid in cash; and

(b)

Sellers shall be issued, in the aggregate, shares of Buyer’s Common Stock having a market value equal to Eleven Million Dollars ($11,000,000) (the “Buyer Shares”) based upon the average closing price of Buyer’s Common Stock as set forth on The Nasdaq Stock Market for the fifteen (15) consecutive trading days ending two (2) trading days prior to the Closing Date.

2.3

CLOSING

2.4

CLOSING OBLIGATIONS

(a)

Sellers will deliver to Buyer:

(i)

certificates representing the Shares, duly endorsed (or accompanied by duly executed stock powers);

(ii)

releases in the form of Exhibit 2.4(a)(ii) executed by Sellers, and in the case of trusts, the underlying beneficiaries (collectively, “Sellers’ Releases”);

(iii)

consulting agreements in substantially the form of Exhibit 2.4(a)(iii), executed by ▇▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, respectively (collectively, the “Consulting Agreements”);

(iv)

a real property lease agreement in substantially the form of Exhibit 2.4(a)(iv) executed by ▇▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ (the “Lease”);

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(v)

a certificate executed by Sellers representing and warranting to Buyer that each of Sellers’ representations and warranties in this Agreement was accurate in all respects as of the date of this Agreement and is accurate in all respects as of the Closing Date as if made on the Closing Date (giving full effect to any supplements to the Disclosure Letter that were delivered by Sellers to Buyer prior to the Closing Date in accordance with Section 5.5); and

(vi)

the other documents required to be delivered pursuant to Section 7.4; and

(b)

Buyer will deliver to Sellers:

(i)

the cash consideration payable pursuant to Section 2.2 by wire transfer to such accounts, and in the percentages, as set forth in Part 2.2 of the Disclosure Letter;

(ii)

the Buyer Shares;

(iii)

a registration rights agreement in the form of Exhibit 2.4(b)(iii), executed by Buyer (the “Registration Rights Agreement”);

(iv)

a certificate executed by Buyer to the effect that, except as otherwise stated in such certificate, each of Buyer’s representations and warranties in this Agreement was accurate in all respects as of the date of this Agreement and is accurate in all respects as of the Closing Date as if made on the Closing Date; and

(v)

the other documents required to be delivered pursuant to Section 8.4.

2.5

NET WORKING CAPITAL ADJUSTMENT

(a)

Not later than five (5) business days prior to the Closing Date, Sellers will deliver to Buyer the most recently prepared month-end consolidated balance sheet of the Acquired Companies setting forth the Net Working Capital of the Acquired Companies (the “Most Recent Balance Sheet”). If the Net Working Capital shown on the Most Recent Balance Sheet exceeds the Adjusted Net Working Capital, the cash portion of the Purchase Price payable to Sellers shall be increased by such amount. If the Net Working Capital shown on the Most Recent Balance Sheet is less than the Adjusted Net Working Capital, the cash portion of the Purchase Price payable at Closing shall be decreased by such amount.

(b)

Within forty-five (45) days after the Closing Date, Buyer will prepare (to the extent not already prepared), or review and make any adjustments it deems necessary and appropriate, and deliver to Sellers a consolidated balance sheet setting forth the Net Working Capital of the Acquired Companies as of the Calculation Date (the “Calculation Date Balance Sheet”). “Calculation Date” shall mean either: (i) the last day of the month prior to month in which the Closing Date occurs, in the event the Closing Date occurs on one of the first fifteen days of a month; or (ii) the last day of the month in which the Closing Date occurs, in the event the Closing Date occurs on a day after the fifteenth day of such month. If Sellers have any objections to the Calculation Date Balance Sheet, they shall notify Buyer in writing within twenty (20) days of receipt of the Calculation Date Balance Sheet and deliver a detailed written statement describing their objections. Buyer and Sellers shall use their reasonable efforts to resolve any such objections themselves. If Buyer and Sellers cannot resolve any such objections within thirty (30) days after Buyer receives Sellers’ statement of objections, such dispute shall be referred to the Nashville office of Ernst & Young, LLP, each party hereby represents that such firm through its Nashville office has not provided material services for the benefit of such party or its Related Persons within the preceding three years, for conclusive and binding resolution. The Buyer and the Sellers shall direct such firm to render a determination within thirty (30) days after its retention and the Buyer, the Sellers and their respective agents shall cooperate with the such firm during its engagement. Such firm may consider only those items and amounts in the Calculation Date Balance Sheet and related computation and the written objection from Sellers that the Buyer and the Sellers are unable to resolve. In resolving any disputed item, such firm may not ultimately assign a value to any item greater than the greatest value for such item claimed by a party or less than the smallest value

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for such item claimed by either party. The determination of such firm shall be conclusive and binding upon the Buyer and the Sellers, with no right of appeal. The Buyer and the Sellers shall bear the costs and expenses of such firm based on the percentage that the portion of the contested amount not awarded to each party bears to the amount actually contested by such party. If there is a dispute as to the Net Working Capital adjustment required hereunder, the Buyer and the Sellers shall promptly pay to the other, as appropriate, such amounts as are not in dispute pending final determination of such dispute.

(c)

If the Net Working Capital shown on the Calculation Date Balance Sheet (as prepared by Buyer) exceeds the Net Working Capital shown on the Most Recent Balance Sheet as prepared by Sellers, Buyer will pay Sellers in cash within five (5) business days an amount equal to the amount by which Net Working Capital shown on the Calculation Date Balance Sheet exceeds the Net Working Capital shown on the Most Recent Balance Sheet. If the Net Working Capital shown on the Calculation Date Balance Sheet is less than the Net Working Capital shown on the Most Recent Balance Sheet, Sellers will pay Buyer in cash within five (5) business days an amount equal to the amount of such deficit.

3.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SELLERS

3.1

ORGANIZATION AND GOOD STANDING

(a)

Part 3.1 of the Disclosure Letter contains a complete and accurate list for each Acquired Company of its name, its jurisdiction of incorporation or formation, other jurisdictions in which it is authorized to do business, and its capitalization (including the identity of each stockholder or member (as applicable) and the number of shares or membership percentage (as applicable) held by each). Each Acquired Company is a corporation or limited liability company (as applicable) duly organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation or formation, with full corporate or limited liability company power and authority (as applicable) to conduct its business as it is now being conducted, to own or use the properties and assets that it purports to own or use, and to perform all its obligations under Applicable Contracts. Each Acquired Company is duly qualified to do business as a foreign corporation or limited liability company (as applicable) and is in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such qualification.

(b)

Sellers have delivered to Buyer copies of the Organizational Documents of each Acquired Company, as currently in effect.

3.2

AUTHORITY; NO CONFLICT

(a)

This Agreement has been duly authorized by all necessary corporate action on the part of the Company and constitutes the legal, valid, and binding obligation of the Company and the Sellers, enforceable against the Company and the Sellers in accordance with its terms, except as such may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditor’s rights generally, and by general equitable principles. Upon the execution and delivery by Sellers of the Sellers’ Releases, the Sellers’ Releases will constitute the legal, valid, and binding obligations of Sellers, enforceable against Sellers in accordance with their respective terms. The Company and the Sellers have the absolute and unrestricted right, power, authority, and capacity to execute and deliver this Agreement to perform their obligations under this Agreement. The Sellers have the absolute and unrestricted right, power, authority, and capacity to execute and deliver the Sellers’ Releases and to perform their obligations under the Sellers’ Releases.

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(b)

Except as set forth in Part 3.2 of the Disclosure Letter, neither the execution and delivery of this Agreement nor the consummation or performance of any of the Contemplated Transactions will, directly or indirectly (with or without notice or lapse of time):

(i)

contravene, conflict with, or result in a violation of (A) any provision of the Organizational Documents of the Acquired Companies, or (B) any resolution adopted by the board of directors, stockholders or members (as applicable) of any Acquired Company;

(ii)

contravene, conflict with, or result in a violation of, or give any Governmental Body or other Person the right to challenge any of the Contemplated Transactions or to exercise any remedy or obtain any relief under, any Legal Requirement or any Order to which any Acquired Company or any of the Sellers, or any of the assets owned or used by any Acquired Company, may be subject;

(iii)

contravene, conflict with, or result in a violation of any of the terms or requirements of, or give any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate, or modify, any Governmental Authorization that is held by any Acquired Company or that otherwise relates to the business of, or any of the assets owned or used by, any Acquired Company;

(iv)

contravene, conflict with, or result in a violation or breach of any provision of, or give any Person the right to declare a default or exercise any remedy under, or to accelerate the maturity or performance of, or to cancel, terminate, or modify, any Applicable Contract; or

(v)

result in the imposition or creation of any Encumbrance upon or with respect to any of the assets owned or used by any Acquired Company.

3.3

CAPITALIZATION

3.4

FINANCIAL STATEMENTS

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with the reports thereon of York, ▇▇▇▇ & Co.—Madisonville, LLP, independent certified public accountants, (b) a consolidated balance sheet of the Acquired Companies as at December 31, 2004 (the “Balance Sheet”), and the related consolidated statements of income, changes in stockholders’ equity, and cash flow for the fiscal year then ended (including the notes thereto), together with the report thereon of York, ▇▇▇▇ & Co.—Madisonville, LLP, independent certified public accountants, and (c) an unaudited consolidated balance sheet of the Acquired Companies as at February 28, 2005 (the “Interim Balance Sheet”) and the related unaudited consolidated statements of income, and cash flow for the two months then ended, including in each case the notes thereto. Such financial statements and notes have been prepared in accordance with GAAP and fairly present the financial condition and the results of operations, changes in stockholders’ equity, and cash flow of the Acquired Companies as at the respective dates of and for the periods referred to in such financial statements, subject, in the case of interim financial statements, to normal recurring year-end adjustments (the effect of which will not, individually or in the aggregate, be materially adverse) and the absence of notes (that, if presented, would not differ materially from those included in the consolidated audited financial statements for the year ended December 31, 2004); the financial statements referred to in this Section 3.4 reflect the consistent application of such accounting principles throughout the periods involved. No financial statements of any Person other than the Acquired Companies are required by GAAP to be included in the consolidated financial statements of the Company.

3.5

BOOKS AND RECORDS

3.6

TITLE TO PROPERTIES; ENCUMBRANCES; PERSONAL PROPERTY; REAL PROPERTY

(a)

The Acquired Companies own (with Good and Marketable Title in the case of real property, subject only to the matters permitted by the following sentence) all the properties and assets (whether real, personal, or mixed and whether tangible or intangible) reflected in the Balance Sheet and the Interim Balance Sheet (except for assets held under capitalized leases disclosed or not required to be disclosed in Part 3.6(d) of the Disclosure Letter and personal property sold since the date of the Balance Sheet and the Interim Balance Sheet, as the case may be, in the Ordinary Course of Business), and all of the properties and assets purchased or otherwise acquired by the Acquired Companies since the date of the Balance Sheet (except for personal property acquired and sold since the date of the Balance Sheet in the Ordinary Course of Business and consistent with past practice). Except as set forth in Part 3.6(a) of the Disclosure Letter, all material properties and assets reflected in the Balance Sheet and the Interim Balance Sheet are free and clear of all Encumbrances except for Permitted Encumbrances. All buildings, plants, and structures owned by the Acquired Companies lie wholly within the boundaries of the real property owned by the Acquired Companies and do not encroach upon the property of, or otherwise conflict with the property rights of, any other Person. To the Knowledge of the Sellers and the Company, there are no claims of adverse ownership to any of the properties occupied or used by any of the Acquired Companies.

(b)

Part 3.6(b) of the Disclosure Letter sets forth a true and complete list of all the material machinery, equipment, vehicles and other tangible personal property now owned or leased by each Acquired Company and indicates which of the Acquired Companies owns or leases such asset. As to each asset shown in Part 3.6(b) of the Disclosure Letter, each Acquired Company has Good and Marketable Title to, or holds by a valid and enforceable lease or license with respect to, such asset. Except as set forth

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in Part 3.6(b) of the Disclosure Letter, no rights of the Acquired Companies under such leases or licenses have been assigned or otherwise transferred as security for any obligation of the Acquired Companies.

(c)

The title or leasehold interests to the assets set forth in Part 3.6(b) of the Disclosure Letter includes all material tangible assets used by the Acquired Companies to conduct the business of the Acquired Companies as currently conducted.

(d)

Part 3.6(d) of the Disclosure Letter is a true and complete list of all capital leases of the Acquired Companies, indicating which of the Acquired Companies is a party to such captial leases and the payoff amount under each such capital lease that, if paid to the lessor thereunder, would fully satisfy the Acquired Companies’ remaining obligations under such capital lease as a primary obligor.

