Exhibit 10.14
COAL MINING LEASE
THIS COAL MINING LEASE ("Lease") dated December 4, 2002, effective as of
December 1, 2002, by and between CSTL LLC ("Lessor"), a Delaware limited
liability company, and COASTAL COAL-WEST VIRGINIA, LLC ("Lessee"), a Delaware
limited liability company.
SECTION 1. LEASE FOR COAL MINING PURPOSES.
In consideration of the terms, conditions, and stipulations set forth to
be performed and observed by Lessee, Lessor, acting on its own behalf and with
the intention of exercising any right, option or power held by it on behalf of
any other person or entity, does, to the extent that it owns or controls same,
hereby demise, lease and let to Lessee, the sole and exclusive right of mining
and removing all of the coal (the "Leased Coal") lying in, on or under the
premises shown on the map attached hereto and made a part hereof as Exhibit A,
and hereinafter referred to as the "Leased Premises", together with such other
rights in or relating to the Leased Premises as may be necessary or convenient
for the mining, preparation, loading, removal, transportation and shipping of
the Leased Coal, Foreign Coal (as hereinafter defined), including the products
and by-products of each and synthetic fuel produced from each, and the
reclamation of the Leased Premises in connection therewith in accordance with
applicable law.
Without limiting the foregoing, to the extent that Lessor owns or
controls same, Lessee shall have all and exclusive coal and mining rights in, on
and under the Leased Premises and shall also have, subject to the provisions
hereof, the right to use as much of the surface of the Leased Premises, and the
right to take and use stone, soil and water thereon, as may be necessary for, or
incident to, (a) the mining, preparation, loading, removal, transportation and
shipping of Leased Coal and Foreign Coal; (b) the construction, maintenance and
use of all structures, fixtures, equipment, plant or facilities deemed necessary
or convenient by Lessee, including without limitation, preparation facilities,
synthetic fuel facilities, buildings, offices, impoundments, valley fills,
tipples, roads, railroads, utilities, pipelines, conveyors and other structures,
facilities and improvements necessary for, or incident to, the purposes of this
Lease; (c) storage of all such coal, any mine refuse and any equipment,
materials and supplies; (d) the dumping of rock, slate, overburden, fill
material and other refuse (including refuse from preparation of Foreign Coal);
(e) the pumping, discharge, deposit, treatment, diversion and draining of water;
and (1) the unrestricted right of ingress and egress to and from the Leased
Premises for any purposes incidental to the above.
Lessee shall have the right to mine the Leased Coal by all mining
methods now existing or hereafter developed, including surface mining methods
(including contour strip mining, mountaintop removal, area mining, and highwall
mining), and underground mining methods (including room and pillar and longwall
mining methods); provided, however, that Lessee shall not mine any Leased Coal
by the auger mining method without first obtaining the prior written consent of
Lessor, which consent shall not be unreasonably withheld, delayed or
conditioned. Lessor hereby waives the right to lateral and subjacent support and
any claim or liability for damages to the surface or subsurface, and grants
Lessee the right to subside the surface and overlying strata without liability
therefor.
Lessee is hereby granted the right to store upon and transport through,
over, across or under the Leased Premises Foreign Coal (as hereinafter defined),
and men, materials, supplies and equipment in connection with mining on the
Leased Premises or any other lands.
SECTION 2. RESERVATIONS AND EXCEPTIONS.
All rights, title and interest in the Leased Premises vested in Lessor
and not herein granted to
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
Lessee are reserved to Lessor, its successors and assigns.
Without limiting the generality of this reservation, there are hereby
expressly excepted from this Lease and reserved to Lessor, its successors and
assigns:
(1) all existing licenses, easements and rights-of-way to third
parties for railroad or other purposes heretofore granted by or
otherwise lawfully acquired from Lessor or its predecessors in
title;
(2) all oil, gas (including gas and/or methane in the Leased Coal,
provided, however, that Lessee shall have the right to vent,
liberate or otherwise remove such gas or methane in the course
of mining operations pursuant hereto without liability or
payment therefor), timber, and minerals other than coal;
(3) the following rights and privileges in and respecting the Leased
Premises:
(a)the right at all reasonable times to enter upon the Leased
Premises, and to drill, bore, excavate, cut, remove, develop,
store, and market (or to lease or license to others said
rights), all such oil, gas, timber and other minerals
hereinabove excepted;
(b)the right to construct and operate railroads, roads,
structures, and appliances which may be necessary for the
removal or processing of such oil, gas, timber and other
minerals, or to serve other properties of the Lessor;
(c)the right and privilege of leasing to tenants the surface of
the Leased Premises for the purposes of occupying and farming
said surface or of constructing thereon such facilities as may
be needed for the removal or processing of said oil, gas, timber
and other minerals; provided, however that, notwithstanding
anything in this Lease to the contrary, Lessor shall not without
Lessee's consent, which consent shall not be unreasonably
withheld, enter into leases for surface occupation, residential
purposes, farming or business development on property (i) within
the Permitted Areas or (ii) within areas reasonably designated
by Lessee as likely to be affected by Lessee's operations; and
(d)the right to grant and convey from time to time to any
electric or other power company, pipeline, gas, oil, mining or
railroad company, so much of the surface of the Leased Premises
as may be required for rights-of-way by such company or
companies; provided that Lessor shall use its commercially
reasonable efforts to ensure that such rights of way shall
include, for the benefit of Lessor and Lessee, the right to
demand relocation thereof at no cost in connection with
operations pursuant to this Lease.
In the event Lessor desires to exercise any of the rights reserved
herein and such exercise shall include operations to be conducted on a portion
of the Leased Premises with regard to which Lessee has posted a reclamation or
performance bond or has received a permit or other authorization from, or has a
pending permit application with, any federal, state, local or other governmental
agency to conduct operations on such portion of the Leased Premises or on any
area within three hundred (300) feet of any exterior permit boundary that would
require Lessee or the operator to obtain a waiver for such permit or operations
(collectively "Permitted Areas"), then Lessor shall give Lessee at least thirty
(30) days prior written notice thereof, and shall not exercise any such rights
with respect to any Permitted Areas without
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
Lessee's prior written consent, which consent shall not be unreasonably
withheld, delayed or conditioned. Without limiting the above, such consent can
be conditioned upon Lessor or its subsequent lessee or assign agreeing to remove
any equipment, material or fixtures that any of them might have installed that
subsequently interfere with Lessee's mining operations under this Lease. Lessor
shall reimburse Lessee for the reasonable additional costs added by Lessor's
operations to Lessee's costs of compliance with such bonds, permits, and/or
other authorizations or for costs related to accommodation of Lessor's
operations. Any lease, assignment or other transfer of the rights retained by
Lessor hereby shall contain provisions that expressly incorporate the provisions
set forth above.
