EXHIBIT 10.1

EXECUTION VERSION

STOCK PURCHASE AGREEMENT
dated as of June 30, 2014
among
SUNRISE COAL, LLC,
VECTREN UTILITY SERVICES, INC.
and
VECTREN FUELS, INC.

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ARTICLE I
DEFINITIONS; CONSTRUCTION    1

1.1
Definitions

1.2
Construction    

ARTICLE II
PURCHASE AND SALE OF THE COMMON STOCK    13

2.1
Purchase and Sale of the Common Stock    

2.2
Closing    

2.3
Calculation and Payment of Purchase Price on the Closing Date    

2.4
Purchase Price Adjustment    

2.5
Closing Deliveries    

2.6
Withholding    

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER    20

3.1
Organization and Good Standing    

3.2
Authority and Enforceability    

3.3
No Conflicts; Consents    

3.4
Common Stock Ownership    

3.5
Brokers’ Fees    

3.6
U.S. Status of Seller    

ARTICLE IV
REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY    22

4.1
Organization and Good Standing    

4.2
Capitalization    

4.3
No Conflicts; Consents    

4.4
Financial Statements; No Undisclosed Liabilities; Accounts Receivable    

4.5
Taxes    

4.6
Compliance with Law; Permits    

4.7
Personal Property    

4.8
Real Property    

4.9
Intellectual Property    

4.10
Absence of Certain Changes or Events    

4.11
Contracts    

4.12
Litigation    

4.13
Intentionally omitted    

4.14
Labor and Employment Matters    

4.15
Environmental    

4.16
Insurance    

4.17
Customers and Suppliers    

4.18
Affiliate Transactions    

4.19
Bank Accounts    

4.20
Coal Reserves    

4.21
Royalties    

4.22
Bonds    

4.23
Books and Records    

 

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4.24
Brokers    

4.25
No Other Representations and Warranties    

ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER    38

5.1
Organization and Good Standing    

5.2
Authority and Enforceability    

5.3
No Conflicts; Consents    

5.4
Financing    

5.5
Brokers    

5.6
Purchase for Investment    

5.7
Independent Investigation    

ARTICLE VI
COVENANTS    40

6.1
Restrictions on Equity Interest Transfers    

6.2
Conduct of Business    

6.3
Access to Information; Notification    

6.4
Resignations    

6.5
Termination or Transfer of Certain Obligations    

6.6
Confidentiality    

6.7
Public Announcements    

6.8
Employee Matters    

6.9
Tax Matters    

6.10
Regulatory Approvals    

6.11
Access to Books and Records    

6.12
Further Assurances    

6.13
Release    

6.14
Exclusivity    

6.15
Restrictive Covenants    

6.16
Financing    

6.17
Support Obligations    

6.18
WARN Notice    

6.19
Other Funds    

6.20
Like-Kind Exchange    

6.21
Use of Name    

ARTICLE VII
CONDITIONS TO CLOSING    57

7.1
Conditions to Obligations of the Purchaser and the Seller    

7.2
Conditions to Obligations of the Purchaser    

7.3
Conditions to Obligations of the Seller    

ARTICLE VIII
TERMINATION    60

8.1
Termination    

8.2
Purchaser Termination Fee    

8.3
Effect of Termination    

ARTICLE IX
INDEMNIFICATION    62

 

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9.1
Survival    

9.2
Indemnification by the Seller    

9.3
Indemnification by the Purchaser    

9.4
Indemnification Procedure for Third Party Claims    

9.5
Indemnification Procedures for Non-Third Party Claims    

9.6
Other Matters Relating to Indemnification    

ARTICLE X
MISCELLANEOUS    67

10.1
Notices    

10.2
Amendments and Waivers    

10.3
Expenses    

10.4
Assignment and Delegation    

10.5
Successors and Assigns    

10.6
Governing Law    

10.7
Consent to Jurisdiction    

10.8
Specific Performance: Limitation on Damages    

10.9
“As Is” Sale; No Reliance    

10.10
Certain Limitations    

10.11
Counterparts    

10.12
Third Party Beneficiaries    

10.13
Entire Agreement    

10.14
Captions    

10.15
Severability    

10.16
Interpretation; Disclosure Schedules    

Annexes
Annex I     –     Coal Inventory Methodology
Annex II     –     Working Capital Methodology
Annex III     –     Net Plant Value Methodology
Annex IV     –     Example Closing Date Purchase Price Calculation

Exhibits
Exhibit A     –     Seller Guaranty
Exhibit B-1     –     Interim Services Agreement (Oaktown #1)
Exhibit B-2     –     Interim Services Agreement (Oaktown #2)
Exhibit B-3     –     Interim Services Agreement (Prosperity)
Exhibit C-1     –     Contractor Termination Agreement (Oaktown)
Exhibit C-2     –     Contractor Termination Agreement (Prosperity)
Exhibit D-1     –     Lafayette Termination Notice (Oaktown)
Exhibit D-2     –     Lafayette Termination Notice (Prosperity)

 

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STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT is dated as of June 30, 2014 (this “Agreement”),
among Sunrise Coal, LLC, an Indiana limited liability company (the “Purchaser”),
Vectren Utility Services, Inc., an Indiana corporation (the “Seller”), and
Vectren Fuels, Inc., an Indiana corporation (the “Company”).
WHEREAS, the Seller owns all of the issued and outstanding common stock, without
par value, of the Company (the “Common Stock”); and
WHEREAS, the Seller desires to sell all of the Common Stock to the Purchaser,
and the Purchaser desires to purchase all of the Common Stock from the Seller,
in each case upon the terms and subject to the conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the respective
representations, warranties, covenants and agreements contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
Article I
DEFINITIONS; CONSTRUCTION
(1.1)    Definitions. Except as otherwise explicitly provided herein, when used
in this Agreement, the following terms shall have the meanings ascribed to them
in this Section 1.1.
“Accounts Receivable” means any trade or note account receivable and other
rights to payment owed to the Company or its Subsidiaries.
“Action” has the meaning set forth in Section 4.12.
“Adjustment Notice” has the meaning set forth in Section 2.4(e).
“Affiliate” means, with respect to any specified Person, any other Person
directly or indirectly Controlling, Controlled by or under common Control with
such specified Person. The Contractors will not be deemed to be Affiliates of
the Seller.
“Agreement” has the meaning set forth in the preamble hereto.
“Ancillary Agreements” means the Seller Guaranty and the other agreements,
instruments and documents delivered pursuant to this Agreement and the other
Ancillary Agreements.
“Balance Sheet” has the meaning set forth in Section 4.4(a).
“Base Purchase Price” has the meaning set forth in Section 2.1.
“Benefit Plan” means any Plan, existing at the Closing Date or prior thereto,
established, sponsored or to which contributions have at any time been made by
the Company or any ERISA

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Affiliate, or any predecessor of any of the foregoing, or under which any
employee, former employee, director, agent or independent contractor of the
Company or any ERISA Affiliate thereof or any beneficiary thereof is covered, is
eligible for coverage, has benefit rights, or for which the Company or any ERISA
Affiliate is a party, is subject or may have Liabilities. For the avoidance of
doubt, Benefit Plans do not include any benefit plans of the Contractors.
“Bonds” means surety or other bonds, letters of credit or other security issued
by or for any Permits, performance under Coal Supply Agreements, or as a deposit
for goods or services provided to or for the benefit of the Company or its
Subsidiaries.
“Books and Records” means minutes books; books of account; manuals; general,
financial, warranty and shipping records; invoices; stockholders, customer and
supplier lists; correspondence; engineering, maintenance and operating records;
advertising and promotional materials; credit records of customers and other
documents, records and files, in each case related to the business of the
Company or its Subsidiaries, including books and records relating to, and
tangible embodiments of, Company Intellectual Property.
“Business Day” means a day other than a Saturday, Sunday or other day on which
banks located in Indianapolis, Indiana are authorized or required by Law to
close.
“Cash” means all cash and cash equivalents held by the Company or its
Subsidiaries, determined in accordance with GAAP. For the avoidance of doubt,
(a) Cash shall be calculated net of issued but uncleared checks and drafts, and
(b) Cash shall include checks and drafts received by the Company or its
Subsidiaries as of the Closing but not yet deposited.
“Closing” has the meaning set forth in Section 2.2.
“Closing Date” has the meaning set forth in Section 2.2.
“Closing Date Net Plant Value” means the Net Plant Value as of the Closing Date.
“Closing Date Net Working Capital” means the Net Working Capital as of the
Closing Date.
“Closing Date Purchase Price” has the meaning set forth in Section 2.3(a).
“Coal Reserves” means the coal reserve estimates of the Company and its
Subsidiaries as reported in the reserve studies listed on Section 1.1(a) of the
Seller’s Disclosure Schedule.
“Coal Supply Agreements” has the meaning set forth in Section 4.11(a)(iv).
“Code” means the Internal Revenue Code of 1986 and the rules and regulations
promulgated thereunder.
“Common Stock” has the meaning set forth in the recitals hereto.
“Company” has the meaning set forth in the preamble hereto.

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“Company Contracts” has the meaning set forth in Section 4.11(a).
“Company Customers” has the meaning set forth in Section 4.17.
“Company Intellectual Property” has the meaning set forth in Section 4.9(a).
“Company Material Suppliers” has the meaning set forth in Section 4.17.
“Confidentiality Agreement” means the Confidentiality Agreement between Hallador
Energy Company and Seller Parent dated as of March 31, 2014.
“Contract” means any agreement, contract, license, lease, commitment,
arrangement or understanding, written or oral, including any invoice, sales
order or purchase order, other than the Leases or Rights of Way.
“Contract Mining Agreements” means the Contract Mining and Coal Supply Agreement
dated January 14, 2000 between Prosperity Mine, LLC and Five Star Mining, Inc.,
as amended, and the Contract Mining Agreement dated November 23, 2009 between
Oaktown Fuels Mine No. 1, LLC and Black Panther Mining, LLC, as amended.
“Contractor” and “Contractors” means Five Star Mining, Inc. and Black Panther
Mining, LLC.
“Contractor Material Suppliers” has the meaning set forth in Section 4.17.
“Contractor Termination Agreements” has the meaning set forth in Section 6.5(d).
“Contractor Termination Royalties” means the royalty payments payable to Five
Star Mining, Inc. for any coal mined from the Prosperity mine reserve following
the termination of the Contract Mining Agreement with Five Star Mining, Inc. as
specifically set forth in such Contractor Termination Agreement.
“Control” means, when used with respect to any Person, the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by Contract or otherwise and the terms
“Controlling” and “Controlled” shall have meanings correlative to the foregoing.
“Deductible” has the meaning set forth in Section 9.6(a).
“De Minimis Claim Amount” has the meaning set forth in Section 9.6(a).
“Determination Date” has the meaning set forth in Section 2.4(h).
“Disclosure Schedules” means the Purchaser’s Disclosure Schedule and the
Seller’s Disclosure Schedule.
“Dispute” has the meaning set forth in Section 2.4(f).

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“DOJ” has the meaning set forth in Section 6.10(a).
“Election Allocations” has the meaning set forth in Section 6.9(f)(iii).
“Employees” has the meaning set forth in Section 4.14(a).
“Environment” means all air, surface water, groundwater, or land, including land
surface or subsurface, including all fish, wildlife, biota and all other natural
resources.
“Environmental Law” means all federal, state, local, provincial and foreign,
civil and criminal Laws, Environmental Permits and Contracts with any
Governmental Entity, relating to the protection of the Environment, or governing
the handling, use, generation, treatment, storage, transportation, disposal,
manufacture, distribution, formulation, packaging, labeling or Release of or
exposure to Hazardous Materials.
“Environmental Permit” means any federal, state or local Permits required or
issued by any Governmental Entity under or in connection with any Environmental
Law, including any and all Orders or Contracts issued by or entered into with a
Governmental Entity under any applicable Environmental Law.
“Equity Financing” has the meaning set forth in Section 5.4.
“Equity Financing Letter” has the meaning set forth in Section 5.4.
“Equity Interest” means any capital stock, partnership or limited liability
company interest (as applicable) or other equity (including equity appreciation
rights) or voting interest or any security or evidence of indebtedness
convertible into or exchangeable or exercisable for any capital stock,
partnership or limited liability company interest, or any warrant or option to
acquire any of the foregoing.
“ERISA” means the Employee Retirement Income Security Act of 1974 and the rules
and regulations promulgated thereunder.
“ERISA Affiliate” means any person (within the meaning of Section 3(9) of ERISA)
who is, or at any time was, a member of a controlled group (within the meaning
of Section 412(d)(3) of the Code) that includes, or at any time included, the
Company or any Affiliate thereof, or any predecessor of any of the foregoing.
“Estimated Cash Amount” has the meaning set forth in Section 2.4(a).
“Estimated Closing Balance Sheet” has the meaning set forth in Section 2.4(a).
“Estimated Net Plant Value” has the meaning set forth in Section 2.4(a).
“Estimated Net Plant Value Adjustment Amount” has the meaning set forth in
Section 2.4(c).

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“Estimated Net Working Capital” has the meaning set forth in Section 2.4(a).
“Estimated Net Working Capital Adjustment Amount” has the meaning set forth in
Section 2.4(b).
“Estimated Purchaser Paid Indebtedness Amount” has the meaning set forth in
Section 2.4(a).
“Final Balance Sheet” has the meaning set forth in Section 2.4(e).
“Final Cash Amount” has the meaning set forth in Section 2.4(e).
“Final Indebtedness Amount” has the meaning set forth in Section 2.4(e).
“Final Net Plant Value” has the meaning set forth in Section 2.4(e).
“Final Net Working Capital” has the meaning set forth in Section 2.4(e).
“Financial Statements” has the meaning set forth in Section 4.4(a).
“Financing” has the meaning set forth in Section 5.4.
“Financing Definitive Agreements” has the meaning set forth in Section 6.16(a).
“FTC” has the meaning set forth in Section 6.10(a).
“GAAP” has the meaning set forth in Section 4.4(a).
“Governmental Entity” means any entity or body exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to United States federal, state, local or municipal government, foreign,
international, multinational or other government, including any department,
commission, board, agency, bureau, subdivision, instrumentality, official or
other regulatory, administrative or judicial authority thereof, and any
arbitrator, including any authority or other quasi‑governmental entity
established by a Governmental Entity to perform any of such functions, and any
non-governmental regulatory body to the extent that the rules and regulations or
orders of such body have the force of Law.
“Hazardous Material” means petroleum, petroleum hydrocarbons or petroleum
products, petroleum by-products, radioactive materials, asbestos or
asbestos-containing materials, gasoline, diesel fuel, pesticides, radon, urea
formaldehyde, mold, lead or lead-containing materials, polychlorinated
biphenyls, and any other chemicals, materials, substances or wastes in any
amount or concentration which are now or hereafter (a) become defined as or
included in the definition of “hazardous substances,” “hazardous materials,”
“hazardous wastes,” “extremely hazardous wastes,” “restricted hazardous wastes,”
“toxic substances,” “toxic pollutants,” “pollutants,” “regulated substances,”
“solid wastes” or “contaminants,” or words of similar import, under any
Environmental Law or (b) are regulated by or for which Liability can be imposed
under any Environmental Law.

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“Highly Confident Letter” has the meaning set forth in Section 5.4.
“HSR Act” means the Hart-Scott Rodino Antitrust Improvements Act of 1976.
“Income Taxes” means Taxes imposed on or measured by reference to net income or
receipts, and franchise and similar Taxes.
“Income Tax Returns” means Tax Returns relating to Income Taxes.
“Indebtedness” means: (a) any indebtedness, whether or not contingent, for
borrowed money; (b) any obligations evidenced by bonds, debentures, notes or
other similar instruments; (c) any obligations to pay the deferred purchase
price of property or services; (d) any obligations as lessee under leases that
have been, or should be, recorded as capitalized leases under GAAP; (e) any
indebtedness created or arising under any conditional sale or other title
retention agreement with respect to acquired property; (f) any obligations,
contingent or otherwise, under or with respect to acceptance credit, letters of
credit or similar facilities; (g) any obligation with respect to interest rate
and currency cap, collar, hedging or swap Contracts; (h) any obligation secured
by a Lien; (i) a guarantee of the obligations of any other Person other than a
subsidiary of the Company; (j) any guaranty of any of the foregoing; (k) any
accrued interest, fees and charges in respect of any of the foregoing; and
(l) any prepayment premiums and penalties, and any other fees, expenses,
indemnities and other amounts payable, as a result of the prepayment or
discharge of any of the foregoing, but excluding Bonds, Contractor Termination
Royalties, Lafayette Pre-Closing Payments and Reclamation Liabilities.
“Indemnitee” means any Person that is seeking indemnification from an Indemnitor
pursuant to the provisions of this Agreement.
“Indemnitor” means any party to this Agreement from which any Indemnitee is
seeking indemnification pursuant to the provisions of this Agreement.
“Indemnitor Defense Review Period” has the meaning set forth in Section 9.4(b).
“Infringing” has the meaning set forth in Section 4.9(b).
“Initial Resolution Period” has the meaning set forth in Section 2.4(e).
“Intellectual Property” means any and all of the following in any jurisdiction
throughout the world: (i) trademarks and service marks, including all
applications and registrations and the goodwill connected with the use of and
symbolized by the foregoing; (ii) copyrights, including all applications and
registrations related to the foregoing; (iii) trade secrets and confidential
know-how; (iv) patents and patent applications; (v) internet domain name
registrations; and (vi) other intellectual property and related proprietary
rights, interests and protections.
“Interim Financial Statements” has the meaning set forth in Section 4.4(a).

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“Knowledge of the Seller” or any similar phrase means, with respect to any fact
or matter, the actual knowledge of the individuals set forth on Section 1.1(b)
of the Seller’s Disclosure Schedule, without inquiry.
“Lafayette Agreements” means the Sales Marketing Agreement dated May 24, 2000
between the Company and Lafayette Coal Company (n/k/a Lafayette Energy Company),
as amended, and the Oaktown No. 1 Mine Sales Marketing Agreement dated May 25,
2010 between Oaktown Fuels Mine No. 1, LLC, the Company and Lafayette Energy
Company.
“Lafayette Pre-Closing Payments” means the commissions due to Lafayette Energy
Company under the Lafayette Agreements, but only to the extent that such
commissions are attributable to sales revenues actually received prior to the
Closing Date or to the extent associated with Accounts Receivable assigned to
the Seller and actually received by the Seller.
“Lafayette Termination Notices” has the meaning set forth in Section 6.5(e).
“Law” means any law (including common law), statute, constitution, treaty,
charter, ordinance, code, Order, rule, regulation and any other binding
requirement or determination of any Governmental Entity.
“Lease” means any lease or sublease relating to Leased Real Property to which
any of Company or its Subsidiaries is a party or by which it is bound.
“Leased Real Property Interests” means all real property and real property
interests leased or subleased by the Company or its Subsidiaries.
“Liabilities” means any direct or indirect liabilities, obligations, expenses,
Indebtedness, claims, losses, damages, deficiencies, guarantees, endorsements or
commitments of any nature whatsoever, asserted or unasserted, known or unknown,
absolute or contingent, accrued or unaccrued, due or to become due, liquidated
or unliquidated, matured or unmatured or otherwise.
“Lien” means, with respect to any property or asset, any lien (statutory or
otherwise), mortgage, pledge, charge, security interest, hypothecation,
community property interest, equitable interest, servitude, option, right
(including rights of first refusal), restriction (including restrictions on
voting, transfer or other attribute of ownership), lease, license, other rights
of occupancy, adverse claim, reversion, reverter, preferential arrangement or
any other encumbrance in respect of such property or asset.
“Loan Financing” has the meaning set forth in Section 5.4.
“Losses” has the meaning set forth in Section 9.2.
“Material Adverse Effect” means, when used in connection with the Company or any
of its Subsidiaries, any event, change, circumstance, development or effect that
individually or in the aggregate, is reasonably likely to be materially adverse
to the business, results of operations or financial condition of the Company and
its Subsidiaries taken as a whole, excluding any such events, changes or effects
resulting from or arising in connection with (i) changes in Laws, rules or

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regulations of general applicability or applicability to the coal industry;
(ii) changes or conditions generally affecting the U.S. and global coal
industry; (iii) changes or conditions generally affecting the U.S. and global
economy or financial markets; (iv) acts of war (whether or not declared), armed
hostilities or terrorism, or the escalation or worsening thereof; (v) any action
taken (or omitted to be taken) with the written consent of or at the written
request of the Purchaser, or any effect resulting from the Purchaser’s refusal
to consent to a reasonable request of the Seller; (vi) any matter set forth in
the Seller’s Disclosure Schedule to the extent that it is readily apparent from
the face of the disclosure of such matter that such matter could reasonably be
expected to result in a Material Adverse Effect; (vii) any changes in applicable
tax and financial accounting rules (including GAAP); (viii) the announcement,
pendency or completion of the transactions contemplated by this Agreement, other
than with respect to losses or threatened losses of customers prior to the
expiration of existing contracts; (ix) any natural or man-made disaster or acts
of God; (x) any failure by the Company to meet any internal or published
projections, forecasts or revenue or earnings predictions (provided that the
underlying causes of such failures (subject to the other provisions of this
definition) shall not be excluded); (xi) the identity of the Purchaser;
(xii) seasonal fluctuations in the business of the Company; (xiii) a notice of a
pattern of violations at the Prosperity mine from the Mine Safety and Health
Administration; or (xiv) the Lafayette Termination Notices; provided, further,
however, that any event, change, circumstance, development or effect referred to
in clauses (i) through (iv), (vii) and (ix) immediately above shall be taken
into account in determining whether a Material Adverse Effect has occurred or is
reasonably likely to occur only to the extent that such event, change,
circumstance, development or effect has a disproportionate adverse effect on the
Company compared to other companies in the coal mining business and in the same
general geographic region as the Company.
“Minimum Coal Inventory Amount” means an amount of coal in inventory equal to
(i) 800,000 tons minus (ii) the lesser of (A) the total amount of coal inventory
purchased by the Seller or one of its Affiliates immediately prior to Closing
pursuant to Section 2.3(f) and (B) 300,000 tons of coal.
“Mining Operations” means the coal mining operations at the Oaktown 1, Oaktown 2
and Prosperity mines as presently conducted, including processing and
reclamation.
“Mining Permits” means those Permits that are directly related to the Mining
Operations, including those so designated in Section 4.6(b)(i) of the Seller’s
Disclosure Schedule.
“Mining Regulations” means the Federal Surface Mining Control and Reclamation
Act, 30 U.S.C. Section 1201, et seq. (SMCRA), and analogous state Laws; the
federal Mine Safety and Health Act of 1977, as amended (MSHA), and analogous
state Laws, and any Environmental Law to the extent that any Mining Permit was
issued pursuant to the requirements of such Environmental Law.
“Multiemployer Plan” means a Plan that is a multiemployer plan within the
meaning of Section 3(37) of ERISA with respect to which the Company or any ERISA
Affiliate has an obligation to contribute or has or could have withdrawal
Liability under Section 4201 of ERISA.