(e)

Part 3.6(e) of the Disclosure Letter lists all parcels (or portions thereof) of real property owned or leased by the Acquired Companies (including all other interests in land owned, leased, licensed to, or otherwise held by, the Acquired Companies). The Acquired Companies own, lease, license or otherwise hold all rights necessary to conduct Mining Activities on such parcels of real property, and any other activities permitted on such parcels of real property will not interfere with such Mining Activities.

(1)

Sellers have heretofore made available to Buyer copies of the deeds and other instruments (as recorded) by which the Acquired Companies acquired such real property that is owned by any of the Acquired Companies and copies of all title insurance policies, opinions, abstracts, and surveys in the possession of Sellers or the Acquired Companies and relating to such owned real property. With respect to each such parcel of real property owned by any of the Acquired Companies, except as otherwise specified in Part 3.6(e) of the Disclosure Letter:

(i) the identified owner has Good and Marketable Title to such parcel of real property and all fixtures and improvements on such real property, including all preparation plants or other coal processing facilities, loadout and other transportation facilities (the “Owned Fixtures and Improvements”);

(ii) there are no pending or, to the Knowledge of the Company or Sellers, threatened condemnation Proceedings, eminent domain or requisition Proceedings; and

(iii) there are no other matters that materially adversely affect the title of any Acquired Company to such real property or the Owned Fixtures and Improvements.

(2)

Set forth opposite each parcel or portion of real property or other interest in land identified in Part 3.6(e) of the Disclosure Letter is a list of all leases, subleases, licenses and Contracts applicable to such parcel or portion of real property or other interest in land (including, without limitation, all leases, subcontracts, licenses or Contracts pursuant to which any of the Acquired Companies are, or may become, responsible for the payment of annual minimum, production or overriding royalties or other consideration). Sellers have heretofore made available to Buyer true and complete copies of all such leases, subleases, licenses and Contracts (as amended to the date of this Agreement and the date of Closing). With respect to each such lease, sublease, license and Contract and except as otherwise specified in Part 3.6(e) of the Disclosure Letter:

(i) such lease, sublease, license or Contract is in full force and effect in all material respects and enforceable in accordance with its terms;

(ii) to the extent provided in the respective leases or subleases, the Acquired Companies have a valid leasehold interest in all leased or subleased real property and all fixtures and improvements on such property, including all preparation plants or other coal processing facilities, loadout and other transportation facilities (the “Leased Fixtures and Improvements”), in each case, free and clear of any Encumbrances other than Permitted Encumbrances;

(iii) (A) none of the Acquired Companies is in default under any such lease, sublease, license or Contract and no event has occurred which, with the passage of time or expiration of any grace period would constitute a default of any Acquired Company’s obligations under such lease,

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sublease, license or Contract, (B) to the Knowledge of the Company and the Sellers, no other party to any such lease, sublease, license or Contract is in default thereunder and (C) none of the Acquired Companies has received a written or other notice of default with respect to such lease, sublease, license or Contract;

(iv) there are no unwritten or oral modifications to such leases, subleases, licenses or Contracts or any course of dealing or business operations that are modifications to such leases, subleases, licenses or Contracts;

(v) no such lease, sublease, license or Contract has been mortgaged, deeded in trust or subjected to an Encumbrance by any Acquired Company; and

(vi) there are no other matters that materially adversely affect the rights of any Acquired Company to such real property or other interest in land or the Leased Fixtures and Improvements.

(f)

The Acquired Companies hold or control adequate ingress and egress to the real property identified in Part 3.6(e) of the Disclosure Letter and any facilities located on such real property and all material rights, easements and rights-of-way necessary for the continued operation in their present manner of any facilities located on such real property.

(g)

Except as set forth in Part 3.6(g) of the Disclosure Letter, none of the Acquired Companies nor any Seller has received any written or other notice of claims that any Acquired Company has mined any coal that it did not have the right to mine or mined any coal in such reckless and imprudent fashion as to give rise to any claims for loss, waste or trespass and, to Sellers’ and the Company’s Knowledge, no facts exist upon which such a claim could be based. Sellers have made available to Buyer the most recent complete and correct version of each of the following items to the extent such items are (a) in the possession of the Acquired Companies, (b) relate to or affect the real property identified in Part 3.6(e) of the Disclosure Letter, including the coal reserves, coal ownership, mining conditions, mines, and mining plans of the Acquired Companies and (c) material to the conduct of the business of any Acquired Company: geological data, reserve data, existing mine maps, surveys, core hole logs and associated data, coal measurements, coal samples, lithologic data, coal reserve calculations or reports, washability analyses or reports, mine plans, mining permit applications and supporting data, engineering studies and all other books and records, information, maps, reports and data.

3.7

CONDITION AND SUFFICIENCY OF ASSETS

3.8

ACCOUNTS RECEIVABLE

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3.9

INVENTORY

3.10

NO UNDISCLOSED LIABILITIES

3.11

TAXES

(a)

The Acquired Companies have filed or caused to be filed on a timely basis all material Tax Returns that are or were required to be filed by or with respect to any of them, either separately or as a member of a group of corporations, pursuant to applicable Legal Requirements. Sellers have delivered to Buyer copies of, and Part 3.11 of the Disclosure Letter contains a complete and accurate list of, all such Tax Returns filed since January 1, 2001. Except as listed in Part 3.11 of the Disclosure Letter, none of the Acquired Companies is the beneficiary of any extension of time within which to file any Tax Return. The Acquired Companies have paid, or made provision for the payment of, all Taxes that have or may have become due pursuant to those Tax Returns (whether or not shown on any Tax Return) or otherwise, or pursuant to any assessment received by Sellers or any Acquired Company, except such Taxes, if any, as are listed in Part 3.11 of the Disclosure Letter and are being contested in good faith and as to which adequate reserves (determined in accordance with GAAP) have been provided in the Balance Sheet and the Interim Balance Sheet.

(b)

To the knowledge of any Seller or director or officer, no claim has ever been made by an authority in a jurisdiction where any of the Acquired Companies does not file Tax Returns that it is or may be

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subject to taxation by that jurisdiction. There are no Encumbrances for Taxes (other than Taxes not yet due and payable) upon any of the assets of the Acquired Companies.

(c)

Except as listed in Part 3.11 of the Disclosure Letter, no foreign, federal, state or local tax audits or administrative or judicial Tax proceedings are pending or being conducted with respect to any of the Acquired Companies. Except as listed in Part 3.11 of the Disclosure Letter, none of the Acquired Companies has received from any foreign, federal, state or local taxing authority (including jurisdictions where the Acquired Companies have not filed Tax Returns) any (i) notice indicating an intent to open an audit or other review, (ii) request for information related to Tax matters, or (iii) notice of deficiency or proposed adjustment for any amount of Tax proposed, asserted or assessed by any taxing authority against any of the Acquired Companies. Part 3.11 of the Disclosure Letter contains a complete and accurate list of those Tax Returns that have been audited, and indicates those Tax Returns that currently are the subject of audit, including a reasonably detailed description of the nature and outcome of each audit. All deficiencies proposed as a result of such audits have been paid, reserved against, settled, or, as described in Part 3.11 of the Disclosure Letter, are being contested in good faith by appropriate proceedings. Part 3.11 of the Disclosure Letter describes all adjustments to the United States federal income Tax Returns filed by any Acquired Company or any group of corporations including any Acquired Company for all taxable years since January 1, 2001, and the resulting deficiencies proposed by the IRS. Except as described in Part 3.11 of the Disclosure Letter, no Seller or Acquired Company has given or been requested to give waivers or extensions (or is or would be subject to a waiver or extension given by any other Person) of any statute of limitations relating to the payment of Taxes of any Acquired Company or for which any Acquired Company may be liable.

(d)

The charges, accruals, and reserves with respect to Taxes on the respective books of each Acquired Company are adequate (determined in accordance with GAAP) and are at least equal to that Acquired Company’s liability for Taxes. To the knowledge of any Seller or director or officer, there exists no proposed tax assessment against any Acquired Company. All Taxes that any Acquired Company is or was required by Legal Requirements to withhold or collect have been duly withheld or collected and, to the extent required, have been paid to the proper Governmental Body or other Person.

(e)

All Tax Returns filed by any Acquired Company are true, correct, and complete in all material respects. There is no tax sharing agreement that will require any payment by any Acquired Company after the date of this Agreement.

(f)

At all times since July 1, 1995, the Company (and any predecessor of the Company) has been a validly electing S corporation within the meaning of Sections 1361 and 1362 of the IRC at all times during its existence and the Company will be an S corporation up to and including the day before the Closing Date.

(g)

None of the Acquired Companies is a “qualified subchapter S subsidiary” within the meaning of Section 1361(b)(3)(B) of the IRC.

(h)

None of the Acquired Companies has been a United States real property holding corporation within the meaning of Section 897(c)(2) of the IRC during the applicable period specified in Section 897(c)(1)(A)(ii).

(i)

None of the Acquired Companies (or any entity purchased by, merged with or into, acquired pursuant to a share exchange or other reorganization with either of the Acquired Companies) has been a member of an Affiliated Group filing a consolidated federal income Tax Return (other than a group the common parent of which was the Company).

(j)

None of the Acquired Companies (or any entity purchased by, merged with or into, acquired pursuant to a share exchange or other reorganization with either of the Acquired Companies) will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any: (A) change in the method of accounting for a taxable period ending on or prior to the Closing Date; (B) “closing agreement”

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as described in Section 7121 of the IRC (or any corresponding or similar provision of state, local or foreign income Tax law) executed on or prior to the Closing Date; (C) installment sale or open transaction disposition made on or prior to the Closing Date; or (D) prepaid amount received on or prior to the Closing Date.

(k)

None of the Acquired Companies is a party to any agreement, contract, arrangement or plan that has resulted or would result, separately or in the aggregate, in the payment of any “excess parachute payment” within the meaning of Section 280G of the IRC (or any corresponding provision of state, local or foreign Tax law).

(l)

Each Acquired Company has collected all material sales and use Taxes required to be collected, and has remitted or will remit on a timely basis, such amounts to the appropriate taxing authorities, or have been furnished properly completed exemption certificates. Each Acquired Company (i) has in its (or its affiliates’) possession all material records and supporting documents required by all applicable sales and use Tax statutes and regulations regarding the collection and payment of sales and use Taxes required to be collected and paid over by such Acquired Company and regarding all exempt transactions by such Acquired Company for all periods open under the applicable statute of limitations, and (ii) has maintained all such records and supporting documents in material compliance with all sales and use Tax statutes and regulations applicable thereto.

3.12

BANK ACCOUNTS

3.13

EMPLOYEE BENEFITS

(a)

As used in this Section 3.13, the following terms have the meanings set forth below.

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(b)    (i)

Part 3.13(i) of the Disclosure Letter contains a complete and accurate list of all Company Plans, Company Other Benefit Obligations, and Company VEBAs, and identifies as such all Company Plans that are (A) defined benefit Pension Plans, (B) Qualified Plans, (C) Title IV Plans, or (D) Multi-Employer Plans.

(ii)

Part 3.13(ii) of the Disclosure Letter contains a complete and accurate list of (A) all ERISA Affiliates of each Acquired Company, and (B) all Plans of which any such ERISA Affiliate is or was a Plan Sponsor, in which any such ERISA Affiliate participates or has participated, or to which any such ERISA Affiliate contributes or has contributed.

(iii)

Part 3.13(iii) of the Disclosure Letter sets forth, for each Multi-Employer Plan, as of its last valuation date, the amount of potential withdrawal liability of the Acquired Companies and the Acquired Companies’ other ERISA Affiliates, calculated according to information made available pursuant to ERISA Section 4221(e).

(iv)

Part 3.13(iv) of the Disclosure Letter sets forth a calculation of the liability of the Acquired Companies for post-retirement benefits other than pensions, made in accordance with Financial Accounting Statement 106 of the Financial Accounting Standards Board, regardless of whether any Acquired Company is required by this Statement to disclose such information.

(v)

Part 3.13(v) of the Disclosure Letter sets forth the financial cost of all obligations owed under any Company Plan or Company Other Benefit Obligation that is not subject to the disclosure and reporting requirements of ERISA.

(vi)

Part 3.13(vi) of the Disclosure Letter sets forth any obligation and potential liability of the Acquired Companies and the Acquired Companies’ other ERISA Affiliates under the Coal Act.

