Exhibit 10.1

 

Execution Version

 

TRANSITION SERVICES AGREEMENT

 

This TRANSITION SERVICES AGREEMENT, dated as of October 24, 2019 (this
“Agreement”), is by and among Navajo Transitional Energy Company, LLC, a Navajo
Nation limited liability company (“Purchaser”), Cloud Peak Energy Inc., a
Delaware corporation (the “Company” or the “Seller”, and collectively with each
Additional Seller, the “Sellers”). The Service Recipient (as defined below) and
the Service Provider (as defined below) are sometimes hereinafter individually
referred to as a “Party” and collectively as the “Parties.” Capitalized but
undefined terms used herein shall have the meaning ascribed to them in the Asset
Purchase Agreement, dated as of August 19, 2019, between the Purchaser and the
Sellers (as such agreement may be amended from time to time, the “Purchase
Agreement”).

 

WITNESSETH:

 

WHEREAS, the Purchaser and the Sellers have entered into the Purchase Agreement
pursuant to which, among other things, the Sellers have agreed to sell to
Purchaser all of the Purchased Assets and to assign to Purchaser the Assumed
Liabilities, and Purchaser has agreed to purchase from the Sellers all of the
Purchased Assets and to assume from the Sellers the Assumed Liabilities, as more
fully described in the Purchase Agreement; and

 

WHEREAS, in connection with the consummation of the transactions contemplated by
the Purchase Agreement, the Parties will enter into this Agreement pursuant to
which Purchaser (the “Service Provider”) will provide certain transition
services to the Company (the “Service Recipient”).

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, the Sellers and the Purchaser agree as follows:

 

ARTICLE I
AGREEMENT TO PROVIDE SERVICES

 

1.1.                            Provision of Services.

 

(a)                                 On the terms and subject to the conditions
set forth in this Agreement, from the date of this Agreement until the
expiration of the applicable Term (as defined below) or as otherwise agreed to
by the Parties, the Service Provider shall provide, or cause to be provided
pursuant to Section 1.2, to the Service Recipient the services set forth in
Schedule A hereto (each, a “Service”) in accordance with Section 2.1. A
description of each Service and the Term of such Service is set forth in
Schedule A. The Service Provider agrees to adhere to any conditions or policies
applicable to its delivery of the Services as set forth in this Agreement or in
Schedule A hereto, or as mutually agreed to by the Parties in writing.

 

(b)                                 During the Term (as defined below), the
Service Provider shall consider any reasonable requests of the Service Recipient
for the provision of additional transition services, including the expansion of
the scope of any existing Services, that are reasonably necessary for the
operation of the Company to provide the continued administration of the Sellers’
bankruptcy estates and the Company’s remaining assets (the “Additional
Services”). If the Parties, acting reasonably and in good faith, mutually agree
that such Additional Services shall be provided, the

 

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Parties hereto shall mutually agree, acting reasonably and in good faith, on the
terms upon which the Service Provider would provide such Additional Services;
provided that, the Service Charge (as defined below) of such Additional Services
shall be based on Costs incurred by the applicable Seller with respect to such
Additional Services prior to the Closing Date or as may be mutually agreed by
both parties. In the event that any such Additional Services are mutually agreed
among the Parties, the Parties will enter into an amendment to this Agreement
amending Schedule A to reflect such Additional Services.

 

(c)                                  The Service Provider shall provide, and the
Service Recipient shall receive, each Service to be provided by the Service
Provider for such period as is specified for such Service in Schedule A (each
such period, a “Term”). The Term for each Service may be extended or shortened
by written mutual agreement of the Parties; provided that the Service Recipient
for each Service may, in its sole discretion, terminate such Service at any time
prior to the expiration of the applicable Term by providing thirty (30) days’
written notice to the Service Provider with respect to such Service.