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“Net Plant Value” means the net book value of all property and equipment, mining
property, mine development costs, and asset retirement obligation assets, in
each case calculated in accordance with GAAP consistently applied and in
accordance with the methodology set out on Annex III.
“Net Working Capital” means, with respect to the Company and its Subsidiaries,
current assets (excluding Cash, deferred Tax assets, Accounts Receivable from
the Seller or an Affiliate thereof and any Accounts Receivable assigned to the
Seller pursuant to Section 2.3(e), but including advance royalties paid by the
Company or its Subsidiaries that have not yet been used to offset earned
royalties) less current liabilities (excluding Income Taxes, deferred Tax
liabilities and payables to the Seller or an Affiliate thereof and the current
portion of long-term Indebtedness, but including mine and rail reclamation
obligations), in each case calculated in accordance with GAAP consistently
applied and in accordance with the methodology set out on Annex II; provided
that for purposes of determining current assets, (i) the coal inventory included
in current assets will be determined in accordance with the methodology set
forth on Annex I and (ii) the parts inventory included in current assets will be
valued on the same basis as such inventory is valued in the Financial
Statements. For the avoidance of doubt, Net Working Capital shall not include
any amount that is included in Net Plant Value.
“Notice of Claim” has the meaning set forth in Section 9.4(a).
“Objection Notice” has the meaning set forth in Section 2.4(e).
“Objection Period” has the meaning set forth in Section 2.4(e).
“Order” means any order, award, injunction, judgment, decree, ruling, subpoena
or verdict or other decision issued, promulgated or entered by or with any
Governmental Entity or arbitrator of competent jurisdiction.
“Organizational Documents” means, with respect to any entity, the certificate of
incorporation or formation, the articles of incorporation, by-laws, articles of
organization, partnership agreement, limited liability company agreement,
formation agreement, joint venture agreement or other similar organizational
documents of such entity (in each case, as amended).
“Outside Date” shall mean November 26, 2014.
“Owned Real Property Interests” means real property and interests in real
property owned in fee by the Company or its Subsidiaries.
“Owned Real Property Parcel” means any parcel or tract of property in which
Company or a Subsidiary has Owned Real Property Interests.
“Permit” means any authorization, approval, consent, certificate, declaration,
filing, notification, qualification, registration, license, permit or franchise
or any waiver of any of the foregoing, of or from, or to be filed with or
delivered to, any Person or pursuant to any Law.
“Permitted Liens” means (a) building restrictions, easements, covenants, rights
of way and other similar restrictions and agreements and/or conditions imposed
by Permits or other impositions

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by any Governmental Entity which do not materially impair the current or
proposed use of the properties they affect as those properties are currently
used; (b) Liens for taxes not yet delinquent or being contested in good faith by
appropriate procedures; (c) Liens arising from Leases or rights retained by a
lessor arising from those Leases; (d) rights of any owner of any interest other
than the Company’s or its Subsidiaries’ interest in the Real Property, including
owners of surface, oil and gas, or other minerals or interests not subject to
the Leases; (e) mechanic’s, carriers’, workmen’s, repairmen’s or other like
Liens arising or incurred in the ordinary course of business or which are being
disputed in good faith; and (f) any other imperfections of title, if any, in
each case that have not and would not materially impair the current or proposed
use of the properties they effect as those properties are currently used.
“Person” means an individual, a corporation, a partnership, a limited liability
company, a trust, an unincorporated association or a Governmental Entity.
“Plan” means any bonus, incentive compensation, deferred compensation, pension,
profit sharing, retirement, stock purchase, stock option, stock ownership, stock
appreciation rights, restricted stock, phantom stock, stock or cash award,
deferred compensation, leave of absence, layoff, stay, vacation, day or
dependent care, legal services, cafeteria, life, health, welfare,
post‑retirement, accident, disability, worker’s compensation or other insurance,
severance, separation, change of control, employment or other employee benefit
plan, practice, policy, agreement or arrangement of any kind, whether written or
oral, or whether for the benefit of a single individual or more than one
individual including any “employee benefit plan” within the meaning of
Section 3(3) of ERISA.
“Policies” has the meaning set forth in Section 4.16.
“Post-Closing Period” means any taxable period or portion thereof beginning
after the Closing Date. The portion of a Straddle Period that begins on the day
following the Closing Date shall constitute a Post-Closing Period.
“Pre-Closing Period” means any taxable period or portion of a Straddle Period
that is not a Post‑Closing Period.
“Proposal” has the meaning set forth in Section 6.14.
“Proposed Balance Sheet” has the meaning set forth in Section 2.4(e).
“Proposed Cash Amount” has the meaning set forth in Section 2.4(e).
“Proposed Indebtedness Amount” has the meaning set forth in Section 2.4(e).
“Proposed Net Plant Value” has the meaning set forth in Section 2.4(e).
“Proposed Net Working Capital” has the meaning set forth in Section 2.4(e).
“Purchased Balance Sheet” has the meaning set forth in Section 4.4(a).

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“Purchase Price” has the meaning set forth in Section 2.1.
“Purchase Price Adjustment Deficit” has the meaning set forth in Section 2.4(g).
“Purchase Price Adjustment Surplus” has the meaning set forth in Section 2.4(g).
“Purchaser” has the meaning set forth in the preamble hereto.
“Purchaser Indemnitees” has the meaning set forth in Section 9.2.
“Purchaser Paid Indebtedness” has the meaning set forth in Section 2.3(c).
“Purchaser Termination Fee” has the meaning set forth in Section 8.2.
“Purchaser’s Disclosure Schedule” means the disclosure schedule dated and
delivered as of the date hereof by the Purchaser to the Seller, which is
attached to this Agreement.
“Purchaser’s Fundamental Representations” has the meaning set forth in
Section 9.1(a).
“Real Property” has the meaning set forth in Section 4.8(a).
“Reclamation Liabilities” means all obligations or liabilities (a) arising from
Permits; or (b) associated with or arising from the reclamation (including
mitigation), decommissioning, deconstruction, disposal, or final retirement of
mine sites, rail sidings and yards, coal piles, coal processing facilities and
other facilities, and disturbances associated with any mining or mining-related
activities conducted by or for the Company or its Subsidiaries.
“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping or disposing of a Hazardous
Material.
“Representatives” has the meaning set forth in Section 6.3(a).
“Restricted Period” has the meaning set forth in Section 6.15(a).
“Reviewing Party” has the meaning set forth in Section 2.4(f).
“Rights of Way” means all easements, right of way, prescriptive rights, and
other ways of necessity, whether of record or not, used in connection with or
necessary for the conduct of the Mining Operations.
“Section 338(h)(10) Election” has the meaning set forth in Section 6.9(f)(i).
“Section 338(h)(10) Election Form” has the meaning set forth in
Section 6.9(f)(ii).
“Section 338 Forms” has the meaning set forth in Section 6.9(f)(ii).
“Seller” has the meaning set forth in the preamble hereto.

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“Seller Guarantor” means Vectren Enterprises, Inc., an Indiana corporation.
“Seller Guaranty” means a guarantee of performance of the Seller’s obligations
under this Agreement and the other Ancillary Agreements by Seller Guarantor,
substantially in the form attached hereto as Exhibit A.
“Seller Indemnitees” has the meaning set forth in Section 9.3.
“Seller Parent” means Vectren Corporation, an Indiana corporation.
“Seller’s Disclosure Schedule” means the disclosure schedule dated and delivered
as of the date hereof by the Seller to the Purchaser, which is attached to this
Agreement.
“Seller’s Fundamental Representations” has the meaning set forth in
Section 9.1(a).
“Site” means any of the Real Property currently or previously owned, leased or
operated (directly or through the Contractors) by: (a) the Company or its
Subsidiaries; or (b) any entities previously owned by the Company or its
Subsidiaries, in each case including all soil, subsoil, surface waters and
groundwater thereat.
“Straddle Period” has the meaning set forth in Section 6.9(a)(iii).
“Subsidiary” means, with respect to any Person, any other Person that is
directly or indirectly Controlled by such Person.
“Support Obligations” has the meaning set forth in Section 6.17.
“Target Net Plant Value” means $297,988,656.
“Target Net Working Capital” means $20,251,711.
“Tax” or “Taxes” means any and all federal, state, local, or foreign net or
gross income, gross receipts, net proceeds, sales, use, ad valorem, value added,
franchise, bank shares, withholding, payroll, employment, excise, property,
abandoned property, escheat, deed, stamp, alternative or add-on minimum,
environmental, profits, windfall profits, transaction, license, lease, service,
service use, occupation, severance, energy, Transfer Taxes, unemployment, social
security, workers’ compensation, capital, premium, and other taxes, assessments,
customs, duties, fees, levies, or other governmental charges of any nature
whatever, whether disputed or not, together with any interest, penalties,
additions to tax, or additional amounts with respect thereto and any liability
in respect of any the foregoing payable by reason of contract, assumption,
transferee or successor liability, operation of Law, Treasury Regulation §
1.1502-6 (or any analogous or similar provision of Law) or otherwise.
“Taxing Authority” means any Governmental Entity having jurisdiction with
respect to any Tax.

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“Tax Returns” means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
“Third Party” means a Person not a party to this Agreement.
“Third Party Claim” has the meaning set forth in Section 9.4(a).
“Third Party Defense” has the meaning set forth in Section 9.4(b).
“Transaction Expenses” has the meaning set forth in Section 10.3.
“WARN Act” means the Worker Adjustment and Retraining Notification Act of 1988.
“Working Capital and Net Plant Value Methodology” has the meaning set forth in
Section 2.4(d).
“$” means United States dollars.
1.2    Construction. For the purposes of this Agreement, except as otherwise
expressly provided herein or unless the context otherwise requires (a) the
meaning assigned to each term defined herein shall be equally applicable to both
the singular and the plural forms of such term and vice versa, and words
denoting any gender shall include all genders as the context requires; (b) where
a word or phrase is defined herein, each of its other grammatical forms shall
have a corresponding meaning; (c) the terms “hereof,” “herein,” “hereunder,”
“hereby” and “herewith” and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement; (d) when a reference is made in this
Agreement to an Article, Section, paragraph, Exhibit or Schedule, such reference
is to an Article, Section, paragraph, Exhibit or Schedule of this Agreement
unless otherwise specified; (e) the words “include,” “includes” and “including”
when used in this Agreement shall be deemed to be modified by the words “without
limitation,” unless otherwise specified; (f) the use of the word “or” is not
intended to be exclusive unless expressly indicated otherwise; (g) the word
“shall” shall be construed to have the same meaning and effect of the word
“will;” (h) a reference to any party to this Agreement or any other agreement or
document shall include such party’s predecessors, successors and permitted
assigns; (i) a reference to any Law means such Law as amended, modified,
codified, replaced or reenacted, from time to time, and all rules and
regulations promulgated thereunder; and (j) all accounting terms used and not
defined herein have the respective meanings given to them under GAAP.
ARTICLE II    
PURCHASE AND SALE OF THE COMMON STOCK
2.1    Purchase and Sale of the Common Stock. Upon the terms and subject to the
conditions set forth in this Agreement, at the Closing, the Seller will sell,
transfer and deliver, and the Purchaser will purchase from the Seller, all of
the Common Stock (free and clear of all Liens, subscriptions, options, warrants,
calls, proxies, commitments and rights to acquire shares of any

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kind) for an aggregate purchase price equal to $296,000,000 (the “Base Purchase
Price”), subject to adjustments pursuant to Section 2.4 (as finally adjusted,
the “Purchase Price”); provided that in no event shall the Purchase Price exceed
$325,000,000. Payment of the Purchase Price shall be made in accordance with
Sections 2.3 and 2.4.
2.2    Closing. The consummation of the transactions contemplated by this
Agreement (the “Closing”) shall take place at the offices of the Purchaser, 1183
East Canvasback Dr., Terre Haute, Indiana 47802, at 10:00 a.m. on the date that
is two Business Days after the satisfaction (or waiver as provided herein) of
the conditions set forth in Article VII (other than those conditions that by
their nature will be satisfied at the Closing), unless another time, date or
place is agreed to in writing by the parties. The date upon which the Closing
occurs is herein referred to as the “Closing Date.” The Closing will be deemed
effective as of 11:59 p.m. Central Time on the Closing Date.
2.3    Calculation and Payment of Purchase Price on the Closing Date.
(a)    Calculation of the Closing Date Purchase Price. The aggregate amount to
be paid to the Seller on the Closing Date (the “Closing Date Purchase Price”) is
equal to the Base Purchase Price plus the Estimated Cash Amount (determined in
accordance with Section 2.4(a), plus or minus, as applicable, the Estimated Net
Working Capital Adjustment Amount (determined in accordance with
Section 2.4(b)), plus or minus, as applicable, the Estimated Net Plant Value
Adjustment Amount (determined in accordance with Section 2.4(c)), less the
Estimated Purchaser Paid Indebtedness Amount, which the Purchaser will pay on
behalf of the Company pursuant to Section 2.3(c), plus any adjustment amount
pursuant to Section 6.5(e)(i); provided that the Closing Date Purchase Price
shall not exceed $325,000,000. An example calculation of the Closing Date
Purchase Price is set forth on Annex IV hereto.
(b)    Payment of the Closing Date Purchase Price. At the Closing, the Purchaser
shall pay to the Seller by wire transfer of immediately available funds to an
account designated in writing by the Seller no fewer than five Business Days
prior to the Closing Date an amount equal to the Closing Date Purchase Price.
(c)    Payment of Purchaser Paid Indebtedness. At the Closing, the Purchaser
shall pay on behalf of the Company all of the Indebtedness described on Section
2.3(c) of the Seller’s Disclosure Schedule (the “Purchaser Paid Indebtedness”)
to the holder or holders thereof in accordance with, and upon receipt by the
Purchaser of, a fully executed pay‑off letter and any other applicable
discharges and lien release documentation, in each case, in form and substance
reasonably acceptable to the Purchaser and, in each case, delivered by the
Company to the Purchaser on or prior to the Closing Date.
(d)    Third Party Payments. Notwithstanding that the Purchaser is obligated to
make on behalf of the Company certain payments to Third Parties pursuant to this
Section 2.3, it is acknowledged that the underlying obligations in respect of
which such payments are being made are not the obligations of the Purchaser and
the Purchaser shall only be liable hereunder to make payments to such Third
Parties in such amounts as the Purchaser is directed to make in accordance with
the terms hereof.

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(e)    The Seller and the Company shall, and shall cause each of the Company’s
Subsidiaries to, use their reasonable best efforts prior to the Closing to
minimize the Estimated Net Plant Value Adjustment Amount to the maximum extent
possible through the management of the operations of the business of the Company
and its Subsidiaries, including with respect to capital expenditures to be made
by the Company or its Subsidiaries; provided that neither the Seller nor the
Company shall take any action pursuant to this Section 2.3(e) that would
compromise safety at the Mining Operations.
(f)    If when calculated in accordance with Section 2.3(a), the Closing Date
Purchase Price exceeds $325,000,000, the Seller shall notify the Purchaser and
provide reasonable supporting documentation of the adjustments to the Base
Purchase Price and the calculation of the Closing Date Purchase Price. Subject
to the Purchaser’s right to dispute such adjustments, the Company shall assign
to the Seller certain Accounts Receivable prior to the Closing on a basis
mutually agreeable to the Purchaser and the Seller (such agreement not to be
unreasonably withheld, conditioned or delayed), in order to reduce the Estimated
Net Working Capital such that the Closing Date Purchase Price does not exceed
$325,000,000. To the extent additional measures are required to reduce the
Closing Date Purchase Price to $325,000,000, the Purchaser and the Seller shall
discuss in good faith other methods as shall be mutually agreeable to the
Purchaser and the Seller (such agreement not to be unreasonably withheld,
conditioned or delayed) of reducing the Closing Date Purchase Price to such
amount. The Purchaser agrees that those methods will include, at the Seller’s
election, the purchase of existing coal inventory by the Seller or one of its
Affiliates immediately prior to Closing at the spot market price to the extent
necessary to reduce the Closing Date Purchase Price to $325,000,000, with the
provision that the purchased inventory will be stored separately at the mine
where the inventory is located at the time of sale and will be maintained there
under a separate contractual arrangement to be entered into by the Purchaser and
the Seller (or its Affiliate), which will include the reimbursement of the
Purchaser’s reasonable handling charges and any necessary or advisable measures
to protect the Seller’s (or its Affiliate’s) interest in the purchased
inventory, including a security interest therein; provided that no such purchase
of inventory by the Seller or its Affiliate shall be permitted to the extent it
would cause the condition set forth in Section 7.2(d) to fail to be satisfied.
2.4    Purchase Price Adjustment.
(a)    Estimated Closing Date Balance Sheet Certificate. At least five Business
Days prior to the Closing Date, the Company and the Seller shall jointly prepare
and deliver to the Purchaser (i) a reasonable good faith estimate of the
consolidated balance sheet for the Company as of the Closing Date (the
“Estimated Closing Balance Sheet”), (ii) a reasonable good faith estimate of the
Closing Date Net Working Capital (the “Estimated Net Working Capital”),
(iii) the resulting Estimated Net Working Capital Adjustment Amount, (iv) a
reasonable good faith estimate of the Closing Date Net Plant Value (the
“Estimated Net Plant Value”), (v) the resulting Estimated Net Plant Value
Adjustment Amount, (vi) a reasonable good faith estimate of the Cash, if any, of
the Company as of the Closing Date (as reflected on the Estimated Closing
Balance Sheet) (the “Estimated Cash Amount”), (vii) a reasonable good faith
estimate of the Indebtedness of the Company to be paid by the Purchaser as of
the Closing Date (the “Estimated Purchaser Paid Indebtedness Amount”), and
(viii) a certificate of the chief financial officer of the Company

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certifying the foregoing. Prior to the delivery of the Estimated Closing Balance
Sheet, (1) representatives of the Purchaser and the Seller shall jointly survey,
measure and calculate the coal inventory using the inventory methodology set
forth on Annex I, which coal inventory calculation shall be used in determining
the Estimated Net Working Capital, and (2) representatives of the Purchaser and
the Seller shall jointly measure and calculate the parts inventory, which
determination shall be used in the parts inventory calculation to be used in
determining the Estimated Net Working Capital.
(b)    Estimated Net Working Capital Adjustment Amount. The Base Purchase Price
shall be increased on a dollar-for-dollar basis to the extent the Estimated Net
Working Capital is greater than the Target Net Working Capital, and shall be
reduced on a dollar‑for‑dollar basis to the extent the Estimated Net Working
Capital is less than the Target Net Working Capital (the “Estimated Net Working
Capital Adjustment Amount”).
(c)    Estimated Net Plant Value Adjustment Amount. The Base Purchase Price
shall be increased on a dollar-for-dollar basis to the extent the Estimated Net
Plant Value is greater than the Target Net Plant Value, and shall be reduced on
a dollar‑for‑dollar basis to the extent the Estimated Net Plant Value is less
than the Target Net Plant Value (the “Estimated Net Plant Value Adjustment
Amount”).
(d)    Working Capital and Net Plant Value Methodology. The Estimated Closing
Balance Sheet and the Final Balance Sheet (and the individual elements thereof,
including Net Working Capital and Net Plant Value) shall be prepared and
determined in accordance with GAAP, with such modifications as are specified in
the policies, principles, procedures and methodologies as set forth in
Annexes I, II and III and made a part hereof (the “Working Capital and Net Plant
Value Methodology”). Each of the deliveries set forth in this Section 2.4 shall
be prepared in accordance with the Working Capital and Net Plant Value
Methodology.
(e)    Final Balance Sheet. On the Closing Date and promptly following the
Closing, representatives of the Purchaser and Seller shall jointly survey,
measure and calculate the coal inventory using the inventory methodology set
forth on Annex I, which coal inventory calculation shall be used in determining
the Proposed Net Working Capital. Within 90 days following the Closing Date, the
Purchaser shall prepare and deliver to the Seller a notice (an “Adjustment
Notice”), which shall include a consolidated balance sheet of the Company as of
the Closing Date prepared in accordance with GAAP and the methodologies
specified in Annexes I, II and III (the “Proposed Balance Sheet” and, in its
final and binding form after resolution of any disputes pursuant to this
Section 2.4, the “Final Balance Sheet”) setting forth its calculation of (i) the
Cash of the Company and its Subsidiaries as of the Closing Date (the “Proposed
Cash Amount”, and, in its final and binding form after resolution of any
disputes pursuant to this Section 2.4, the “Final Cash Amount”), (ii) the
Indebtedness of the Company and its Subsidiaries as of the Closing Date that was
not paid by the Purchaser pursuant to Section 2.3(c) or previously satisfied
prior to the Closing (the “Proposed Indebtedness Amount”, and, in its final and
binding form after resolution of any disputes pursuant to this Section 2.4, the
“Final Indebtedness Amount”), (iii) the Closing Date Net Working Capital (the
“Proposed Net Working Capital”, and, in its final and binding form after
resolution of any disputes pursuant to this Section 2.4, the “Final Net Working
Capital”), and

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(iv) the Closing Date Net Plant Value (the “Proposed Net Plant Value”, and, in
its final and binding form after resolution of any disputes pursuant to this
Section 2.4, the “Final Net Plant Value”), together with the calculations
utilized in, and the supporting documentation for the preparation of the
Proposed Balance Sheet, the calculation of the Proposed Net Working Capital and
the calculation of the Proposed Net Plant Value. The Seller shall have a period
of 60 days (the “Objection Period”) after delivery of the Adjustment Notice in
which to request additional information which shall be promptly provided by the
Purchaser and to provide written notice to the Purchaser of any objections to
the Proposed Balance Sheet and the calculation thereof (the “Objection Notice”).
The Objection Notice shall set forth in reasonable detail the item of the
Adjustment Notice to which each objection relates and the basis for each such
objection. If the Seller delivers an Objection Notice within the Objection
Period, the Seller and the Purchaser shall attempt in good faith to resolve any
dispute concerning the items subject to such Objection Notice. If the Seller and
the Purchaser do not resolve any dispute arising in connection with the Proposed
Balance Sheet and its constituent parts within 30 days after the date of
delivery of the Objection Notice, which 30‑day period may be extended by written
agreement of the Purchaser and the Seller (such period, as it may be extended,
the “Initial Resolution Period”), such dispute shall be resolved in accordance
with the procedures set forth in Section 2.4(f). The Proposed Balance Sheet and
the resulting Proposed Net Working Capital, Proposed Net Plant Value, Proposed
Cash Amount and Proposed Indebtedness Amount shall be deemed to be accepted by
the Seller, and shall become final and binding on the parties hereto on the
earlier of (x) the expiration of the Objection Period without delivery to the
Purchaser of an Objection Notice or (y) the date on which all objections
provided for in a timely-delivered Objection Notice have been resolved by the
parties or as provided for in Section 2.4(f).
(f)    Dispute Resolution Mechanism. If the Purchaser and the Seller have not
been able to resolve the matters set forth in the Objection Notice (the
“Dispute”) within the Initial Resolution Period, either party may submit such
disputed matters to Crowe Horwath LLP (the “Reviewing Party”). Both parties
shall submit to the Reviewing Party all materials and information to be
considered by the Reviewing Party as promptly as practicable and in any event
within 30 days following the initial submission of the Dispute to the Reviewing
Party. The fees and expenses of the Reviewing Party incurred in the resolution
of the disputed matters set forth in the Objection Notice shall be borne by the
Purchaser, on the one hand, and the Seller, on the other hand, in proportion to
the relative amounts of the aggregate disputed amount as to which such party
prevailed, as determined by the Reviewing Party. The Reviewing Party shall make
a determination regarding the Dispute (and written notice thereof shall be given
to the Seller and the Purchaser) as promptly as practicable, but in any event
within 30 days following the date on which the last item of information
regarding the Dispute has been delivered to the Reviewing Party. The Reviewing
Party will decide only the matters specifically raised in the Dispute based
solely on the submissions made to the Reviewing Party which may include factual
testimony and legal memoranda. The Reviewing Party will provide a written
explanation in reasonable detail of the resolution of each matter raised in the
Dispute, including the basis therefor; provided, however, that the Reviewing
Party shall only decide the specific items under dispute by the parties. The
determination of the Reviewing Party shall be final and binding on the Purchaser
and the Seller, and the decision rendered pursuant to this Section 2.4(f) may be
filed as a judgment in any court of competent jurisdiction. For the avoidance of
doubt, nothing in this Section 2.4(f) shall preclude either party from pursuing
any other remedy it may