(c)

Sellers have delivered to Buyer:

(i)

all documents that set forth the current terms of each Company Plan, Company Other Benefit Obligation, or Company VEBA and of any related trust, including (A) the most recent plan descriptions and summary plan descriptions of Company Plans for which Sellers or the Acquired Companies are required to prepare, file, and distribute plan descriptions and summary plan descriptions, and (B) the most recent summaries and descriptions furnished to participants and beneficiaries regarding Company Plans, Company Other Benefit Obligations, and Company VEBAs for which a plan description or summary plan description is not required;

(ii)

all current personnel, payroll, and employment manuals and policies;

(iii)

all collective bargaining agreements pursuant to which contributions have been made or obligations incurred (including both pension and welfare benefits) by the Acquired Companies and the ERISA Affiliates of the Acquired Companies, and all collective bargaining agreements pursuant to which contributions are being made or obligations are owed by such entities;

(iv)

a written description of any Company Plan or Company Other Benefit Obligation that is not otherwise in writing;

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(v)

all registration statements filed with respect to any Company Plan;

(vi)

all insurance policies currently in effect purchased by or to provide benefits under any Company Plan;

(vii)

all contracts with third party administrators, actuaries, investment managers, consultants, and other independent contractors that relate to any Company Plan, Company Other Benefit Obligation, or Company VEBA;

(viii)

all reports submitted within the four years preceding the date of this Agreement by third party administrators, actuaries, investment managers, consultants, or other independent contractors with respect to any Company Plan, Company Other Benefit Obligation, or Company VEBA;

(ix)

all notifications provided during the three year period preceding the date of this Agreement to employees of their rights under ERISA Section 601 et seq. and IRC Section 4980B;

(x)

the Form 5500 filed in each of the most recent three plan years with respect to each Company Plan, including all schedules thereto and the opinions of independent accountants;

(xi)

all notices relating to any Company Plan that were given by any Acquired Company or any ERISA Affiliate of an Acquired Company or any Company Plan to the IRS, the PBGC, or any participant or beneficiary, pursuant to statute, within the four years preceding the date of this Agreement, including notices that are expressly mentioned elsewhere in this Section 3.13;

(xii)

all notices that were given by the IRS, the PBGC, or the Department of Labor to any Acquired Company, any ERISA Affiliate of an Acquired Company, or any Company Plan within the four years preceding the date of this Agreement;

(xiii)

with respect to Qualified Plans and VEBAs, the most recent determination letter for each Plan of the Acquired Companies that is a Qualified Plan or IRS opinion letter in the case of any Qualified Plan that is a prototype plan; and

(xiv)

with respect to Title IV Plans, the Form PBGC-1 filed for each of the three most recent plan years.

(d)

Except as set forth in Part 3.13(vi) of the Disclosure Letter:

(i)

The Acquired Companies have performed all of their respective obligations under all Company Plans, Company Other Benefit Obligations, and Company VEBAs. The Acquired Companies have made appropriate entries in their financial records and statements for all obligations and liabilities under such Plans, VEBAs, and Obligations that have accrued but are not due.

(ii)

No statement, either written or oral, has been made by any Acquired Company to any Person with regard to any Plan or Other Benefit Obligation that was not in accordance with the Plan or Other Benefit Obligation and that could have an adverse economic consequence to any Acquired Company or to Buyer.

(iii)

The Acquired Companies, with respect to all Company Plans, Company Other Benefits Obligations, and Company VEBAs, are, and each Company Plan, Company Other Benefit Obligation, and Company VEBA is, in full compliance with ERISA, the IRC, and other applicable Laws including the provisions of such Laws expressly mentioned in this Section 3.13, and with any applicable collective bargaining agreement.

(A)

No transaction prohibited by ERISA Section 406 and no “prohibited transaction” under IRC Section 4975(c) have occurred with respect to any Company Plan.

(B)

No Seller or Acquired Company has any liability to the IRS with respect to any Plan, including any liability imposed by Chapter 43 of the IRC.

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(C)

No Seller or Acquired Company has any liability to the PBGC with respect to any Plan or has any liability under ERISA Section 502 or Section 4071.

(D)

All filings required by ERISA and the IRC as to each Plan have been timely filed, and all notices and disclosures to participants required by either ERISA or the IRC have been timely provided.

(E)

All contributions and payments made or accrued with respect to all Company Plans, Company Other Benefit Obligations, and Company VEBAs are deductible under IRC Section 162 or Section 404. No amount, or any asset of any Company Plan or Company VEBA, is subject to tax as unrelated business taxable income.

(iv)

Each Company Plan can be terminated within thirty days, without payment of any additional contribution or amount and without the vesting or acceleration of any benefits promised by such Plan.

(v)

Since December 31, 2004, there has been no establishment or amendment of any Company Plan, Company VEBA, or Company Other Benefit Obligation.

(vi)

No event has occurred or circumstance exists that could result in a material increase in premium costs of Company Plans and Company Other Benefit Obligations that are insured, or a material increase in benefit costs of such Plans and Obligations that are self-insured.

(vii)

Other than claims for benefits submitted by participants or beneficiaries, no claim against, or legal proceeding involving, any Company Plan, Company Other Benefit Obligation, or Company VEBA is pending or, to Sellers’ Knowledge, is threatened.

(viii)

No Company Plan is a stock bonus, pension, or profit-sharing plan within the meaning of IRC Section 401(a).

(ix)

Each Qualified Plan of each Acquired Company is qualified in form and operation under IRC Section 401(a); each trust for each such Plan is exempt from federal income tax under IRC Section 501(a). Each Company VEBA is exempt from federal income tax. No event has occurred or circumstance exists that will or could give rise to disqualification or loss of tax-exempt status of any such Plan or trust.

(x)

Each Acquired Company and each ERISA Affiliate of an Acquired Company has met the minimum funding standard, and has made all contributions required, under ERISA Section 302 and IRC Section 402.

(xi)

No Company Plan is subject to Title IV of ERISA.

(xii)

The Acquired Companies have paid all amounts due to the PBGC pursuant to ERISA Section 4007.

(xiii)

No Acquired Company or any ERISA Affiliate of an Acquired Company has ceased operations at any facility or has withdrawn from any Title IV Plan in a manner that would subject to any entity or Sellers to liability under ERISA Section 4062(e), Section 4063, or Section 4064.

(xiv)

No Acquired Company or any ERISA Affiliate of an Acquired Company has filed a notice of intent to terminate any Title IV Plan or has adopted any amendment to treat a Title IV Plan as terminated. The PBGC has not instituted proceedings to treat any Company Plan as terminated. No event has occurred or circumstance exists that may constitute grounds under ERISA Section 4042 for the termination of, or the appointment of a trustee to administer, any Company Plan.

(xv)

No amendment has been made, or is reasonably expected to be made, to any Plan that has required or could require the provision of security under ERISA Section 307 or IRC Section 401(a)(29).

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(xvi)

No accumulated funding deficiency, whether or not waived, exists with respect to any Company Plan; no event has occurred or circumstance exists that may result in an accumulated funding deficiency as of the last day of the current plan year of any such Plan.

(xvii)

The actuarial report, if any, that is required to be prepared pursuant to applicable provisions of ERISA for any Pension Plan of each Acquired Company and each ERISA Affiliate of each Acquired Company fairly presents the financial condition and the results of operations of each such Plan in accordance with GAAP.

(xviii)

Since the last valuation date for each Pension Plan of each Acquired Company and each ERISA Affiliate of an Acquired Company, no event has occurred or circumstance exists that would increase the amount of benefits under any such Plan or that would cause the excess of Plan assets over benefit liabilities (as defined in ERISA Section 4001) to decrease, or the amount by which benefit liabilities exceed assets to increase.

(xix)

No reportable event (as defined in ERISA Section 4043 and in regulations issued thereunder) has occurred.

(xx)

No Seller or Acquired Company has Knowledge of any facts or circumstances that may give rise to any liability of any Seller, any Acquired Company, or Buyer to the PBGC under Title IV of ERISA.

(xxi)

No Acquired Company or any ERISA Affiliate of an Acquired Company has ever established, maintained, or contributed to or otherwise participated in, or had an obligation to maintain, contribute to, or otherwise participate in, any Multi-Employer Plan.

(xxii)

No Acquired Company or any ERISA Affiliate of an Acquired Company has withdrawn from any Multi-Employer Plan with respect to which there is any outstanding liability as of the date of this Agreement. No event has occurred or circumstance exists that would constitute a withdrawal from any Multi-Employer Plan, nor, to the Knowledge of any Acquired Company or any of the Sellers, has any event occurred that could otherwise result in any liability of either any Acquired Company or Buyer to a Multi-Employer Plan.

(xxiii)

No Acquired Company or any ERISA Affiliate of an Acquired Company has received notice from any Multi-Employer Plan that it is in reorganization or is insolvent, that increased contributions may be required to avoid a reduction in plan benefits or the imposition of any excise tax, or that such Plan intends to terminate or has terminated.

(xxiv)

No Multi-Employer Plan to which any Acquired Company or any ERISA Affiliate of an Acquired Company contributes or has contributed is, to the Knowledge of any Acquired Company or any Seller, a party to any pending merger or asset or liability transfer or is subject to any proceeding brought by the PBGC.

(xxv)

Neither the Acquired Companies nor the Acquired Companies’ other ERISA Affiliates have any obligation or liability under the Coal Act.

(xxvi)

Except to the extent required under ERISA Section 601 et seq. and IRC Section 4980B, no Acquired Company provides health or welfare benefits for any retired or former employee or is obligated to provide health or welfare benefits to any active employee following such employee’s retirement or other termination of service.

(xxvii)

Each Acquired Company has the right to modify and terminate benefits (other than pensions) to retirees who receive benefits by reason of having been employed by such Acquired Company and may exercise such rights both with respect to its employees who have not yet retired and with respect to those of its employees who have already retired.

(xxviii)

Sellers and all Acquired Companies have complied with the provisions of ERISA Section 601 et seq. and IRC Section 4980B.

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(xxix)

No payment that is owed or may become due to any director, officer, employee, or agent of any Acquired Company will be non-deductible to the Acquired Companies or subject to tax under IRC Section 280G or Section 4999; nor will any Acquired Company be required to “gross up” or otherwise compensate any such person because of the imposition of any excise tax on a payment to such person.

(xxx)

The consummation of the Contemplated Transactions will not result in the payment, vesting, or acceleration of any benefit.

3.14

COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS

(a)

Except as set forth in Part 3.14(a) of the Disclosure Letter:

(i)

each Acquired Company is, and at all times has been, in compliance in all material respects with each Legal Requirement that is or was applicable to it or to the conduct or operation of its business or the ownership or use of any of its assets, including, without limitation, each Environmental Law and Occupational Safety and Health Law and SMCRA;

(ii)

no event has occurred or circumstance exists that (with or without notice or lapse of time) (A) constitutes a violation by any Acquired Company of, or a failure on the part of any Acquired Company to comply with, any material Legal Requirement, or (B) gives rise to any obligation on the part of any Acquired Company to undertake, or to bear all or any portion of the cost of, any remedial action of any nature; provided, however, that excluded from (B) are reclamation obligations and liabilities under SMCRA in the Ordinary Course of Business that are typical of coal mining activities of the type conducted by the Acquired Companies; and

(iii)

no Acquired Company has received and not resolved, at any time since December 31, 2000, any notice or other communication (whether oral or written) from any Governmental Body or any other Person regarding (A) any actual, alleged, possible, or potential violation of, or failure to comply with, any Legal Requirement, or (B) any actual, alleged, possible, or potential obligation on the part of any Acquired Company to undertake, or to bear all or any portion of the cost of, any remedial action of any nature; provided, however, that excluded from (B) are reclamation obligations and liabilities under SMCRA in the Ordinary Course of Business that are typical of coal mining activities of the type conducted by the Acquired Companies.

(b)

Part 3.14(b) of the Disclosure Letter contains a complete and accurate list of each Governmental Authorization that is held by any Acquired Company or that otherwise relates to the business of, or to any of the assets owned or used by, any Acquired Company. Each Governmental Authorization listed or required to be listed in Part 3.14(b) of the Disclosure Letter is valid and in full force and effect in all material respects. Except as set forth in Part 3.14(b) of the Disclosure Letter:

(i)

each Acquired Company is, and at all times has been, in compliance in all material respects with all of the terms and requirements of each Governmental Authorization identified or required to be identified in Part 3.14(b) of the Disclosure Letter;

(ii)

no event has occurred or circumstance exists that (with or without notice or lapse of time) (A) constitutes or will result directly or indirectly in a violation of or a failure to comply with any material term or requirement of any Governmental Authorization listed or required to be listed in Part 3.14(b) of the Disclosure Letter, or (B) will result directly or indirectly in the revocation, withdrawal, suspension, cancellation, or termination of, or any modification to, any Governmental Authorization listed or required to be listed in Part 3.14(b) of the Disclosure Letter;

(iii)

no Acquired Company has received, at any time since December 31, 2000, any notice or other communication (whether oral or written) from any Governmental Body or any other Person regarding (A) any actual, alleged, possible, or potential violation of or failure to comply with

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any term or requirement of any Governmental Authorization, or (B) any actual, proposed, possible, or potential revocation, withdrawal, suspension, cancellation, termination of, or modification to any Governmental Authorization; and

(iv)

all applications required to have been filed for the renewal of the Governmental Authorizations listed or required to be listed in Part 3.14(b) of the Disclosure Letter have been duly filed on a timely basis with the appropriate Governmental Bodies, and all other material filings required to have been made with respect to such Governmental Authorizations have been duly made on a timely basis with the appropriate Governmental Bodies.