Notwithstanding anything herein to the contrary, the rights granted to
Lessee by this Lease are dominant, and the rights and privileges hereby excepted
and reserved in this Section shall be exercised in such manner as to not
unreasonably interfere with Lessee's exercise of its rights hereunder or with
Lessee's mining operations in connection therewith, having due regard for the
requirements, convenience, and safety of said rights and operations; and
provided further, that Lessor shall indemnify Lessee for all direct costs and
liabilities incurred by Lessee resulting from Lessor's exercise of such rights
and privileges (including claims of personal injury or property damage resulting
from the activities of Lessor or any of Lessor's lessees, licensees, invitees,
contractors or subcontractors); provided, further, however, that it is not the
intent of this sentence that Lessee shall be entitled to charge Lessor any usage
fees for the exercise of reserved rights.
SECTION 3. TERM.
The initial term (the "Initial Term") of this Lease shall be for a
period of ten (10) years from the effective date set forth in the preamble
paragraph hereto (hereinafter, the "anniversary date"), unless sooner terminated
as hereinafter provided. This Lease shall be automatically extended upon the
expiration of the Initial Term for consecutive terms of five years each, up to a
maximum of fifty (50) years from the beginning anniversary date of the Initial
Term, subject to the right of Lessee to terminate this Lease on the expiration
of the Initial Term or the expiration of any subsequent five year extension
period by delivering written notice of its desire to do so to Lessor at least
ninety (90) days prior to such termination date For purposes of this Lease,
"Lease Year" shall mean the one year period beginning on the effective date
hereof with respect to the first Lease Year, and thereafter beginning on each
succeeding anniversary date.
In the event all the merchantable and mineable coal underlying the
Leased Premises shall have been mined and removed from the Leased Premises
pursuant to the provisions of this Lease and mining operations by Lessee have
ceased upon the Leased Premises, then this Lease shall cease and terminate upon
the date when all such coal shall have been mined and removed and such mining
operations have ceased. Notwithstanding anything herein to the contrary, (a) the
term of this Lease may be extended beyond such date by Lessee to the extent
reasonably required by Lessee to continue the operation of any facilities that
are located on the surface of the Leased Premises that are useful for the
handling or processing of any Foreign Coal, provided that Lessee shall pay
Lessor $[***] in annual rental at the same time and in the same manner that
Minimum Annual Royalty would have been payable hereunder; and (b) Lessee shall
have the right to enter upon the Leased Premises after the termination or
forfeiture of this Lease, without rental, (i) for the purpose of removing all of
Lessee's buildings, structures, machinery, equipment and other property from any
part of the Leased Premises following the termination of this Lease in
accordance with Section 14 hereof; and (ii) for the purpose of conducting
reclamation activities and complying with applicable law, provided that if
Lessee exercises its rights pursuant to subparagraph (b) above, the provisions
of the last four paragraphs of Section 5 shall apply during said time.
SECTION 4 ROYALTIES.
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
(a) Lessee shall pay to Lessor, CSTL LLC, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇ or at such other places as Lessor may from time to time designate in
writing, during the term of this Lease, a Tonnage Royalty in the amount of the
greater of [***] percent ([***]%) of the gross selling price for the coal mined
from the Leased Premises and sold during each calendar month of the term hereof
or $[***] per ton, to be received by Lessor within twenty (20) days from the end
of the month to which payment applies. In the event Lessor consents to mining on
the Leased Premises by the auger mining method then, and in that event, the
royalty attributable to all coal so mined by the auger mining method shall be
[***] percent ([***]%) of the Gross Selling Price.
(b) Beginning January 1, 2003 and thereafter during the Term hereof, as
same may be extended, Lessee shall pay to Lessor a Minimum Annual Royalty in the
amount of $[***], each payment to be made in advance, in equal quarterly
installments with each installment equal to one-fourth of the Minimum Annual
Royalty on the first day of January, April, July and October of each Lease Year.
Each quarterly payment shall hereinafter be referred to as a "Quarterly
Payment". Lessee shall have the right to recoup a Quarterly Payment at any time
after payment of same during the ten years following the date of payment, from
Tonnage Royalty Payments due after the payment date of the Quarterly Payment,
but in no event shall any credit be carried forward to any subsequent year for
any coal mined in excess of the required minimum during any given year.
The term "coal" referred to herein shall include any low-coal content
merchantable product that is sometimes sold and shipped under various trade
names including bone, coal, fuel and middlings, and, for purposes of this Lease,
synthetic fuel produced by Lessee from Leased Coal. The term "ton" referred to
herein shall mean 2,000 pounds.
Subject to the qualification hereinafter stated in this paragraph,
"gross selling price" of coal shall, for all purposes under this Lease, be the
amount received, by Lessee, upon sale thereof after preparation and/or tippling,
to an unaffiliated third party purchaser f.o.b. railroad cars, trucks or other
transport at the loading point at which Leased Coal mined hereunder has been
prepared and loaded for shipment to such unaffiliated third party purchaser,
without any deduction for selling expense or sale commission. It is this
section's intent that the gross selling price be the price received by Lessee or
its affiliates, in the last arm's length transaction between an unaffiliated
third party purchaser and Lessee or its affiliates for such Leased Coal. If
Lessee or any affiliate of Lessee shall consume any of the Leased Coal, the
price of the Leased Coal as consumed shall be considered equal to (1) the
average sales price of Leased Coal of comparable quality and as is then being
sold to unaffiliated third party purchasers, or (2) if there are no unaffiliated
third party purchasers, the average sales price of comparable coal in the open
market.
Lessee shall furnish to Lessor on or before the 20th day of each
calendar month the railroad and truck scale weights showing the quantity of
Leased Coal shipped from the Leased Premises and weights of Leased Coal, if any,
consumed on the Leased Premises or at the preparation plant or tipple during the
preceding calendar month. Lessee shall comply with all reasonable rules and
regulations which may be prescribed by Lessor's engineer for the ascertainment
of and payment of tonnage royalties on the Leased Coal mined and sold or
consumed under this Lease. Lessee shall keep accurate and correct books of
account showing all coal mined, and all coal consumed on, transported, or
shipped from the Leased Premises or elsewhere, together with the correct weights
and gross selling price thereof, to which books and records Lessor shall at all
reasonable times have access for verification of statements to be furnished by
Lessee for a period of five (5) years from the date of payment.