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have under other provisions of this Agreement with respect to matters other than
the matters governed by this provision.
(g)    Post-Closing Purchase Price Adjustments.
(i)    If (A) the Final Net Working Capital is less than the Estimated Net
Working Capital, the Purchase Price shall be reduced on a dollar‑for‑dollar
basis by an amount equal to such deficit, or (B) the Final Net Working Capital
is greater than the Estimated Net Working Capital, the Purchase Price shall be
increased by an amount equal to such surplus.
(ii)    If (A) the Final Net Plant Value is less than the Estimated Net Plant
Value, the Purchase Price shall be reduced on a dollar‑for‑dollar basis by an
amount equal to such deficit, or (B) the Final Net Plant Value is greater than
the Estimated Net Plant Value, the Purchase Price shall be increased by an
amount equal to such surplus.
(iii)    If (A) the Final Cash Amount is less than the Estimated Cash Amount,
the Purchase Price shall be reduced on a dollar‑for‑dollar basis by an amount
equal to such deficit, or (B) the Final Cash Amount is greater than the
Estimated Cash Amount, the Purchase Price shall be increased by an amount equal
to such surplus.
(iv)    If (A) the Final Indebtedness Amount is greater than the Estimated
Purchaser Paid Indebtedness Amount, the Purchase Price shall be reduced on a
dollar‑for‑dollar basis by an amount equal to such surplus, or (B) the Final
Indebtedness Amount is less than the Estimated Purchaser Paid Indebtedness
Amount, the Purchase Price shall be increased by an amount equal to such
surplus.
The net amount of the adjustments to the Purchase Price under this
Section 2.4(g) shall be the “Purchase Price Adjustment Deficit” if the net
amount of the adjustments would, in the aggregate, reduce the Purchase Price
hereunder, or the “Purchase Price Adjustment Surplus” if the net amount of the
adjustments would, in the aggregate, increase the Purchase Price hereunder.
(h)    Payment Regarding Purchase Price Adjustments. Upon determination of the
Final Net Working Capital, the Final Net Plant Value, the Final Cash Amount and
the Final Indebtedness Amount in accordance with this Section 2.4 (such date of
determination, the “Determination Date”), (i) if there is a Purchase Price
Adjustment Deficit, the Seller shall pay to the Purchaser within five Business
Days after the Determination Date, by wire transfer of immediately available
funds an amount equal to the Purchase Price Adjustment Deficit; and (ii) if
there is a Purchase Price Adjustment Surplus, the Purchaser shall, within five
Business Days after the Determination Date, pay to the Seller by wire transfer
of immediately available funds an amount equal to the Purchase Price Adjustment
Surplus.
2.5    Closing Deliveries.
(a)    Documents Delivered by the Seller. At or prior to the Closing, the Seller
will deliver to the Purchaser each of the following:

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(i)        certificates representing the Common Stock, duly endorsed in blank or
accompanied by stock powers duly endorsed in blank in proper form for transfer;
(ii)        a properly prepared certificate of non‑foreign status, as required
pursuant to Treas. Reg. §1.1445‑2(b)(2), duly executed by the Seller;
(iii)        the Section 338(h)(10) Election Form (as described in Section
6.9(f)), duly executed by the Seller;
(iv)        pay‑off letters, in customary form, duly executed by the Company and
the holders of any Purchaser Paid Indebtedness and any inter-company or
Affiliate obligations to be discharged prior to closing and any other applicable
discharges or lien release documentation, in each case, in form and substance
reasonably acceptable to the Purchaser;
(v)        the corporate record book, stockholder ledger and all other corporate
records of each of the Company and its Subsidiaries;
(vi)        a certificate, in form and substance reasonably acceptable to the
Purchaser, duly executed by the Secretary of the Company certifying:
(A)    that attached to such certificate is a copy of duly adopted resolutions
of the board of directors of the Company approving this Agreement and
authorizing the execution and delivery of this Agreement, including the
Ancillary Agreements, and the consummation of the transactions contemplated
hereby and thereby;
(B)    that such resolutions have not been amended, modified or rescinded and
are in full force and effect; and
(C)    that attached to such certificate is a true and correct copy of the
Organizational Documents of each of the Company and its Subsidiaries, each of
which are in full force and effect and have not been amended, modified or
rescinded.
(vii)    a certificate of existence for each of the Company and its Subsidiaries
dated within 30 days prior to the Closing Date issued by the secretary of state
of the applicable state of organization and foreign qualification good standing
certificates for the Company and its Subsidiaries in each of the jurisdictions
set forth in Sections 4.1 and 4.2(b) of the Seller’s Disclosure Schedule, as
applicable;
(viii)    a copy of the duly adopted resolutions of the board of directors of
the Seller, certified by an officer of the Seller, approving this Agreement and
authorizing the execution and delivery of this Agreement, including the
Ancillary Documents to be executed and delivered by the Seller pursuant hereto,
and the consummation of the transactions contemplated hereby and thereby;
(ix)        all approvals, consents and waivers set forth on Section 7.2(g) of
the Seller’s Disclosure Schedule, each of which approvals, consents and waivers
shall be (1) in full

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force and effect, (2) not subject to any condition or other qualification and
(3) in form and substance reasonably satisfactory to the Purchaser;
(x)        a landlord estoppel certificate for each Lease with Templeton Coal
Company in form and substance reasonably satisfactory to the Purchaser;
(xi)        evidence of the assignment of the Accounts Receivable in accordance
with Section 2.3(f) in a form mutually agreeable to the Purchaser and the
Seller;
(xii)    the Seller Guaranty, duly executed by Seller Guarantor;
(xiii)    duly executed copies of each of the Contractor Termination Agreements
and the Lafayette Termination Notices;
(xiv)    interim services agreements with the Contractors, substantially in the
forms attached hereto as Exhibit B-1, B-2 and B-3, duly executed by the
Contractors; and
(xv)    such other documents and items as are reasonably necessary or
appropriate to effect the consummation of the transactions contemplated hereby
or which may be customary under local Law.
(b)    Documents Delivered by the Purchaser. At or prior to the Closing, the
Purchaser will deliver to the Seller each of the following:
(i)    payment of the Closing Date Purchase Price to be paid pursuant to the
methods and determined in accordance with Section 2.3;
(ii)    a copy of the duly adopted resolutions of the board of directors of the
Purchaser, certified by an officer of the Purchaser, approving this Agreement
and authorizing the execution and delivery of this Agreement, including the
Ancillary Documents to be executed and delivered by the Purchaser pursuant
hereto, and the consummation of the transactions contemplated hereby and
thereby; and
(iii)    such other documents and items as are reasonably necessary or
appropriate to effect the consummation of the transactions contemplated hereby
or which may be customary under local Law.
2.6    Withholding. The Company, the Purchaser and their Affiliates will be
entitled to deduct and withhold from the amounts otherwise payable pursuant to
this Agreement to any Person such amounts as they determine, in good faith and
after due consultation with the Seller, are required to be deducted and withheld
with respect to the making of such payment under the Code, or any provision of
state, local or foreign Tax Law. In the event that any amount is so deducted and
withheld, such withheld amounts will be treated for all purposes of this
Agreement as having been paid to the Person to whom the payment from which such
amounts were withheld was made.
ARTICLE III    
REPRESENTATIONS AND WARRANTIES OF THE SELLER

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The Seller represents and warrants to the Purchaser as of the date hereof and as
of the Closing as follows:
3.1    Organization and Good Standing. The Seller is duly organized and validly
existing under the Laws of the State of Indiana.
3.2    Authority and Enforceability. The Seller has the requisite legal capacity
to execute and deliver this Agreement and the Ancillary Agreements to which it
is a party, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The execution,
delivery and performance by the Seller of this Agreement and the Ancillary
Agreements to which it is a party and the consummation by the Seller of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary action on the part of the Seller and no other action is necessary on
the part of the Seller to authorize this Agreement or any Ancillary Agreement to
which it is a party or to consummate the transactions contemplated hereby and
thereby. This Agreement and each Ancillary Agreement to which it is a party have
been duly executed and delivered by the Seller. Assuming due authorization,
execution and delivery by the Purchaser and each other party thereto, this
Agreement and each such Ancillary Agreement constitutes a legal, valid and
binding obligation of the Seller, enforceable against the Seller in accordance
with its terms, except as limited by (a) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar Laws relating to creditors’
rights generally and (b) general principles of equity, whether such
enforceability is considered in a proceeding in equity or at Law.
3.3    No Conflicts; Consents.
(a)    The execution and delivery by the Seller of this Agreement and the
Ancillary Agreements to which it is a party does not, the performance by the
Seller of its obligations hereunder and thereunder and the consummation of the
transactions contemplated hereby and thereby (in each case with or without the
giving of notice or lapse of time or both) will not, directly or indirectly,
(i) violate any Law, Order or other restriction of any Governmental Entity to
which the Seller may be subject or (ii) violate, breach, conflict with or
constitute a default or an event creating any additional rights (including
rights of amendment, impairment, modification, suspension, revocation,
acceleration, termination or cancellation), impose additional obligations or
result in a loss of any rights, result in the creation of any Lien or require a
consent or the delivery of notice, under any Contract or Permit to which the
Seller is a party or by which the Seller is bound or to which any of the shares
of Common Stock are subject. There is no Action pending or, to the Knowledge of
the Seller, threatened against or affecting its shares of Common Stock.
(b)    Except as set forth on Section 3.3(b) of the Seller’s Disclosure
Schedule, the Seller is not required to give any notice to, make any filing with
or obtain any authorization, consent or approval of any Governmental Entity in
order for the parties to consummate the transactions contemplated hereby and by
the Ancillary Agreements.

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3.4    Common Stock Ownership.
(a)    The Seller has good and valid title to, and holds of record and owns
beneficially, all of the Common Stock, free and clear of all Liens,
subscriptions, warrants, calls, proxies, commitments, restrictions and rights to
acquire shares of any kind. The shares of Common Stock are the only Equity
Interests in the Company owned of record or beneficially by the Seller and the
Seller does not own (or have any rights in or to acquire) any other Equity
Interests in the Company or any other securities convertible into, or
exercisable or exchangeable for, equity or voting interests in the Company. The
shares of Common Stock were not issued in violation of (i) any Contract to which
the Seller is or was a party or by which the Seller or its properties or assets
is or was subject or (ii) of any preemptive or similar rights of any Person.
This Agreement, together with the other documents executed and delivered at the
Closing by the Seller, will be effective to transfer valid title to the Common
Stock to the Purchaser, free and clear of all Liens, subscriptions, warrants,
calls, proxies, commitments and Contracts of any kind.
(b)    The Seller is not party to (i) any voting agreement, voting trust,
registration rights agreement, stockholder or member agreement or other similar
arrangement with respect to the equity or voting interests in the Company or
(ii) any Contract obligating the Seller to vote or dispose of any Equity
Interests in the Company or which has the effect of restricting or limiting the
transfer, voting or other rights associated with the Common Stock.
3.5    Brokers’ Fees. The Seller does not have any Liability to pay any fees or
commissions to any broker, finder or similar agent with respect to this
Agreement, the Ancillary Agreements or the transactions contemplated by hereby
or thereby.
3.6    U.S. Status of Seller. The Seller is not a “foreign person” within the
meaning of Section 1445 of the Code and is not a Person whose separate existence
from a “foreign person” within the meaning of Section 1445 of the Code is
disregarded for U.S. federal income tax purposes.
ARTICLE IV    
REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY
The Seller represents and warrants to the Purchaser as of the date hereof and as
of the Closing as follows:
4.1    Organization and Good Standing. The Company is duly organized and validly
existing under the Laws of the State of Indiana, has all requisite power and
authority to own, lease and operate its properties and assets and to carry on
its business as now being conducted and as proposed to be conducted. The Company
is duly licensed or qualified to do business as a foreign corporation and is in
good standing in each jurisdiction in which it owns or leases property or assets
or the nature of its activities require such licensing or qualification, except
where the failure to be so licensed or qualified would not have a Material
Adverse Effect on the Company. Section 4.1 of the Seller’s Disclosure Schedule
sets forth the jurisdiction of incorporation of the Company and each
jurisdiction in which the Company is licensed or qualified to do business. The
Seller has made available to the Purchaser a complete and accurate copy of the
Organizational Documents for the

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Company. The Company is not and has not been in breach or violation of or
default under any provision of its Organizational Documents.
4.2    Capitalization.
(a)    Except for the Common Stock, no other Equity Interests in the Company are
authorized, issued or outstanding. All of the shares of Common Stock are duly
authorized, validly issued, fully paid and nonassessable and were issued in
compliance with all applicable Laws. None of the shares of Common Stock were
issued in violation of (i) any Contract to which the Seller or the Company is or
was a party or by which the Seller or the Company or their respective properties
or assets is or was subject or (ii) of any preemptive or similar rights of any
Person. Except as set forth on Section 4.2(a) of the Seller’s Disclosure
Schedule, there are no outstanding options, warrants or other Equity Interests
or subscription, preemptive or other rights convertible into or exchangeable or
exercisable for any shares of capital stock or other Equity Interests of the
Company and there are no “phantom stock” rights, stock appreciation rights or
other similar rights with respect to the Company. There are no Contracts to
which the Company is a party or by which the Company is subject, obligating the
Company to issue, deliver, grant or sell, or cause to be issued, delivered,
granted or sold, additional shares of capital stock of, or other Equity
Interests in, or options, warrants or other securities or subscription,
preemptive or other rights convertible into, or exchangeable or exercisable for,
any such shares of the Company, or any “phantom stock” right, stock appreciation
right or other similar right with respect to the Company, or obligating the
Company to enter into any such Contract. There are no Contracts, contingent or
otherwise, obligating the Company to repurchase, redeem or otherwise acquire or
dispose of any shares of capital stock of, or other Equity Interests in, the
Company. There are no voting agreements, voting trusts, registration rights
agreements, member agreements, stockholder agreements or other similar
arrangements with respect to the capital stock of the Company. There are no
rights plans affecting the Company.
(b)    Except as set forth on Section 4.2(b) of the Seller’s Disclosure
Schedule, the Company does not own or hold the right to acquire any stock,
partnership interest or joint venture interest or other Equity Interest in any
other corporation, organization or entity. Except as set forth on Section 4.2(b)
of the Seller’s Disclosure Schedule, the Company owns, directly or indirectly,
of record and beneficially, all capital stock and other Equity Interests in each
of its Subsidiaries, and all such capital stock and other equity interests are
validly issued, fully paid and non-assessable (to the extent such concept is
applicable to such equity interests). Each of the Company’s Subsidiaries is duly
formed or organized and validly existing under the applicable Laws of its
jurisdiction of formation or organization, and each of the Company’s
Subsidiaries has all requisite power and authority to own and operate its
properties and to carry on its businesses as now conducted. Each of the
Company’s Subsidiaries is duly licensed or qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which it owns or
leases property or assets or the nature of its activities require such licensing
or qualification, except where the failure to be so licensed or qualified would
not have a Material Adverse Effect on such Subsidiary. Section 4.2(b) of the
Seller’s Disclosure Schedule sets forth the jurisdiction of organization of each
of the Company’s Subsidiaries and each jurisdiction in which each of the
Company’s Subsidiaries is licensed or qualified to do business. The Seller has
made available to the Purchaser a complete and accurate copy of the

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Organizational Documents for each of the Company’s Subsidiaries. No Company
Subsidiary is or has been in breach or violation of or default under any
provision of its Organizational Documents
(c)    Except as set forth on Section 4.2(c) of the Seller’s Disclosure
Schedule, neither the Company nor its Subsidiaries has any Indebtedness.
4.3    No Conflicts; Consents.
(a)    Except as set forth on Section 4.3(a) of the Seller’s Disclosure
Schedule, the execution and delivery of this Agreement and the Ancillary
Agreements to which the Company is a party does not, and the performance by the
Company of any of its obligations hereunder and thereunder and the consummation
of the transactions contemplated hereby and thereby (in each case with or
without the giving of notice or lapse of time, or both) will not, directly or
indirectly, (i) violate or conflict with or result in the breach of the
provisions of any of the Organizational Documents of the Company, (ii) violate,
breach, conflict with or constitute a default or an event creating any
additional rights (including rights of amendment, impairment, modification,
suspension, revocation, acceleration, termination or cancellation), impose
additional obligations or result in a loss of any rights, or require a consent
or the delivery of notice, under any Company Contract, Law or Permit applicable
to the Company or to which the Company is a party or otherwise subject, or
(iii) result in the creation of any Liens upon any asset owned or used by the
Company.
(b)    Except as set forth on Section 4.3(b) of the Seller’s Disclosure
Schedule, the Company is not required to give any notice to, make any filing
with or obtain any authorization, consent or approval of any Governmental Entity
in order for the parties to consummate the transactions contemplated hereby and
by the Ancillary Agreements.
4.4    Financial Statements; No Undisclosed Liabilities; Accounts Receivable.
(a)    Section 4.4(a) of the Seller’s Disclosure Schedule sets forth true and
complete copies of the audited consolidated balance sheet of the Company as at
December 31, 2013 (the “Balance Sheet”) December 31, 2012, and the related
audited consolidated statements of income, changes in shareholders’ equity and
cash flows of the Company, together with all related notes and schedules
thereto, accompanied by the reports thereon of the Company’s independent
auditors (collectively referred to as the “Financial Statements”), the unaudited
consolidated balance sheet of the Company as at May 31, 2014, and the related
consolidated statements of income, changes in shareholders’ equity and cash
flows of the Company, together with all related notes and schedules thereto
(collectively referred to as the “Interim Financial Statements”), and a pro
forma balance sheet of the Company as at May 31, 2014 reflecting the
transactions contemplated hereby (the “Purchased Balance Sheet”). Each of the
Financial Statements, the Interim Financial Statements and the Purchased Balance
Sheet (i) has been prepared based on the Books and Records of the Company and
its Subsidiaries, (ii) has been prepared in accordance with United States
generally accepted accounting principles (“GAAP”) applied on a consistent basis
throughout the periods indicated and (iii) fairly presents, in all material
respects, the financial position, results of operations and cash flows of the
Company and its Subsidiaries as at the respective dates thereof and for the
respective periods indicated therein, subject, in the case of the Interim
Financial Statements and Purchased Balance Sheet, to normal recurring year‑end
audit adjustments and the absence of notes,

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in each case the effect of which, individually or in the aggregate, would not
reasonably be expected to be material to the Company. The Company maintains a
standard system of accounting and internal controls established and administered
in accordance with GAAP.
(b)    Except as set forth on Section 4.4(b) of the Seller’s Disclosure
Schedule, neither the Company nor any of its Subsidiaries has any Liabilities
except those which (i) are adequately reflected or reserved against in the
Balance Sheet, (ii) have been incurred in the ordinary course of business
consistent with past practice since December 31, 2013 and (iii) are not,
individually or in the aggregate, material in amount.
4.5    Taxes.
(a)    All Income Tax Returns and other material Tax Returns required to have
been filed by or with respect to the Company or any of its Subsidiaries have
been duly and timely filed (or, if due between the date hereof and the Closing
Date, will be duly and timely filed), and each such Tax Return in all material
respects reflects Liabilities for Taxes and all other information required to be
reported thereon. All material Taxes owed by the Company or any of its
Subsidiaries (whether or not shown on any Tax Return) have been timely paid (or,
if due between the date hereof and the Closing Date, will be duly and timely
paid). The Company and each of its Subsidiaries has adequately provided for, in
its books of account and related records, Liabilities for all unpaid Taxes (that
are current Taxes not yet due and payable) in accordance with GAAP.
(b)    Except as set forth on Section 4.5(b) of the Seller’s Disclosure
Schedule, (i) there is no action or audit currently proposed, threatened or
pending respect to the Company or any of its Subsidiaries in respect of any
material Taxes; and (ii) neither the Company nor any of its Subsidiaries is the
beneficiary of any extension of time within which to file any Tax Return, nor
has the Company or any of its Subsidiaries made (or had made on its behalf) any
requests for such extensions. No written claim (or, to the Knowledge of Seller,
no other claim) has ever been made by an authority in a jurisdiction where the
Company and its Subsidiaries do not file Tax Returns that as a result of their
activities, the Company or any of its Subsidiaries is or may be subject to
taxation by that jurisdiction or that as a result of its activities, the Company
or any of its Subsidiaries must file Tax Returns in such jurisdiction. There are
no Liens on any of the stock, assets or properties of the Company or its
Subsidiaries with respect to Taxes, except for Permitted Liens.
(c)    The Company and each of its Subsidiaries has withheld and timely paid all
material Taxes required to have been withheld or paid and has complied with all
information reporting and backup withholding requirements, including maintenance
of required records with respect thereto.
(d)    There is no pending dispute or claim concerning any material Liabilities
for Taxes with respect to the Company or any of its Subsidiaries for which
notice has been provided or which is asserted or threatened. No issues have been
raised in any examination with respect to the Company or any of its Subsidiaries
which, by application of similar principles, could be expected to result in
material Liabilities for Taxes for the Company or any of its Subsidiaries for
any other period not so examined. Section 4.5(d) of the Seller’s Disclosure
Schedule (i) lists all federal, state and local Income Tax Returns filed with
respect to the Company or any of its Subsidiaries for taxable

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periods ended on or after January 1, 2008, (ii) indicates those Income Tax
Returns that have been audited and (iii) indicates those Income Tax Returns that
currently are the subject of audit. The Seller has made available to the
Purchaser copies of all proforma federal Income Tax Returns, examination reports
and statements of deficiencies assessed against or agreed to by the Company or
any of its Subsidiaries since January 1, 2008. Neither the Company nor any of
its Subsidiaries has waived (or is subject to a waiver of) any statute of
limitations in respect of Taxes or has agreed to (or is subject to) any
extension of time with respect to a Tax assessment or deficiency.
(e)    None of the assets or properties of the Company or its Subsidiaries
constitutes tax exempt bond financed property or tax exempt use property within
the meaning of Section 168 of the Code. Neither the Company nor any of its
Subsidiaries is a party or is subject to any “safe harbor lease” within the
meaning of Section 168(f)(8) of the Code, as in effect prior to amendment by the
Tax Equity and Fiscal Responsibility Act of 1982, or to any “long term contract”
within the meaning of Section 460 of the Code. Neither the Company nor any of
its Subsidiaries has made any payments, is obligated to make any payments, is a
party or subject to any Contract that under certain circumstances could obligate
it to make payments that would result in a nondeductible expense under Section
280G of the Code or an excise Tax to the recipient of such payments pursuant to
Section 4999 of the Code. Neither the Company nor any of its Subsidiaries has
participated in or cooperated with an international boycott as defined in
Section 999 of the Code.
(f)    Neither the Company nor any of its Subsidiaries has received (or is
subject to) any ruling from any Taxing Authority or has entered into (or is
subject to) any Contract with a Taxing Authority. The Company and each of its
Subsidiaries has disclosed on its federal income Tax Returns all positions taken
therein that could give rise to a substantial understatement of federal income
Tax within the meaning of Section 6662 of the Code.
(g)    Neither the Company nor any of its Subsidiaries has agreed to or is
required to make by reason of a change in accounting method or otherwise, or
could be required to make by reason of a proposed or threatened change in
accounting method or otherwise, any adjustment under Section 481(a) of the Code.
Neither the Company nor any of its Subsidiaries has been the “distributing
corporation” (within the meaning of Section 355 of the Code) with respect to a
transaction described in Section 355 of the Code within the two-year period
ending as of the date of this Agreement.
(h)    Neither the Company nor any of its Subsidiaries is a party to, a
beneficiary of or subject to, any Tax allocation or sharing agreement with the
Seller or Seller Parent (or any of their Affiliates) that will be in existence
at Closing. Neither the Company nor any of its Subsidiaries has any Liabilities
for the Taxes of any Person (i) as a transferee or successor, (ii) by Contract
(other than commercial contracts the principal purpose of which is not Tax
related), or (iii) except with respect to Seller Parent as the parent of the
U.S. consolidated group of which the Company and its Subsidiaries are members
under Section 1.1502-6 of the Treasury regulations (or any similar provision of
state, local or foreign Law). Neither the Company nor any of its Subsidiaries is
a party to, a beneficiary of or subject to, any joint venture, partnership or
other arrangement that is treated as a partnership for federal income Tax
purposes.