The Governmental Authorizations listed in Part 3.14(b) of the Disclosure Letter collectively constitute all of the Governmental Authorizations necessary to permit the Acquired Companies to lawfully conduct and operate their businesses in the manner they currently conduct and operate such businesses and to permit the Acquired Companies to own and use their assets in the manner in which they currently own and use such assets.

(c)

Except as set forth in Part 3.14(c) of the Disclosure Letter, the execution, delivery and performance by Sellers of this Agreement and the consummation by the Sellers of the transactions contemplated hereby (i) will require no action by or in respect of, or any Consent from, any Governmental Body, (ii) to the Knowledge of the Sellers and Company, will not give any Governmental Body the right to challenge any portion of the transactions contemplated by this Agreement or exercise any remedy or obtain any relief under any Legal Requirement to which any of the Acquired Companies are subject, or (iii) will not contravene, conflict with or result in a violation of any of the terms or requirements of, or give any Governmental Body the right to revoke, withdraw, suspend, cancel, or terminate any Governmental Authorization that is held by the Seller or the Acquired Companies or that otherwise relates to the Acquired Companies.

(d)

(i)    There are no Mining Authorizations other than as set forth in Part 3.14(d)(i) of the Disclosure Letter. The Acquired Companies hold the legal or beneficial title to the interest in each of the Mining Authorizations and each such Mining Authorization is in full force and effect.

(ii)    There are no applications for Mining Authorizations in the name of any of the Acquired Companies other than those set forth in Part 3.14(d)(ii) of the Disclosure Letter (the “Mining Applications”); and the Acquired Companies will, on grant of any of such applications, hold a legal or beneficial title to the interest in each such application as set forth in Part 3.14(d)(ii) of the Disclosure Letter; provided that Sellers are making no representations or warranties as to whether such Mining Applications will be granted. Except as set forth in Part 3.14(d)(ii) of the Disclosure Letter, each of the Mining Applications has been made in accordance with applicable Legal Requirements. None of the Sellers or any Acquired Company has received any written or other communication that indicates that any of the Mining Applications will not be granted.

(iii)   Each Acquired Company has complied in all material respects with the terms and conditions of the Mining Authorizations and with regard to each such Mining Authorization (i) no modification, suspension or revocation thereof is threatened in writing (or otherwise known to any Sellers); and (ii) no facts exist that permit or, upon the giving of notice or the lapse of time or otherwise would permit, revocation or termination of such Mining Authorization, except for expirations of Mining Authorizations which are set forth in Part 3.14(d)(iii) of the Disclosure Letter. There are no matters that adversely affect the title of any Acquired Company to any Mining Authorization or the use of the Mining Authorizations for the purposes of the business of any Acquired Company and in accordance with their terms.

(e)

The Acquired Companies have posted all deposits, letters of credit, guarantees, indemnities, trust funds, bid bonds, performance bonds, reclamation bonds and surety bonds (and all such similar undertakings) required to be posted in connection with their operations, including those necessary to secure the performance of the Acquired Companies’ respective reclamation or other obligations pursuant to, in connection with or as a condition of, the Governmental Authorizations (collectively, the “Acquired

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Companies’ Surety Bonds”). Except as set forth in Part 3.14(e) of the Disclosure Letter, neither of the Acquired Companies has received notice that the Acquired Companies’ Surety Bonds are not in amounts, or not in other respects, sufficient for their purpose. The Acquired Companies’ Surety Bonds are in full force and effect and no facts exist that will require any of the Acquired Companies to increase the amounts of the Acquired Companies’ Surety Bonds. All of the Acquired Companies’ Surety Bonds are listed in Part 3.14(e) of the Disclosure Letter and such list includes all obligees, beneficiaries, amounts, effective dates and the purpose of each such Acquired Companies’ Surety Bond. Except as disclosed in Part 3.14(e) of the Disclosure Letter: (A) each of the Acquired Companies is in compliance with all Acquired Companies’ Surety Bonds applicable to it; and (B) the state of reclamation with respect to the Acquired Companies’ Surety Bonds and Governmental Authorizations are “current” or in “deferred status” regarding reclamation obligations.

(f)

Neither the Sellers nor any Acquired Company, nor any Person “owned or controlled” by any Seller or any Acquired Company, nor any Person which “owns or controls” any Acquired Company, has been notified in writing or otherwise by the Federal Office of Surface Mining or the agency of any state administering the SMCRA or any comparable state statute, that it is: (i) ineligible to receive additional surface mining permits; or (ii) is under investigation to determine whether their eligibility to receive such Governmental Authorization should be revoked, i.e., “permit blocked.” No facts exist that presently or upon the giving of notice or the lapse of time or otherwise would render any of the Acquired Companies ineligible to receive surface mining permits. As used herein, the terms “owned or controlled” and “owns or controls” shall be defined as set forth in 30 C.F.R. Section 773.5 (1998).

3.15

LEGAL PROCEEDINGS; ORDERS

(a)

Except as set forth in Part 3.15 of the Disclosure Letter, there is no pending Proceeding that has been commenced by or against any Acquired Company or that otherwise has been commenced:

(i)

that relates to or may affect the business of, or any of the assets owned or used by, any Acquired Company;

(ii)

that challenges, or that may have the effect of preventing, delaying, making illegal, or otherwise interfering with, any of the Contemplated Transactions; or

(iii)

that is in respect of any Mining Authorization.

To the Knowledge of Sellers and the Acquired Companies, (1) no such Proceeding has been Threatened, and (2) no event has occurred or circumstance exists that is reasonably likely to give rise to or serve as a basis for the commencement of any such Proceeding. Sellers have delivered to Buyer copies of all pleadings, correspondence, and other documents relating to each Proceeding listed in Part 3.15 of the Disclosure Letter. The Proceedings listed in Part 3.15 of the Disclosure Letter will not have a material adverse effect on the business, operations, assets, condition, or prospects of any Acquired Company.

(b)

Except as set forth in Part 3.15 of the Disclosure Letter:

(i)

there is no Order to which any of the Acquired Companies, or any of the assets owned or used by any Acquired Company, is subject or in respect of any of the Mining Authorizations;

(ii)

none of the Sellers is subject to any Order that relates to the business of, or any of the assets owned or used by, any Acquired Company; and

(iii)

no officer or director, or to the Knowledge of the Company or any Seller any agent or employee, of any Acquired Company is subject to any Order that prohibits such officer, director, agent, or employee from engaging in or continuing any conduct, activity, or practice relating to the business of any Acquired Company.

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(c)

Except as set forth in Part 3.15 of the Disclosure Letter:

(i)

each Acquired Company is, and at all times has been, in full compliance with all of the terms and requirements of each Order to which it, or any of the assets owned or used by it, is or has been subject;

(ii)

no event has occurred or circumstance exists that may constitute or result in (with or without notice or lapse of time) a violation of or failure to comply with any term or requirement of any Order to which any Acquired Company, or any of the assets owned or used by any Acquired Company, is subject; and

(iii)

no Acquired Company has received any notice or other communication (whether oral or written) from any Governmental Body or any other Person regarding any actual, alleged, possible, or potential violation of, or failure to comply with, any term or requirement of any Order to which any Acquired Company, or any of the assets owned or used by any Acquired Company, is or has been subject.

(d)

Except as set forth in Part 3.15 of the Disclosure Letter, to the Company’s or Sellers’ Knowledge there are no existing claims by or disputes between Persons owning, controlling or occupying lands or realty adjoining or near any of the Real Property and/or reserves of the Acquired Companies or regarding adverse possession, the location of boundary lines, encroachments, mineral rights, subsidence, water quality or quantity, flood damage, blasting damage, trespass, waste, transportation of coal or other materials, nuisances or any other similar matter.

3.16

ABSENCE OF CERTAIN CHANGES AND EVENTS

(a)

change in any Acquired Company’s authorized or issued capital stock; grant of any stock option or right to purchase shares of capital stock of any Acquired Company; issuance of any security convertible into such capital stock; grant of any registration rights; purchase, redemption, retirement, or other acquisition by any Acquired Company of any shares of any such capital stock; or declaration or payment of any dividend or other distribution or payment in respect of shares of capital stock (exclusive of the distribution to Sellers of an aggregate of $1,503,130 in January 2005);

(b)

amendment to the Organizational Documents of any Acquired Company;

(c)

payment or increase by any Acquired Company of any bonuses, salaries, or other compensation to any stockholder, director, officer, or (except in the Ordinary Course of Business) employee or entry into any employment, severance, or similar Contract with any director, officer, or employee;

(d)

adoption of, or increase in the payments to or benefits under, any profit sharing, bonus, deferred compensation, savings, insurance, pension, retirement, or other employee benefit plan for or with any employees of any Acquired Company;

(e)

damage to or destruction or loss of any asset or property of any Acquired Company, whether or not covered by insurance, materially and adversely affecting the properties, assets, business, financial condition, or prospects of the Acquired Companies, taken as a whole;

(f)

entry into, termination of, or receipt of notice of termination of (i) any license, distributorship, dealer, sales representative, joint venture, credit, or similar agreement, or (ii) any Contract or transaction involving a total remaining commitment by or to any Acquired Company of at least $25,000;

(g)

sale (other than sales of inventory in the Ordinary Course of Business), lease, or other disposition of any material asset or property of any Acquired Company or mortgage, pledge, or imposition of any Encumbrance (other than Permitted Encumbrances) on any material asset or property of any Acquired Company, including the sale, lease, or other disposition of any of the Intellectual Property Assets;

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(h)

cancellation or waiver of any claims or rights with a value to any Acquired Company in excess of $25,000;

(i)

material change in the accounting methods used by any Acquired Company;

(j)

material adverse change in the business, operations, properties, prospects, assets, or condition of any Acquired Company, and no event has occurred or circumstance exists that are likely to result in such a material adverse change; or

(k)

agreement, whether oral or written, by any Acquired Company to do any of the foregoing.

3.17

CONTRACTS; NO DEFAULTS

(a)

Part 3.17(a) of the Disclosure Letter contains a complete and accurate list, and the Company or Sellers have delivered to Buyer true and complete copies, of:

(i)

each Applicable Contract that involves performance of services or delivery of goods or materials by one or more Acquired Companies of an amount or value in excess of $50,000;

(ii)

each Applicable Contract that involves performance of services or delivery of goods or materials to one or more Acquired Companies of an amount or value in excess of $50,000;

(iii)

each Applicable Contract that was not entered into in the Ordinary Course of Business and that involves expenditures or receipts of one or more Acquired Companies in excess of $50,000;

(iv)

each lease, rental or occupancy agreement, license, installment and conditional sale agreement, and other Applicable Contract affecting the ownership of, leasing of, title to, use of, or any leasehold or other interest in, any real or personal property (except personal property leases and installment and conditional sales agreements having a value per item or aggregate payments of less than $50,000 and with terms of less than one year);

(v)

each licensing agreement or other Applicable Contract with respect to patents, trademarks, copyrights, or other intellectual property, including agreements with current or former employees, consultants, or contractors regarding the appropriation or the non-disclosure of any of the Intellectual Property Assets;

(vi)

each collective bargaining agreement and other Applicable Contract to or with any labor union or other employee representative of a group of employees;

(vii)

each joint venture, partnership, and other Applicable Contract (however named) involving a sharing of profits, losses, costs, or liabilities by any Acquired Company with any other Person;

(viii)

each Applicable Contract containing covenants that in any way purport to restrict the business activity of any Acquired Company or any Affiliate of an Acquired Company or limit the freedom of any Acquired Company or any Affiliate of an Acquired Company to engage in any line of business or to compete with any Person;

(ix)

each Applicable Contract providing for payments to or by any Person based on sales, purchases, or profits, other than direct payments for goods;

(x)

each power of attorney that is currently effective and outstanding;

(xi)

each Applicable Contract entered into other than in the Ordinary Course of Business that contains or provides for an express undertaking by any Acquired Company to be responsible for consequential damages;

(xii)

each Applicable Contract for capital expenditures in excess of $50,000;

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(xiii)

each written warranty, guaranty, and or other similar undertaking with respect to contractual performance extended by any Acquired Company other than in the Ordinary Course of Business;

(xiv)

each agreement with respect to any hedging, swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions;

(xv)

all outstanding standby letters of credit, guarantees, subordination agreements and indemnity agreements, whether or not entered into in the Ordinary Course of Business, under which any Acquired Company may become liable for or obligated to discharge, or any asset of any Acquired Company is or may become subject to the satisfaction of, any indebtedness, obligations, performance or undertaking of other Persons (other than any Acquired Company) involving the potential expenditure by any Company after the date of this Agreement of more than $50,000 in any instance (or any such guarantee, subordination agreement or indemnity agreement involving the potential aggregate expenditure by any Acquired Company of more than $100,000);

(xvi)

all Employment Contracts of the Acquired Companies;

(xvii)

any Contract or agreement for the payment or receipt of license fees, commissions or royalties to or from any Person anticipated to be in excess of $50,000 individually or on an annual basis (or any such Contract or agreement providing for aggregate payments to or from any Person anticipated to be in excess of $100,000);

(xviii)

any other material agreement, commitment, arrangement or plan not made in the Ordinary Course of Business; and

(xix)

each amendment, supplement, and modification (whether oral or written) in respect of any of the foregoing.