 

1.2.                            Personnel and Resources. In providing, or
otherwise making available, a Service to the Service Recipient, the Service
Provider may (a) provide such Service directly or through one or more of its
Affiliates and/or (b) employ the services of contractors, subcontractors,
vendors or other third-party providers; provided that the Service Provider shall
remain responsible for the performance of all of its obligations hereunder. The
Service Provider will have the right, in its reasonable discretion, to designate
which personnel will be assigned to perform the Services, including the right to
remove and replace any such personnel at any time; provided, however, that the
personnel performing the Services shall have substantially the same expertise as
the personnel performing such Services (or similar Services) for the Service
Provider’s own businesses at such time.

 

1.3.                            Cooperation; Relationship Management; Dispute
Resolution. The Parties shall cooperate with each other in good faith in all
matters relating to the provision of Services, and take or cause to be taken all
appropriate actions reasonably necessary, proper or advisable under applicable
law, and execute and deliver such documents as may be required or appropriate to
carry out the provisions of this Agreement. Without limiting the generality of
the foregoing, (i) the Service Provider shall (x) use commercially reasonable
efforts, at Service Provider’s sole expense, to negotiate and obtain any and all
waivers, permits, approvals, consents, licenses and sublicenses that may be
required (including under the terms of any agreements with third parties) for
the Service Provider and any and all service providers to provide the Services,
and for the Service Recipient to receive and enjoy the full benefit of the
Services and to use any deliverables in connection therewith (“Third Party
Consents”), and (y) provide the Service Recipient with equivalent substitute
services or deliverables in the event any Third Party Consents are not obtained
(for which the Service Provider shall provide prompt notice to the Service
Recipient) (“Alternative Arrangements”), and (ii) the Service Recipient shall
reasonably assist the Service Provider, at the Service Provider’s reasonable
request and sole expense, in the Service Provider’s efforts to obtain any Third
Party Consents. Upon the Service Recipient’s request, the Service Provider shall
provide the Service Recipient with copies of any purchase orders, proofs of
payment and vendor invoices concerning such Third Party Consents in reasonably
sufficient detail to verify the terms of such Third Party Consents. All fees and
costs associated with implementing such Alternative Arrangements (“Alternative
Arrangement Costs”) shall be borne solely by the

 

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Service Provider. For the avoidance of doubt, with respect to any Services which
are subject to any Alternative Arrangement and for which Service Charge is based
on Cost, such Service Charge shall not include Alternative Arrangement Costs.
Nothing contained herein shall require the Service Provider to provide a Service
for which a Third Party Consent is required but has not been obtained.

 

1.4.                            Books and Records. Service Provider shall keep
books and records of the Services provided and reasonable supporting
documentation of all charges and expenses incurred in providing such Services
and shall produce written records that verify the dates and times during which
the Services were performed. Service Provider shall make such books and records
available to the other Party, upon reasonable notice.

 

ARTICLE II
SERVICES; PAYMENT

 

2.1.                            Performance Standard.

 

(a)                                 Unless otherwise agreed in writing by the
Parties, the Services shall be performed by the Service Provider (or such other
provider pursuant to Section 1.2) for the Service Recipient (or in the case of
Services not provided in that period, with a commercially reasonable standard of
care).  Service Provider shall comply with applicable laws in connection with
the provision of the Services.

 

(b)                                 EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT OR THE PURCHASE AGREEMENT, THE SERVICE PROVIDER AND THE SERVICE
RECIPIENT HEREBY EXPRESSLY DISCLAIM ALL REPRESENTATIONS AND WARRANTIES, EXPRESS
OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
ANY PARTICULAR PURPOSE, WITH RESPECT TO THE SERVICES.

 

(c)                                  In the event of any breach of this
Agreement by the Service Provider with respect to any error in the provision of
any Service, the Service Provider shall promptly notify the Service Recipient
and, at the Service Recipient’s request, promptly correct such error or
re-perform or re-deliver the work capable of being re-performed or re-delivered
in accordance with the requirements of Schedule A at no charge.