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(i)    Neither the Company nor any of its Subsidiaries will be required to
include any item of income in, or exclude any item of deduction from, taxable
income for any taxable period (or portion thereof) ending after the Closing Date
as a result of any (i) intercompany transactions or excess loss accounts
described in Treasury regulations under Section 1502 of the Code (or any similar
provision of state, local or foreign Tax Law), (ii) installment sale or open
transaction disposition made on or prior to the Closing Date, (iii) prepaid
amount received on or prior to the Closing Date, or (iv) cancellation of
Indebtedness income arising on or prior to the Closing Date.
(j)    Neither the Company nor any of its Subsidiaries has been a party to, nor
has engaged, in any transaction that, as of the date hereof, is a “listed
transaction” or “substantially similar” transaction under Section 1.6011-4(b)(2)
of the Treasury Regulations.
(k)    The Seller and/or Seller Parent is eligible to join with Purchaser in
making the Section 338(h)(10) Election with respect to the purchase of all the
Common Stock of the Company contemplated by this Agreement.
(l)    Notwithstanding anything elsewhere in this Agreement to the contrary, the
representations and warranties in this Section 4.5 are the sole and exclusive
representations and warranties in this Agreement concerning Taxes.
4.6    Compliance with Law; Permits.
(a)    Except as indicated on Sections 4.6(a)(i) and 4.6(c) of the Seller’s
Disclosure Schedule and except for violations that have been fully cleared or
resolved with the relevant Governmental Entity: (i) each of the Company and its
Subsidiaries (A) has since January 1, 2008 conducted, and are presently
conducting, their respective businesses in compliance with all applicable Laws
in all material respects, and (B) has prior to January 1, 2008 conducted their
respective businesses in compliance with all applicable Laws other than such
non-compliance which would not reasonably be expected to result in a Material
Adverse Effect, and (ii) each of the Contractors has (A) since January 1, 2008
conducted, and are presently conducting, the Mining Operations in compliance
with all applicable Laws in all material respects, and (B) has prior to January
1, 2008 conducted the Mining Operations in compliance with all applicable Laws
other than such non-compliance which would not reasonably be expected to result
in a Material Adverse Effect. Except as indicated on Section 4.6(a)(ii) of the
Seller’s Disclosure Schedule, to the Knowledge of the Seller, no event has
occurred and no circumstances exist that (with or without the passage of time or
the giving of notice) would be reasonably expected to result in a violation of,
conflict with or failure on the part of the Company or any of its Subsidiaries
to conduct its business, or on the part of the Contractors to conduct the Mining
Operations, in compliance with, any applicable Law in all material respects.
Except as indicated on Sections 4.6(a) and 4.6(c) of the Seller’s Disclosure
Schedule, neither the Company nor any of its Subsidiaries has received notice
regarding any material violation of, conflict with, or failure to conduct its
business or the Mining Operations in compliance with, any applicable Law,
excluding any notice of any such violation, conflict or failure on the part of
the Contractors that has been fully resolved with the relevant Governmental
Entity. The Mining Operations have not been designated as being subject to a
pattern of violations by the Mine Safety and Health Administration, and neither
the Company nor its Subsidiaries, nor to the Knowledge of the Seller, the
Contractors, have received any written

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or oral communications from the Mine Safety and Health Administration indicating
such a designation.
(b)    Each of the Company and its Subsidiaries has obtained, owns, holds or
lawfully uses directly or through the Contractors, all Permits which are
material for the conduct of its business or the Mining Operations, and each
Permit is held free and clear of all Liens. Each such Permit is valid and in
full force and effect and is listed on Section 4.6(b)(i) of the Seller’s
Disclosure Schedule (with all Mining Permits being so designated).
Section 4.6(b)(ii) of the Seller’s Disclosure Schedule sets forth each Order
entered, issued or rendered by any Governmental Entity to which the Company or
one of its Subsidiaries or its or their business, properties or assets is
subject that could reasonably be expected to materially restrict the Mining
Operations or result in Liability to the Company or its Subsidiaries that has
not been fully resolved. Except as noted on Section 4.6(b)(iii) of the Seller’s
Disclosure Schedule and except for violations that have been fully resolved with
the relevant Governmental Entity, each of the Company and its Subsidiaries and
the Contractors is and has been in compliance in all material respects with the
Permits, and, to the Knowledge of the Seller, no event has occurred and no
circumstances exist that (with or without the passage of time or the giving of
notice) would be reasonably expected to result in a material violation of,
conflict with, failure on the part of the Company or one its Subsidiaries or the
Contractors to comply with the terms of, or the revocation, withdrawal,
termination, cancellation, suspension or modification of any Permit.
(c)    Section 4.6(c) of the Seller’s Disclosure Schedule sets forth a complete
list of each violation of, conflict with or failure to comply with the Mining
Regulations in connection with the Mining Operations that is open or has not
been fully resolved with the relevant Governmental Entity.
(d)    Section 4.6(d) of the Seller’s Disclosure Schedule sets forth, as of the
date of this Agreement, a complete list of all current plans, including mine
plans, roof control plans, ventilation plans, corrective action programs, and
any amendments, modifications, updates or material correspondence related
thereto, for each of the Mining Operations that have been submitted to
applicable Governmental Entities pursuant to the Mining Regulations, each of
which has been made available to the Purchaser.
(e)    None of the representations and warranties contained in this Section 4.6
shall be deemed to relate to tax matters (which are governed by Section 4.5),
labor and employment matters (which are governed by Section 4.14) or
environmental matters (which are governed by Section 4.15). Notwithstanding the
foregoing, the representations and warranties contained in this Section 4.6
shall be deemed to relate to the Mining Regulations.
4.7    Personal Property.
(a)    Except as set forth in Section 4.7(a) of the Seller’s Disclosure
Schedule, each of the Company and its Subsidiaries has good and marketable title
to the personal property (i.e. tangible property other than Real Property) it
purports to own, and a valid leasehold interest in the personal property it
leases, in each case free and clear of all Liens other than Permitted Liens,
lease terms and purchase money liens. The material personal properties and
assets that will be owned or

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leased and available for use by the Company or its Subsidiaries after the
consummation of the transactions contemplated hereby (including the termination
of Contracts pursuant to Section 6.5) (a) are in good operating condition and
repair, subject to ordinary wear and tear, are usable in the ordinary course of
the Mining Operations, and are suitable for the purposes for which they are
currently being used, and (b) are sufficient for the conduct of the Mining
Operations.
(b)    Section 4.7(b) of the Seller’s Disclosure Schedule sets forth a complete
and accurate list of the equipment owned or leased by the Company or its
Subsidiaries and used in the Mining Operations as of the date hereof with a net
book value equal to or greater than $10,000 organized by coal mine, and with
respect to equipment with a net book value equal to or greater than $50,000,
also organized by production unit. All of such equipment will be located at such
coal mines for use by the Purchaser as of the Closing.
4.8    Real Property.
(a)    Section 4.8(a) of the Seller’s Disclosure Schedule contains a list of
(i) the Owned Real Property Interests, (ii) the Leased Real Property Interests,
and (iii) the Rights of Way, and, together with the Owned Real Property
Interests and Leased Real Property Interests, the “Real Property”); provided
that the omission of any Owned Real Property Interests, Leased Real Property
Interests or Right of Way by inadvertence which is not, individually or in the
aggregate, material to the Company or its Subsidiaries or the Mining Operations
from Section 4.8(a) of the Seller’s Disclosure Schedule shall not constitute a
breach of this Section 4.8(a).
(b)    With respect to each Owned Real Property Interest:
(i)    Either the Company or one of its Subsidiaries has good and marketable
title to each such Owned Real Property Interest free and clear of all Liens,
except Permitted Liens.
(ii)    No structures, facilities or other improvements on any parcel adjacent
to an Owned Real Property Parcel encroach onto any portion of the Owned Real
Property Parcel in a manner that materially impairs the use of such property in
the manner it is currently used by the Company.
(iii)    The Seller has made available to the Purchaser copies of the deeds and
other instruments (as recorded) by which the Company or its Subsidiaries
acquired the Owned Real Property Interests, and copies of all title insurance
policies, opinions, abstracts and surveys in the possession of the Company or
its Subsidiaries with respect to such Owned Real Property Interests.
(iv)    Except as set forth on Section 4.8(b)(iv) of the Seller’s Disclosure
Schedule, there are no outstanding put rights or options or rights of first
refusal or rights of first offer in Third Parties to purchase any of the Owned
Real Property Interests.
(c)    With respect to Leased Real Property Interests, and except as set forth
on Section 4.8(c) of the Seller’s Disclosure Schedule:

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(i)    The Seller has made available to the Purchaser a true and complete copy
of each Lease, and there are no oral or other agreements, amendments or
modifications affecting such Lease, provided that a failure by inadvertence to
make available to Purchaser any Lease or amendment which is not, individually or
in the aggregate, material to the Company or its Subsidiaries or the Mining
Operations shall not constitute a breach of this Section 4.8(c).
(ii)    Each Lease is a valid and binding Contract of the Company or its
Subsidiaries, and is in full force and effect and is binding on and enforceable
against the Company or its Subsidiaries, and, to the Knowledge of the Seller,
binding upon and enforceable against the counterparties thereto (except as may
be limited by bankruptcy, insolvency, moratorium, reorganization or similar Laws
affecting the rights of creditors generally and subject to general principles of
equity), and is free and clear of any Liens other than Permitted Liens. Neither
the Company nor any of its Subsidiaries, nor to Knowledge of the Seller, any
other party to a Lease is in violation or breach of or default thereof that
would constitute a material default thereof or otherwise entitle the lessor to
terminate or modify any such Lease. No event has occurred which (whether with
notice or lapse of time, or both) would constitute a material default thereof or
otherwise entitle the lessor to terminate or modify any such Lease. Neither the
Company nor any of its Subsidiaries has received any written notice alleging any
violation, breach or default under any such Lease.
(iii)     Neither the Company nor any of its Subsidiaries owes or will owe any
material brokerage commissions or finder’s fees with respect to any Lease or any
renewal or extension thereof or the exercise of any right or option thereunder.
(d)    The Company or one of its Subsidiaries owns, has rights to use or
possesses all material Rights of Way.
(e)    To the Knowledge of the Seller, no Governmental Entity or other Third
Party having the power of eminent domain over the Real Property has commenced or
intends to exercise the power of eminent domain or a similar power with respect
to all or any part of such Real Property. There are no pending or, to the
Knowledge of the Seller, threatened condemnation, fire, health, safety,
building, zoning or other land use regulatory proceedings, lawsuits or
administrative actions relating to any portion of the Real Property or any other
matters which do or may adversely affect the current use, occupancy or value
thereof. Neither the Company nor any of its Subsidiaries has received notice of
any pending or threatened special assessment proceedings affecting any portion
of such Real Property.
(f)    The Real Property and all present uses and operations of the Real
Property by the Company, its Subsidiaries or the Contractors comply with all
zoning or other land use Laws affecting the Real Property in all material
respects.
(g)    Except as set forth in Section 4.8(g) of the Seller’s Disclosure
Schedule, no Person other than the Company or its Subsidiaries is in possession
of any material Real Property or any portion thereof, and to the Knowledge of
the Seller, there are no leases, subleases, licenses, concessions or other
agreements, written or oral, granting to any Person other than the Company or
its Subsidiaries the right of use or occupancy of such Real Property or any
portion thereof.

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4.9    Intellectual Property.
(a)    Section 4.9(a)(i) of the Seller’s Disclosure Schedule contains a complete
and accurate list of all Intellectual Property that is material to or necessary
for the conduct of the Company’s and its Subsidiaries’ businesses or the Mining
Operations (the “Company Intellectual Property”), and except as set forth on
Section 4.9(a)(ii) of the Seller’s Disclosure Schedule, as of the Closing the
Company or its Subsidiaries will own or have the right to use all such Company
Intellectual Property.
(b)    Except as set forth on Section 4.9(b) of the Seller’s Disclosure
Schedule, to the Knowledge of the Seller: (i) the Company Intellectual Property
as currently licensed or used by the Company or its Subsidiaries, and the
Company’s and its Subsidiaries’ conduct of their businesses as currently
conducted, do not infringe, violate or misappropriate the Intellectual Property
of any Person; and (ii) no Person is infringing, violating or misappropriating
any Company Intellectual Property.
4.10    Absence of Certain Changes or Events.
(a)    As of the date hereof, except as set forth in Section 4.10(a) of the
Seller’s Disclosure Schedule, since the date of the Balance Sheet, no Material
Adverse Effect has occurred and is continuing.
(b)    Without limiting the generality of Section 4.10(a), except as set forth
on Section 4.10(b) of the Seller’s Disclosure Schedule, since the date of the
Balance Sheet, each of the Company and its Subsidiaries has conducted its
business in the ordinary course, consistent with past practice, and neither the
Company nor any of its Subsidiaries has:
(i)    made any change in its accounting principles or practices or the methods
by which such principles or practices are applied for financial reporting
purposes (except as required by GAAP), changed, or made, any material Tax
election, changed any Tax accounting method or settled any material claim for
Taxes or written down or written up (or failed to write down or write up in
accordance with GAAP consistent with past practice) the value of any Accounts
Receivable or revalued any of their respective assets other than in the ordinary
course of business consistent with past practice and in accordance with GAAP;
(ii)    suffered any material damage, destruction or Loss with respect to any of
its properties or assets, whether or not covered by insurance;
(iii)     other than in the ordinary course of business consistent with past
practice, acquired, sold, transferred, conveyed, leased, subleased or otherwise
disposed of any businesses or any material properties or assets (whether by
merger, consolidation or otherwise); or
(iv)     authorized, committed or agreed to do any of the foregoing.

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4.11    Contracts.
(a)    Section 4.11(a) of the Seller’s Disclosure Schedule sets forth a complete
and accurate list of all of the following Contracts to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or any of its or their assets are subject:
(i)    Contracts for the purchase or lease of materials, supplies, goods,
services, equipment or other assets requiring aggregate payments in excess of
$100,000;
(ii)    Contracts for the sale by the Company or any of its Subsidiaries of
materials, supplies, goods, services, equipment or other assets (other than
coal) having a value in excess of $50,000;
(iii)     Contracts requiring the Company or any of its Subsidiaries to purchase
its total requirements of any product or service from a Third Party or that
contain “take or pay” or other minimum purchase requirements provisions;
(iv)     Contracts for the purchase, sale or transport of coal (collectively,
the “Coal Supply Agreements”);
(v)    Contracts with coal brokers for the sale of coal;
(vi)     Contracts to supply or provide contract mining services and any other
Contracts with coal mine operators or their Affiliates, directors, managers,
officers, stockholders or partners;
(vii)    partnership, joint venture or similar Contracts;
(viii)    employment, severance, stay, bonus, termination, change in control,
consulting or similar Contracts;
(ix)     Contracts containing covenants not to compete or other covenants
restricting or purporting to restrict the right of the Company or any of its
Subsidiaries or Affiliates to engage in any line of business, acquire any
property, develop or distribute any product, provide any service (including
geographic restrictions) or to compete with any Person, or granting any
exclusive distribution rights, in any market, field or territory;
(x)    Contracts with the Seller or any Affiliate of the Seller, the Company or
any of its Subsidiaries, other than Coal Supply Agreements;
(xi)     Notes, debentures, bonds, equipment trusts, letters of credit, loans or
other Contracts for or evidencing Indebtedness or the lending of money including
Bonds;
(xii)    Contracts (including keepwell agreements) under which (A) any Person
has directly or indirectly guaranteed Indebtedness or other Liabilities of the
Company or any of its Subsidiaries or (B) the Company or any of its Subsidiaries
has directly or indirectly

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guaranteed Indebtedness or other Liabilities of any Third Party (in each case
other than endorsements for the purpose of collection in the ordinary course of
business consistent with past practice);
(xiii)    Contracts under which the Company or any of its Subsidiaries has,
directly or indirectly, made any advance, loan, extension of credit or capital
contribution to, or other investment in, any Third Party;
(xiv)    Contracts under which there is a continuing obligation to pay any “earn
out” payment or deferred or contingent purchase price or any similar payment
respecting the purchase of any business or assets;
(xv)    Contracts that are material to the conduct of the business of the
Company or its Subsidiaries as currently conducted (i) under which any Company
Intellectual Property is licensed to any Third Party, or (ii) that constitute
Intellectual Property licensed by the Company or its Subsidiaries (excluding
generally-commercially‑available off‑the‑shelf software programs that in each
case has incurred license fees of less than $2,500), identifying in each case
whether such license is exclusive or non‑exclusive;
(xvi)    Contracts with any Governmental Entity with a value in excess of
$50,000, other than Permits;
(xvii)    Contracts other than the Leases, the Contractor Mining Agreements or
the Lafayette Agreements which require payment by the Company or its
Subsidiaries of any royalties; and
(xviii)    Contracts that are otherwise material to the Mining Operations and
not previously disclosed pursuant to this Section 4.11.
The Contracts required to be listed on Section 4.11(a) of the Seller’s
Disclosure Schedule are collectively referred to herein as the “Company
Contracts.” The Seller has made available complete and accurate copies of each
Company Contract (including all material amendments, modifications, extensions
and renewals thereof and related notices relating thereto) to the Purchaser.
(b)    Except as set forth on Section 4.11(b) of the Seller’s Disclosure
Schedule, (i) each Company Contract is in full force and effect and valid and
enforceable in accordance with its terms, (ii) each of the Company and its
Subsidiaries and, to the Knowledge of the Seller, all other parties thereto have
complied with and are in compliance with the provisions of each Company Contract
in all material respects, (iii) neither the Company nor any of its Subsidiaries
is, nor to the Knowledge of the Seller, any other party thereto is, in material
default in the performance, observance or fulfillment of any obligation,
covenant, condition or other term contained in any Company Contract, and neither
the Company nor any of its Subsidiaries has given or received notice to or from
any Person relating to any such alleged or potential default that has not been
cured, and (iv) the Company Contracts are all of the Contracts that are material
to or necessary for the conduct of the Company’s and its Subsidiaries’
businesses or the Mining Operations.

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(c)    Except as disclosed in Section 4.11(c) of the Seller’s Disclosure
Schedule:
(i)    neither the Company nor any of its Subsidiaries has received written
notice from any party to a Coal Supply Agreement threatening to suspend
shipments under such Coal Supply Agreement due to an alleged breach by the
Company or any of its Subsidiaries of such Coal Supply Agreement;
(ii)    there have been no whole or partial assignments or other transfers of
any of the Coal Supply Agreements or of any interest therein by the Company or
any of its Subsidiaries;
(iii)     none of the parties to any of the Coal Supply Agreements has made any
written claim to the Company or any of its Subsidiaries, either by
contractually-required notice or otherwise, of the existence of any force
majeure events, which materially affect or could materially affect future
deliveries under such Coal Supply Agreement;
(iv)    no written claims have been made or, to the Knowledge of the Seller,
threatened under any economic hardship or similar provisions of any of the Coal
Supply Agreements;
(v)    there have been no written demands by any of the parties to any of the
Coal Supply Agreements for adequate assurance of performance, whether made
pursuant to the terms of the Coal Supply Agreements or pursuant to statutory or
common law;
(vi)     there are no pending or, to the Knowledge of the Seller, threatened
material pricing disputes under the Coal Supply Agreements;
(vii)    no party to any of the Coal Supply Agreements has currently suspended
or, to the Knowledge of the Seller, threatened to suspend its performance of the
terms and conditions of the applicable Coal Supply Agreement either under the
terms of such Coal Supply Agreement or otherwise;
(viii)    none of the customers or sellers under any of the Coal Supply
Agreements has sought to renegotiate, alter or terminate any of the terms of the
Coal Supply Agreements by any means, including, but not limited to, litigation,
arbitration, renegotiation under the terms of the Coal Supply Agreements or
renegotiation outside of the terms of the Coal Supply Agreements; and
(ix)     neither the Company nor any of its Subsidiaries is obligated to deliver
any quantities of coal under any Coal Supply Agreement, the consideration for
which has been pre-paid.
4.12    Litigation. Except as set forth on Section 4.12 of the Seller’s
Disclosure Schedule, (a) there are no material actions, suits, proceedings,
claims, arbitrations, litigations or investigations (each, an “Action” and
collectively “Actions”), (i) pending or, to the Knowledge of the Seller,
threatened against or affecting the Company or any of its Subsidiaries or its or
their business, properties or assets or (ii) that challenges or seeks to
prevent, enjoin or otherwise delay the transactions contemplated by this
Agreement or the Ancillary Agreements; (b) no event has occurred

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or circumstances exist that does or could reasonably be expected to result in or
serve as a basis for any such material Action; and (c) there is no material
unsatisfied judgment, penalty or award against the Company or any of its
Subsidiaries or affecting its or their assets or properties.
4.13    Intentionally omitted.
4.14    Labor and Employment Matters.
(a)    Set forth on Section 4.14(a) of the Seller’s Disclosure Schedule is a
complete and accurate list of any employees of the Company and its Subsidiaries
(the “Employees”), and contractors and consultants who are individuals that
provide services to the Company and its Subsidiaries as of the date hereof.
(b)    Neither the Company nor any of its Subsidiaries is a party or subject to
any collective bargaining agreement, union contract, letter, side letter or
other Contract involving any union, labor organization or other employee
association. No union, labor organization or other employee association
represents or purports to represent any Employee, contractor or consultant
employed or retained by the Company or any of its Subsidiaries; there is not
pending any effort or campaign to organize Employees into any union, labor
organization or other employee association; and neither the Company nor any of
its Subsidiaries has any obligation to recognize or bargain with any union,
labor organization or other employee association. There have not been, and there
are not pending or, to the Knowledge of the Seller, threatened, any labor
disputes, strikes, work stoppages, lockouts, requests for representation,
pickets, or work slowdowns that involve any union, labor organization or other
employee association or Employees, contractors who are individuals or
consultants of the Company or any of its Subsidiaries.
(c)    Except as contemplated by this Agreement, neither the Company nor any of
its Subsidiaries has effectuated or is in the process of effectuating a “plant
closing” (as defined in the WARN Act) or a “mass lay-off” (as defined in the
WARN Act), in either case affecting any site of employment or facility of the
Company or any of its Subsidiaries, except in compliance with the WARN Act.
(d)    Since January 1, 2008, the Company and each of its Subsidiaries has
complied with and has not engaged in any action or failure to act giving rise to
liability under any Law, Contract (including but not limited to any employment
or services agreement), benefit plan or other legal requirement, restriction or
entitlement relative to any employee, contractor, consultant, labor organization
or other individual employed by or who provides services to the Company or its
Subsidiaries, or their businesses.
(e)    Notwithstanding anything elsewhere in this agreement to the contrary, the
representations and warranties in this Section 4.14 are the sole and exclusive
representations and warranties in this Agreement concerning labor and employment
matters, subject to the last sentence of Section 4.6(e).