(b)

Except as set forth in Part 3.17(b) of the Disclosure Letter:

(i)

none of the Sellers (and no Related Person of any Seller) has or may acquire any rights under, and none of the Sellers has or may become subject to any obligation or liability under, any Contract that relates to the business of, or any of the assets owned or used by, any Acquired Company; and

(ii)

no officer or director, or to the Knowledge of the Company or any Seller any agent, employee, consultant, or contractor, of any Acquired Company is bound by any Contract that purports to limit the ability of such officer, director, agent, employee, consultant, or contractor to (A) engage in or continue any conduct, activity, or practice relating to the business of any Acquired Company, or (B) assign to any Acquired Company or to any other Person any rights to any invention, improvement, or discovery.

(c)

Except as set forth in Part 3.17(c) of the Disclosure Letter, each Contract identified or required to be identified in Part 3.17(a) of the Disclosure Letter is in full force and effect and is valid and enforceable in accordance with its terms.

(d)

Except as set forth in Part 3.17(d) of the Disclosure Letter:

(i)

each Acquired Company is, and at all times has been, in material compliance with all applicable terms and requirements of each Contract under which such Acquired Company has or had any obligation or liability or by which such Acquired Company or any of the assets owned or used by such Acquired Company is or was bound;

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(ii)

to the Knowledge of the Sellers and of the Acquired Companies, each other Person that has or had any obligation or liability under any Contract under which an Acquired Company has or had any rights is, and at all times has been, in compliance with all applicable terms and requirements of such Contract;

(iii)

no event has occurred or circumstance exists that (with or without notice or lapse of time) is likely to contravene, conflict with, or result in a violation or breach of, or give any Acquired Company or to Sellers’ Knowledge any other Person the right to declare a default or exercise any remedy under, or to accelerate the maturity or performance of, or to cancel, terminate, or modify, any Applicable Contract; and

(iv)

no Acquired Company has given to or received from any other Person, at any time since December 31, 2001, any notice or other communication (whether oral or written) regarding any actual, alleged, possible, or potential violation or breach of, or default under, any Contract.

(e)

There are no renegotiations of, attempts to renegotiate, or outstanding rights to renegotiate any amounts paid or payable to any Acquired Company in an amount individually in excess of $50,000, or in the aggregate exceeding $100,000, under current or completed Contracts with any Person and no such Person has made written demand for such renegotiation.

(f)

The Contracts relating to the sale, design, manufacture, or provision of products or services by the Acquired Companies have been entered into in the Ordinary Course of Business and have been entered into without the commission of any act alone or in concert with any other Person, or any consideration having been paid or promised, that is or would be in violation of any Legal Requirement.

3.18

INSURANCE

(a)

Sellers have delivered to Buyer:

(i)

true and complete copies of all policies of insurance to which any Acquired Company is a party or under which any Acquired Company, or any director of any Acquired Company, is or has been covered at any time within the three (3) policy years preceding the date of this Agreement (a list of the policies in force for the current policy year is set forth in Part 3.18(a) of the Disclosure Letter);

(ii)

true and complete copies of all pending applications for policies of insurance; and

(iii)

any statement by the auditor of any Acquired Company’s financial statements with regard to the adequacy of such entity’s coverage or of the reserves for claims.

(b)

Part 3.18(b) of the Disclosure Letter describes any self-insurance arrangement by or affecting any Acquired Company, including any reserves established thereunder.

(c)

Part 3.18(c) of the Disclosure Letter sets forth, by year, for the current policy year and each of the three (3) preceding policy years:

(i)

a summary of the loss experience under each policy; and

(ii)

a statement describing the loss experience for all claims that were self-insured, including the number and aggregate cost of such claims.

(d)

Except as set forth on Part 3.18(d) of the Disclosure Letter:

(i)

All policies to which any Acquired Company is a party or that provide coverage to any Seller, any Acquired Company, or any director or officer of an Acquired Company:

(A)

are valid, outstanding, and enforceable;

(B)

are sufficient for compliance with all Legal Requirements and Contracts to which any Acquired Company is a party or by which any of them is bound;

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(C)

will continue in full force and effect following the consummation of the Contemplated Transactions; and

(D)

do not provide for any retrospective premium adjustment or other experienced-based liability on the part of any Acquired Company.

(ii)

No Seller or Acquired Company has received with respect to such policies (A) any refusal of coverage or any notice that a defense will be afforded with reservation of rights, or (B) any notice of cancellation or any other indication that any insurance policy is no longer in full force or effect or will not be renewed or that the issuer of any policy is not willing or able to perform its obligations thereunder.

(iii)

The Acquired Companies have paid all premiums due, and have otherwise performed all of their respective obligations, under each policy to which any Acquired Company is a party or that provides coverage to any Acquired Company or director thereof.

3.19

ENVIRONMENTAL AND SMCRA MATTERS

(a)

Each Acquired Company is, and at all times has been, in full compliance with, and has not been and is not in violation of, any Environmental Law and SMCRA. Except for reclamation liabilities under SMCRA and ongoing requirements under permits and similar obligations, all in the Ordinary Course of Business, no Acquired Company has any liabilities under any Environmental Law or SMCRA. No Seller or Acquired Company has any basis to expect, nor has any of them or any other Person for whose conduct they are or may be held to be responsible received, any actual or Threatened order, notice, or other communication from (i) any Governmental Body or private citizen acting in the public interest, or (ii) the current or prior owner or operator of any Facilities, of any actual or potential violation or failure to comply with any Environmental Law or SMCRA, or of any actual or Threatened obligation to undertake or bear the cost of any Environmental, Health, and Safety Liabilities with respect to any of the Facilities or any other properties or assets (whether real, personal, or mixed) in which Sellers or any Acquired Company has had an interest, or with respect to any property or Facility at or to which Hazardous Materials were generated, manufactured, refined, transferred, imported, used, or processed by Sellers, any Acquired Company, or any other Person for whose conduct they are or may be held responsible, or from which Hazardous Materials have been transported, treated, stored, handled, transferred, disposed, recycled, or received.

(b)

There are no pending or, to the Knowledge of Sellers and the Acquired Companies, Threatened claims, Encumbrances (other than Permitted Encumbrances), or other restrictions of any nature, resulting from any Environmental, Health, and Safety Liabilities or arising under or pursuant to any Environmental Law with respect to or affecting any of the Facilities or any other properties and assets (whether real, personal, or mixed) in which Sellers or any Acquired Company has or had an interest.

(c)

No Seller or Acquired Company has any basis to expect, nor has any of them or any other Person for whose conduct they are or may be held responsible, received, any citation, directive, inquiry, notice, Order, summons, warning, or other communication that relates to Hazardous Materials, or any alleged, actual, or potential violation or failure to comply with any Environmental Law or SMCRA, or of any alleged, actual, or potential obligation to undertake or bear the cost of any Environmental, Health, and Safety Liabilities with respect to any of the Facilities or any other properties or assets (whether real, personal, or mixed) in which Sellers or any Acquired Company had an interest, or with respect to any property or facility to which Hazardous Materials generated, manufactured, refined, transferred, imported, used, or processed by Sellers, any Acquired Company, or any other Person for whose conduct they are or may be held responsible, have been transported, treated, stored, handled, transferred, disposed, recycled, or received.

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(d)

No Seller or Acquired Company, or any other Person for whose conduct they are or may be held responsible, has any Environmental, Health, and Safety Liabilities with respect to the Facilities or with respect to any other properties and assets (whether real, personal, or mixed) in which Sellers or any Acquired Company (or any predecessor), has or had an interest, or at any property geologically or hydrologically adjoining the Facilities or any such other property or assets.

(e)

There are no Hazardous Materials present on or in the Environment at the Facilities or at any geologically or hydrologically adjoining property, including any Hazardous Materials contained in barrels, above or underground storage tanks, landfills, land deposits, dumps, equipment (whether moveable or fixed) or other containers, either temporary or permanent, and deposited or located in land, water, sumps, or any other part of the Facilities or such adjoining property, or incorporated into any structure therein or thereon. No Seller, Acquired Company, any other Person for whose conduct they are or may be held responsible, or any other Person, has permitted or conducted, or is aware of, any Hazardous Activity conducted with respect to the Facilities or any other properties or assets (whether real, personal, or mixed) in which Sellers or any Acquired Company has or had an interest, except in full compliance with all Environmental Laws.

(f)

There has been no Release or, to the Knowledge of Sellers and the Acquired Companies, Threat of Release, of any Hazardous Materials at or from the Facilities or at any other locations where any Hazardous Materials were generated, manufactured, refined, transferred, produced, imported, used, or processed from or by the Facilities, or from or by any other properties and assets (whether real, personal, or mixed) in which Sellers or any Acquired Company has or had an interest, or any geologically or hydrologically adjoining property, whether by Sellers, any Acquired Company, or any other Person.

(g)

Sellers have made available to Buyer true and complete copies and results of any reports, studies, analyses, tests, or monitoring possessed or initiated by Sellers or any Acquired Company pertaining to Hazardous Materials or Hazardous Activities in, on, or under the Facilities, or concerning compliance by Sellers, any Acquired Company, or any other Person for whose conduct they are or may be held responsible, with Environmental Laws.

3.20

EMPLOYEES

(a)

Part 3.20 of the Disclosure Letter contains a complete and accurate list of the following information for each employee or director of the Acquired Companies, including each employee on leave of absence or layoff status: employer; name; job title; current compensation paid or payable and any change in compensation since December 31, 2003; vacation accrued; and service credited for purposes of vesting and eligibility to participate under any Acquired Company’s pension, retirement, profit-sharing, thrift-savings, deferred compensation, stock bonus, stock option, cash bonus, employee stock ownership (including investment credit or payroll stock ownership), severance pay, insurance, medical, welfare, or vacation plan, other employee pension benefit plan or employee welfare benefit plan, or any other employee benefit plan or any director plan.

(b)

No employee or director of any Acquired Company is a party to, or is otherwise bound by, any agreement or arrangement, including any confidentiality, noncompetition, or proprietary rights agreement, between such employee or director and any other Person (“Proprietary Rights Agreement”) that in any way adversely affects or will affect (i) the performance of his duties as an employee or director of the Acquired Companies, or (ii) the ability of any Acquired Company to conduct its business, including any Proprietary Rights Agreement with Sellers or the Acquired Companies by any such employee or director. To the Company’s or Sellers’ Knowledge, no director, officer, or other key employee of any Acquired Company intends to terminate his employment with such Acquired Company.

(c)

Part 3.20 of the Disclosure Letter also contains a complete and accurate list of the following information for each retired employee or director of the Acquired Companies, or their dependents, receiving benefits

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or scheduled to receive benefits in the future: name, pension benefit, pension option election, retiree medical insurance coverage, retiree life insurance coverage, and other benefits.

3.21

LABOR RELATIONS; COMPLIANCE

3.22

INTELLECTUAL PROPERTY

3.23

CERTAIN PAYMENTS

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3.24

CUSTOMERS AND SUPPLIERS

3.25

SOLVENCY

3.26

OFFERS

3.27

DEBT; SECURITY INTERESTS

3.28

GRANTS AND ALLOWANCES

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3.29

RELATIONSHIPS WITH RELATED PERSONS

3.30

BROKERS OR FINDERS

3.31

DISCLOSURE

(a)

No representation or warranty of the Company in this Agreement and no statement in the Disclosure Letter or otherwise contained in this Agreement or in any related document furnished or to be furnished to the Buyer pursuant hereto under this Agreement contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact or any fact necessary to make the statements herein or therein, in light of the circumstances in which they were made, not misleading.

(b)

No notice given pursuant to Section 5.5 will contain any untrue statement or omit to state a material fact necessary to make the statements therein or in this Agreement, in light of the circumstances in which they were made, not misleading.

3.32

INFORMATION IN REGISTRATION STATEMENT

3A.