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
Lessor, for like purposes, is hereby authorized to demand and require of
any railroad company or other agents transporting the products of the Leased
Premises, inspection of its books and records, showing the weight and quantity
of such products and pertinent information in relation thereto. Lessee hereby
authorizes and requests such carriers and other agents to show Lessor, or its
agents, all such books and records and to furnish all such information when
requested.
In the event it shall be necessary or reasonably convenient in mining
Leased Coal to load the same over a tipple or tipples over which other coal is
loaded, thereby mixing the Leased Coal with other coal, Lessee shall keep a
strict account of the tonnage of Leased Coal as well as a strict account of the
tonnage of other coal being loaded over the same tipple or tipples. Before other
coal may be mixed with Leased Coal, the method of determining these respective
tonnages shall be approved in writing by the Engineer of Lessor consistent with
standard industry practice, which approval shall not be unreasonably withheld,
delayed or conditioned.
In the event Leased Coal is so commingled, then the Gross Selling Price,
as set forth in Section 4 hereof, shall be the average sales price for all coal
with which such Leased Coal is commingled, to the end that unless the Leased
Coal is mined, processed, stored and sold separately from all other coals, then
the Gross Selling Price shall be the Average Gross Selling Price for all coal
sold from the Lessee's facility with which Leased Coal is commingled.
(c) In addition to Tonnage Royalty payable under this Section, Lessee
shall pay to Lessor at the same time Tonnage Royalty is payable hereunder (and
Lessor shall pay to Fraharco Limited Partnership, when due), overriding royalty
required to be paid to Fraharco Limited Partnership under that certain Deed
dated January 1, 1992, from Fraharco Limited Partnership to Cat Run Coal
Company, with respect to mining of Leased Coal by Lessee.
(d) Lessor acknowledges that it holds the Leased Premises subject to,
and that it is required to pay, an Overriding Royalty in the amount of [***]
percent ([***]%) of Gross Selling Price, as defined in those certain Deeds,
dated of even date herewith, between Lessor, Lessee and El Paso CGP Company (the
"Deeds"), which Overriding Royalty was granted to El Paso CGP Company by such
Deeds. Lessor further acknowledges that the Tonnage Royalty rate set forth in
Section 4 (a) above includes such Overriding Royalty and that Lessor will remit
payment of the Overriding Royalty to the appropriate party in accordance with
the terms of the Deeds. Further, if Lessee pays royalty to Lessor as required
under this Lease, (i) Lessor will indemnify and hold Lessee harmless from any
and all claims, suits or other proceedings brought by the holder of such
Overriding Royalty interest seeking to enforce the rights thereto, and (ii) if
Lessor fails to remit such Overriding Royalty to the owner and holder thereof,
Lessee shall be entitled to set off against payments thereafter due to Lessor
under this Lease any amounts that Lessee pays directly to owner and holder of
the Overriding Royalty interest for or in satisfaction of the Overriding Royalty
payments not so remitted by Lessor.
SECTION 5 TAXES AND INSURANCE.
Lessor will, in the first instance, pay all the taxes, levies and
assessments on or in respect of Lessor's ownership of the Leased Premises and,
during the continuance of this Lease, Lessee shall reimburse to Lessor the
amount of such taxes, levies, and assessments attributable to the Leased Coal
and the Leased Premises, but excluding taxes attributable to all rights excepted
and reserved, if separately assessed, including taxes attributable to timber,
oil, gas and other minerals, promptly upon receipt of
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
Lessor's statement therefor, such amounts to constitute and be treated as
additional rental hereunder; provided that the obligation of Lessee shall be
prorated for any partial calendar years for the first year and the last year of
this Lease. Lessee shall promptly pay at the several times they become due and
payable all taxes levied or assessed upon coal mined from or products
manufactured from coal upon the Leased Premises. Lessee shall also pay any and
all taxes due to the state and/or its subdivision for severing, removing,
processing, or preparing of said coal, except for taxes on gross or net income
of Lessor on receipt of royalties, and Lessee shall also pay all royalties for
removal of coal required by any existing or future labor agreements of lessee,
its agents, operators or affiliates. If Lessor fails to pay the taxes, levies
and assessments set forth above or if there are any taxes or encumbrances due on
the Leased Premises, then Lessee may pay the same and any penalties, or redeem
the Leased Premises from a tax sale, and deduct the amount expended attributable
to taxes attributable to all rights excepted or reserved, if separately
assessed, as well as penalties and interest assessed due to Lessor's failure to
timely pay any taxes, levies and assessments, from any rents and royalties
subsequently accruing.
Lessee may, at any time during the continuance of this Lease, at its own
cost and expense, and after reasonable notice to Lessor of its intention so to
do, contest any of the taxes, levies, or assessments to be borne by Lessee as
above provided. In the event of any such contest, Lessee is authorized to
proceed in the name of Lessor with respect to the reversionary interest of
Lessor in the Leased Premises, but Lessee shall indemnify Lessor against any
costs, penalties, expenses, or interest charges arising out of such contest.
Lessee shall submit to Lessor, for its review, a copy of annual coal
appraisal reports or returns prepared pursuant to laws or regulations in the
State of West Virginia with respect to Lessor's ownership prior to the filing
with any governmental agency. It is understood and agreed that the taxes levied
or assessed from such reports are based, in part, upon the permitting and/or
production of Lessee and for that reason, Lessee's payments to Lessor as
provided for in this section shall continue and survive any termination of this
Lease until the earlier of such time as (a) said taxes levied or assessed are
not based on the designation of the Leased Coal as "permitted" under said coal
appraisal reports or returns, (b) the Leased Coal is leased to any third parties
(or if partially leased, to the extent so leased); or (c) five years following
termination of this Lease. Notwithstanding the foregoing, after termination of
the Lease, Lessee's responsibilities for payment of taxes shall be limited to
the incremental difference between the amount of taxes due based on the
designation of coal reserves as permitted on such coal appraisal reports or
returns and the amount of taxes that would be due if such reserves were
designated as unpermitted on such coal appraisal reports and returns. Lessor
shall use its commercially reasonable efforts to minimize all taxes payable by
Lessee under this Lease.