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4.15    Environmental.
(a)    Except as set forth in the corresponding subsection of Section 4.15 of
the Seller’s Disclosure Schedule, matters that have been fully satisfied and
resolved with the relevant Governmental Entity, and matters addressed in Section
4.6: (i) except would not reasonably be expected to have a Material Adverse
Effect, the Company and each of its Subsidiaries and each of the Mining
Operations is and has been in compliance with, and neither the Company nor any
of its Subsidiaries has any Liabilities under, any and all Environmental Laws;
(ii) the Company and each of its Subsidiaries, directly or through the
Contractors possesses, has possessed and is and has been in compliance in all
material respects with all applicable Environmental Permits; (iii) there are no
Actions pending or, to the Knowledge of the Seller, threatened against either
the Company or any of its Subsidiaries or to the Knowledge of the Seller either
of the Contractors alleging that the Company or any of its Subsidiaries or any
of the Mining Operations is in violation of or has any Liability under
Environmental Laws or Environmental Permits; (iv) no Releases of Hazardous
Materials have occurred and no Person has been exposed to any Hazardous
Materials at, from, in, to, on, or under any Site and no Hazardous Materials are
present in, on, under, about or migrating to or from any Site that would
reasonably be expected to give rise to a material Liability to the Company and
its Subsidiaries under applicable Environmental Laws; (v) neither the Company
nor any of its Subsidiaries nor to the Knowledge of the Seller either of the
Contractors has transported or arranged for the treatment, storage, handling,
disposal or transportation of any Hazardous Material to any location which has
resulted or could result in a material Liability to the Company and its
Subsidiaries; (vi) there are no Phase I or Phase II environmental assessments,
environmental investigations, studies, audits, tests, reviews or other analyses
conducted by, on behalf of, or which are in the possession of the Company or any
of its Subsidiaries (or any advisors or representatives thereof) or the
Contractors with respect to any Site, other than the Environmental Site
Assessment dated March 8, 2010 by John T. Boyd Company Mining and Geological
Consultants made available to Purchaser; (vii) except for the Contract Mining
Agreements, neither the Company nor any of its Subsidiaries has, either
expressly or by operation of Law, assumed responsibility for or agreed to
indemnify or hold harmless any Person for any Liability or obligation, arising
under or relating to Environmental Laws; (viii) neither the execution of this
Agreement nor consummation of the transaction contemplated by this Agreement
will require any pre-closing notification to or consent of any Governmental
Authority (except with regard to the transfer of Permits or other ministerial
notifications or transfers) or the undertaking of any investigations or remedial
actions pursuant to Environmental Laws; (ix) other than the Permits listed on
Sections 4.6(b)(i) and 4.6(b)(ii) of the Seller’s Disclosure Schedule, neither
the Company nor any of its Subsidiaries has entered into or is subject to, any
judgment, decree, order or other similar requirement of or agreement with any
Governmental Authority under any Environmental Laws; and (x) there are no
(A) polychlorinated biphenyl containing equipment, (B) underground storage
tanks, or (C) asbestos-containing material at the Real Property.
(b)     Notwithstanding anything elsewhere in this agreement to the contrary,
the representations and warranties in this Section 4.15 are the sole and
exclusive representations and warranties in this Agreement concerning
environmental matters, subject to the last sentence of Section 4.6(e).

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4.16    Insurance. Section 4.16 of the Seller’s Disclosure Schedule sets forth
(a) a list of each material insurance policy and fidelity bond on which the
Company or any of its Subsidiaries, is the named insured or otherwise the
beneficiary of coverage (the “Policies”). There are no material pending claims
under any of such Policies as to which coverage has been questioned, denied or
disputed by the insurer or in respect of which the insurer has reserved its
rights. All Policies are in full force and effect and are valid and are
enforceable in accordance with their terms. All premiums due under the Policies
have been paid in full or, with respect to premiums not yet due, accrued.
Neither the Company nor any of its Subsidiaries has received a notice of
cancellation or termination of any Policy or of any material changes that are
required in the conduct of the Company’s and its Subsidiaries’ businesses as a
condition to the continuation of coverage under, or renewal of, any such Policy.
4.17    Customers and Suppliers. Section 4.17(a) of the Seller’s Disclosure
Schedule sets forth a complete and accurate list of the current customers (other
than customers of spot sales of less than one year) of the Company and its
Subsidiaries (the “Company Customers”). Section 4.17(b) of the Seller’s
Disclosure Schedule sets forth a complete and accurate list of each supplier
(i) that constitutes a sole or primary source of supply to the Company or any of
its Subsidiaries, (ii) to which the Company or its Subsidiaries made payments in
excess of $100,000 during the year ended December 31, 2013, or (iii) that is
otherwise material to the operation of the Company’s business (the “Company
Material Suppliers”). The Company’s and its Subsidiaries’ relationships with
each of the Company Customers and Company Material Suppliers are good commercial
working relationships. Section 4.17(c) of the Seller’s Disclosure Schedule sets
forth a list, to the Knowledge of the Seller, of each supplier (i) that
constitutes a sole or primary source of supply to the Contractors with respect
to the Mining Operations, (ii) to which the Contractors made payments in excess
of $100,000 during the year ended December 31, 2013 with respect to the Mining
Operations, or (iii) that is otherwise material to the Mining Operations (the
“Contractor Material Suppliers”). Except as indicated in Section 4.17(d) of the
Seller’s Disclosure Schedule, no Company Customer or Company Material Supplier
has canceled, terminated or otherwise materially and adversely modified, or
threatened to cancel, terminate or otherwise materially and adversely modify,
its relationship with the Company or any of its Subsidiaries, and neither the
Company nor any of its Subsidiaries has received notice that any Company
Customer might take such action or limit its purchases from or sales to the
Company or any of its Subsidiaries, either as a result of the consummation of
the transactions contemplated by this Agreement and the Ancillary Agreements or
otherwise. To the Knowledge of the Seller, the Contractors’ relationships with
each of the Contractor Material Suppliers are good commercial working
relationships. To the Knowledge of the Seller, no Contractor Material Supplier
has canceled, terminated or otherwise materially and adversely modified, or
threatened to cancel, terminate or otherwise materially and adversely modify,
its relationship with the Contractors, and neither the Company nor any of its
Subsidiaries has received notice that any Contractor Material Supplier might
take such action or limit its sales to such Contractor.
4.18    Affiliate Transactions. Except as set forth on Section 4.18 of the
Seller’s Disclosure Schedule, no Affiliate of the Seller, or Affiliate or family
member of any director, current or former partner, member, manager, stockholder
or officer of the Company or any of its Subsidiaries is a party to or is subject
to, any Contract with the Company or any of its Subsidiaries or has any interest

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in any of the properties or assets of the Company or any of its Subsidiaries.
There are no services provided to the Company or any of its Subsidiaries by any
Affiliate of the Seller or by any Affiliate or family member of any director,
current or former partner, member, manager, stockholder, officer or direct or
indirect holder of equity interests of the Company or any of its Subsidiaries
(other than services provided by any such Persons as directors, officers or
employees of the Company or its Subsidiaries). Neither the Seller nor any
Affiliate of the Seller or the Company or its Subsidiaries owns, directly or
indirectly, any interest in (except for the ownership of marketable securities
of publicly owned corporations, representing in no case more than 5% of the
outstanding shares of such class of securities) or Controls or is a director,
officer, employee, current or former partner of, participant in, consultant or
contractor to any business organization which is a competitor, creditor,
supplier, customer, landlord or tenant of the Company or any of its
Subsidiaries.
4.19    Bank Accounts. Section 4.19 of the Seller’s Disclosure Schedule sets
forth the name of each bank, safe deposit company or other financial institution
in which the Company or any of its Subsidiaries has an account, lock box or safe
deposit box and the names of all Persons authorized to draw thereon or have
access thereto.
4.20    Coal Reserves.
(a)    To the Knowledge of the Seller, none of the Coal Reserves are within an
area designated as unsuitable for mining activities or under study for
designation as unsuitable for mining activities under the Federal Surface Mining
Control and Reclamation Act, 30 U.S.C. Section 1201, et seq. or analogous state
laws.
(b)    The Seller has in good faith made available to the Purchaser all of the
drilling, sampling, quality analyses and other geological, geotechnical and
geophysical data in the possession of the Seller, the Company or its
Subsidiaries, related to the Real Property or the Coal Reserves. The Seller has
no Knowledge indicating that such information is inaccurate in any material
respect. Notwithstanding the foregoing, the Seller makes no warranty or
representation, and affirmatively disclaims any warranty or representation
regarding the existence, nature, quality or quantity of any Coal Reserves.
4.21    Royalties. Except as set forth on Section 4.21 of the Seller’s
Disclosure Schedule, all advanced or earned royalties due under the Leases or
any Contracts have been timely and properly paid, and neither the Company nor
any of its Subsidiaries has received notices of default or notices of audits in
connection with the payment of such royalties.
4.22    Bonds. Section 4.22 of the Seller’s Disclosure Schedule lists all Bonds,
including reclamation bonds, with respect to the Mining Operations, all of which
are currently in effect.
4.23    Books and Records. The minute books and stock record books of the
Company and each of its Subsidiaries reflect all material actions taken by
written consent or resolution and meetings by their respective stockholders,
members, partners, directors, managers, committees and other applicable
governing or managing bodies, as the case may be. The Seller has made available
to the Purchaser an accurate copy of the minute books and stock record books of
the Company and each

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of its Subsidiaries. All Books and Records of the Company and each of its
Subsidiaries will be in the possession of the Company and available to the
Purchaser as of the Closing.
4.24    Brokers. Neither the Company nor any of its Subsidiaries has any
Liability to pay any fees or commissions to any broker, finder or similar agent
with respect to this Agreement, the Ancillary Agreements or the transactions
contemplated by hereby or thereby.
4.25    No Other Representations and Warranties. Except for the representations
and warranties contained in Article III and this Article IV (including the
related portions of the Seller’s Disclosure Schedules) or the certificates
delivered by the Seller at the Closing, none of the Seller, the Company, its
Subsidiaries or any other Person has made or makes any other express or implied
representation or warranty, either written or oral, on behalf of the Seller, the
Company or any of its Subsidiaries, including any representation or warranty as
to the accuracy or completeness of any information regarding the Company
furnished or made available to the Purchaser and its Representatives, or any
representation or warranty arising from statute or otherwise in law.
ARTICLE V    
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser represents and warrants to the Seller as of the date hereof and as
of the Closing as follows:
5.1    Organization and Good Standing. The Purchaser is duly organized and
validly existing under the Laws of the State of Indiana.
5.2    Authority and Enforceability. The Purchaser has the requisite power and
authority to enter into this Agreement and each of the Ancillary Agreements to
which it is a party, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The execution,
delivery and performance by the Purchaser of this Agreement and each of the
Ancillary Agreements to which it is a party and the consummation by the
Purchaser of the transactions contemplated hereby and thereby have been duly
authorized by all necessary action on the part of the Purchaser and no other
action is necessary on the part of the Purchaser to authorize this Agreement or
any Ancillary Agreement to which it is a party or to consummate the transactions
contemplated hereby and thereby. This Agreement and each of the Ancillary
Agreements to which it is a party have been duly executed and delivered by the
Purchaser. Assuming due authorization, execution and delivery by the Seller and
each other party thereto, this Agreement and each of the Ancillary Agreements
constitutes the valid and binding obligation of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as limited by
(a) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar Laws relating to creditors’ rights generally and (b) general
principles of equity, whether such enforceability is considered in a proceeding
in equity or at Law.
5.3    No Conflicts; Consents.
(a)    The execution and delivery by the Purchaser of this Agreement and the
Ancillary Agreements to which it is a party does not, and the performance by the
Purchaser of its

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obligations hereunder and thereunder and the consummation of the transactions
contemplated hereby and thereby (in each case, with or without the giving of
notice or lapse of time, or both) will not, directly or indirectly, (i) violate
or conflict with the provisions of any of the Organizational Documents of the
Purchaser or (ii) violate any Law, Order or other restriction of any
Governmental Entity to which the Purchaser may be subject or (iii) violate,
breach, conflict with or constitute a default, an event of default, or an event
creating any additional rights (including rights of amendment, impairment,
suspension, revocation, acceleration, termination or cancellation), impose
additional obligations or result in a loss of any rights, result in the creation
of any Lien or require a consent or the delivery of notice, under any Contract
or Permit applicable to the Purchaser or to which the Purchaser is a party or by
which the Purchaser is bound or to which its assets are subject, except in the
case of clauses (ii) and (iii) which would not reasonably be expected to impair
or delay in any material respect the ability of the Purchaser to consummate the
transactions contemplated hereby or by the Ancillary Agreements.
(b)    Except for the requirements of the HSR Act, the Purchaser is not required
to give any notice to, make any filing with or obtain any authorization, consent
or approval of any Governmental Entity in order for the parties to consummate
the transactions contemplated hereby and by the Ancillary Agreements, except
where the failure to do so would not reasonably be expected to impair or delay
in any material respect the ability of the Purchaser to consummate the
transactions contemplated hereby or by the Ancillary Agreements.
5.4    Financing. The Purchaser has provided to the Seller a complete and
correct copy of (a) a proposal letter and term sheet dated June 24, 2014 from
its prospective financing arranger to the Purchaser (the “Highly Confident
Letter”), evaluating the feasibility of a financing of up to $375,000,000 on the
terms and conditions described therein (the “Loan Financing”) to finance the
transactions contemplated by this Agreement and expressing the view that such
arranger is “highly confident” that the financing described therein can be
accomplished, subject to the terms and conditions expressed therein; and (b) a
letter dated June 12, 2014 from a potential investor (the “Equity Financing
Letter”) expressing an intent to provide equity financing (the “Equity
Financing,” and together with the Loan Financing, the “Financing”) in connection
with the transactions contemplated by this Agreement if necessary depending on
the amount of available cash and funding the Purchaser obtains in connection
with the Loan Financing. Subject to its terms and conditions, the Financing, if
and when funded, will provide the Purchaser with acquisition financing on the
Closing Date sufficient to pay to the Seller the Purchase Price and to pay all
related fees and expenses due upon the Closing on the terms contemplated by this
Agreement. The Purchaser has no reason to believe that it will not be able to
complete the Financing on the terms and conditions outlined in the Highly
Confident Letter and the Equity Financing Letter, subject to the terms and
conditions expressed therein and the satisfaction of the conditions precedent to
the Purchaser’s obligation to consummate the transactions contemplated hereby as
specified in Sections 7.1 and 7.2 hereof.
5.5    Brokers. The Purchaser does not have any Liability to pay any fees or
commissions to any broker, finder or similar agent with respect to this
Agreement, the Ancillary Agreements or the transactions contemplated by hereby
or thereby.

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5.6    Purchase for Investment. The shares of Common Stock purchased by the
Purchaser pursuant to this Agreement are being acquired for investment only and
not with a view to any public distribution thereof. The Purchaser shall not
offer to sell or otherwise dispose of, or sell or otherwise dispose of, the
Common Stock so acquired by it in violation of any of the registration
requirements of the Securities Act of 1933.
5.7    Independent Investigation. The Purchaser has conducted its own
independent investigation, review and analysis of the business, results of
operations, prospects, condition (financial or otherwise) or assets of the
Company and its Subsidiaries, and acknowledges that it has been provided
adequate access to the personnel, properties, assets, premises, books and
records, and other documents and data of the Seller and the Company and its
Subsidiaries for such purpose.  The Purchaser acknowledges and agrees that:
(a) in making its decision to enter into this Agreement and to consummate the
transactions contemplated hereby, the Purchaser has relied solely upon (i) the
representations and warranties of the Seller set forth in Article III and
Article IV of this Agreement (including the related portions of the Seller’s
Disclosure Schedule) and the certificates delivered by the Seller at the
Closing, and (ii) its own investigations; and (b) none of the Seller, the
Company or any other Person has made any representation or warranty as to the
Seller, the Company or this Agreement, except as set forth in Article III and
Article IV of this Agreement (including the related portions of the Seller’s
Disclosure Schedule) or the certificates delivered by the Seller at the Closing.
ARTICLE VI    
COVENANTS
6.1    Restrictions on Equity Interest Transfers. The Seller hereby agrees not
to transfer, assign or pledge, directly or indirectly, by operation of Law or
otherwise, any of its Equity Interests in the Company or any of its Subsidiaries
(other than the sale of the Seller’s Common Stock pursuant to this Agreement)
during the period from the date hereof through and including the earlier of
(a) the Closing; and (b) the termination of this Agreement in accordance with
its terms. Any such attempted transfer, assignment or pledge during such period
will not be effective, and the Seller shall cause the Company or its
Subsidiaries not to record such transfer, assignment or pledge in the records of
the Company or its Subsidiaries.
6.2    Conduct of Business.
(a)    Subject to such steps as the Seller may take pursuant to Section 2.3(e)
and Section 2.3(f) and except (i) as set forth on Section 6.2 of the Seller’s
Disclosure Schedule, (ii) as required by applicable Law, or (iii) with the prior
written consent of the Purchaser, during the period commencing on the date
hereof and ending at the earlier of the Closing Date and the termination of this
Agreement in accordance with its terms, the Company will, and the Seller will
cause the Company to, and the Seller and the Company will cause each of the
Company’s Subsidiaries to, carry on the business of the Company and its
Subsidiaries in the ordinary course in a manner consistent with past practice
(including maintenance of all appropriate safety measures), to pay its debts and
Taxes when due and, to the extent consistent therewith, to use commercially
reasonable efforts to keep intact its business, keep available the services of
its current employees and preserve its relationships with customers, suppliers,
licensors, licensees, distributors and other Persons with

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which it has significant business relationships. Among other things, the Company
shall notify the Purchaser of (i) any notice of violation of the Mining
Regulations in connection with the Mining Operations that occurs following the
date hereof, or (ii) any material deviation of the Mining Operations from the
plans as provided by the Seller pursuant to Section 4.6(d) or the submission or
receipt of any amendments, modifications, updates or correspondence related to
such plans.
(b)    Without limiting the generality of Section 6.2(a), subject to such steps
as Seller may take pursuant to Section 2.3(e) and Section 2.3(f) and except
(i) as set forth on Section 6.2 of the Seller’s Disclosure Schedule, (ii) as
required by applicable Law, or (iii) with the prior written consent of the
Purchaser (which consent, with respect to entering into Contracts for sales of
coal, shall not be unreasonably withheld, conditioned or delayed), during the
period commencing on the date hereof and ending at the earlier of the Closing
Date and the termination of this Agreement in accordance with its terms, the
Seller and the Company will not, and the Seller will cause the Company not to,
and the Seller and the Company will cause each of the Company’s Subsidiaries not
to, take any action or enter into any transaction listed below:
(i)    amend or change its Organizational Documents;
(ii)    issue, sell or otherwise dispose of or repurchase, redeem or otherwise
acquire any of its shares of, or rights of any kind to acquire (including
options) any shares of, any of its capital stock or other Equity Interests;
(iii)     declare, set aside or pay any non-cash dividend or other distribution
(whether in stock or property, or any combination thereof) on any of its capital
stock or other Equity Interests;
(iv)     reclassify, combine, split, subdivide or issue any other securities in
respect of, in lieu of or in substitution for, directly or indirectly, any of
its capital stock or other Equity Interests;
(v)    make any change in its accounting principles or practices or the methods
by which such principles or practices are applied for financial reporting
purposes (except as required by GAAP), changed, or make, any material Tax
election, change any Tax accounting method or settled any material claim for
Taxes or written down or written up (or fail to write down or write up in
accordance with GAAP consistent with past practice) the value of any Accounts
Receivable or revalue any of their respective assets other than in the ordinary
course of business consistent with past practice and in accordance with GAAP;
(vi)        (A) cancel, materially modify, terminate or grant a material waiver
or release of any Company Contract or material Permit, or give any consent or
exercise any material right thereunder or (B) enter into any Contract which
would be a Company Contract if in effect on the date hereof;
(vii)    acquire, sell, transfer, convey, lease, sublease or otherwise dispose
of any businesses or any properties or assets (whether by merger, consolidation
or otherwise);