REPRESENTATIONS AND WARRANTIES OF EACH SELLER

3A.1

STOCKHOLDERS TITLE

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3A.2

AUTHORITY; NO CONFLICT

(a)

This Agreement constitutes the legal, valid, and binding obligation of Seller enforceable against such Seller in accordance with its terms, except as such may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditor’s rights generally, and by general equitable principles. Upon the execution and delivery by Seller of the Sellers’ Releases, the Sellers’ Releases will constitute the legal, valid, and binding obligations of such Seller, enforceable against Seller in accordance with their respective terms. Seller has the absolute and unrestricted right, power, authority, and capacity to execute and deliver this Agreement and to perform such Seller’s obligations under this Agreement. The Seller has the absolute and unrestricted right, power, authority, and capacity to execute and deliver the Sellers’ Releases and to perform such Seller’s obligations under the Sellers’ Releases.

(b)

Except as set forth in Part 3A.2 of the Disclosure Letter, neither the execution and delivery of this Agreement nor the consummation or performance of any of the Contemplated Transactions will, directly or indirectly (with or without notice or lapse of time) contravene, conflict with, or result in a violation of, or give any Governmental Body or other Person the right to challenge any of the Contemplated Transactions or to exercise any remedy or obtain any relief under, any Legal Requirement or any Order to which such Seller may be subject. Except as set forth in Part 3A.2 of the Disclosure Letter, such Seller is not and will not be required to give any notice to or obtain any Consent from any Person in connection with the execution and delivery of this Agreement or the consummation or performance of any of the Contemplated Transactions.

3A.3 INVESTMENT INTENT

3A.4 DISCLOSURE

(a)

No representation or warranty of Seller in this Agreement and no statement in the Disclosure Letter or otherwise contained in this Agreement or in any related document furnished or to be furnished to the Buyer pursuant hereto under this Agreement contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact or any fact necessary to make the statements herein or therein, in light of the circumstances in which they were made, not misleading.

(b)

No notice given pursuant to Section 5.5 will contain any untrue statement or omit to state a material fact necessary to make the statements therein or in this Agreement, in light of the circumstances in which they were made, not misleading.

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4.

REPRESENTATIONS AND WARRANTIES OF BUYER

4.1

ORGANIZATION AND GOOD STANDING

(a)

Buyer is a corporation duly organized, validly existing, and in good standing under the laws of the State of Virginia.

(b)

Buyer has delivered to Sellers copies of the Organizational Documents of Buyer, as currently in effect.

4.2

AUTHORITY; NO CONFLICT

(a)

This Agreement constitutes the legal, valid, and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, except as the enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other laws relating to or limiting creditors’ rights generally or by general principles of equity. Buyer has the absolute and unrestricted right, power, and authority to execute and deliver this Agreement and to perform its obligations under this Agreement.

(b)

Except as set forth in Schedule 4.2, neither the execution and delivery of this Agreement by Buyer nor the consummation or performance of any of the Contemplated Transactions by Buyer will give any Person the right to prevent, delay, or otherwise interfere with any of the Contemplated Transactions pursuant to:

(i)

any provision of Buyer’s Organizational Documents;

(ii)

any resolution adopted by the board of directors or the stockholders of Buyer;

(iii)

any Legal Requirement or Order to which Buyer may be subject; or

(iv)

any Contract to which Buyer is a party or by which Buyer may be bound.

4.3

INVESTMENT INTENT

4.4

CERTAIN PROCEEDINGS

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4.5

SEC REPORTS

4.6

BROKERS OR FINDERS

4.7

SHARES OF BUYERS STOCK

4.8

BUYER’S INVESTIGATION OF COMPANY

4.9

DISCLOSURE

4.10

SHAREHOLDER APPROVAL

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4.11

NO MATERIAL ADVERSE CHANGE

5.

COVENANTS OF SELLERS AND THE COMPANY

5.1

ACCESS AND INVESTIGATION

5.2

OPERATION OF THE BUSINESSES OF THE ACQUIRED COMPANIES

(a)

conduct the business of such Acquired Company only in the Ordinary Course of Business;

(b)

use their commercially reasonable efforts to preserve intact the current business organization of such Acquired Company, keep available the services of the current officers, employees, and agents of such Acquired Company, and maintain the relations and good will with suppliers, customers, landlords, creditors, employees, agents, and others having business relationships with such Acquired Company;

(c)

confer with Buyer concerning operational matters of a material nature;

(d)

comply with Legal Requirements and Governmental Authorizations;

(e)

make no capital expenditures without the written consent of Buyer;

(f)

maintain all buildings, equipment and tangible property in good repair, consistent with past practice;

(g)

make all payments called for in any lease or sublease relating to any real property leased, subleased or licensed by any of the Acquired Companies and maintain any such leases, subleases and licenses in force through the Closing Date and will not permit any of the Acquired Companies to commit any default under any of such leases, subleases or licenses or to amend or surrender any of such leases, subleases or licenses prior to the Closing Date;

(h)

continue to prepare monthly and year-to-date financial statements, consistent with those dated February 28, 2005, and deliver to Buyer such financial statements within thirty (30) days of each calendar month end prior to the Closing Date; and

(i)

otherwise report periodically to Buyer concerning the status of the business, operations, and finances of such Acquired Company.

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5.3

NEGATIVE COVENANT

5.4

REQUIRED APPROVALS

5.5

NOTIFICATION

5.6

PAYMENT OF INDEBTEDNESS BY RELATED PERSONS

5.7

NO NEGOTIATION

5.8

BEST EFFORTS

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5.9

RESIGNATIONS

5.10

COOPERATION IN FINANCING

5.11

NONCOMPETITION AND NONSOLICITATION

(a)

As an inducement for Buyer to enter into this Agreement and as additional consideration to be paid to Sellers, each Seller and each beneficiary of a Seller that is a trust agrees that:

(i)

for a period of five (5) years after the Closing Date, he, she or it will not, and will cause each of his or her Related Persons not to, directly or indirectly, (A) entice, induce or attempt to cause any officer or employee of any Acquired Company to terminate his or her employment with any Acquired Company or (B) hire or employ any such officer or employee or any individual whose employment with any Acquired Company ended less than one hundred eighty (180) days prior to such hiring or employment.

(ii)

for a period of five (5) years after the Closing Date, he, she or it will not, and will cause each of his or her Related Persons not to, directly or indirectly, solicit, with respect to Mining Activities, the business of any customer of any of the Acquired Companies; and

(iii)

at any time, he, she or it will not, and will cause each of his or her Related Persons not to, disparage Buyer or any of the Acquired Companies or any stockholder, director, officer, employee or agent of Buyer, its subsidiaries or the Acquired Companies.

(b)

As an additional inducement for Buyer to enter into this Agreement and as additional consideration to be paid to Sellers, each Seller and each beneficiary of a Seller that is a trust (other than ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇ Worth, each of whom is expressly addressed below) agrees that for a period of five (5) years after the Closing Date, he, she or it will not, and will cause each of his or her Related Persons not to, directly or indirectly, engage or invest in, own, manage, operate, finance, control or participate in the ownership, management, operation, financing or control of, be employed by (except as set forth in Part 5.11 of the Disclosure Letter), associated with or in any manner connected with, or render services or advice or other aid to, or guarantee any obligation of, any Person engaged in or planning to become engaged in Mining Activities within the Midwestern Coal Basin (defined herein as that geographic area designated on Schedule 5.11) or any other business whose activities compete in whole or in part with the business in which any of the Acquired Companies were engaged prior to the Closing within the Midwestern Coal Basin;

(c)

As an additional inducement for Buyer to enter into this Agreement and as additional consideration to be paid to Sellers, ▇▇▇ ▇▇▇▇ agrees that for a period of five (5) years after the Closing Date, he will

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not, and will cause each of his Related Persons not to, directly or indirectly, engage or invest in, own, manage, operate, finance, control or participate in the ownership, management, operation, financing or control of, be employed by, associated with or in any manner connected with, or render services or advice or other aid to, or guarantee any obligation of, any Person engaged in or planning to become engaged in Mining Activities within the Midwestern Coal Basin or any other business whose activities compete in whole or in part with the business in which any of the Acquired Companies were engaged prior to the Closing within the Midwestern Coal Basin; provided, however, that after the first anniversary of the Closing Date, ▇▇▇ ▇▇▇▇ shall be permitted to engage or invest in, own, manage, finance or control a business solely engaged in reclamation activities (as opposed to Mining Activities);

(d)

As an additional inducement for Buyer to enter into this Agreement and as additional consideration to be paid to Sellers, each of ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇ Worth agrees that for a period of three (3) years after the Closing Date, he will not, and will cause each of his Related Persons not to, directly or indirectly, engage or invest in, own, manage, operate, finance, control or participate in the ownership, management, operation, financing or control of, be employed by, associated with or in any manner connected with, or render services or advice or other aid to, or guarantee any obligation of, any Person engaged in or planning to become engaged in Mining Activities within the Midwestern Coal Basin or any other business whose activities compete in whole or in part with the business in which any of the Acquired Companies were engaged prior to the Closing within the Midwestern Coal Basin;

(e)

Each Seller, beneficiary of a Seller that is a trust or Related Person (a “Covered Party”) acknowledges that, in the event of a breach (as mutually agreed or as judicially determined) by any Covered Party of any covenant set forth in this Section 5.11, the term of such covenant will be extended by the period of the duration of such breach. Each Covered Party acknowledges that all of the restrictions in this Section 5.11 are reasonable in all respects, including duration, geographic territory and scope of activity restricted. Each Covered Party agrees that each of the covenants contained in this Section 5.11 shall be construed as separate agreements independent of any other provision of this Agreement or of any other agreement between Sellers and Buyer or any other entity. Each Covered Party agrees that the existence of any claim or cause of action by any Covered Party against Buyer or any other entity, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement of the covenants and restrictions contained in this Section 5.11. Each Covered Party acknowledges that the breach, or threatened breach, by any Covered Party of the provisions of this Agreement shall cause irreparable harm to Buyer, which harm cannot be fully redressed by the payment of damages to Buyer. Each Covered Party acknowledges that the duration and terms of this Section 5.11 are reasonable under the circumstances. Accordingly, Buyer shall be entitled, in addition to any other right or remedy it may have at law or in equity, to an injunction enjoining or restraining a Covered Party from any breach or threatened breach of this Agreement. Each Covered Party hereby waives the defense in any equitable proceeding that there is an adequate remedy at law for any such breach.

5.12

TAX MATTERS

(a)

Tax Indemnification. Notwithstanding anything in this Agreement to the contrary, Sellers shall indemnify Buyer and its respective Related Persons (including each Acquired Company) and hold them harmless from (a) all liability for Taxes of each Acquired Company for any tax period ending on or prior to the Closing Date, (b) all liability for Taxes of each Acquired Company for any Straddle Period to the extent allocated to the portion of the Straddle Period ending on the Closing Date in accordance with Section 5.12(b), (c) all liability for Taxes of any Acquired Company arising out of a breach of the representations and warranties contained in Section 3.11, (d) any liability for Taxes resulting from the failure by Sellers (or any Related Person thereof (other than the Acquired Companies)) or from the failure prior to the Closing of any Acquired Company to perform or observe in any respect Sellers’ (or its) obligations and covenants under this Section 5.12, (e) any payments required to be made by any Acquired Company after the Closing Date to any third party (other than

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any Acquired Company, Buyer (or any Related Person thereof) or any successor or transferee of any of the foregoing) under any Tax sharing, Tax indemnity, Tax allocation or similar contracts, whether or not written, entered into by such Acquired Company prior to the Closing, and (f) in the case of clauses (a), (b), (c), (d), or (e), all reasonable legal, accounting, appraisal, consulting, or similar fees and expenses attributable to such Taxes or liabilities; provided, however, and notwithstanding anything in this Section 5.12(a) to the contrary, Sellers shall be liable for Taxes only to the extent that such taxes are in excess of the amount reserved by the Acquired Companies for Taxes and which are reflected on the Balance Sheet and the Interim Balance Sheet. For the avoidance of doubt, no indemnification payments under this Section 5.12(a) shall be subject to the limitations on indemnity contained in Section 10; provided, however, indemnification payments relating to liability for sales and use, reclamation, excise and payroll taxes shall be subject to the limitations on indemnity contained in Section 10.

(b)

Straddle Period. In the case of each Straddle Period of each Acquired Company, the amount of any Taxes of such Acquired Company based on or measured by income or receipts of the Acquired Company allocable to the portion of the Straddle Period ending on the Closing Date shall be determined based on an interim closing of the Acquired Company’s books as of the close of business on of the Closing Date, consistent with its past practice for reporting items, except that exemptions, allowances or deductions that are calculated on a time basis, such as deduction for depreciation, shall be apportioned on a time basis (and for this purpose, the taxable period of any partnership or other pass-though entity in which such Acquired Company directly or indirectly holds a beneficial interest shall be deemed to terminate at such time) and the amount of other Taxes of the Acquired Companies allocable to the portion of the Straddle Period ending on the Closing Date shall be deemed to be the amount of such Tax for the entire taxable period multiplied by a fraction the numerator of which is the number of days in the taxable period ending on the Closing Date and the denominator of which is the number of days in such Straddle Period.