Lessee agrees that it shall comply with all of the terms and provisions
of the black lung laws (defined below) and will secure the payment of black lung
benefits (defined below) as hereinafter provided. "Black lung laws" mean the
Black Lung Benefits Act, Title 1V of the Federal Mine Safety and Health Act of
1977, 30 U.S.C. 901 et seq., and the Internal Revenue Code, 26 U.S.C. 1 et seq.,
Black Lung Benefits Reform Act of 1977 (P.L. 95-239), Black Lung Benefits
Revenue Act of 1977 (P.L. 75-227), Black Lung Benefits Revenue Act of 1981 (P.L.
97-119), as now or hereafter amended, and all rules and regulations adopted
pursuant thereto. "Black lung benefits" means any and all benefits payable
pursuant to the black lung laws. Lessee acknowledges that, as between itself and
Lessor, it is, and shall be deemed to be, the operator of any coal mine or coal
preparation facility or facility used for the extraction, preparation or
transportation of Leased Coal and of all related activities, including, but not
limited to, coal mine construction or maintenance, engaged in by Lessee pursuant
to the terms of this Lease with respect to any claim for black lung benefits
filed by or on account of any of its employees or former employees. To the
extent required under the black lung laws, Lessee shall secure and shall require
any other person or
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
entity who operates, controls or supervises a coal mine or coal preparation
facility on the Leased Premises or performs services of construction,
maintenance, transportation, or other activities related to coal mining or
preparation associated with this Lease, and who otherwise is liable for the
payment of black lung benefits, to secure the payment of such black lung
benefits to or on account of employees or former employees in accordance with
the black lung laws and shall provide Lessor, upon request, with appropriate
certification that each of them has provided security in compliance with all
black lung laws for the payment of such black lung benefits. Without limiting
the generality of Lessee's obligations to comply with all other provisions of
this Lease, Lessee agrees that it will secure and guarantee the payment of all
black lung benefits required to be paid under the black lung laws by reason of
mining, construction, transportation, and related activities under this Lease,
and Lessee does hereby agree that it will indemnify and hold Lessor harmless
from any liability or expenses, including reasonable attorney fees and expenses,
which Lessor may suffer directly or indirectly, as a result of or with respect
to any claim for black lung benefits filed by or on account of any of Lessee's
employees or former employees, or employees or former employees of others
operating on the Leased Premises pursuant to this Lease who may be required to
secure the payment of black lung benefits as provided above. Notwithstanding
anything in this Lease to the contrary, this Lease does not empower Lessor to
make any decisions and Lessor hereby expressly waives and disclaims any right to
make any decisions with respect to the terms and conditions under which the
leased coal is extracted or prepared, such as, but not limited to, the manner of
extraction or preparation or the amount of leased coal to be produced at any
particular time, all within the meaning of the black lung laws. The parties
hereto acknowledge, however, that Lessor has reserved certain rights and has
imposed certain requirements under the terms of this Lease solely for the
purpose of preventing waste and protecting the reserved rights of Lessor.
Lessee further covenants and agrees that all employees of Lessee and/or
any and all other persons performing work on the Leased Premises pursuant to the
rights granted in this Lease will be fully covered by or insured at all times by
Workers' Compensation, and to that end Lessee shall comply with all applicable
Workers' Compensation laws, rules and regulations and shall make all necessary
contributions and/or premium or other payments.
Lessee covenants and agrees to indemnify and save harmless Lessor, its
owners and its or their partners (general and limited), officers, directors,
agents, employees, successors and assigns from and against (a) any and all
claims, demands, actions or causes of action by or on behalf of any person,
firm, corporation or governmental body for damages, injuries, deaths, penalties,
fines, assessments or otherwise caused by, arising out of, resulting from or as
a consequence of, in whole or in part, (i) any acts or omissions of Lessee, its
officers, directors, employees, sublessees, contractors, subcontractors,
licensees, invitees, engineers, agents, successors, assigns or parent or
affiliated corporations or any other persons or entities acting by direct or
indirect authority of Lessee, or pursuant to any rights granted in this Lease or
(ii) the use and enjoyment of the Leased Premises pursuant to this Lease, or
(iii) the approval by Lessor of any Mine Plans (as hereafter defined) and (b)
any and all costs, counsel fees, expenses and liabilities incurred in or about
any such claim or action brought thereon. Notwithstanding anything herein to the
contrary, Lessee shall not be liable for special, consequential or punitive
damages incurred by Lessor, but as between Lessor and Lessee, Lessee shall be
liable for special, consequential or punitive damages incurred by unaffiliated
third parties as a result of Lessee's actions on the Leased Premises.
During the term of this Lease, Lessee shall carry, with a limit of $1
million per person and $5 million per occurrence, coal mine liability and
contractual liability insurance. Lessor shall be named as an additional insured
and provided a certificate of insurance reflecting such coverage, which shall
not be cancelable except after thirty (30) days' notice to Lessor. Such
insurance shall be written on an "occurrence" basis unless the policy is
available only on a "claims made" basis, in which case such
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
"claims made" insurance coverage shall be maintained in effect for a period of
at least five (5) years after the termination of this Lease, or until final
release of Lessee's environmental reclamation bonds required by any regulatory
authority, whichever shall last occur.
SECTION 6 METHOD OF OPERATION.
Upon termination of this Lease for any reason, Lessee shall, at Lessor's
option, to be exercised within thirty (30) days if at all, sell and convey to
Lessor, at fair market value, any real property owned by Lessee or its
affiliates within the Controlled Properties boundary as defined by the bold
green outline on Exhibit A.
Lessee covenants and agrees that when it commences operation in any of
the seams leased herein it will thereafter prosecute its operations hereunder
utilizing modern mining equipment and to conduct such operations in a careful,
skillful, and workmanlike manner, and in compliance with the present and any
future laws of the State of West Virginia and of the United States, and also
according to the rules and practices of good mining and with due regard for the
value of the Leased Premises as a coal producing property. Minimum Annual
Royalty paid hereunder shall be in lieu of any implied covenant of diligent
development.
