Exhibit 10.1

 

ACCELERATION AND RELEASE AGREEMENT

 

THIS ACCELERATION AND RELEASE AGREEMENT (this “Agreement”), dated effective as
of August 19, 2014 (the “Effective Date”) is entered into by and between Cloud
Peak Energy Inc., a Delaware corporation (“CPE”) and Rio Tinto Energy
America Inc., a Delaware corporation (“RTEA”).

 

RECITALS

 

WHEREAS, CPE and RTEA entered into a Tax Receivable Agreement, dated as of
November 19, 2009, (the “TRA”) in which CPE and RTEA agreed to certain tax
arrangements in connection with RTEA’s sale of membership units of Cloud Peak
Energy Resources LLC to CPE in 2009 and related payments based on such
transaction to be made over time from CPE to RTEA; and

 

WHEREAS, CPE and RTEA desire to accelerate the amount due from CPE to RTEA under
the TRA and provide mutual releases thereunder, as specifically set forth in
this Agreement.

 

NOW, THEREFORE, in consideration of the foregoing and the respective covenants
and agreements set forth herein, and intending to be legally bound hereby, the
parties hereto agree as follows:

 

AGREEMENT

 

1.                                      Acceleration Payment.  CPE shall pay
RTEA Forty-Five Million Dollars ($45,000,000.00) in United States currency (the
“Acceleration Payment”) in satisfaction of the acceleration and release under
the TRA.  The Acceleration Payment will be made in a single lump sum by a wire
transfer of immediately available funds, to a bank account designated by RTEA,
no later than 1 U.S. business day after the Effective Date, without deduction,
withholding or set-off for any reason. Notwithstanding anything contained in the
TRA, effective upon receipt of the Acceleration Payment, (a) neither RTEA nor
CPE shall have any further payment obligations under the TRA and (b) CPE agrees
it shall not be entitled to any repayments of any amounts paid by CPE hereunder
or under the TRA for any reason.

 

2.                                      TRA Acceleration.  Effective upon
receipt of the Acceleration Payment, all other rights and obligations under the
TRA shall terminate except for Sections 6.02 (Consistency), 6.03 (Cooperation),
7.04 (Governing Law) and 7.12 (Confidentiality) of the TRA (collectively, the
“Surviving TRA Terms”).  The Surviving TRA Terms shall remain in effect.  CPE
and RTEA agree that the entering into of this Agreement and payment of the
Acceleration Payment hereunder does not constitute an Early Termination Notice
(as defined in the TRA).

 

3.                                      Mutual Release.

 

(a)                                 “Released Party” means each of RTEA and CPE,
as applicable, their respective affiliates, parent companies, predecessors,
successors and assigns, and in the case of RTEA, shall include

 

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any affiliate of Rio Tinto plc and/or Rio Tinto Limited,(1) and each of their
respective employees, officers, board members, partners, managers, members, and
shareholders.

 

(b)                                 “Claims” means all claims, causes of action,
demands, obligations, or liabilities of any kind, whether accrued or unaccrued,
known or unknown, suspected or unsuspected, concealed or hidden, fixed or
contingent, matured or unmatured, liquidated or unliquidated, foreseen or
unforeseen, relating to or arising out of the TRA, including but not limited to
any and all performance or payment obligations relating thereto, but does not
include claims for enforcement, default, damages, or breach with respect to any
provision of this Agreement or the Surviving TRA Terms.

 

(c)                                  Subject to and effective immediately upon
receipt of the Acceleration Payment, (i) RTEA irrevocably releases, acquits, and
discharges each CPE Released Party from any and all Claims, and (ii) CPE
irrevocably releases, acquits, and discharges each RTEA Released Party from any
and all Claims.

 

4.                                      Further Assurances.  If any further
action is reasonably necessary to carry out the purpose of this Agreement, then
each party will take such further action (including the execution and delivery
of further documents) as the other party reasonably requests to carry out such
purpose, including executing any agreement or providing additional information,
documents and other materials for purposes of preparing any financial statement,
preparing any tax return or contesting or defending any audit, examination or
controversy in connection with the transactions contemplated by this Agreement.