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(viii)    (A) incur, guarantee or assume any Indebtedness, or mortgaged, pledged
or subjected to any Lien any of its properties or assets, (B) pay any principal
of or interest on any Indebtedness before the required date of such payment,
cancel any Indebtedness or waive of any claims or rights with respect to any
Indebtedness, or (C) fail to pay any creditor any amount owed to such creditor
when due;
(ix)     make any loan, advance or capital contribution to, or investment in,
any Person other than travel loans or advances in the ordinary course of
business consistent with past practice;
(x)    fail to maintain in full force and effect or fail to use reasonable best
efforts to replace or renew the Policies;
(xi)     undergo a complete or partial liquidation, dissolution, restructuring,
recapitalization or other reorganization; or
(xii)    authorize, commit or agree to do any of the foregoing.
6.3    Access to Information; Notification.
(a)    From the date hereof until the Closing, or earlier termination of this
Agreement, Seller shall (and shall cause the Company and its Subsidiaries to)
(i) afford to the Purchaser and its officers, directors, employees, accountants,
counsel, consultants, advisors, agents and other representatives
(“Representatives”) reasonable access to and the right to inspect all of the
Real Property, properties, assets, premises, Books and Records, contracts,
agreements and other documents and data related to the Company and its
Subsidiaries; (b) furnish the Purchaser and its Representatives with such
financial, operating and other data and information related to the Company and
its Subsidiaries as the Purchaser or any of its Representatives may reasonably
request; and (c) instruct the Representatives of the Seller and the Company to
cooperate with the Purchaser in its investigation of the Company and its
Subsidiaries; provided, however, that any such investigation shall be conducted
during normal business hours upon reasonable advance notice to the Seller, under
the supervision of the Seller’s personnel and in such a manner as not to
unreasonably interfere with the normal operations of the Company. All requests
by the Purchaser for access pursuant to this Section 6.3 shall be submitted or
directed exclusively to Randy Beck or such other individuals as the Seller may
designate in writing from time to time. Notwithstanding anything to the contrary
in this Agreement, neither the Seller nor the Company shall be required to
disclose any information to the Purchaser if such disclosure would:
(x) jeopardize any attorney-client or other privilege; or (y) contravene any
applicable Law, fiduciary duty or binding agreement entered into prior to the
date of this Agreement. Prior to the Closing, the Purchaser shall not contact
any suppliers to, or customers of, the Company and its Subsidiaries with respect
to the Company or its Subsidiaries or the transactions contemplated hereby
without the prior written consent of the Seller, which consent shall not be
unreasonably withheld, conditioned or delayed. The Purchaser and the Seller
shall jointly develop and implement transition plans with respect to customers
and suppliers regarding the transactions contemplated by this Agreement and will
work together to communicate with customers and suppliers and implement those
plans in a timely manner. Between the date of this Agreement and the Closing,
except in connection with the weekly observation visits pursuant to

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Section 6.3(c), which may include underground observations, or as set forth on
Section 6.3(a) of the Purchaser’s Disclosure Schedule, the Purchaser shall have
no right to perform invasive or subsurface investigations of the Real Property.
The Purchaser shall, and shall cause its Representatives to, abide by the terms
of the Confidentiality Agreement with respect to any access or information
provided pursuant to this Section 6.3 and comply with all applicable Laws and
work rules of the Company and its Subsidiaries, and will indemnify the Company,
its Subsidiaries and the Contractors for any Liabilities arising from or caused
by the Purchaser’s or its Representatives’ negligence or willful misconduct
while present at the Mining Operations or otherwise on the Real Property
pursuant to the exercise of the Purchaser’s rights pursuant to this
Section 6.3(a). The Purchaser’s representation in Section 5.7 shall apply to any
information provided to the Purchaser pursuant to this Section 6.3(a). Prior to
the Closing and if the Closing does not occur, the information provided pursuant
to this Section 6.3 will be used solely for the purpose of evaluating and
effecting the transactions contemplated hereby.
(b)    Between the date hereof and the Closing Date, each of the Seller and the
Purchaser shall provide the other parties hereto with prompt written notice
(i) in the event of the happening of (or the Seller or the Purchaser becoming
aware of) any fact, event or occurrence (taken together with all other facts,
events and occurrences) which (A) does, or would reasonably be expected to, have
a Material Adverse Effect, or cause a breach of, or any material inaccuracy in,
any of the representations and warranties set forth in Article III, Article IV
or Article V of this Agreement or breach any of the Seller’s or the Purchaser’s
covenants set forth herein or in the Ancillary Agreements if such fact, event or
occurrence existed on the date hereof or (B) creates, or could be reasonably
likely to create, a reasonable basis for the Seller or the Purchaser to believe
that it will not be able to satisfy at the Closing any condition set forth in
Article VII, (ii) of any notice or other communication from any Person alleging
that the consent of such Person is or could be required in connection with the
transactions contemplated by this Agreement and (iii) of any notice or other
communication from any Governmental Entity in connection with the transactions
contemplated by this Agreement; provided, that the delivery of any notice
pursuant to this Section 6.3(b) shall not (x) modify, diminish or in any other
way affect the Seller’s or the Purchaser’s remedies hereunder (including their
respective rights to indemnification), (y) cure any inaccuracies in or breaches
of representations or warranties, or breaches of covenants made by the Seller or
the Purchaser in this Agreement or (z) be deemed to amend, modify or supplement
the Seller’s Disclosure Schedule or the Purchaser’s Disclosure Schedule.
(c)    Without otherwise limiting the Purchaser’s rights hereunder, between the
date hereof and the Closing Date, the Seller shall cause the Company and its
Subsidiaries to allow up to two Representatives of the Purchaser to visit on a
weekly basis at each of the Company’s or its Subsidiaries’ operating mines to
observe the Mining Operations; provided that such Representatives of the
Purchaser shall comply with the safety and security rules then in effect at such
operating mines. The parties shall work in good faith to schedule such visits in
advance at times and for durations that are not disruptive to the Mining
Operations.
(d)    Within 15 days following the end of each month prior to the Closing Date,
the Seller shall deliver to the Purchaser unaudited consolidated balance sheets
of the Company as of the last day of such month, and related unaudited
consolidated statements of income, changes in

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shareholders’ equity and cash flow for the month then ended. The Company
covenants that such monthly and quarterly statements shall (i) be prepared by
consistent with the manner in which the Financial Statements were prepared and
be in accordance with GAAP applied on a consistent basis throughout the periods
covered thereby and present fairly, in all material respects, the financial
position of the Company and its Subsidiaries as of the applicable date; and
(ii) be prepared from the Books and Records of the Company and its Subsidiaries.
In addition, as soon as reasonably practicable following the date hereof, the
Seller shall (i) deliver to the Purchaser an update to Section 4.7(b) of the
Seller’s Disclosure Schedule to include the net book value of each item of
equipment on such schedule, and (ii) cause the Company to write off the value of
its parts inventory determined to be obsolete in such amount as mutually agreed
by the parties hereto.
(e)    Following the date hereof until the Closing Date, the Purchaser shall
have the right to place its own security personnel on-site at each of the
Company’s or its Subsidiaries’ operating mines to monitor activity with respect
to equipment and materials leaving the mine site, provided that such personnel
do not unreasonably interfere with the Mining Operations. During the week prior
to the anticipated Closing Date, the Purchaser shall have the right to inspect
the equipment located at each of the Company’s or its Subsidiaries’ operating
mines (both underground and at the surface). The Seller shall, and shall cause
the Company and its Subsidiaries and the Contractors to provide reasonable
assistance to the Purchaser during such inspections, including accompanying the
Purchaser’s personnel during such inspections and assisting in locating the
relevant equipment. The parties shall work in good faith to coordinate the
Purchaser’s inspection and security procedures in order to minimize any
disruption to the Mining Operations.
(f)    Prior to the Closing, the Seller shall be entitled, at its own expense,
to make copies of the Books and Records and to retain such copies following the
Closing, which copies shall remain subject to the confidentiality obligations of
Section 6.6(a).
6.4    Resignations. At the Closing, the Seller shall (and shall cause the
Company and its Subsidiaries to) deliver to the Purchaser duly signed
resignations (including releases of claims) in form and substance reasonably
satisfactory to the Purchaser, effective as of the Closing, of (a) all directors
or managers of the Company and its Subsidiaries of their positions as directors
or managers, as applicable, and (b) prior to the Closing, any officers of the
Company and its Subsidiaries of their positions as officers.
6.5    Termination or Transfer of Certain Obligations.
(a)    Prior to the Closing, the Seller shall, and shall cause the Company and
its Subsidiaries to, (i) repay and extinguish all Indebtedness of the Company
and its Subsidiaries, other than Purchaser Paid Indebtedness; and (ii) secure
the release of all Liens, other than Permitted Liens (except for Liens of the
type set forth in clause (e) of the definition of Permitted Lien, all of which
shall be released or for which the Seller shall indemnify the Purchaser), in and
upon any of the properties and assets of the Company and its Subsidiaries, other
than the release of Liens associated with such Purchaser Paid Indebtedness.
(b)    The Seller shall be solely responsible for the payment of any amounts
payable under the severance, management, employment, stay, bonus, phantom stock,
deferred compensation,

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termination or similar Plans or Contracts of the Company or its Subsidiaries as
a result of the consummation of the transactions contemplated hereby and by the
Ancillary Agreements.
(c)    Prior to the Closing, the Seller shall (and shall cause the Company and
its Subsidiaries to) (i) terminate any Contracts (other than the Contracts set
forth on Section 6.5(c) to the Seller’s Disclosure Schedule) between the Company
or any of its Subsidiaries, on the one hand, and the Seller or any Affiliate of
the Seller, on the other hand, and (ii) settle any unpaid intercompany amounts
or obligations between the Company or any of its Subsidiaries, on the one hand,
and the Seller or any Affiliate of the Seller, on the other hand.
(d)    Prior to the Closing, the Seller shall (and shall cause the Company and
its Subsidiaries to) terminate any Contracts between the Company or any of its
Subsidiaries, on the one hand, and the Contractors or any other mine operators,
on the other hand, without any further obligation or liability to the Company,
any of its Subsidiaries or the Purchaser following the Closing other than the
Contractor Termination Royalties, pursuant to termination agreements in
substantially the form attached hereto as Exhibits C-1 and C-2 (the “Contractor
Termination Agreements”).
(e)    As of the date hereof, the Seller has provided or shall (and shall cause
the Company and its Subsidiaries to) provide notices to terminate the Lafayette
Agreements, in accordance with the terms of those agreements, substantially in
the form attached hereto as Exhibits D-1 and D-2 (the “Lafayette Termination
Notices”).
(x)    Following the date hereof and prior to the Closing, the parties shall
cooperate in good faith to obtain a settlement and release from Lafayette Energy
Company with respect to the termination of the Lafayette Agreements; provided
that (A) the form and substance of any such settlement and release shall be
subject to the approval of the Purchaser in its sole discretion provided that
such settlement and release shall not impose any liability on the Seller, and
(B) any amounts to be paid to Lafayette Energy Company in respect of such
settlement and release in excess of the Lafayette Pre-Closing Payments shall be
paid by the Purchaser on behalf of the Company at the Closing, and will be
included in an upward adjustment to the Closing Date Purchase Price.
(xi)    The parties acknowledge and agree that in the event a settlement and
release is not reached with Lafayette Energy Company, (A) the Seller shall be
responsible (to the extent not reflected in the Final Balance Sheet and the
Purchase Price as adjusted pursuant to Section 2.4) for all Lafayette
Pre-Closing Payments, and (B) from and after the Closing, the Company shall be
responsible for all liabilities and other obligations under the Lafayette
Agreements, whether arising before or after the Closing (excluding the Lafayette
Pre-Closing Payments for which the Seller is responsible as described in
subclause (A) above), including all such liabilities arising in connection with
the termination of the Lafayette Agreements as contemplated by the Lafayette
Termination Notices and attributable to the period commencing on the Closing
Date and continuing thereafter.
(f)    Prior to the Closing, the Seller shall (and shall cause the Company and
its Subsidiaries to) terminate or assign to the Seller or one of its Affiliates
the Contracts set forth on

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Section 6.5(f) of the Seller’s Disclosure Schedule, without any further
obligation or liability to the Company, any of its Subsidiaries or the Purchaser
following the Closing.
6.6    Confidentiality.
(a)    From and after the Closing, the Seller shall, and shall cause its
Affiliates to, and shall use its reasonable best efforts to cause its and their
respective officers, directors, employees, accountants, counsel, consultants,
advisors, agents and other representatives to, hold in confidence any and all
information, whether written or oral, concerning the Company or any of its
Subsidiaries, except to the extent that such Person can show that such
information (i) is in the public domain through no fault of the Seller or any
Affiliate thereof or (ii) is lawfully acquired by them after the Closing from
sources which are not prohibited from disclosing such information by a legal,
contractual or fiduciary obligation. If the Seller or any Affiliate thereof is
compelled to disclose any such information by judicial or administrative process
or by other requirements of Law, such Person shall promptly notify the Purchaser
in writing and shall disclose only that portion of such information which such
Person is advised by its counsel in writing is legally required to be disclosed,
provided that such Person shall exercise its reasonable best efforts to obtain
an appropriate protective order or other reasonable assurance that confidential
treatment will be accorded such information. Without prejudice to the rights and
remedies otherwise available in this Agreement, the parties each acknowledge
that money damages would not be an adequate remedy for any breach of this
Section 6.6, and that the Purchaser will be entitled to specific performance and
other equitable relief by way of injunction in respect of a breach or threatened
breach of any this Section 6.6.
(b)    From and after the Closing, the Purchaser shall, and shall cause its
Affiliates to, and shall use its reasonable best efforts to cause its and their
respective officers, directors, employees, accountants, counsel, consultants,
advisors, agents and other representatives to, hold in confidence any and all
information, whether written or oral, concerning the Seller, except to the
extent that such Person can show that such information (i) is in the public
domain through no fault of the Purchaser or any Affiliate thereof or (ii) is
lawfully acquired by them after the Closing from sources which are not
prohibited from disclosing such information by a legal, contractual or fiduciary
obligation. If the Purchaser or any Affiliate thereof is compelled to disclose
any such information by judicial or administrative process or by other
requirements of Law, such Person shall promptly notify the Seller in writing and
shall disclose only that portion of such information which such Person is
advised by its counsel in writing is legally required to be disclosed, provided
that such Person shall exercise its reasonable best efforts to obtain an
appropriate protective order or other reasonable assurance that confidential
treatment will be accorded such information. Without prejudice to the rights and
remedies otherwise available in this Agreement, the parties each acknowledge
that money damages would not be an adequate remedy for any breach of this
Section 6.6, and that the Seller will be entitled to specific performance and
other equitable relief by way of injunction in respect of a breach or threatened
breach of any this Section 6.6.
6.7    Public Announcements. No party hereto shall issue any press release or
make any public statement relating to the subject matter of this Agreement
without the prior written approval of all parties, except that the parties or
their Affiliates may make any public disclosure it believes in good faith it is
required to make by applicable Law or pursuant to any listing agreement with

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any national securities exchange or stock market (in which case the party
required to make the disclosure shall consult with the other parties and allow
the other parties reasonable time to comment thereon prior to issuance or
release).
6.8    Employee Matters. Nothing contained in this Section 6.8 or elsewhere in
this Agreement, express or implied, shall confer upon any Employee or legal
representative or beneficiary thereof, any rights or remedies of any nature or
kind whatsoever under or by reason of this Agreement, including any right to
employment or continued employment for any specified period, or level of
compensation or benefits. Nothing contained in this Section 6.8 or elsewhere in
this Agreement, express or implied, shall (i) impose an obligation on the
Purchaser or its Affiliates to offer employment to any Employee or contractor or
consultant of the Company or any of its Subsidiaries, (ii) limit the right of
the Purchaser or its Affiliates to terminate the employment or services of, or
to reassign or otherwise alter the status of, any Employee or contractor or
consultant of the Company or any of its Subsidiaries after the Closing or to
change in any manner the terms and conditions of his or her employment or other
service to or engagement by the Company or any of its Subsidiaries, (iii) be
construed to prevent, and no action by the Company or any of its Subsidiaries
prior to the Closing Date shall limit the ability of, the Purchaser or its
Affiliates from terminating or modifying to any extent or in any respect any
Plan that the Purchaser or its Affiliates may establish or maintain, or (iv) be
construed as amending any Benefit Plan as in effect immediately prior to the
Closing.
6.9    Tax Matters.
(a)    Preparation and Filing of Pre-Closing and Post-Closing Period Tax
Returns.
(i)    Income Tax Returns for Pre-Closing Periods. The Seller or Seller Parent
shall prepare and file, or cause to be prepared and filed, in a manner
consistent with past practice (except as otherwise required by Law), all Income
Tax Returns relating to the Company or its Subsidiaries for taxable periods
ending on or prior to the Closing Date. The Seller or Seller Parent shall
provide to the Purchaser a copy of any such Income Tax Return, or in the case of
Income Tax Returns filed on a consolidated, combined or unitary basis, a pro
forma Income Tax Return for the Company and its Subsidiaries, once filed.
(ii)    Tax Periods Ending on or Before the Closing Date. The Purchaser shall
prepare, or cause to be prepared, and file, or cause to be filed, all other Tax
Returns of the Company and its Subsidiaries for all periods ending on or prior
to the Closing Date which are filed after the Closing Date, taking into account
valid extensions of time within which to file. The Purchaser shall permit the
Seller to review and comment upon such Tax Returns at least 15 days prior to the
filing due date,, the Purchaser shall take into account in good faith any
comments provided by the Seller and the Purchaser shall not file such Tax
Returns without the consent of the Seller, which consent shall not be
unreasonably withheld or delayed. The Seller shall be obligated to pay to the
Purchaser the amount of Taxes with respect to such Tax Returns within 5 days
following any demand by the Seller for such payment, but no earlier than 2
Business Days prior to the applicable due date (taking into account valid
extensions of time within which to file), except to the extent that such Taxes
were taken into account as a current liability that actually reduced Final Net
Working Capital.

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(iii)    Tax Periods Beginning Before and Ending After the Closing Date. The
Purchaser shall prepare, or cause to be prepared, consistent with past practice
to the extent consistent with existing law, and file, or cause to be filed, all
Tax Returns of the Company and its Subsidiaries for Tax periods which begin on
or before the Closing Date and end after the Closing Date (each a “Straddle
Period”). With respect to any such Tax Returns, the Seller shall be obligated to
pay to the Purchaser, within 5 days following any demand by the Purchaser, but
no earlier than 2 Business Days prior to the applicable due date (taking into
account valid extensions of time within which to file), an amount equal to the
portion of such Taxes which relates to the Pre-Closing Period portion of each
such Straddle Period (as determined pursuant to Section 6.9(c)), except to the
extent that such portion of such Taxes was taken into account as a current
liability that actually reduced Final Net Working Capital. The Purchaser shall
permit the Seller to review and comment upon such Tax Returns at least 15 days
prior to the filing due date, the Purchaser shall take into account in good
faith any comments provided by the Seller and the Purchaser shall not file such
Tax Returns without the consent of the Seller, which consent shall not be
unreasonably withheld or delayed it being understood that failure to raise
objection to such Tax Returns within 10 days of receipt of the applicable Tax
Return shall be deemed consent.
(b)    Cooperation in Filing Tax Returns. The Purchaser, the Seller and Seller
Parent shall, and shall cause each of their Affiliates to, fully cooperate with
and provide each other with all reasonably requested information in connection
with preparing, reviewing and filing of any Tax Return, amended Tax Return or
claim for refund, determining Liabilities for Taxes or a right to refund of
Taxes, or in conducting any audit or other Action with respect to Taxes. Such
cooperation and information shall include providing copies of all relevant
portions of relevant Tax Returns, together with relevant accompanying schedules
and relevant work papers, relevant documents relating to rulings and other
determinations by Governmental Entities relating to Taxes, and relevant records
concerning the ownership and Tax basis of property, which any such party may
possess. Each party will retain all Tax Returns, schedules, work papers, and all
material records and other documents relating to Tax matters of the Company and
its Subsidiaries for the Tax period first ending after the Closing Date and for
all prior Tax periods until the later of either (i) the expiration of the
applicable statute of limitations (and, to the extent notice is provided with
respect thereto, any extensions thereof) for the Tax periods to which the Tax
Returns and other documents relate or (ii) eight years following the due date
(without extension) for such Tax Returns. Thereafter, the party holding such Tax
Returns or other documents may dispose of them provided that such party shall
give to the other party 30 days written notice of such disposal and providing
the other party with the opportunity to copy (at such other party’s cost) such
Tax Returns or other documents. Each party shall make its employees reasonably
available on a mutually-convenient basis at its cost to provide explanation of
any documents or information so provided.
(c)    Allocation of Certain Taxes and Tax Refunds.
(i)    If the Company or any of its Subsidiaries is permitted but not required
under applicable state, local or foreign income Tax Laws to treat the Closing
Date as the last day of a taxable period, then the parties shall treat that day
as the last day of a taxable period.

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(ii)    In the case of Taxes arising in a Straddle Period, except as provided in
Section 6.9(c)(iii), the allocation of such Taxes between the Pre-Closing Period
and the Post-Closing Period shall be made on the basis of an interim closing of
the books as of the end of the Closing Date.
(iii)     In the case of any real property, personal property or similar ad
valorem Taxes that are payable for a Straddle Period, the portion of such Taxes
which relates to the Pre-Closing Period portion of such Straddle Period shall be
deemed to be the amount of such Tax for the entire Straddle Period multiplied by
a fraction, the numerator of which is the number of days in the Pre-Closing
Period portion of the Straddle Period and the denominator of which is the number
of days in the entire Straddle Period; provided, however, any such Taxes
attributable to any property that was owned by the Company at some point in the
Pre-Closing Period, but is not owned as of the Closing Date, shall be allocated
entirely to the Pre-Closing Period.
(iv)     The Seller shall be entitled to all Tax refunds and overpayments taken
as a credit that relate to Pre-Closing Periods of Company and its Subsidiaries,
and if any such refunds or overpayments are received by the Purchaser or any of
its Affiliates (including, after the Closing, the Company or any of its
Subsidiaries), the Purchaser promptly shall pay or cause to be paid to the
Seller the amount so received, except to the extent that such refunds or
overpayments were taken into account as a current asset that actually increased
Final Working Capital.
(d)    Payment of Transfer Taxes and Fees. The Seller and Purchaser shall each
pay one-half of any Transfer Taxes arising out of or in connection with the
transactions effected pursuant to this Agreement (other than Section 6.20
hereof, which Transfer Taxes shall be solely for the account of the Purchaser).
The Seller shall file all necessary documentation and Tax Returns with respect
to such Transfer Taxes and Purchaser shall provide such cooperation in
connection with the preparation and filing of such documentation and Tax Returns
as may be reasonably requested by the Seller.
(e)    Termination of Tax Sharing Agreements. The Seller shall ensure that any
and all Tax allocation agreements, Tax sharing agreements or similar agreements
or arrangements between the Company or any of its Subsidiaries, on the one hand,
and the Seller or any of its Affiliates (other than the Company and its
Subsidiaries), on the other hand, shall be terminated with respect to the
Company and its Subsidiaries as of the day before the Closing Date, and from and
after the Closing Date, the Company and its Subsidiaries shall have no
obligation to make any payments in respect thereof to any Person for any period.
(f)    Section 338 Elections; Election Allocations.
(i)    At the Purchaser’s request, the Seller and/or Seller Parent will join
with the Purchaser in making an election under Section 338(h)(10) of the Code
(and any corresponding elections under state or local Law) with respect to the
Company and any of its Subsidiaries classified as U.S. corporations for federal
income tax purposes (collectively, the “Section 338(h)(10) Election”). The
Seller will pay any Taxes resulting from the making of the Section 338(h)(10)
Election. The Purchaser will not make any Section 338(g) election with respect
to this transaction.