Lessee shall be responsible for complying with all present and future
laws and governmental regulations, including environmental laws and regulations,
related to or controlling mining and related operations by Lessee, its
sublessees and contractors, on the Leased Premises, which responsibility shall
survive termination of this Lease. If Lessee violates, or is claimed to have
violated, laws or governmental regulations, then Lessee shall indemnify Lessor
and hold it harmless from any penalties, fines, costs, and expenses, including
legal fees and court costs, imposed upon or incurred by Lessor as a result of
said claim, violation or violations.
Notwithstanding Lessee's obligation to comply with all laws, rules,
regulations and orders as set forth above, Lessor shall not declare a default
hereunder solely as a result of one or more operational violations which Lessee
cures or abates as promptly as practical. Lessee shall be solely responsible for
treatment of any water discharge caused by its operations, if required by
present or future law or regulation, which responsibility shall survive
termination of this Lease. Lessor shall consent to Lessee's election of
post-mining land uses (including post-mining retention of roads and ponds in
place to the extent allowed by applicable law) and shall execute all consents,
waivers and authorizations reasonably requested by Lessee with respect thereto.
Lessee agrees that it will work and mine the coal in accordance with
general and detail maps and plans of mining and descriptions to be prepared by
Lessee (hereinafter collectively called "Mine Plans") and will submit a copy of
same to the Lessor. Said Mine Plans shall take into consideration the entire
area proposed to be developed by Lessee, and shall make suitable provisions for
(1) the proper protection of overlying and underlying seams consistent with the
terms of this Lease and (2) the reasonable and proper removal of all the
mineable and merchantable coal within such Mine Plans. No Mine Plan shall be
proposed which, if adopted, and Lessor may refuse to approve any Mine Plan that,
would render any substantial portion of otherwise mineable and merchantable coal
unmineable or unmerchantable or substantially more difficult or expensive to
mine. The Mine Plans shall be submitted to the Lessor at least thirty (30) days
prior to the commencement of any operation on the Leased Premises. In the event
Lessor determines that the Mine Plans submitted by Lessee fail to comply with
any of the terms of this Lease, Lessor shall so notify Lessee, in which event
Lessee will make reasonable attempts to modify the Mine Plans to comply with the
terms and conditions hereof. No material change in, modification of, or
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
departures from any Mine Plans so approved shall be made in the development or
operation of the mine or mines except pursuant to modified Mine Plans submitted
by Lessee to Lessor for the purpose of allowing Lessor to determine that said
modification complies with the terms of this Lease. Lessor's right to notify
Lessee that proposed mining plans fail to comply with this Lease is a right
reserved solely to protect Lessor's interest in the Leased Premises and to
prevent waste and is not intended to give and shall not be construed to give
Lessor any control over Lessee's operations. Lessor shall have no authority to
determine the manner in which or the methods by which any of Lessee's mining
operations are to be conducted, all of which shall be solely determined by
Lessee. Lessor acknowledges its approval of all Mine Plans of Lessee prepared
prior to the date hereof and made available to Lessor during Lessor's due
diligence review related to the transaction described in that certain Purchase
and Sale Agreement of even date herewith between Lessee and Lessor.
"Foreign Coal" is any coal mined from any lands other than the Leased
Premises, and "foreign coal refuse" is refuse resulting from the processing of
Foreign Coal.
Anything contained in this Lease to the contrary notwithstanding, the
Lessee shall give notice in writing to the Lessor at least six (6) months prior
to the start of any operations authorized herein which would require or result
in the displacement or removal of trees or timber on the surface of the Leased
Premises where said surface is owned by Lessor. The Lessor may, at its election,
remove such trees or timber. Lessor shall make all reasonable efforts to
complete any harvesting operations for trees or timber sold "on the ▇▇▇▇▇" prior
to start-up operations by Lessee, but it is understood that both activities may
continue simultaneously, provided such continuance does not unreasonably
interfere with Lessee's operations. Notwithstanding the foregoing, if Lessor has
not removed timber within such six (6) month period, Lessee may remove or
destroy such timber without liability or payment therefor. As an additional
option, Lessee may give written notice to Lessor and elect to reimburse Lessor
for such trees and timber at the fair market value and dispose of such trees or
timber in any manner it shall deem appropriate or necessary and upon making
payment in full, the Lessee shall not have any further obligation to the Lessor
with respect to such trees and timber or the disposition thereof.
Lessee may conduct its operations under this Lease through its
contractors or agents, provided in any case Lessee shall be and remain liable to
Lessor for all obligations of the Lessee under this Lease authority.
If it is found and reported to Lessee in writing by an agent of Lessor
that in the progress of the work any areas of merchantable and mineable coal
have been passed by or abandoned with the result that coal has not been mined
and removed, which in accordance with good mining practice should have been
mined and removed, it shall be the duty of Lessee to return as soon as
reasonably practicable to such areas and mine and remove the coal therefrom, or
failing so to do, Lessee shall account for the coal contained therein and pay
the royalty therefor the same as though it had been mined. If Lessee
subsequently mines and removes any coal which has been bypassed and paid for
within the contemplation of this Section, Lessee shall not be liable for any
additional royalty for such coal.
Lessee shall employ a competent mining engineer, duly registered in the
State of West Virginia, whose duty it shall be to keep up the mine surveys and
make accurate maps thereof, which maps shall at all reasonable times and upon
reasonable notice be subject to the inspection of Lessor, or its duly authorized
agents, and copies furnished to the Engineer of Lessor on or before February 1
and August 1 of each year. Such maps shall show the location of the coal section
numbers obtained by Lessor during mine inspections in a form convenient to
Lessee and acceptable to the Engineer of Lessor.
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
Lessee shall furnish Lessor copies of data derived from any and all
future coal exploration activities within the Leased Premises, including, but
not limited to, driller's logs, geophysical logs, and coal laboratory analyses
of core holes and associated geological maps.
Upon request of Lessor, Lessee shall make available for Lessor's
inspection and copying any and all laboratory analyses made of coal mined from
the Leased Premises.
Upon request of Lessor, Lessee shall make available for Lessor's
inspection and copying any and all Lessee's correspondence with government
agencies or departments which pertain to the Leased Premises, or to operations
undertaken or to be undertaken thereon.
Lessor, through its duly authorized agents, shall at all reasonable
times and its own risk have the right to enter said mines, inspect the same, and
have surveys made thereof to determine if all the terms and conditions of this
Lease are fully complied with, and for these purposes to use freely the means of
access to said mines and the workings thereof without hindrance, but in such
manner as not unreasonably to interfere with the operation thereof.
Lessor shall maintain all records furnished or made available pursuant
hereto in confidence.