 

(d)                                 The Service Provider shall have the right to
shut down temporarily for routine maintenance or similar purposes the operation
of the facilities, networks and/or systems providing any Service whenever in its
judgment, reasonably exercised, such action is necessary. In the event such
shutdown is nonscheduled, the Service Provider shall notify the Service
Recipient as much in advance as reasonably practicable that such shutdown is
required. Unless not feasible under the circumstances, this notice shall be
given in writing. Where written notice is not feasible, the Service Provider
shall give prompt oral notice, which notice shall be promptly confirmed in
writing by the Service Provider. The Service Provider shall be relieved of its
obligations to provide the Services affected by such maintenance only for the
period of time that its facilities, networks and/or systems are so shut down but
shall use commercially reasonable efforts to minimize each period of shutdown
for such purpose and to schedule such shutdown so as not to inconvenience or
disrupt

 

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the conduct of business by the Service Recipient. The Service Provider shall
consult with the Service Recipient prior to temporary shutdowns to the extent
reasonably practicable or, if not reasonably practicable, immediately thereafter
in order to establish alternative sources for such Services. The Service
Provider shall use commercially reasonable efforts to perform Services related
to network or computer related migration to avoid any network downtime.

 

2.2.                            Costs.

 

(a)                                 As consideration for providing the Services,
the Service Recipient shall pay to the Service Provider the amount specified
next to each Service set forth in Schedule A or, if no amount is provided in
Schedule A, an amount equal to the reasonably documented, actual direct
out-of-pocket cost (“Cost”) of providing such Services (with respect to a
Service, the “Service Charge” for such Service). Each month’s Service Charges
(pro-rated if applicable to less than a full calendar month) shall be payable in
arrears, unless otherwise specified for each Service in Schedule A, to the
Service Provider within thirty (30) days following receipt of an invoice from
the Service Provider.

 

(b)                                 The Service Provider shall be entitled to
charge and collect from the Service Recipient an additional amount equal to all
applicable state, local and/or foreign sales tax, or any other similar tax, with
respect to the provision of any Services provided hereunder and shall timely
remit such taxes to the appropriate tax authorities. For the avoidance of doubt,
this Section 2.2(b) does not pertain to taxes in the nature of items identified
in Schedule 1.1(f) of the Purchase Agreement and shall not limit the Service
Provider’s obligations under the Purchase Agreement in respect of such items.

 

(c)                                  The Service Recipient shall pay to the
Service Provider the full amount of Service Charges and other amounts required
to be paid by the Service Recipient under this Agreement (except for such
periods during which the Services are suspended as described in
Section 2.1(d) or Section 5.9).  In the event the Service Recipient does not
timely pay any amounts owed under this Agreement, Service Provider may set-off,
counterclaim or otherwise withhold a corresponding amount from any amounts owed
to Service Recipient pursuant to the Purchase Agreement.

 

(d)                                 The Service Recipient shall compensate the
Service Provider only for Services actually received. The Service Recipient
shall not make, or shall receive an appropriate credit with respect to, payment
for Services that are not provided to the Service Recipient for any reason.

 

(e)                                  During the Term, and for a period of six
(6) months thereafter, the Service Recipient shall have the right, at its own
cost and expense, to conduct or cause to be conducted, a reasonable audit of the
data, books and records and other pertinent information of the Service Provider
concerning the provision of Services hereunder, including without limitation,
for purposes of disputing the calculation of any fees charged under this
Agreement or for preparing financial statements.  All books and records created
by Service Provider in connection with the provision of the Services that would
be necessary for, or useful to, Service Recipient after the Term will be
delivered to Service Recipient promptly after the end of the Term.

 

2.3.                            Use of Services. The Service Provider shall be
required to provide Services only to the Service Recipient and its subsidiaries.
Except to/for any subsidiary of Service Recipient, the

 

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Service Recipient shall not, and shall not permit its employees, agents or
Affiliates to, assign, resell or otherwise transfer any Services to any person
whatsoever or permit the use of the Services by any person.

 

ARTICLE III
TERM OF SERVICES

 

3.1.                            Effective Date and Final Term. This Agreement
shall become effective and the provision of Services shall commence as of the
date hereof and, unless terminated earlier pursuant to Section 3.2 below, shall
remain in full force and effect with respect to each Service until the end of
the Term for such Service.