In respect of each Acquired Company, Buyer shall (or shall cause such Acquired Company to) timely pay all Taxes due in respect of all Straddle Periods of such Company; provided, however, that Sellers shall pay to Buyer, at least two (2) business days prior to the date on which such Taxes are due to the relevant taxing authority, an amount equal to the portion of such Taxes that would be indemnifiable by Sellers under Section 5.12(a) with respect to such Taxes and Straddle Period.

(c)

Responsibility for Filing Tax Returns. Sellers shall prepare or cause to be prepared and filed all Tax Returns for the Acquired Companies for all periods ending on or prior to the Closing Date. All such Tax Returns shall be prepared consistent with past practices. Sellers shall permit Buyer to review and comment on each such Tax Return. Buyer shall prepare or cause to be prepared all Tax Returns for the Acquired Companies filed with respect to Straddle Periods. Buyer shall permit Sellers to review and comment on each Tax Return that is described in the preceding sentence.

(d)

Cooperation on Tax Matters. Sellers and Buyer shall (and Buyer shall cause the Acquired Companies, officers, employees, agents, auditors and other representatives to) cooperate fully, as and to the extent reasonably requested by the other party, in connection with the preparation and filing of Tax Returns pursuant to this Section 5.12 and any audit, litigation or other proceeding with respect to Taxes, which cooperation shall include the retention and, upon request, the provision to the requesting person of records and information which are reasonably relevant to such Tax Returns or any such audit, litigation or other proceeding, and making employees available on a mutually convenient basis to provide additional information or explanation of any material provided hereunder. Buyer and Sellers shall (and Buyer shall cause the Acquired Companies and its Related Persons to) (i) retain all books and records with respect to Tax matters pertinent to the Acquired Companies relating to any whole or partial taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by Buyer or Sellers, any extensions thereof) of the respective taxable periods, and to abide by all record retention law and agreements entered into with any taxing authority, and (ii) give the other party reasonable written notice prior to transferring, destroying or discarding any such books

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and records and, if the other party so requests, Sellers or Buyer, as the case may be, shall allow the other party, at its own expense, to take possession of such books and records. Sellers and Buyer further agree, upon reasonable request, to use their Best Efforts to obtain any certificate or other document from any Governmental Body or any other Person as may be necessary to mitigate, reduce or eliminate any Tax that could be imposed (including, but not limited to, with respect to the transactions contemplated hereby) on any of the Sellers or any of the Acquired Companies for any taxable period beginning prior to the Closing Date.

(e)

Tax Sharing. All Tax sharing agreements or similar agreements with respect to or involving any of the Acquired Companies shall be terminated as of the Closing Date and, after the Closing Date, the Acquired Companies shall not be bound thereby or have any liability thereunder.

5.13

PLANT REPAIRS

6.

COVENANTS OF BUYER

6.1

APPROVALS OF GOVERNMENTAL BODIES

6.2

EFFORTS

6.3

SELLER GUARANTEES; BONDS

(a)

Seller Guarantees. At or prior to Closing, Buyer shall use its commerically reasonable efforts to cause Sellers who are parties to the Seller Guarantees set forth in Part 6.3 of the Disclosure Letter to be fully released and discharged with respect thereto, in each case, as of the Closing Date. With respect to any Seller Guarantees that are not fully released and discharged as of the Closing Date, Buyer and Sellers shall work together in good faith and shall use their respective commercially reasonable efforts to replace such Seller Guarantees and cause Sellers to be fully released and discharged therefrom as promptly as practicable following the Closing. Following the date of this Agreement and prior to Closing without the prior written consent of Buyer, Sellers shall not enter into any guarantees, indemnities, letters of credit, letters of comfort or similar obligations that would have been “Seller Guarantees” had they been entered into on or prior to the date hereof. Any such guarantees, indemnities, letters of credit, letters of comfort or similar obligations the entry into which shall have been approved

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by Buyer shall be deemed to be “Seller Guarantees” and shall be deemed to be included in Part 6.3(a) of the Disclosure Letter for all purposes of this Agreement.

(b)

Bonds. At or prior to Closing, Buyer shall: (i) secure, in accordance with Legal Requirements, irrevocable commitments to issue replacement bonds for all Seller Bonds sufficient to cause the applicable Governmental Authority to transfer the applicable Governmental Authorizations to Buyer in accordance with Legal Requirements; and (ii) deliver copies of such documents to Sellers. After the Closing Date, Buyer shall use commercially reasonable efforts to secure a new bond in replacement of the Seller Bonds. Each such replacement surety bond so provided by Buyer shall provide on its face that it “supersedes and replaces” the applicable Seller Bond. Furthermore, at the time of such replacement, Buyer shall deliver, or cause to be delivered, to Sellers, such other documents as may reasonably be requested by Sellers in order to permit Sellers to effect the full release and discharge of Sellers and all Related Persons of Sellers as contemplated hereby with respect to the Seller Bonds. Until Buyer secures the replacement of the applicable Seller Bonds in accordance with the provisions of this Section 6.3(b), Sellers shall maintain in full force and effect the Seller Bonds until the beneficiary of such bond accepts Buyer’s replacements thereof. Following the date of this Agreement and prior to Closing, without the prior written consent of Buyer (which consent will not be unreasonably withheld), Sellers shall not enter into any deposits, trust funds, bid bonds, performance bonds, surety bonds or similar undertakings that would have been “Seller Bonds” had they been entered into on or prior to the date hereof. Any such deposits, trust funds, bid bonds, performance bonds, surety bonds or similar undertakings the entry into which shall have been approved by Buyer shall be deemed to be “Seller Bonds” and shall be deemed to be included in Part 6.3(b) of the Disclosure Letter for all purposes of this Agreement. Buyer shall reimburse Sellers on a monthly basis for all reasonable and documented costs and expenses incurred by Sellers or the Related Persons of Sellers with respect to all such Seller Bonds that remain outstanding following the Closing Date.

(c)

Indemnification After Closing. Until the Seller Guarantees and Seller Bonds have been fully and finally released and discharged in accordance with this Section, Buyer shall indemnify and hold Sellers harmless from and against, and pay and reimburse Sellers for, any and all (i) Damages of Sellers that Sellers suffer as a result of being required to make any payment under the Seller Guarantees or Seller Bonds or otherwise incur expenses related thereto after the Closing Date related to either (x) the failure of any Acquired Company to meet its obligations underlying the Seller Guarantees or Seller Bonds or (y) the failure of Sellers (other than any Acquired Company) to be fully released from the Seller Guarantees or Seller Bonds, and (ii) Damages of Sellers that Sellers suffer related to such Seller Guarantees and Seller Bonds (including premium payments, bank fees, reasonable legal fees or similar costs) after the Closing Date relating to extension or renewal of Seller Bonds or Seller Guarantees that have not been fully released and discharged (Sellers, in their individual capacity, are under no obligation to extend or renew any Seller Bonds or Seller Guarantees following the Closing). Any payment required to be made by Buyer under this Section shall be made within ten (10) business days after Buyer’s receipt of written notice from Sellers describing in reasonable detail the amount owing hereunder.

(d)

Required Efforts. Notwithstanding the foregoing, in no event shall any party hereto be required to or otherwise file any lawsuit or to take other legal action, make any amendment to any Seller Guarantee or waive any rights thereunder or pay any amount, in order to cause the replacement and/or release and discharge of any Seller Bond or Seller Guarantee. After the Closing, Buyer will not, and will not permit any Acquired Company to, renew, extend, amend or supplement any loan, contract, lease or other obligation underlying any Seller Bond or Seller Guarantee with respect to which Sellers are not fully released and discharged as of the Closing Date in any manner that would materially extend or materially increase the liability of Sellers under such Seller Guarantee or Seller Bond without providing Sellers with evidence satisfactory to Sellers that Sellers have been fully released and discharged therefrom.

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6.4

ACCESS

6.5

NOTIFICATION

6.6

DIRECTOR AND OFFICER LIABILITY AND INDEMNIFICATION

6.7

INSURANCE

6.8

TREATMENT OF TRIAD MINING INC. PROFIT SHARING PLAN

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Plan into another plan that is qualified under Section 401(a) of the Code; provided, however, the accounts maintained for participants in the Profit Sharing Plan, or in the case of a merger of the Profit Sharing Plan into another plan, the portion of the accounts in the surviving plan that are attributable to the accounts that were maintained under the Profit Sharing Plan, shall continue to be subject to the covenant set forth above concerning the rights of the participants and/or beneficiaries, as the case may be, to direct the investment of such accounts.

7.

CONDITIONS PRECEDENT TO BUYER’S OBLIGATION TO CLOSE

7.1

ACCURACY OF REPRESENTATIONS

(a)

All of Sellers’ representations and warranties in this Agreement (considered collectively), and each of these representations and warranties (considered individually), must have been accurate in all material respects as of the date of this Agreement, and must be accurate in all material respects as of the Closing Date as if made on the Closing Date, without giving effect to any supplement to the Disclosure Letter.

(b)

Each of Sellers’ representations and warranties in Sections 3.3, 3.4, 3.16, 3A.1 and 3A.4 must have been accurate in all respects as of the date of this Agreement, and must be accurate in all respects as of the Closing Date as if made on the Closing Date, without giving effect to any supplement to the Disclosure Letter.

7.2

SELLERS’ PERFORMANCE

(a)

All of the covenants and obligations that Sellers are required to perform or to comply with pursuant to this Agreement at or prior to the Closing (considered collectively), and each of these covenants and obligations (considered individually), must have been duly performed and complied with in all material respects.

(b)

Each document required to be delivered pursuant to Section 2.4 must have been delivered, and each of the other covenants and obligations in Sections 5.4, 5.6 and 5.8 must have been performed and complied with in all respects.

7.3

CONSENTS

7.4

ADDITIONAL DOCUMENTS

(a)

an opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ & Manner, P.C., dated the Closing Date, in substantially the form of Exhibit 7.4(a);

(b)

copies of the Consents referred to in Section 7.3;

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(c)

a cross-receipt from Sellers acknowledging payment of the Purchase Price;

(d)

copies of the resolutions of the board of directors of the Company authorizing and approving this Agreement and the transactions contemplated hereby, certified by the Secretary of the Company to be true and complete and in full force and effect and unmodified as of the Closing Date;

(e)

certificates of good standing or existence with respect to each of the Acquired Companies issued by the appropriate Governmental Body of the jurisdiction of incorporation or formation and of each jurisdiction in which such Acquired Company is qualified to transact business as of a date not more than five (5) days prior to the Closing Date;

(f)

the resignations required by Section 5.9;

(g)

the Warranty Agreement executed by the Construction Firm required by Section 5.13;

(h)

the certificate of Sellers as to Section 5.13 repairs; and

(i)

such other documents as Buyer may reasonably request for the purpose of (i) enabling its counsel to provide the opinion referred to in Section 8.4(a), (ii) evidencing the accuracy of any of Sellers’ or the Company’s representations and warranties, (iii) evidencing the performance by any of the Sellers of, or the compliance by any of the Sellers with, any covenant or obligation (as contemplated hereby or in the Schedules/Disclosure Letter) required to be performed or complied with by any Seller, (iv) evidencing the satisfaction of any condition referred to in this Section 7, or (v) otherwise facilitating the consummation or performance of any of the Contemplated Transactions.

7.5

NO PROCEEDINGS

7.6

NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS

7.7

NO PROHIBITION

7.8

FINANCING

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8.

CONDITIONS PRECEDENT TO SELLERS’ OBLIGATION TO CLOSE

8.1

ACCURACY OF REPRESENTATIONS

8.2

BUYER’S PERFORMANCE

(a)

All of the covenants and obligations that Buyer is required to perform or to comply with pursuant to this Agreement at or prior to the Closing (considered collectively), and each of these covenants and obligations (considered individually), must have been performed and complied with in all material respects.

(b)

Buyer must have delivered each of the documents required to be delivered by Buyer pursuant to Section 2.4 and must have made the cash payments required to be made by Buyer pursuant to Sections 2.4(b)(i).

8.3

[INTENTIONALLY OMITTED]

8.4

ADDITIONAL DOCUMENTS

(a)

the opinions of Bass, ▇▇▇▇▇ & ▇▇▇▇ PLC and ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, dated the Closing Date, in substantially the form of Exhibit 8.4(a);

(b)

copies of the resolutions of the board of directors of Buyer authorizing and approving this Agreement and the transactions contemplated hereby, certified by the Secretary of Buyer to be true and complete and in full force and effect and unmodified as of the Closing Date;

(c)

a certificate of good standing or existence with respect to Buyer issued by the appropriate Governmental Body of the jurisdiction of incorporation as of a date not more than five (5) days prior to the Closing Date; and

(d)

such other documents as Sellers may reasonably request for the purpose of (i) enabling their counsel to provide the opinion referred to in Section 7.4(a), (ii) evidencing the accuracy of any representation or warranty of Buyer, (iii) evidencing the performance by Buyer of, or the compliance by Buyer with, any covenant or obligation (as contemplated hereby or in the Schedules) required to be performed or complied with by Buyer, (ii) evidencing the satisfaction of any condition referred to in this Section 8, or (v) otherwise facilitating the consummation of any of the Contemplated Transactions.