SECTION 7 REMEDIES OF LESSOR.
All payments hereunder required to be made by Lessee to Lessor shall be
deemed and considered as rent reserved upon contract, and all remedies now or
hereafter given by the laws of the State of West Virginia for the collection of
rent are reserved to Lessor in respect of the sums so payable, and a lien is
hereby reserved upon this Lease and the leasehold estate hereby created, to
secure the payment of any and all sums.
If default be made by Lessee in the payment of the rentals and royalties
herein reserved, or in the performance of any of the other terms or conditions
hereof required to be kept or performed by Lessee, and such default shall
continue for a period of ten (10) days with respect to payment of rentals and
royalties, or thirty (30) days with respect to performance of any of the other
terms or conditions, after written notification thereof has been posted to
Lessee, then in such event and as often as the same occurs, Lessor may, at its
option, terminate this Lease without any further notice and re-enter upon and
take possession of the Leased Premises and hold and possess the same as its
absolute property free and clear of any claims of, by, or through Lessee, and
pursue any and all other remedies available under the laws of the State of West
Virginia for violation of any covenant or condition hereof, and all such
remedies shall be deemed cumulative and not exclusive. Notwithstanding the
foregoing, should physical conditions on the Leased Premises prohibit cure of
any default (other than payment of rental or royalty) by Lessee within the
prescribed thirty (30) day period, then Lessee shall be required to have
diligently and in good faith commenced curative measures and shall within ten
(10) days of notice of default advise Lessor in detail in writing as to what
physical conditions are prohibiting completion of such cure and setting forth a
timetable for such cure. Such notice by Lessee to Lessor shall toll the thirty
(30) day curative time until physical conditions on the Leased Premises permit
completion of curative work in a diligent good faith fashion. No action by
Lessor pursuant to this Section 7 shall impair the right to rental and royalties
due or accrued up to the time of termination and re-entry hereunder, but none
shall be charged for any period thereafter
Lessee further agrees that if the interest of Lessee in the Leased
Premises shall be sold on execution or judicial sale, or if bankruptcy
proceedings be begun by Lessee, or if Lessee be adjudged a
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
bankrupt, or it makes an assignment for the benefit of creditors, or a receiver
be appointed for it or for the Leased Premises, or if an assignment occurs by
operation of law, then, and in any such event, this Lease shall forthwith
terminate and be forfeited and the Leased Premises and all improvements thereon
shall forthwith become the property of Lessor, without compensation to Lessee,
and without refund of any royalties paid hereunder.
SECTION 8 ASSIGNMENT OR SUBLETTING.
Lessee covenants and agrees that it will not sell, assign, sublease,
mortgage, pledge or otherwise transfer or encumber (collectively "transfer")
this Lease or any rights, interests or estates created by this Lease or all or
any portion of the Leased Premises, either voluntarily or by operation of law,
without having first obtained the written consent of Lessor (which consent shall
not be unreasonably withheld or delayed, and in the case of an assignment,
without obtaining and presenting to Lessor a covenant of assumption by the
assignee, wherein such assignee expressly agrees to and with Lessor to assume
and be bound by all of the covenants, terms, conditions and provisions hereof to
the same extent as if said assignee had been named as the original Lessee.
Notwithstanding anything herein to the contrary, Lessee may transfer this Lease,
or any rights, interests or estates created by this Lease or all or any portion
of the Leased Premises to an entity affiliated with Lessee, its permitted
successors or assigns, without consent.
Any such transfer shall not relieve Lessee from its obligations to
comply with all the covenants, terms, conditions and provisions of this Lease,
unless otherwise agreed in writing by Lessor. In the event Lessor consents to
any transfer, such consent shall not relieve Lessee and/or any transferee,
assignee, sublessee, etc., from securing Lessor's written consent to any further
transfer, nor shall any such consent be construed as a consent to any further
transfer or as a waiver of any portion of this section or of Lessor's rights
hereunder.
A transfer of control of Lessee's capital stock, either voluntarily or
by operation of law, shall constitute a "transfer" of the Lease under this
section. "Transfer of Control" as used in the foregoing shall include, without
limitation, (a) an outright sale, assignment or transfer of sufficient shares of
Lessee's capital stock to vest 51% or more of Lessee's capital stock in persons
or entities controlled directly or indirectly by persons or entities, some or
all of whom are different than those persons or entities which directly or
indirectly control 51% or more of Lessee's capital stock as of the effective
date of this Lease, or (b) a sale, assignment or other transfer of shares of the
capital stock or ownership interest in any corporation, partnership or other
entity, which, as of the effective date of this Lease, owns, separately or
jointly with others, directly or indirectly, 51% or more of Lessee's capital
stock, where such transfer is sufficient to vest 51% or more of such capital
stock or ownership interest in persons or entities, some or all of whom are
different than those persons or entities owning such shares or ownership
interest as of the effective date of this Lease. Notwithstanding anything herein
to the contrary, the Transfer of Control of a publicly traded entity that
directly or indirectly controls 51% or more of Lessee's capital stock or the
issuance of publicly traded stock by Lessee or any entity directly or indirectly
controlling Lessee shall not constitute a transfer requiring consent hereunder.
Accordingly, a "transfer of control" shall have occurred whenever 51% or
more of Lessee's capital stock shall become subject to the direct or indirect
control of persons or entities, some or all of whom are different than those
persons or entities which directly or indirectly control that portion of
Lessee's capital stock as of the effective date of this Lease.
Lessee shall have the right, without Lessor's consent, to assign, pledge
or mortgage all
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
of Lessee's rights and interests under this Lease to any provider of
construction, interim, or long-term financing (including a leveraged lease), or
any refinancing thereof, and any trustee or agent acting on their behalf
("Lenders") as security for Lessee's obligations under all documents and
instruments evidencing, guaranteeing or executed by Lessee in connection with
any financing ("Financing Documents"). Such assignment, pledge or mortgage shall
be in writing, and a copy of such assignment, pledge or mortgage shall be
furnished by Lessee to Lessor. In the event of such an assignment, pledge or
mortgage and upon occurrence of an event of default by Lessee under this Lease
or the Financing Documents, as the case may be, the Lenders shall have the right
(but not the obligation) to assume, all of the rights, interests and obligations
of Lessee thereafter arising under this Lease. Lessor or Lessee, upon request of
the other shall promptly execute and deliver to the requesting party, and/or
their Lenders a written consent to any such assignment, pledge or mortgage of
this Lease and such written certificates as to the due authorization, execution
and delivery by the executing party, and enforceability against Lessor or Lessee
of this Lease as Lessor or Lessee and/or their Lenders may reasonably request.