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(ii)    At the Closing, the Seller will deliver to the Purchaser a fully
executed IRS Form 8023 reflecting the Section 338(h)(10) Election, and any
similar form provided for under state or local Law (collectively, the “Section
338(h)(10) Election Form”). As requested from time to time by the Purchaser
(whether before, at or after the Closing), the Seller and Seller Parent shall
assist the Purchaser in, and shall provide the necessary information to the
Purchaser, in connection with the preparation of any form or document required
to effect a valid and timely Section 338(h)(10) Election, including IRS
Form 8883, any similar form under state, local or other Law and any schedules or
attachments thereto (collectively, “Section 338 Forms”). The Seller, Seller
Parent and the Purchaser shall cooperate fully, and in good faith, with each
other in making the Section 338(h)(10) Election. Each of the Purchaser, the
Seller and/or Seller Parent shall timely file such IRS Forms 8023 by the
prescribed due date under applicable Law.
(iii)    The parties agree that the Purchase Price and the liabilities of the
Company and its Subsidiaries (plus other relevant items) will be allocated to
the assets of the Company and its Subsidiaries for Tax and financial accounting
purposes in the manner described in Treasury regulation section 1.338-6. After
determination of the Final Balance Sheet pursuant to Section 2.4 but in no event
later than 30 days prior to the latest date for the filing of each applicable
Section 338 Form, the Purchaser shall prepare and submit to the Seller for the
Seller’s review, comment and approval (such approval not to be unreasonably
withheld or delayed and it being understood that failure to raise objection to
within 10 Business Days of receipt of such submission shall be deemed consent),
the Purchaser’s proposed allocation of the aggregate deemed sales price at which
the Company and its Subsidiaries are deemed to have sold their assets for Tax
purposes as a result of the Section 338(h)10 Election among the assets of the
Company and its Subsidiaries as applicable and related Section 338 Forms
(collectively, the “Election Allocations”) together with any materials
supporting its Election Allocations (such as third party appraisals). The
Purchaser and the Seller shall seek in good faith to resolve any differences
that they may have with respect to the proposed Section 338 Allocation Schedule.
In the event that the Purchaser and the Seller are unable to reach agreement on
the Election Allocations within 20 Business Days of delivery thereof to the
Seller, then the Reviewing Party shall resolve any issue in dispute under this
Section 6.9(f) as promptly as possible and the determination of the Reviewing
Party shall be final. The Purchaser and the Seller shall equally share the fees
of the Reviewing Party in performing its obligations under this Section 6.9(f).
Each of the Purchaser and the Seller agrees that promptly upon agreeing on the
Election Allocations (or the determination of the Reviewing Party) it shall
return an executed copy thereof to the other party hereto. The Purchaser, the
Seller and Seller Parent shall, and shall cause their respective Affiliates to,
file all Tax Returns in accordance with the Election Allocations and not to take
any action inconsistent therewith unless otherwise required by a Taxing
Authority.
(g)    Next Day Rule. The Purchaser, the Seller and Seller Parent agree to apply
the Next Day Rule described in Treas. Reg. 1.1502-76(b)(ii)(B) and/or Treas.
Reg. 1.338-1(d) to any applicable transaction that is not in the ordinary course
of business that occurs on the Closing Date but after the Closing.
6.10    Regulatory Approvals.

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(a)    Each of the Purchaser and the Seller shall promptly apply for, and take
all reasonably necessary actions to obtain or make all declarations and filings
with, and notices to, any Governmental Entity or other Person required to be
obtained or made by it for the consummation of the transactions contemplated by
this Agreement, including the transfer of all Permits. Each party shall
cooperate with and promptly furnish information to the other party necessary in
connection with any requirements imposed upon such other party in connection
with the consummation of the transactions contemplated by this Agreement.
Without limiting the generality of the foregoing, the Seller and the Purchaser,
or an Affiliate thereof, shall, as promptly as practicable, but in no event
later than 15 Business Days following the execution and delivery of this
Agreement, file with the United States Federal Trade Commission (the “FTC”) and
the United States Department of Justice (“DOJ”), the notification and report
form required for the transactions contemplated by this Agreement and any
supplemental information requested in connection therewith pursuant to the HSR
Act. Each of the Seller and the Purchaser shall furnish to each other’s counsel
such necessary information and reasonable assistance as the other may request in
connection with its preparation of any filing or submission that may be
necessary under the HSR Act. The Purchaser and the Seller shall be equally
responsible for all filing and other similar fees payable in connection with
such filings, and for any local counsel fees.
(b)    Each of the Purchaser and the Seller shall use its commercially
reasonable efforts to obtain the expiration of any applicable waiting period
under the HSR Act required for the consummation of the transactions contemplated
hereby. Each of the Purchaser and the Seller shall keep the other apprised of
the status of any substantive communications with, and any inquiries or requests
for additional information from, the FTC and the DOJ and shall comply promptly
with any such inquiry or request. Notwithstanding the foregoing, the Purchaser
shall not be required to (i) consent to the divestiture, license or other
disposition or holding separate (through the establishment of a trust or
otherwise) of any of its or its Affiliates’ assets or any assets of the Company
or its Subsidiaries, (ii) consent to any other structural or conduct remedy or
enter into any settlement or agree to any Order regarding antitrust matters
respecting the transactions contemplated by this Agreement, or (iii) litigate.
Each of the Purchaser and the Seller shall both promptly respond to the DOJ or
the FTC to any request for additional information.
(c)    The Purchaser and the Seller shall instruct their respective counsel to
cooperate with each other and use commercially reasonable efforts to facilitate
and expedite the identification and resolution of any issues arising under the
HSR Act at the earliest practicable dates. Such commercially reasonable efforts
and cooperation include, but are not limited to, counsel’s undertaking (i) to
keep each other appropriately informed of communications from and to personnel
of the reviewing Governmental Entity, and (ii) to confer with each other
regarding appropriate contacts with and response to personnel of such
Governmental Entity. Prior to the submission of any substantive written
communication to any Governmental Entity, each such party shall provide the
other party with a reasonable opportunity to review and comment on such
communication, to the extent practicable. Unless prohibited by the Governmental
Entity or any applicable Law, no party shall participate in any meeting, or
engage in any material substantive conversation, with any Governmental Entity
without giving the other party prior notice of the meeting or conversation and
the opportunity to attend or participate in such meeting or conversation.

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(d)    Until the Closing, none of the Purchaser, the Seller, Seller Guarantor,
Seller Parent, or the Company or its Subsidiaries, directly or indirectly,
through one or more of their respective Affiliates, shall acquire or make any
investment in any corporation, partnership, limited liability company or other
business organization or any division or assets thereof, or merge with or into
any other entity, or enter into any agreement or commitment to do any of the
foregoing, that in any case would reasonably be expected to cause any material
delay in the satisfaction of the conditions contained in Article VII or the
consummation of the transactions contemplated hereby.
(e)    Following the Closing the Purchaser will promptly make all necessary
filings to transfer or cause the re-issuance of, as applicable, all Permits,
including without limitation all Mining Permits, mine licenses and MSHA
identification numbers, and the Purchaser will diligently pursue such transfer
or reissuance to the end that all Permits be transferred or reissued to the
Purchaser as soon as is reasonably practicable. Prior to the Closing the parties
will cooperate with each other to facilitate the transfer process.
6.11    Access to Books and Records. Each of Seller and Purchaser shall preserve
until the sixth anniversary of the Closing Date all records possessed or to be
possessed by it relating to the Company or its Subsidiaries. After the Closing
Date, each such party shall provide the other party with reasonable access to
such records, upon prior written request specifying the need therefor, during
regular business hours, and the requesting party shall have the right to make
copies of such Books and Records at its sole cost.
6.12    Further Assurances. Except as otherwise provided herein, the Purchaser
and the Seller shall (and the Seller shall cause the Company and its
Subsidiaries to) use reasonable best efforts to take, or cause to be taken, all
actions necessary or appropriate to consummate and make effective the
transactions contemplated by this Agreement. If at any time (whether before or
after the Closing) any further action is necessary or appropriate to carry out
the purposes of this Agreement, the parties shall use commercially reasonable
efforts to take, or cause to be taken, that action, including the transfer of
all Permits from the Contractors to the Purchaser, the Company or its
Subsidiaries.
6.13    Release.
(a)    Effective upon the Closing, the Seller hereby irrevocable waives,
releases and discharges the Company and its Subsidiaries, the Purchaser and each
of their respective Affiliates and Representatives of and from any and all
Liabilities and obligations to the Seller of any kind or nature whatsoever
(including in respect of any rights of contribution or indemnification), whether
arising under any Contract or otherwise at Law or in equity, and whether or not
then known (other than Liabilities that arise under this Agreement and the
Ancillary Agreements), other than pursuant to the Contracts set forth on Section
6.5(c) of the Seller’s Disclosure Schedule, and the Seller agrees that it will
not seek to recover any amounts in connection therewith or thereunder from the
Company, its Subsidiaries, the Purchaser or any of their respective Affiliates
or Representatives.
(b)    Effective upon the Closing, Purchaser, (on behalf of the Company and the
Company’s Subsidiaries) and the Company hereby irrevocably waives, releases and
discharges the Seller and each of its Affiliates and Representatives of and from
any and all Liabilities and obligations

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to the Purchaser of any kind or nature whatsoever (including in respect of any
rights of contribution or indemnification), whether arising under any Contract
or otherwise at Law or in equity, and whether or not then known (other than
Liabilities that arise under this Agreement and the Ancillary Agreements), other
than pursuant to the Contracts set forth on Section 6.5(c) of the Seller’s
Disclosure Schedule, and the Purchaser agrees that it will not seek to recover
any amounts in connection therewith or thereunder from the Seller or any of its
respective Affiliates or Representatives.
6.14    Exclusivity. During the term of this Agreement, and except with respect
to this Agreement and the transactions contemplated hereby, the Seller agrees
that it will not, and will cause the Company, its Subsidiaries and its and their
respective directors, officers, managers, employees, Affiliates and other agents
and representatives not to: (a) encourage, initiate, solicit, seek or respond
to, directly or indirectly, any inquiries or the making or implementation of any
proposal or offer with respect to a merger, acquisition, consolidation,
recapitalization, business combination, liquidation, dissolution, equity
investment or similar transaction involving, or any purchase of all or any
substantial portion of the assets or any equity or equity-linked securities of,
the Company or its Subsidiaries, which could impair, prevent or delay or dilute
the benefits to the Purchaser of the transactions contemplated by this Agreement
and the Ancillary Agreements (any such proposal or offer being hereinafter
referred to as a “Proposal”); (b) continue, engage in, initiate or otherwise
participate in, any negotiations concerning, or provide any information or data
to, or have any substantive discussions with, any Person relating to a Proposal;
(c) otherwise facilitate or cooperate in any effort or attempt to make,
implement or accept a Proposal; or (d) enter into Contract with any Person
relating to a Proposal.
6.15    Restrictive Covenants.
(a)    The Seller covenants that, commencing on the Closing Date and ending on
the fifth anniversary of the Closing Date (the “Restricted Period”), the Seller
shall not, and shall cause its Affiliates not to, directly or indirectly engage
in the mining, marketing or sale of coal (other than sales of excess coal by the
Seller’s regulated utility Affiliates), or the acquisition of any fee or
leasehold interests in any mineral rights to coal (other than coal bed methane
or acquisitions of fee interests or leasehold interests in real property where
the acquisition of rights to coal is incidental to the primary acquisition), in
the State of Indiana. Neither the Seller nor its Affiliates will be precluded or
restrained from engaging in (i) the purchase or development or any other
activities related to oil or gas (including coal bed methane), or other minerals
(other than coal), or (ii) entering into any merger or acquisition with a Third
Party that is directly or indirectly engaged in the mining, marketing or sale of
coal in the State of Indiana, provided that the primary business of such Third
Party and its Affiliates is a business other than the mining, marketing or sale
of coal, and provided further, that nothing in this provision shall preclude any
transaction involving a change of control of Seller Parent.
(b)    The Seller covenants that for two years following the Closing, it shall
not (and shall cause its Affiliates not to), solicit the employment of any
Person who is during such two year period an Employee of the Purchaser, the
Company or any of its Subsidiaries, hire any such Person, or persuade, induce or
attempt to persuade or induce any such Person to leave his, her or

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its employment to the Company, its Subsidiaries, the Purchaser or its
Affiliates; provided that nothing in this Section 6.15(b) shall prohibit the
Seller or its Affiliates from hiring (i) any individual listed on Section
6.15(b) of the Seller’s Disclosure Schedule, (ii) any Employee of the Company or
its Subsidiaries as a result of any general solicitation for employment not
specifically directed at persons who are employed by the Company or its
Subsidiaries or presented to the Seller by a recruiting or search firm so long
as such recruiting or search firm is not specifically directed to solicit
persons who are employed by the Company or its Subsidiaries, (iii) any former
employee of the Company or its Subsidiaries, or (iv) any employee of the Company
or its Subsidiaries that initiates contact with Seller regarding potential
employment on his or her own initiative without any direct or indirect
solicitation by the Seller or its Affiliates or its or their Representatives.
(c)    The Seller covenants that for two years following the Closing, it shall
not (and shall cause its Affiliates not to) solicit or induce, or in any manner
attempt to solicit or induce, or cause or authorize any other Person to solicit
or induce any Person to cease, diminish or not commence doing business with the
Company, its Subsidiaries, the Purchaser or its Affiliates; provided that
nothing in this Section 6.15(c) shall prohibit the Seller or its Affiliates from
exercising or enforcing in any manner any of their rights under contracts that
the Seller or its affiliates may have with the Company or its Subsidiaries
following the Closing.
(d)    From and after the Closing Date, the Seller shall not (and shall cause
its Affiliates not to) disparage the Company, its Subsidiaries, the Purchaser or
its Affiliates to any Person. From and after the Closing Date, the Purchaser
shall not (and shall cause its Affiliates not to) disparage the Seller or its
Affiliates to any Person.
(e)    The Seller acknowledges that the restrictions contained in this Section
6.15 are reasonable and necessary to protect the legitimate interests of the
Purchaser and constitute a material inducement to the Purchaser to enter into
this Agreement and consummate the transactions contemplated by this Agreement,
and that a violation of this Section 6.15 by the Seller will result in
irreparable injury to the Purchaser and agrees that the Purchaser shall be
entitled to seek preliminary and permanent injunctive relief, as well as such
other equitable remedies as may be available to the Purchaser, which remedies
shall be cumulative and in addition to any other rights or remedies to which the
Purchaser may be entitled.
(f)    In the event that any covenant contained in this Section 6.15 should ever
be adjudicated to exceed the time, geographic, product or service or other
limitations permitted by applicable Law in any jurisdiction, then any court is
expressly empowered to reform such covenant, and such covenant shall be deemed
reformed, in such jurisdiction to the maximum time, geographic, product or
service or other limitations permitted by applicable Law. The covenants
contained in this Section 6.15 and each provision thereof are severable and
distinct covenants and provisions. The invalidity or unenforceability of any
such covenant or provision as written shall not invalidate or render
unenforceable the remaining covenants or provisions hereof, and any such
invalidity or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such covenant or provision in any other jurisdiction.

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6.16    Financing.
(a)    The Purchaser shall use its reasonable best efforts to take, or cause to
be taken, all actions, and to cause, or cause to be done, all things, in each
case reasonably necessary, proper or advisable to obtain and consummate the
Financing as described in the Highly Confident Letter and, if applicable, the
Equity Financing Letter, including using its reasonable best efforts to
(i) negotiate in good faith and enter into definitive agreements with respect to
the Loan Financing as soon as reasonably practicable and (A) on the terms and
subject to the conditions reflected in the Highly Confident Letter, or (B) on
such other terms that are acceptable in good faith to the Purchaser; (ii) if
required to obtain sufficient funds to complete the transactions contemplated
hereby, to negotiate in good faith and enter into one or more equity commitment
agreements with respect to the Equity Financing on terms acceptable in good
faith to the Purchaser; (iii) satisfy on a timely basis all conditions in the
definitive agreements relating to the Loan Financing and, if applicable the
Equity Financing (the “Financing Definitive Agreements”) and comply with the
obligations thereunder applicable to the Purchaser and within its control;
(iv) obtain such Third-Party consents as may be reasonably required to be
obtained by the Purchaser in connection with the Financing, subject to the
Seller’s compliance with Section 6.16(b) where applicable; and (v) upon the
satisfaction or waiver of the conditions in the Financing Definitive Agreements,
consummate the Financing on or prior to the Closing; provided, however, that,
notwithstanding anything to the contrary contained herein, (1) the Purchaser
shall have the right to substitute other debt or equity financing for all or any
portion of the Financing from the same or alternative financing sources on terms
and conditions reasonably acceptable to the Purchaser in good faith; and (2) the
Purchaser shall not be required to, and the Purchaser shall not be required to
cause any other Person to, commence, participate in, pursue or defend any Action
against or involving any of the Purchaser’s lenders or investors or other
Persons that have or may have agreed to provide any portion of, or otherwise
with respect to, the Financing. The Purchaser shall provide the Seller with
information on a current basis with respect to (i) the status of its
negotiations with respect to definitive agreements relating to the Financing,
(ii) satisfaction of all conditions in the definitive agreements relating to the
Financing and (iii) such other matters as the Seller may reasonably request
relating to the status of the Financing. The Purchaser shall provide the Seller
with an executed copy of each definitive credit agreement or equity commitment
agreement relating to the Financing promptly following execution thereof in the
forms as will be publicly disclosed, together with any other documents or
attachments thereto to the extent they contain any material terms or conditions
to the Financing not otherwise reflected in the definitive agreement.
(b)    During the period beginning on the date hereof and ending on the Closing
Date, upon the request of the Purchaser, the Seller shall, and shall cause its
Affiliates and Representatives to, cooperate reasonably with the Purchaser in
connection with the Purchaser’s financing of the transactions contemplated
hereby, including by (i) providing customary information reasonably requested by
the Purchaser relating to such financing; and (ii) making commercially
reasonable efforts to obtain consents from Third Parties as reasonably necessary
and taking such other actions as may reasonably be requested to facilitate the
granting of a security interest to the Purchaser’s lenders in the collateral as
contemplated by the Loan Financing on the Closing Date; provided that (i)
nothing herein shall require such cooperation from the Seller or any of its
Subsidiaries to the extent that it would unreasonably interfere with the ongoing
operations of the

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Seller and its Subsidiaries, and (ii) neither the Seller nor any of its
Subsidiaries shall be required to expend any funds (other than incidental
amounts) or make any payment to any Third Party in connection with its
compliance with this Section 6.16(b).
(c)    Purchaser shall, promptly upon request of the Seller, reimburse the
Seller (and its Affiliates and Representatives, including the Company and its
Subsidiaries) for all reasonable out-of-pocket costs incurred by the Seller, and
its Affiliates and Representatives in connection with such cooperation. The
Purchaser shall indemnify and hold harmless the Seller and its Affiliates and
Representatives for and against any and all Losses suffered or incurred by them
in connection with the arrangement of the Financing except to the extent such
Losses arise from any breach or noncompliance by the Seller, the Company or its
Subsidiaries of any covenant or agreement in this Agreement, or the gross
negligence or willful misconduct of the Seller or of the Company or its
Subsidiaries prior to the Closing.
(d)    Any information provided to the Purchaser or its Representatives in
accordance with this Section 6.16 or otherwise pursuant to this Agreement shall
be held by the Purchaser and its Representatives in accordance with, shall be
deemed provided under, and shall be subject to the terms of, the Confidentiality
Agreement.
6.17    Support Obligations. With respect to each guaranty, letter of credit,
performance or surety bond or similar credit support arrangement issued by or
for the account of the Company or any of its Subsidiaries shown on Section 6.17
of the Seller’s Disclosure Schedule (collectively, the “Support Obligations”),
the Purchaser shall obtain, prior to or as of the Closing, substitute credit
support arrangements in replacement for the Support Obligations, and shall
procure that each of the Seller and its Affiliates, and, where applicable, their
sureties or letter of credit issuers, be fully released from their respective
obligations under the Support Obligations as of the Closing Date, in form and
substance reasonably satisfactory to the Seller. The Seller will cooperate
reasonably with the Purchaser with respect to the foregoing.
6.18    WARN Notice. As promptly as practicable following the date hereof, the
Company shall (and shall cause its Subsidiaries to) cause the Contractors to
issue to its employees the notice required under the WARN Act or any other
applicable Law in connection with the termination of the Contract Mining
Agreements pursuant to Section 6.5(d).
6.19    Other Funds. From and after the Closing, (i) if the Seller or its
Affiliates receives or collects any cash, checks or other property which are the
property of the Purchaser, the Company or its Subsidiaries, the Seller shall
remit any such amounts to the Purchaser as promptly as practicable but no later
than ten Business Days after the Seller receives such sum, and (ii) if the
Purchaser, the Company or its Subsidiaries receives or collects any cash, checks
or other property which are the property of the Seller, the Purchaser shall
remit any such amounts to the Seller as promptly as practicable but no later
than ten Business Days after the Purchaser receives such sum.
6.20    Like-Kind Exchange. The Seller acknowledges that the Purchaser is
contemplating acquiring a portion of the assets of the Company and its
Subsidiaries through a like-kind exchange pursuant to Section 1031 of the Code,
and agrees to cooperate with the Purchaser in effecting such transaction,
including by causing the Company and its Subsidiaries to sell certain of their
assets to

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be identified by the Purchaser to an Affiliate of the Purchaser, or to a
Qualified Intermediary as defined by Reg. Section 1.1031(k)(1)(g)(4) or an
Exchange Accommodation Titleholder as defined in Rev. Proc. 2000-37, immediately
prior to the Closing on terms reasonably acceptable to the Seller. The Purchaser
shall indemnify the Seller for any additional Taxes incurred by the Seller
solely as a result of the transactions contemplated by this Section 6.20, and
shall reimburse the Seller for any reasonable out-of-pocket costs (other than
attorney’s fees) incurred by the Seller or the Company or any of its
Subsidiaries in connection with their cooperation hereunder.
6.21    Use of Name. From and after the Closing Date, the Purchaser shall
promptly cease all use of the trademarks, trade names, corporate names, domain
names and logos containing the name “Vectren”, and shall, on or promptly after
the Closing Date, take all steps necessary to change the name of the Company,
including by making filings with the applicable Secretary(ies) of State and
other applicable Governmental Entities. Notwithstanding the foregoing, the
Purchaser may continue to use the name “Vectren” after the Closing Date solely
to the extent necessary to prepare any Tax or other filings to be made with any
Governmental Entity, provided that any such use is on a non-public basis.
ARTICLE VII    
CONDITIONS TO CLOSING
7.1    Conditions to Obligations of the Purchaser and the Seller. The
obligations of the Purchaser and the Seller to consummate the transactions
contemplated by this Agreement are subject to the satisfaction of the following
conditions:
(a)    No temporary restraining Order, preliminary or permanent injunction or
other Order shall be in effect enjoining, prohibiting or otherwise preventing
the consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements;
(b)    No Law shall have been enacted or shall be deemed applicable to the
transactions contemplated by this Agreement which makes the consummation of such
transactions illegal;
(c)    Any applicable waiting period under the HSR Act shall have expired or
been terminated;
(d)    The notice period required under the WARN Act in connection with the
notice issued pursuant to Section 6.18 shall have lapsed; and
(e)    The Closing Date Purchase Price shall not be more than $325,000,000.
7.2    Conditions to Obligations of the Purchaser. The obligation of the
Purchaser to consummate the transactions contemplated by this Agreement is
subject to the satisfaction (or waiver in writing by the Purchaser in its sole
discretion) of the following further conditions:
(a)    Each of the Seller’s Fundamental Representations shall be true and
correct in all material respects, and each other representation and warranty of
the Seller made in Article III