 

3.2.                            Termination. This Agreement (and all Services
required to be provided hereunder) shall terminate on the earliest to occur of
(i) the latest date on which any Service is to be provided as indicated on
Schedule A (the “Expiration Date”), (ii) the date on which this Agreement is
terminated pursuant to Section 3.3, and (iii) the mutual written agreement of
the Parties.

 

3.3.                            Breach of Agreement. If any Party shall cause or
suffer to exist any material breach of any of its obligations under this
Agreement, including any failure to perform any Services or to make payments
when due, and such Party does not cure such breach within twenty (20) days after
receiving written notice thereof from the non-breaching Party, the non-breaching
Party may (i) immediately terminate this Agreement by providing written notice
of termination or (ii) in the event of a breach by the Service Provider,
leverage existing, or procure or retain, services that are, in Service
Recipient’s reasonable discretion, required to achieve the applicable level of
service for each of the Services for which there is or has been a breach (such
right, the “Self-Help Right”). The Service Recipient shall have the right to
set-off its reasonable and documented out-of-pocket costs and expenses incurred
to remedy in the exercise of the Self-Help Right against Service Charges owed to
the Service Provider. The failure of a Party to exercise its rights hereunder
with respect to a breach by the other Party shall not be construed as a waiver
of such rights nor prevent such Party from subsequently asserting such rights
with regard to the same or similar defaults.

 

3.4.                            Sums Due. In the event of a termination of this
Agreement for reasons other than a breach by the Service Provider including any
non-conformance to the standards of performance in Section 2.1(a), the Service
Provider shall be entitled to all outstanding amounts due from the Service
Recipient for the provision of Services actually rendered prior to the date of
termination.

 

3.5.                            Effect of Termination. If a notice of
termination is delivered by any Party pursuant to this ARTICLE III, this
Agreement shall forthwith become wholly void and be of no further force and
effect and all further obligations of the Parties hereunder shall terminate and
there shall be no liability on the part of any Party to the other Party under
this Agreement, (i) except for charges accrued but unpaid as of the date of such
termination in accordance with Section 3.4, (ii) except that the provisions of
this Section 3.5 and ARTICLE V shall remain in full force and effect and the
Parties shall remain bound by and continue to be subject to the provisions
thereof and (iii) no termination will release any Party for any liability
arising from any breach of this Agreement by such Party prior to the date of
termination.  The Service Recipient and/or the Service Provider shall promptly,
upon the written request of the other Party, return or destroy all “Confidential

 

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Information” (as defined in the Confidentiality Agreement) exchanged in
connection with the Services or certify the destruction of the same.

 

ARTICLE IV
LIMITATION OF LIABILITY

 

4.1.                            Maximum Liability.

 

(a)                                 In no event shall the Service Provider’s or
its respective representatives’ and Affiliates’ total liability to the Service
Recipient or any other person hereunder for any action, regardless of the form
of action, whether in tort, contract, breach of warranty, strict liability,
indemnification or otherwise, arising under this Agreement exceed an amount
equal to the total amount payable by the Service Recipient for the applicable
Service; provided that the foregoing shall not (a) impair the ability of the
Service Recipient to seek any remedy of injunctive relief or specific
performance against the Service Provider or (b) limit any claims for fraud,
gross negligence or willful breach or misconduct by the Service Provider.

 

(b)                                 NO PARTY NOR ANY OF ITS AFFILIATES NOR ANY
OF THEIR RESPECTIVE REPRESENTATIVES SHALL BE LIABLE TO THE OTHER PARTY OR ITS
AFFILIATES FOR SPECIAL, PUNITIVE, EXEMPLARY, INCIDENTAL, CONSEQUENTIAL OR
INDIRECT DAMAGES, OR LOST PROFITS, DIMINUTION IN VALUE, LOSSES CALCULATED BY
REFERENCE TO ANY MULTIPLE OF EARNINGS (OR ANY OTHER VALUATION METHODOLOGY),
DAMAGE TO REPUTATION OR LOSS TO GOODWILL, WHETHER BASED ON CONTRACT, TORT,
STRICT LIABILITY, OTHER LAW OR OTHERWISE AND WHETHER OR NOT ARISING FROM THE
OTHER PARTY’S OR ANY OF ITS AFFILIATES’ NOR ANY OF THEIR RESPECTIVE
REPRESENTATIVES’ SOLE, JOINT OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER
FAULT.