 

5.                                      Public Disclosures.

 

(a)                                 Any press release or public statement issued
at any time hereafter by a party, its representatives or its affiliates
concerning this Agreement or the transactions contemplated by this Agreement
will be subject to the prior written (including by way of e-mail) approval of
the other party.

 

(b)                                 Notwithstanding Section 5(a) above, nothing
in this Agreement shall limit a party’s ability to make such disclosures
regarding this Agreement or the transactions contemplated by this Agreement
(including, without limitation, filing this Agreement with the Securities and
Exchange Commission or other securities regulatory authority) to the extent
required or deemed appropriate by such party, taking into account the advice of
such party’s counsel, to comply with applicable law, including federal
securities laws, rules or regulations or the requirements of any exchange on
which a party’s (or its affiliate’s) securities may be listed, quoted or traded,
provided such party allows the other party reasonable time to review and suggest
comments on any such disclosure prior to the issuance thereof.

 

(c)                                  Each party shall be liable for any failure
of its affiliates or representatives to comply with the restrictions set forth
under Sections 5(a) and (b).

 

6.                                      Authority to Execute Agreement.  By
signing below, each party warrants and represents that the person signing this
Agreement on its behalf has authority to bind that party and that the party’s
execution of this Agreement is not in violation of any by-law, covenants and/or
other restrictions placed upon them by their respective entities.

 

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(1)  “Rio Tinto Limited” means Rio Tinto Limited (ABN 96 004 458 404) having its
registered office at 33rd Floor, 120 Collins Street, Melbourne, Victoria 3000;
and “Rio Tinto plc” means Rio Tinto plc (Company No. 719885) of 2 Eastbourne
Terrace, London W2 6LG, United Kingdom.

 

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7.                                      Costs and Expenses.  Each party shall be
responsible for its own costs and expenses incurred in connection with the
transactions contemplated by this Agreement, including but not limited to any
further actions requested pursuant to Section 4 of this Agreement.

 

8.                                      Governing Law.  This Agreement will be
governed by and construed in accordance with the laws of the State of New York,
as outlined in Section 7.04 of the TRA.

 

9.                                      Entire Agreement.  This Agreement
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral among the parties with respect to the
subject matter hereof.  This Agreement shall be binding upon and insure solely
to the benefits of each party hereto and their respective successors and
assigns, and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.

 

10.                               Counterparts. This Agreement may be executed
by facsimile or by email of a signed Agreement to the other party and in
counterparts, all of which will be considered one and the same agreement, and
will become effective when counterparts have been signed by each of the parties
and delivered to each other party.

 

11.                               Severability.  If any terms or other provision
of this Agreement shall be determined by a court, administrative agency or
arbitrator of competent jurisdiction to be invalid, illegal or unenforceable,
such invalidity, illegality or unenforceability shall not render the entire
Agreement invalid.  Rather this Agreement shall be construed as if not
containing the particular invalid, illegal or unenforceable provision, and all
other provisions of this Agreement shall nevertheless remain in full force and
effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to either
party.  Upon such determination that any term or other provision is invalid,
illegal or unenforceable, the parties shall negotiate in good faith, and without
any further consideration, to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that the transactions contemplated hereby are fulfilled to the fullest extent
permitted under applicable law.

 

[Signature page follows]

 

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IN WITNESS WHEREOF, RTEA and CPE have duly executed this Acceleration and
Release Agreement as of the Effective Date.

 

 

 

RIO TINTO ENERGY AMERICA INC.

 

 

 

 

 

By:

/s/ James Berson

 

Name:

James Berson

 

Title:

President and Chief Executive Officer

 

 

 

 

 

CLOUD PEAK ENERGY INC.

 

 

 

 

 

By:

/s/ Colin Marshall

 

Name:

Colin Marshall

 

Title:

President and Chief Executive Officer

 

[Signature page for Acceleration and Release Agreement]

 

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