8.5

NO INJUNCTION

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9.

TERMINATION

9.1

TERMINATION EVENTS

(a)

by either Buyer or Sellers if a material Breach of any provision of this Agreement has been committed by the other party and such Breach is not curable or, if curable, is not cured by the party committing such Breach within thirty (30) days following written notice thereof by the non-breaching party or such Breach has not been waived;

(b)

(i)     by Buyer if any of the conditions in Section 7 has not been satisfied as of the Closing Date or if satisfaction of such a condition is or becomes impossible (other than through the failure of Buyer to comply with its obligations under this Agreement) and Buyer has not waived such condition on or before the Closing Date; or (ii) by Sellers, if any of the conditions in Section 8 has not been satisfied of the Closing Date or if satisfaction of such a condition is or becomes impossible (other than through the failure of Sellers to comply with their obligations under this Agreement) and Sellers have not waived such condition on or before the Closing Date;

(c)

by mutual consent of Buyer and Sellers; or

(d)

by either Buyer or Sellers if the Closing has not occurred (other than through the failure of any party seeking to terminate this Agreement to comply fully with its obligations under this Agreement) on or before June 30, 2005 or such later date as the parties may agree upon; provided, however, that in the event that Buyer elects to finance a portion of the Purchase Price through a registered equity offering pursuant to Section 7.8 and the effectiveness of Buyer’s Registration Statement on Form S-1 has been delayed by the process of securing SEC acceleration of effectiveness, Buyer may request an extension of the June 30, 2005 termination date and Sellers shall not unreasonably withhold their consent to such extension.

9.2

EFFECT OF TERMINATION

10.

INDEMNIFICATION; REMEDIES

10.1

SURVIVAL

10.2

INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLERS

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attorneys’ fees) or diminution of value, whether or not involving a third-party claim (collectively, “Damages”), arising, directly or indirectly, from or in connection with:

(a)

any Breach of any representation or warranty made by Sellers in this Agreement (without giving effect to any supplement to the Disclosure Letter), the Disclosure Letter, the supplements to the Disclosure Letter, or any other certificate or document delivered by Sellers pursuant to this Agreement;

(b)

any Breach of any representation or warranty made by Sellers in this Agreement as if such representation or warranty were made on and as of the Closing Date without giving effect to any supplement to the Disclosure Letter, other than any such Breach that is disclosed in a supplement to the Disclosure Letter and is expressly identified in the certificate delivered pursuant to Section 2.4(a)(v) as having caused the condition specified in Section 7.1 not to be satisfied;

(c)

any Breach by any Seller of any covenant or obligation of such Seller in this Agreement;

(d)

(i) any matters disclosed in Parts 3.13(vi) with respect to 3.13(d)(i) and 3.15(a) of the Disclosure Letter and (ii) any matters disclosed in Part 3.19(3) through (6) of the Disclosure Letter;

(e)

any claim by any Person for brokerage or finder’s fees or commissions or similar payments based upon any agreement or understanding alleged to have been made by any such Person with any Seller or any Acquired Company (or any Person acting on their behalf) in connection with any of the Contemplated Transactions; or

(f)

any claim by any Governmental Body, or any filed or threatened citizen’s suit, that any reclamation under SMCRA completed through Phase III (as that term is used in connection with the reclamation requirements under federal SMCRA) at or prior to the Closing Date is incomplete, inadequate, incorrectly done, or is otherwise not in full compliance with the requirements of SMCRA.

10.3

INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLERS—ENVIRONMENTAL MATTERS

(a)

any Environmental, Health, and Safety Liabilities arising out of or relating to: (i) (A) the ownership, operation, or condition at any time on or prior to the Closing Date of the Facilities or any other properties and assets (whether real, personal, or mixed and whether tangible or intangible) in which Sellers or any Acquired Company has or had an interest, (B) compliance with any Environmental Law on or prior to the Closing Date, including without limitation the deposit, posting or maintaining of any bond or other financial assurance required under any Environmental Law or (C) any Hazardous Materials or other contaminants that were present on the Facilities or such other properties and assets at any time on or prior to the Closing Date; or (ii) (A) any Hazardous Materials or other contaminants, wherever located, that were, or were allegedly, generated, transported, stored, treated, Released, or otherwise handled by Sellers or any Acquired Company or by any other Person for whose conduct they are or

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may be held responsible at any time on or prior to the Closing Date, or (B) any Hazardous Activities that were, or were allegedly, conducted by Sellers or any Acquired Company or by any other Person for whose conduct they are or may be held responsible; or

(b)

any bodily injury (including illness, disability, and death, and regardless of when any such bodily injury occurred, was incurred, or manifested itself), personal injury, property damage (including trespass, nuisance, wrongful eviction, and deprivation of the use of real property), or other damage of or to any Person, including any employee or former employee of Sellers or any Acquired Company or any other Person for whose conduct they are or may be held responsible, in any way arising from or allegedly arising from any Hazardous Activity conducted or allegedly conducted with respect to the Facilities or the operation of the Acquired Companies prior to the Closing Date, or from Hazardous Material that was (i) present or suspected to be present on or before the Closing Date on or at the Facilities (or present or suspected to be present on any other property, if such Hazardous Material emanated or allegedly emanated from any of the Facilities and was present or suspected to be present on any of the Facilities on or prior to the Closing Date) or (ii) Released or allegedly Released by Sellers or any Acquired Company or any other Person for whose conduct they are or may be held responsible, at any time on or prior to the Closing Date.

10.4

INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER

10.5

TIME LIMITATIONS

10.6

LIMITATIONS ON AMOUNT—SELLERS

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10.7

LIMITATIONS ON AMOUNT—BUYER

10.8

PROCEDURE FOR INDEMNIFICATION—THIRD PARTY CLAIMS

(a)

Promptly after receipt by an indemnified party under Section 10.2, 10.4, or (to the extent provided in the last sentence of Section 10.3) Section 10.3 of notice of the commencement of any Proceeding against it, such indemnified party will, if a claim is to be made against an indemnifying party under such Section, give notice to the indemnifying party of the commencement of such claim, but the failure to notify the indemnifying party will not relieve the indemnifying party of any liability that it may have to any indemnified party, except to the extent that the indemnifying party demonstrates that the defense of such action is materially prejudiced by the indemnifying party’s failure to give such notice.

(b)

If any Proceeding referred to in Section 10.8(a) is brought against an indemnified party and it gives notice to the indemnifying party of the commencement of such Proceeding, the indemnifying party will be entitled to participate in such Proceeding and, to the extent that it wishes (unless (i) the indemnifying party is also a party to such Proceeding and the indemnified party determines in good faith that joint representation would be inappropriate, or (ii) the indemnifying party fails to provide reasonable assurance to the indemnified party of its financial capacity to defend such Proceeding and provide indemnification with respect to such Proceeding), to assume the defense of such Proceeding with counsel satisfactory to the indemnified party and, after notice from the indemnifying party to the indemnified party of its election to assume the defense of such Proceeding, the indemnifying party will not, as long as it diligently conducts such defense, be liable to the indemnified party under this Section 10 for any fees of other counsel or any other expenses with respect to the defense of such Proceeding, in each case subsequently incurred by the indemnified party in connection with the defense of such Proceeding, other than reasonable costs of investigation. If the indemnifying party assumes the defense of a Proceeding, (i) it will be conclusively established for purposes of this Agreement that the claims made in that Proceeding are within the scope of and subject to indemnification; (ii) no compromise or settlement of such claims may be effected by the indemnifying party without the indemnified party’s consent unless (A) there is no finding or admission of any violation of Legal Requirements or any violation of the rights of any Person and no effect on any other claims that may be made against the indemnified party, and (B) the sole relief provided is monetary damages that are paid in full by the indemnifying party; (iii) the indemnified party will have no liability with respect to any compromise or settlement of such claims effected without its consent and (iv) the indemnified party will provide reasonable assistance in the defense of such Proceeding as reasonably requested by the indemnifying party (provided the reasonable expenses incurred by the indemnified party pursuant to its assistance shall be payable by the indemnifying party). If notice is given to an indemnifying party of the commencement of any Proceeding and the indemnifying party does not, within twenty (20) days after the indemnified party’s notice is given, give notice to the indemnified party of its election to assume

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the defense of such Proceeding, the indemnifying party will be bound by any determination made in such Proceeding or any compromise or settlement effected by the indemnified party.

(c)

Notwithstanding the foregoing, if an indemnified party determines in good faith that there is a reasonable probability that a Proceeding may adversely affect it or its affiliates other than as a result of monetary damages for which it would be entitled to indemnification under this Agreement, the indemnified party may, by notice to the indemnifying party, assume the exclusive right to defend, compromise, or settle such Proceeding, but the indemnifying party will not be bound by any determination of a Proceeding so defended or any compromise or settlement effected without its consent (which may not be unreasonably withheld).

(d)

Sellers hereby consent to the non-exclusive jurisdiction of any court in which a Proceeding is brought against any Indemnified Person for purposes of any claim that an Indemnified Person may have under this Agreement with respect to such Proceeding or the matters alleged therein, and agree that process may be served on Sellers with respect to such a claim anywhere in the world.

10.9

PROCEDURE FOR INDEMNIFICATION —OTHER CLAIMS

10.10

INSURANCE COVERAGE

10.11

RIGHT TO SET OFF

11.

GENERAL PROVISIONS

11.1

EXPENSES

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11.2

PUBLIC ANNOUNCEMENTS

11.3

CONFIDENTIALITY

11.4

NOTICES

▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Seller’s Agent

▇▇▇▇▇▇ ▇▇▇▇ Hurt & ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇

▇▇

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▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ & Manner, P.C. ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇ Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇

Buyer: ▇▇▇▇▇ River Coal Company ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇ Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇

with a copy to: Bass, ▇▇▇▇▇ & ▇▇▇▇, PLC ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇

and to: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP Suite 2800 ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇

11.5

JURISDICTION; SERVICE OF PROCESS

11.6

FURTHER ASSURANCES

11.7

WAIVER

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11.8

ENTIRE AGREEMENT AND MODIFICATION

11.9

DISCLOSURE LETTER

11.10

ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS

11.11

SEVERABILITY

11.12

SECTION HEADINGS, CONSTRUCTION

11.13

TIME OF ESSENCE

11.14

GOVERNING LAW

11.15

SELLERS’ AGENT; POWER OF ATTORNEY

(a)

Sellers’ Agent. The Sellers hereby appoint and constitute ▇▇▇▇▇▇ ▇. ▇▇▇▇, as Sellers’ Agent hereunder, to exercise the powers on behalf of Sellers set forth in this Agreement; and ▇▇. ▇▇▇▇ hereby accepts such appointment. In the event of the death, resignation or inability to act of ▇▇. ▇▇▇▇, and upon receipt

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by Buyer of evidence of the same which is satisfactory to Buyer, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ shall be successor Sellers’ Agent with all powers of his predecessor.

(b)

Power of Attorney. Each Seller, by his execution of this Agreement, hereby constitutes and appoints the Sellers’ Agent his true and lawful attorney in fact, with full power in his name and on his behalf:

(i)

to act on Sellers’ behalf according to the terms of this Agreement, including, without limitation, the power to contest or acquiesce in the determination of the Net Working Capital Adjustment; to amend this Agreement in accordance with Section 11.8; to consent to the assignment of rights under this Agreement in accordance with Section 11.10 to give and receive notices on behalf of all the Sellers; and to act on their behalf in connection with any matter as to which the Sellers jointly and severally are an “indemnified party” or “indemnifying party” under Article 10 hereof; all in the absolute discretion of the Sellers’ Agent;

(ii)

in general, to do all things and to perform all acts, including, without limitation, executing and delivering all agreements, certificates and receipts, instructions and other instruments contemplated by or deemed advisable in connection with this Agreement.

11.16

COUNTERPARTS

[Signature pages to follow.]

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By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇ Title: Chief Executive Officer

By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Title: President

/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇

/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇

/s/ ▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇

/s/ ▇▇▇▇ ▇. Worth ▇▇▇▇ ▇. Worth

/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇

By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

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By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Trustee

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/s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, Beneficiary

/s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, Beneficiary

/s/ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Beneficiary

/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, Beneficiary

/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, Beneficiary

/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, Beneficiary

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The ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Trust #4 is not included above under “Trust Beneficiaries” because ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, who has already signed in his individual capacity, is the sole beneficiary.

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