 

(c)                                  IN NO EVENT SHALL THE SERVICE PROVIDER BE
LIABLE TO MORE THAN ONE SERVICE RECIPIENT FOR THE SAME BREACH UNDER THIS
AGREEMENT.

 

4.2.                            Indemnity. Subject to Section 4.1, each Party
hereby indemnifies the other Party, its Affiliates and its representatives
(together with their respective successors and permitted assigns) (collectively,
the “Indemnified Parties”) against, and agrees to defend and hold them harmless
from, any and all losses suffered by any of them arising out of, resulting from
or related to the rendering of a Service or any failure to provide a Service in
accordance with the terms and conditions set forth herein solely to the extent
that such losses are caused by the willful misconduct or gross negligence of
such Party, any of its Affiliates or any of its or their representatives. A
Party’s right to indemnification under this Section 4.2 shall survive the end of
the applicable Term with respect to the applicable Service. The Service Provider
agrees to indemnify the Service Recipient, its Affiliates and its
representatives from any and all losses resulting from any claim that the
Services provided by the Service Provider infringe, misappropriate or otherwise
violate the intellectual property of any third party.

 

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ARTICLE V
MISCELLANEOUS

 

5.1.                            Independent Contractor Status. The Service
Provider shall be deemed for all purposes to be an independent contractor of the
applicable Service Recipient. Nothing in this Agreement shall establish an
agency, partnership or joint venture relationship between the Service Provider
and the Service Recipient, and the Service Provider shall not be authorized to
bind the Service Recipient contractually or otherwise. Each Party acknowledges
and agrees that it is acting solely in the capacity of an arm’s length
contractual counterparty with respect to the Services and the transactions
contemplated herein and not as a financial advisor, legal counsel or fiduciary
to the other Party or any of its Affiliates or representatives. All employees
and representatives providing the Services shall be under the direction, control
and supervision of the Service Provider (and not of the Service Recipient), and
the Service Provider shall have the sole right to exercise all authority with
respect to such employees and representatives and in no event shall such
employees and representatives be deemed to be employees or agents of the Service
Recipient.

 

5.2.                            Notices. Any notice, notification, demand or
request provided for in this Agreement, or served, given or made in connection
with it, shall be in writing and shall be deemed properly served, given or made
if delivered by electronic mail, in person or sent by registered or certified
mail, postage prepaid, or by a nationally recognized overnight courier service
that provides a receipt of delivery, in each case, to the Parties at the
addresses specified below:

 

If to the Sellers, to:

 

Cloud Peak Energy Inc.

385 Interlocken Crescent, Suite 400

Broomfield, Colorado 80021
Attention: Bryan J. Pechersky
Email: bryan.pechersky@cldpk.com

 

With a copy (which will not constitute notice) to:

 

Vinson & Elkins LLP

666 Fifth Avenue, 26th Floor

New York, New York 10103

Attention: David S. Meyer, John A. Kupiec

Email: dmeyer@velaw.com, jkupiec@velaw.com

 

and

 

Vinson & Elkins LLP

2001 Ross Avenue, Suite 3900

Dallas, Texas 75201

Attention: Paul E. Heath

Email: pheath@velaw.com

 

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If to Purchaser, to:

 

Navajo Transitional Energy Company, LLC
4801 N. Butler Ave., Bldg. 200
Farmington, New Mexico 87401
Attention: Clark Moseley, Chief Executive Officer
Email: clark.moseley@navajo-tec.com

 

With a copy (which will not constitute notice) to:

 

Navajo Transitional Energy Company, LLC
P.O. Box 11
Farmington, New Mexico 87499-11
Attention: Clark Moseley, Chief Executive Officer

 

and

 

Parsons Behle & Latimer
201 South Main Street, Suite 1800
Salt Lake City, Utah 84111
Attention: Nora Pincus
Email: npincus@parsonsbehle.com

 

5.3.                            Entire Agreement; Amendment. This Agreement
(including Schedule A attached hereto) constitutes the entire agreement of the
Parties hereto with respect to the subject matter contained herein and
supersedes all prior agreements, undertakings and understandings, both written
and oral among the Parties with respect to the subject matter contained herein.
No provision of this Agreement may be amended, supplemented or modified except
by a written instrument making specific reference hereto or thereto signed by
all the Parties.