Provided, however, in no event and under no circumstances shall any assignment,
pledge or mortgage of Lessee's rights and interests under this Lease to Lenders
be superior to any pledge or mortgage of the properties leased hereunder by
Lessor to a current or future lender who has or will supply financing or
refinancing (short or long-term) to Lessor or to a pledge or grant of the Lease
to said Lessor's Lender as security for said financing or refinancing, and,
accordingly, Lessee acknowledges that any assignment, pledge or mortgage of this
Lease to Lenders will be subordinate to Lessor's financing and the rights
thereunder, whether entered into now or at any time in the future.
Upon the occurrence of any such transfer without the prior written
approval of Lessor, Lessor shall have the option to terminate this Lease
pursuant to Section 7 of this Lease.
SECTION 9 WAIVERS AND RELEASES, ETC.
No waiver, release, modification, or amendment of any of the terms,
conditions, or provisions of this Lease shall be valid or set up or relied upon
by Lessor or Lessee, unless the same is in writing duly exercised by Lessor and
Lessee. The failure to exercise any right upon nonperformance shall not be
construed as a waiver of the right to insist on subsequent performance of the
terms and conditions hereof.
SECTION 10 ARBITRATION.
In the event of a dispute between the parties hereto with respect to the
terms of or performance under this Lease, such dispute shall be submitted to
three competent and disinterested arbitrators in the following manner. The party
desiring such arbitration shall select its arbitrator and give written notice
thereof to the other party, and shall in such notice state precisely the matter
or matters which it is proposed to bring before the arbitrators, and only the
matters so stated shall be considered and decided by them. If the party
receiving such notice shall fail to name an arbitrator within thirty (30) days
after notice as aforesaid has been given to it, the Chief Judge of the District
Court of the United States for the Southern District of West Virginia and shall
name and appoint an arbitrator for and in behalf of the party so in default, and
the arbitrator so named and appointed shall have the same power and authority as
if he had been appointed by such party. The arbitrators so chosen shall appoint
a third arbitrator, and in the event they are unable to agree on such
appointment, the appointment of the third arbitrator may be made by the Chief
Judge of the District Court of the United States for the Southern District of
West Virginia on the application of either of the parties hereto. The three
arbitrators shall immediately upon their selection hear and decide the question
or questions submitted for arbitration and shall give to each of the parties
hereto reasonable notice of the time and place of their meetings, and reasonable
opportunity for the production of evidence. Each party shall set forth its
position in writing. After hearing both parties, the
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
arbitrators shall promptly make an award in writing upon the question or
questions submitted and shall serve a copy of such award upon each party hereto.
The award of such arbitrators, or a majority of them, shall be final and binding
upon the parties hereto, and the said arbitrators or a majority of them, shall,
in their award and as a part thereof, decide by whom and in what proportion the
costs of such arbitration shall be borne and paid and the amount of such costs.
In its determination, the arbitrators in their award shall adopt the position of
one of the parties. Neither party hereto shall have or enforce any right or
remedy against the other in respect of any matter herein made the subject of
arbitration, until such matter shall have been submitted to and decided by
arbitration in the manner above provided, and then only in accordance with such
decision in arbitration. Notwithstanding the above, either Party may appeal
manifest errors of law to the District Court of the United States for the
Southern District of West Virginia.
SECTION 11 NOTICES.
Until written notice of a different address, all notices which are
anywhere in this Lease provided to be given shall be served upon or mailed to
Lessee at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and to Lessor at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇; ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
SECTION 12 WARRANTY.
The Lessor, for itself, its successors and assigns, does hereby covenant
and agree with the Lessee, subject to the exceptions and reservations herein set
forth, and subject to such limitations, restrictions and defects in Lessor's
title to the Leased Premises as were in existence at the time of Lessor's
acquisition of title to the various tracts comprising the Leased Premises, that
upon the payment of the rentals and royalties and the performance of all and
singular the covenants and agreements aforesaid, said Lessee shall and may
peaceably and quietly have and enjoy said Leased Premises for and during the
term aforesaid, and for the purposes aforesaid, free from any let or hindrance
by the Lessor, its successors and assigns. Lessor does not warrant generally its
title to the Leased Premises but warrants only that it has done no act to
encumber the titles which it acquired to the various tracts comprising the
Leased Premises since its acquisition of said tracts which would substantially
interfere with the operations of the Lessee hereunder. In the event that Lessee
did not have the right to mine coal in any part of the Leased Premises because
of the rights of a holder of an outstanding superior title antedating Lessor's
acquisition of title to the tract or tracts in question, if the Lessee has mined
and removed a part or all of the coal therefrom and paid the Lessor therefor on
the royalty basis, the Lessor agrees to repay to the Lessee the amount of
royalty so paid, without interest, but the Lessor shall not be otherwise liable
for any damage to Lessee on account of the mining and removing of said coal by
the Lessee.
SECTION 13 SUCCESSORS AND ASSIGNS.
All covenants, agreements, and conditions herein set forth to be
performed by or on behalf of Lessor or Lessee shall bind their respective
successors and assigns, whether so expressed or not, and shall inure to the
benefit not only of Lessor and Lessee, but also the benefit of their respective
successors and assigns; but this Section 13 shall not be construed as in anywise
modifying the provisions of Section 8 hereof.
SECTION 14 REMOVAL OF PROPERTY.
Lessee, having performed all the terms and conditions of this Lease to
be by it performed, may, for a period of twelve (12) months following
termination or expiration, remove any and all equipment and personal property
owned by Lessee, and may remove from the surface overlying the Leased Premises
any
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
and all improvements, buildings, or other structures placed thereon by Lessee
during the term hereof. If the Lessee shall fail to remove any of the equipment
and personal property described above within said twelve (12) months, then at
Lessor's option the same shall thereupon be and become the absolute property of
Lessor.
SECTION 15 MISCELLANEOUS.
Unless expressly provided for elsewhere in this Lease, this Lease shall
be interpreted in accordance with the following provisions:
(a) Whenever the context may require, any pronoun used in this
Lease shall include the corresponding masculine, feminine, or neuter forms, and
the singular form of nouns, pronouns and verbs shall include the plural and vice
versa.