 

5.4.                            Rights and Waivers. All rights and remedies of
the Parties are separate and cumulative, and no one of them, whether exercised
or not, shall be deemed to be to the exclusion of any other rights or remedies
or shall be deemed to limit or prejudice any other legal or equitable rights or
remedies which any Party hereto may have. No Party shall be deemed to waive any
rights or remedies under this Agreement unless such waiver is in writing and
signed by such Party. No delay or omission on the part of any Party in
exercising any right or remedy shall operate as a waiver of such right or remedy
or any other rights or remedies. A waiver on any one occasion shall not be
construed as a bar to or a waiver of any right or remedy on any future occasion.

 

5.5.                            Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced under any law
or as a matter of public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect. Notwithstanding
the foregoing, upon such determination that any term or provision is invalid,
illegal or incapable of being enforced, there shall be added automatically as a
part of this Agreement a legal, valid and enforceable provision so as to effect
the original intent of the Parties as closely as possible in order that the
transactions hereby be consummated as originally contemplated to the greatest
extent possible.

 

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5.6.                            Governing Law; Jurisdiction. The Parties
acknowledge and agree that this Agreement is bound by the terms of governing law
and jurisdiction pursuant to the Purchase Agreement. The terms of Sections 11.3,
11.4, 11.5, and 11.7 of the Purchase Agreement are hereby incorporated by
reference, and the Parties acknowledge and agree that both the terms of this
Agreement and any dispute that arises under this Agreement are subject to the
terms of Sections 11.3, 11.4, 11.5, and 11.7 of the Purchase Agreement. In
accordance therewith, the Parties agree to consent to submit to the executive
personal jurisdiction of the United States District Court for the Southern
District of New York and of any New York state court, in each case, sitting in
New York, New York, and appellate courts therefrom, and that this Agreement
shall in all respects be covered by and construed in accordance with the Laws of
the State of New York, without giving effect to any conflict or choice of law
provision that would result in the imposition of another state’s Law.

 

5.7.                            Assignment. This Agreement shall be binding upon
and inure to the benefit of the Parties and their respective successors and
permitted assigns. This Agreement shall not be assigned or transferred by
operation of law or otherwise without the prior written consent of each of the
Parties, except that the Purchaser may assign in whole or in part this Agreement
and its rights and obligations hereunder to any of its Affiliates or
subsidiaries or in connection with a merger or consolidation involving the
Purchaser or in connection with a sale of stock (or other ownership interests)
or assets of the Purchaser or other disposition of all or any portion of the
Business; provided, however, that no such assignment shall relieve the Purchaser
of its obligations hereunder.

 

5.8.                            No Third Party Beneficiaries. Except as provided
in ARTICLE IV (which shall also be for the benefit of the Parties’ respective
representatives and Affiliates), this Agreement is for the sole benefit of the
Parties and their permitted successors and assigns, and nothing in this
Agreement expressed or implied is intended or shall be construed to confer upon
or give to any person, any right, benefit or remedy of any nature whatsoever
under or by reason of this Agreement.

 

5.9.                            Force Majeure. No Party shall be liable for any
interruption, delay or failure to perform any obligation hereunder to the extent
such interruption, delay or failure results from causes beyond its reasonable
control, including any strikes, acts of any government, acts of terrorism, acts
of public enemy, war, rebellion, sabotage, riot, insurrection or other
hostilities, fire, storm, flood, earthquake, hurricane, explosion, accident,
epidemic, quarantine restrictions, strikes, labor disputes, transportation
embargoes or delays or other acts of God or natural disasters (a “Force Majeure
Event”); provided that such Party shall have exercised commercially reasonable
efforts to minimize the impact of such Force Majeure Event. In any such event,
such Party’s obligations hereunder shall be postponed for such time as its
performance is suspended or delayed on account thereof. Each Party will promptly
notify the other upon learning of the occurrence of such Force Majeure Event.
Upon the cessation of the Force Majeure Event, each Party will use commercially
reasonable efforts to resume its performance with the least possible delay.

 

5.10.                     Headings. The headings contained in this Agreement are
for reference only and shall not affect in any way the meaning or interpretation
of this Agreement.

 

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5.11.                     Counterparts. This Agreement may be executed in any
number of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument. Any facsimile or pdf
copies hereof or signature hereon shall, for all purposes, be deemed originals.

 

5.12.                     Schedules. Schedule A attached hereto shall be
construed with and as an integral part of this Agreement to the same extent as
if the same had been set forth verbatim herein. In the event of any
inconsistency between the terms of Schedule A and the terms set forth in the
main body of this Agreement, the terms of this Agreement shall govern unless
expressly stated otherwise in Schedule A.

 

5.13.                     Relationship to Other Agreements. For the avoidance of
doubt, nothing herein shall limit any rights or obligations of any Party under
the Purchase Agreement.

 

[Remainder of Page Intentionally Blank]

 

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IN WITNESS WHEREOF, each party below has caused this Agreement to be executed by
its duly authorized officer, in each case as of the date first above written.

 

 

SERVICE PROVIDER:

 

 

 

NAVAJO TRANSITIONAL ENERGY COMPANY, LLC

 

 

 

 

 

 

 

By:

/s/ Clark Moseley

 

Name:

Clark Moseley

 

Title:

Chief Executive Officer

 

[Signature Page to Transition Services Agreement]

 

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SERVICE RECIPIENT:

 

 

 

CLOUD PEAK ENERGY INC.

 

 

 

 

 

 

 

 

 

By:

/s/ Heath A. Hill

 

 

Name:

Heath A. Hill

 

 

Title:

Executive Vice President and Chief Financial Officer

 

[Signature Page to Transition Services Agreement]

 

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TRANSITION SERVICES: SCHEDULE A

 

Transition Services

 

Category

 

Description

 

Fee

 

Term

 

Final Close Process

 

- Approximately two weeks to a month depending on position (12 finance
professionals)

- Complete final financial statements and closing/opening balance sheet

 

$

75,000

 

Through Plan Effectiveness

 

Employee Wages

 

- Final payroll for CPE employees retained by NTEC

- Accrued wages and benefits for those not retained by NTEC and off-cycle bonus
payments

- Bi-weekly payroll processing and payments for the retained
executives/directors from closing date to the date of Plan effectiveness (for
the avoidance of doubt, the liability for such salary and other payments shall
remain with CPE)

 

$

1,500

 

Through Plan Effectiveness

 

Customers

 

- Reconcile tonnage delivered at close date and generate final invoices to CPE
customers

- Generate account receivable at closing date for the estate

 

$

1,000

 

3 months

 

Vendors

 

- Input all remaining vendor invoices to determine final account payable balance

- Process and post payments for accurate post-petition liability

 

$

3,000

 

3 months

 

Year-End Process

 

- Employee W2 processing

- Contractors 1099 processing

 

$

10,000

 

Through January 31, 2020

 

Securities Filings

 

- Preparation for financial review for 10-Q

- Assistance from relevant former CPE employees as needed to prepare filings

 

$

30,000

 

Through Plan Effectiveness

 

Office Space

 

- Provide continuing CPE employees and advisors with existing office space and
computer/network systems and phone access until Plan effectiveness, subject to
reasonable extension if needed

 

$

—

 

Through Plan Effectiveness

 

Legal

 

- Eric Pearson to provide legal advice on CPE issues as reasonably necessary

 

$

—

 

n/a

 

 

A-1

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