(b) If a word or phrase is defined, its other grammatical forms
have a corresponding meaning.
(c) A reference to a person, corporation, trust, estate,
partnership, or other entity includes any of them.
(d) The headings contained in this Lease are for reference
purposes only and shall not affect the meaning or interpretation of this Lease.
(e) A reference to legislation or to a provision of legislation
includes a modification or reenactment of it, a legislative provision
substituted for it and a regulation or statutory instrument issued under it.
(f) A reference to a writing includes a facsimile transmission
of it and any means of reproducing of its words in a tangible and permanently
visible form.
(g) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Lease shall refer to this Lease as a whole and
not to any particular provision of this Lease, and article, section, subsection,
schedule and exhibit references are to this Lease unless otherwise specified.
(h) The word "including" shall mean including without
limitation.
(i) The Exhibits identified in this Lease are incorporated
herein by reference and made a part of this Lease.
(j) The parties have participated jointly in the negotiation and
drafting of this Lease. In the event an ambiguity or question of intent or
interpretation arises, this Lease shall be construed as if drafted jointly by
the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Lease.
(k) Lessor and Lessee agree to execute and record a short-form
or memorandum of lease for the purpose of providing record notice of this Lease.
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
IN TESTIMONY WHEREOF, the parties hereto have caused this Lease to be
executed in their respective names by their respective representatives thereunto
duly authorized, all as of the day and year first above written.
Executed in duplicate.
CSTL LLC
By NRP(Operating) LLC
Its Sole Operating Manager
By /s/ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, Its Vice President
COASTAL COAL-WEST VIRGINIA, LLC
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, Its President
STATE OF West Virginia
COUNTY OF Kanawha, SS:
The foregoing instrument was acknowledged before me this 4th day of December,
2002, by ▇▇▇▇▇ ▇▇▇▇, Vice President of NRP (Operating) LLC, sole operating
manager of CSTL LLC, on behalf of CSTL LLC, a limited liability company.
My commission expires March 13, 2005
/s/ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Notary Public (SEAL)
STATE OF West Virginia
COUNTY OF Kanawha, SS:
The foregoing instrument was acknowledged before me this 4th day of December,
2002, by ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, as President of COASTAL COAL-WEST VIRGINIA, LLC, on
behalf of COASTAL COAL-WEST VIRGINIA LLC, a limited liability company.
My commission expires: March 13, 2005
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Notary Public
(SEAL)
Leases/model/se
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
LEASE ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS LEASE ASSIGNMENT AND ASSUMPTION AGREEMENT ("Agreement") is
made and entered into as of this 6th day of March, 2003, by and between ▇▇▇▇▇▇
RUN MINING COMPANY, LLC formerly known as Coastal Coal West Virginia, LLC, a
Delaware limited liability company ("Assignor"), and KINGWOOD MINING COMPANY,
LLC, a Delaware limited liability company (`Assignee"). Assignor and Assignee
are individually referred to in this Agreement as a "Party" and collectively as
the "Parties."
WITNESSETH
WHEREAS, Assignor desires to assign to Assignee all of its rights and
obligations under the leases related to its Kingwood mining operation described
on Exhibit A attached hereto (the "Kingwood Leases"), which exhibit is hereby
made a part of this Agreement; and
WHEREAS, Assignee desires to accept such assignment and assume
Assignor's obligations under the Kingwood Leases.
NOW THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt of which is hereby acknowledged the Parties
agree as follows:
1. Assignment of Rights and Obligations. Assignor hereby grants,
bargains, sells, conveys, transfers, and assigns absolutely and delegates to
Assignee, and Assignee hereby accepts, all of Assignor's rights, benefits, title
and interest in and to the Kingwood Leases. This assignment shall be effective
as of the date of this Agreement. On or after the date hereof, Assignor will
execute and deliver to Assignee all such further assignments, endorsements and
other documents as are reasonably requested in order to complete the sale,
assignment, transfer, conveyance and delivery of the Kingwood Leases.
2. Acceptance of Obligations. Assignee hereby assumes all obligations
associated with the Kingwood Leases on and after the date hereof. Assignee
accepts the Kingwood Leases "as is, where is."
3. Further Assurances. The Parties agree that they shall cooperate
reasonably with each other (i) to furnish upon request to each other such
further information, (ii) to execute and deliver to each other such other
documents, and (iii) to do such other acts and things, all as the other Party
may reasonably request, for the purpose of carrying out the intent of this
Agreement.
4. Consideration. In exchange for accepting the Kingwood Leases and the
real property and other tangible and intangible assets related to its Kingwood
mining operation and for assuming the obligations thereunder, Assignee shall
issue to Assignor one (1) Membership Unit of Assignee, representing 100% of the
equity interest of Assignee.
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
5. Benefit. This Agreement shall be binding upon and inure to the
benefit of the Parties and their respective successors and assigns.
6. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of West Virginia.
7. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument. Any counterpart of this
Agreement which has attached to it separate signature pages, which together
contain the signatures of all the Parties, shall for all purposes be deemed a
fully executed original.
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed by a duly authorized person as of the date first written above.
▇▇▇▇▇▇ RUN MINING COMPANY, LLC
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
KINGWOOD MINING COMPANY, LLC
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.
STATE OF Virginia
COUNTY OF Washington, to-wit:
The foregoing instrument was acknowledged before me this 6th day of
March, 2003, by ▇▇▇▇▇ ▇. ▇▇▇▇▇, the Secretary of ▇▇▇▇▇▇ Run Mining
Company, LLC, a Delaware limited liability company, for and on behalf of
that company.
My commission expires: 11/30/05
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Notary Public
(NOTARIAL SEAL)
STATE OF Virginia
COUNTY OF Washington, to-wit:
The foregoing instrument was acknowledged before me this 6th day of
March, 2003, by ▇▇▇▇▇ ▇. ▇▇▇▇▇ the Secretary of Kingwood Mining Company,
LLC, a Delaware limited liability company, for and on behalf of that
company.
My commission expires: 11/30/05
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Notary Public
(NOTARIAL SEAL)
THIS INSTRUMENT WAS PREPARED BY ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & BATTLE,
PLLC, ▇▇▇▇▇▇▇ CENTER, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇, P. 0. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇.
The symbol [***] is used to indicate that a portion of the exhibit has been
omitted and filed separately with the commission. Confidential treatment has
been requested with respect to the omitted portion.