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and Article IV shall be true and correct in all respects as of the Closing Date
as if made at and as of the Closing Date, except in each case to the extent that
such representation and warranty refers specifically to an earlier date, in
which case such representation and warranty shall have been true and correct as
of such earlier date, except in the case of representations and warranties other
than the Seller’s Fundamental Representations where the failure of such
representations and warranties to be true and correct would not reasonably be
expected to result in a Material Adverse Effect;
(b)    The Seller shall have performed or complied in all material respects with
all obligations and covenants required by this Agreement to be performed or
complied with by it at or prior to the Closing;
(c)    During the period from the date of this Agreement until the Closing, no
event shall have occurred that has had, or would reasonably be expected to have,
a Material Adverse Effect;
(d)    The Company and its Subsidiaries shall own no less than the Minimum Coal
Inventory Amount and no less than $8,000,000 of parts inventory;
(e)    All of the Employees of the Company and its Subsidiaries shall have been
terminated;
(f)    The Purchaser shall have received certificates dated as of the Closing
Date and signed by the Seller to the effect that the conditions set forth in
Sections 7.2(a), 7.2(b) and 7.2(c) shall have been satisfied;
(g)    The consents and approvals listed on Section 7.2(g) of the Seller’s
Disclosure Schedule shall have been obtained, and the notices listed on Section
7.2(g) of the Seller’s Disclosure Schedule shall have been given, and each such
consent, approval and notice shall be in form and substance reasonably
satisfactory to the Purchaser, in full force and effect and not subject to the
satisfaction of any condition that has not been satisfied;
(h)    The Purchaser shall have received the funds sufficient to pay the Closing
Date Purchase Price from the Financing or otherwise;
(i)    The condition identified on Section 7.2(i) of the Purchaser’s Disclosure
Schedule shall be satisfied; and
(j)    The Seller shall have executed and delivered (or caused to be executed
and delivered) to the Purchaser all agreements and other documents required to
be executed and delivered to the Purchaser pursuant to this Agreement at or
prior to the Closing (including all certificates, documents and instruments
required to be delivered to the Purchaser at the Closing pursuant to
Section 2.5(a)).
7.3    Conditions to Obligations of the Seller. The obligation of the Seller to
consummate the transactions contemplated by this Agreement is subject to the
satisfaction (or waiver in writing by the Seller in its sole discretion) of the
following further conditions:

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(a)    Each of Purchaser’s Fundamental Representations shall be true and correct
in all material respects, and each other representation and warranty of Purchase
made in Article V shall be true and correct in all respects as of the Closing
Date as if made at and as of the Closing Date, except in each case to the extent
that such representation and warranty refers specifically to an earlier date, in
which case such representation and warranty shall have been true and correct as
of such earlier date, except in the case of representations and warranties other
than the Purchaser’s Fundamental Representations where the failure of such
representations and warranties to be true and correct would not reasonably be
expected to result in a material adverse effect on the Purchaser’s ability to
consummate the transactions contemplated hereby;
(b)    The Purchaser shall have performed or complied in all material respects
with all obligations and covenants required by this Agreement to be performed or
complied with by it at or prior to the Closing Date;
(c)    The Seller shall have received a certificate dated as of the Closing Date
and signed by the Purchaser to the effect that the conditions set forth in
Sections 7.3(a) and 7.3(b) have been satisfied;
(d)    The Purchaser shall have made payment of the Closing Date Purchase Price,
it being understood that such payment shall be made simultaneously with the
other actions to be taken by the parties as of the Closing and shall be subject
to satisfaction or waiver by the Purchaser of the conditions to the Purchaser’s
obligations set forth in Sections 7.1 and 7.2; and
(e)    The Purchaser shall have executed and delivered to the Seller all
agreements and other documents required to be executed and delivered to the
Seller pursuant to this Agreement at or prior to the Closing (including all
certificates, documents and instruments required to be delivered to the Seller
the Closing pursuant to Section 2.5(b)).
ARTICLE VIII    
TERMINATION
8.1    Termination.
(a)    This Agreement may be terminated and the transactions contemplated hereby
may be abandoned at any time prior to the Closing:
(i)    by mutual written consent of the Purchaser and the Seller;
(ii)    by the Purchaser or the Seller if the Closing does not occur on or
before the Outside Date; provided that the right to terminate this Agreement
under this Section 8.1(a)(ii) shall not be available (A) to any party whose
breach of a representation, warranty, covenant or agreement under this Agreement
has been the cause of, or resulted in the failure of, the Closing to occur on or
before such date, or (B) to the Purchaser in the event this Agreement is also
terminable at such time by the Seller pursuant to Section 8.1(a)(vii);

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(iii)     by the Purchaser if (A) the Seller shall have breached any of the
covenants or agreements contained in this Agreement such that the closing
condition set forth in Section 7.2(b) would not be satisfied, (B) there exists a
breach of any representation or warranty of the Seller contained in this
Agreement such that the closing condition set forth in Section 7.2(a) would not
be satisfied, (C) following the date hereof an event has occurred (and cannot be
cured prior to the Outside Date) that has had, or would reasonably be expected
to have, a Material Adverse Effect; provided, (1) in the case of the immediately
preceding clauses (A) and (B), that such breach is not cured by the Seller
within 20 Business Days following notice thereof, and (2) the Purchaser shall
not be entitled to terminate this Agreement pursuant to the immediately
preceding clause (A) or (B) if, at the time of such termination, the Purchaser
is in breach of any representation, warranty, covenant or other agreement
contained herein in a manner that the conditions to Closing set forth in
Section 7.3(a) or 7.3(b), as applicable, would not be satisfied;
(iv)    by the Seller if (A) the Purchaser shall have breached any of the
covenants or agreements contained in this Agreement such that the closing
condition set forth in Section 7.3(b) would not be satisfied or (B) there exists
a breach of any representation or warranty of the Purchaser contained in this
Agreement such that the closing condition set forth in Section 7.3(a) would not
be satisfied; provided, (1) in the case of the immediately preceding clauses (A)
and (B), that such breach is not cured by the Purchaser within 20 Business Days
following notice thereof, and (2) the Seller shall not be entitled to terminate
this Agreement pursuant to this Section 8.1(a)(iv) if, at the time of such
termination, the Seller is in breach of any representation, warranty, covenant
or other agreement contained herein in a manner that the conditions to Closing
set forth in Section 7.2(a) or 7.2(b), as applicable, would not be satisfied;
(v)    by the Purchaser or the Seller if a Governmental Entity shall have issued
an Order or taken any other Action, in any case having the effect of
restraining, enjoining or otherwise prohibiting, the transactions contemplated
by this Agreement and such Order or other Action is final and non‑appealable;
(vi)     by the Seller if the Federal Office of Surface Mining or any agency of
the State of Indiana administering SMCRA (or any comparable state Law)
determines that Purchaser is (a) ineligible to receive additional surface mining
permits or (b) under investigation to determine whether its eligibility to
receive such permits should be revoked, i.e. “permit blocked” and the Purchaser
is unable to resolve such designation or investigation within 20 Business Days
following notice thereof; or
(vii)    by the Seller, if all of the conditions set forth in Sections 7.1 and
7.2 have been satisfied (other than those conditions set forth in Section 7.2(h)
or that by their terms are to be satisfied at the Closing) and the Seller stands
ready and willing to consummate such transactions, and the condition set forth
in Section 7.2(h) shall not have been satisfied by the Outside Date.
(b)    The party desiring to terminate this Agreement pursuant to
Sections 8.1(a)(ii), 8.1(a)(iii), 8.1(a)(iv), 8.1(a)(v), 8.1(a)(vi) or
8.1(a)(vii) shall give written notice of such termination to the other parties
hereto.

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8.2    Purchaser Termination Fee. If this Agreement is validly terminated by the
Seller pursuant to Section 8.1(a)(vii), then the Purchaser shall pay to the
Seller by wire transfer of immediately available funds an amount equal to
$20,000,000 (the “Purchaser Termination Fee”), such payment to be made within 5
Business Days after written notice of such termination. It is the intent of the
Seller and the Purchaser, and the Seller and the Purchaser hereby acknowledge
and agree, that notwithstanding anything to the contrary in this Agreement, upon
the termination of this Agreement pursuant to Section 8.1(a)(vii), the Seller’s
receipt of the Purchaser Termination Fee shall be the sole and exclusive right
and remedy of the Seller, the Company and their Affiliates, and the sole and
exclusive obligation of the Purchaser and its Affiliates, with respect to all
matters arising under or relating to this Agreement, and that upon payment of
the Purchaser Termination Fee, the Purchaser shall not have any further
liability or obligation relating to or arising out of this Agreement, and all
rights and claims, whether at Law or in equity, in contract, tort or otherwise,
of the Seller, the Company and its Affiliates shall be deemed waived, against
the Purchaser or any of its Affiliates, lenders or investors for any and all
Losses suffered in connection with this Agreement or the transactions
contemplated hereby (other than with respect to obligations arising under the
Confidentiality Agreement, and any expense reimbursement and indemnity
obligations of the Purchaser contained in Sections 6.3(a) and 6.16 and any
interest and expenses payable pursuant to the following sentence of this Section
8.2). In the event that the Purchaser fails to timely pay the Purchaser
Termination Fee when due and payable pursuant to this Section 8.2, and, in order
to obtain such payment the Seller commences an Action, and Purchaser ultimately
pays such Purchaser Termination Fee, the Purchaser shall pay the Seller its
reasonable costs and expenses (including reasonable attorney’s fees) incurred in
connection with such Action along with the Purchaser Termination Fee, together
with interest on the Purchaser Termination Fee and such costs or expenses at the
“prime rate” as published in The Wall Street Journal, Eastern Edition on such
date, from the date on which the Purchaser Termination Fee was due and payable
hereunder (or such costs and expenses were expended by Seller) until the date on
which such payment is received by the Seller.
8.3    Effect of Termination. In the event of termination of this Agreement in
accordance with Section 8.1, this Agreement will forthwith become void and have
no effect, without any Liability (other than, subject to Section 8.2, with
respect to any claim for any intentional pre‑termination breach of any
representation, warranty, covenant or agreement set forth in this Agreement);
provided, that the provisions of Sections 6.6, 6.7, 8.2 and 8.3, Article IX and
Article X will survive any termination hereof pursuant to Section 8.1.
ARTICLE IX    
INDEMNIFICATION
9.1    Survival.
(a)    All representations and warranties of the parties hereto contained in
this Agreement, any Ancillary Agreement and any certificate or other document
provided hereunder will survive the Closing and the consummation and performance
of the transactions contemplated hereby. None of the covenants and other
obligations of the parties contained in this Agreement shall survive the Closing
Date except for those that by their terms contemplate performance after the
Closing Date, and each such surviving covenant and agreement shall survive the
Closing for

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the period contemplated by its terms. If the Closing occurs, the Seller shall
have liability with respect to a breach of any representation or warranty only
if the Purchaser delivers a Notice of Claim with respect to such breach on or
before the date that is twelve (12) months following the Closing Date; provided,
however, that (a) the Seller shall have liability (i) with respect to the
representations and warranties contained in Article III (except Sections 3.3 and
3.6) and Sections 4.1, 4.2 and 4.24 (such representations and warranties being
referred to as the “Seller’s Fundamental Representations”) if the Purchaser
delivers a Notice of Claim at any time, and (ii) with respect to the
representations and warranties contained in Sections 4.5 and 4.15 if the
Purchaser delivers a Notice of Claim on or before the date that is 60 days
following the expiration of the applicable statute of limitations, as extended,
and (b) the Purchaser shall have liability with respect to the representations
and warranties contained in Sections 5.1, 5.2 and 5.5 (such representations and
warranties being referred to as the “Purchaser’s Fundamental Representations”)
if the Seller delivers a Notice of Claim at any time.
(b)    In the event a Notice of Claim for indemnification under Section 9.2 or
9.3 is given within the applicable survival period set forth in Section 9.1(a),
the representation or warranty, covenant or agreement that is the subject of
such indemnification claim (whether or not formal legal Action shall have been
commenced based upon such claim) shall survive with respect to such claim until
such claim is finally resolved. The Indemnitor shall indemnify the Indemnitee
for all Losses (subject to the limitations set forth herein, if applicable) that
the Indemnitee may incur in respect of such claim, regardless of when incurred.
9.2    Indemnification by the Seller. If the Closing occurs and subject to the
limitations set forth herein, the Seller shall indemnify and defend the
Purchaser and its Affiliates (including the Company and its Subsidiaries) and
their respective stockholders, members, managers, officers, directors,
employees, agents, successors and assigns (the “Purchaser Indemnitees”) against,
and shall hold them harmless from, any and all losses, damages, claims, charges,
Liabilities, Actions, interest, penalties, Taxes, costs and expenses, including
legal, consultant, accounting and other professional fees, and fees and costs
actually incurred (collectively, “Losses”) resulting from, arising out of or
incurred by any Purchaser Indemnitee in connection with, or otherwise with
respect to: (a) any inaccuracy or breach of any representation or warranty made
by the Seller in this Agreement, any of the Ancillary Agreements or any
certificate or other document furnished or to be furnished to the Purchaser in
connection with the transactions contemplated by this Agreement; (b) any breach
by the Seller of any covenant or agreement contained in this Agreement or any of
the Ancillary Agreements; (c) except to the extent that the Seller has already
made payments in respect of such amounts pursuant to Section 6.9(a) or to the
extent that such amounts were taken into account as a current liability that
actually reduced Final Net Working Capital, (i) any Tax imposed on or relating
to the Company or its Subsidiaries with respect to any Pre-Closing Period;
(ii) any Liabilities of the Company or its Subsidiaries for the Taxes of another
Person (such as the Seller or Seller Parent) as a transferee or successor, by
Contract (other than a commercial Contract the principal purpose of which is not
Tax related) or by operation of law, where the Company or any of its
Subsidiaries became a transferee or successor, entered into such Contract or the
relationship or connection giving rise to such Liabilities arose prior to the
Closing; (d) Cypress Creek Mine, LLC, an Indiana limited liability company, or
any of its assets, properties, rights, liabilities and obligations, or any other
assets, properties, rights, liabilities and obligations related to the former
Cypress Creek surface

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mine; (e) any Indebtedness or Transaction Expenses to the extent not satisfied
prior to the Closing or included in any Purchase Price adjustment pursuant to
Section 2.4; (f) any notice from a Governmental Entity of a violation of the
Mining Regulations in connection with the Mining Operations that has not been
fully resolved prior to the Closing; (g) any items set forth on Section 4.12 of
the Seller’s Disclosure Schedule; (h) any determination that any individual who
provided services to the Mining Operations was improperly classified as an
independent contractor or other non-employee status, or that the Company or any
of its Subsidiaries was a joint employer or single employer or co-employer with
any other entity associated with the Mining Operations, including (i) under any
Plan, (ii) for taxation or Tax Reporting, and (iii) under the Fair Labor
Standards Act or any similar state statute; (i) any Liens of the type set forth
in clause (e) of the definition of Permitted Liens which have not been released
prior to the Closing (which ultimately result in a Loss to the Company or its
Subsidiaries following the Closing); (j) the Contract Mining Agreements (other
than with respect to the Contractor Termination Royalties); (k) to the extent
set forth in Section 6.5(e)(ii), the Lafayette Pre-Closing Payments; and (l) any
Benefit Plans.
9.3    Indemnification by the Purchaser. If the Closing occurs and subject to
the limitations set forth herein, the Purchaser shall indemnify and defend the
Seller and its Affiliates, and their respective stockholders, members, managers,
officers, directors, employees, agents, successors and assigns (the “Seller
Indemnitees”) against, and shall hold them harmless from, any and all Losses
resulting from, arising out of, or incurred by any Seller Indemnitee in
connection with, or otherwise with respect to: (a) any inaccuracy or breach of
any representation or warranty made by the Purchaser in this Agreement or any of
the Ancillary Agreements or any certificate or other document furnished or to be
furnished to the Seller in connection with the transactions contemplated by this
Agreement; (b) any breach by the Purchaser of any covenant or agreement
contained in this Agreement or any of the Ancillary Agreements; (c) the
ownership or operation of the Company and its Subsidiaries by the Purchaser or
its Affiliates (or any subsequent transferee of any such party, if such transfer
is made within three years of the Closing Date) on and after the Closing Date
(except for (i) any claims with respect to which the Seller is obligated to
indemnify the Purchaser Indemnitees pursuant to Section 9.2, and (ii) any claims
the Purchaser or the Company and its Subsidiaries may have against the Seller or
its Affiliates) (d) any Taxes of the Company or its Subsidiaries attributable to
a Post‑Closing Period and indemnification for which is not provided to the
Purchaser in Section 9.2; (e) any additional Taxes or out-of-pocket costs
relating to the Section 1031 like-kind exchange as set forth in Section 6.20;
(f) any Support Obligation, to the extent the Losses relating to such Support
Obligations arise or are incurred after Closing; and (g) subject to Section
9.2(k), the Lafayette Agreements.
9.4    Indemnification Procedure for Third Party Claims.
(a)    In the event that an Indemnitee becomes aware of the possibility of any
claim or the commencement of any Action by a third party in respect of which
indemnity may be sought under the provisions of Section 6.3(a), Section 6.16(c),
Section 6.20 or this Article IX (a “Third Party Claim”), the Indemnitee shall
notify the Indemnitor in writing of such Third Party Claim (such notice, a
“Notice of Claim”); provided that the failure or delay in notifying the
Indemnitor of such Third Party Claim will not relieve the Indemnitor of any
Liability it may have to the Indemnitee except to the extent that such failure
or delay causes actual harm to the Indemnitor with

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respect to such Third Party Claim. Any Notice of Claim shall describe the Third
Party Claim in reasonable detail, shall include copies of all written material
written evidence thereof and shall indicate the estimated amount, if reasonably
practicable, of the Loss that has been or may be sustained by the Indemnified
Party.
(b)    The Indemnitor will have 30 days from the date on which the Indemnitor
received the Notice of Claim (the “Indemnitor Defense Review Period”) to notify
the Indemnitee that the Indemnitor desires to assume the defense or prosecution
of such Third Party Claim and any litigation resulting therefrom with counsel
reasonably acceptable to the Indemnitee and at the sole cost and expense of the
Indemnitor (a “Third Party Defense”). At any time prior to the Indemnitor’s
assumption of the Third Party Defense in accordance herewith, the Indemnitee may
file any motion, answer or other pleading or take any other action that the
Indemnitee in good faith believes to be necessary to protect its interests. If
the Indemnitor assumes the Third Party Defense in accordance herewith: (i) the
Indemnitee may, at its own expense, retain separate co‑counsel and participate
in the defense of the Third Party Claim, but the Indemnitor shall control the
investigation, defense and settlement thereof; (ii) the Indemnitor will not
consent to the entry of any judgment or enter into any settlement with respect
to the Third Party Claim without the prior written consent of the Indemnitee
which consent shall not be unreasonably delayed, conditioned or withheld;
(iii) the Indemnitor shall conduct the Third Party Defense actively and
diligently and keep the Indemnitee reasonably informed about developments in
connection with the Third Party Defense; (iv) the Indemnitor will not take any
action, or omit to take any action, without the consent of the Indemnitee (which
consent shall not be unreasonably withheld, conditioned or delayed), that would
cause any Contracts, correspondence or other documents of the Indemnitee or its
Affiliates to be disclosed to a third party; and (v) the Indemnitee will provide
reasonable cooperation in the Third Party Defense. Notwithstanding the
foregoing, if counsel for the Indemnitee reasonably determines that there is a
conflict between the positions of the Indemnitor and the Indemnitee in
conducting the defense of such Action or that there are legal defenses available
to such Indemnitee different from or in addition to those available to the
Indemnitor, then counsel for the Indemnitee shall be entitled, if the Indemnitee
so elects, to conduct the defense to the extent reasonably determined by such
counsel to protect the interests of the Indemnitee, at the expense of the
Indemnitor but only with respect to issues with respect to which such conflict
exists.
(c)    If the Indemnitor does not assume the Third Party Defense prior to the
end of the Indemnitor Defense Review Period, the Indemnitee shall have the right
to assume the Third Party Defense with counsel reasonably acceptable to the
Indemnitor, at the expense of the Indemnitor; provided, however, that the
Indemnitor shall have the right, at its expense, to participate in such Third
Party Defense but the Indemnitee shall control the investigation, defense and
settlement thereof. The Indemnitee shall conduct the Third Party Defense
actively and diligently, and the Indemnitor will provide reasonable cooperation
in the Third Party Defense. The Indemnitee shall have the right to consent to
the entry of any judgment or enter into any settlement with respect to the Third
Party Claim in any manner and on such terms as it may deem appropriate without
the consent of the Indemnitor; provided, however, that the amount of any
settlement made or entry of any judgment consented to by the Indemnitee without
the consent of the Indemnitor (not to be unreasonably withheld or delayed) shall
not be determinative of the validity of the claim.

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(d)    Notwithstanding anything herein to the contrary, without the written
consent of the Purchaser, which will not be unreasonably withheld, conditioned
or delayed, the Seller shall not be entitled to assume any Third Party Defense:
(i) to the extent that any such Third Party Claim seeks, in addition to or in
lieu of monetary damages, any injunctive or other equitable relief against the
Purchaser, the Company, any of its Subsidiaries or any of their respective
Affiliates; (ii) if such Third Party Claim relates to or arises in connection
with any criminal proceeding, Action, indictment, allegation or investigation
against the Purchaser, the Company, any of its Subsidiaries or any of their
respective Affiliates; or (iii) if the Seller has failed or is failing to
vigorously prosecute or defend such Third Party Claim.
(e)    The Seller and the Purchaser shall cooperate with the each other in all
reasonable aspects in connection with the defense of any Third Party Claim,
including (i) making available (subject to the provisions of Section 6.11)
records relating to such Third Party Claim and furnishing, without expense
(other than reimbursement of actual out-of-pocket expenses), to the defending
party, management employees of the non-defending party as may reasonably be
necessary for the preparation of the defense of such Third Party Claim, and
(ii) making available the benefits of the Policies in effect prior to or after
the Closing to the extent available to satisfy any such Third Party Claim.
9.5    Indemnification Procedures for Non-Third Party Claims. In the event that
an Indemnitee becomes aware of the possibility of a claim that does not involve
a Third Party Claim in respect of which indemnity may be sought under the
provisions of Section 6.3(a), Section 6.16(c), Section 6.20 or this Article IX,
the Indemnitee shall send a Notice of Claim to the Indemnitor. The Indemnitor
will have 30 days from receipt of such notice of claim to dispute the claim and
will reasonably cooperate and assist the Indemnitee in determining the validity
of the claim for indemnity. If the Indemnitor does not give notice to the
Indemnitee that it disputes such claim within 30 days after its receipt of the
notice of claim, the claim specified in such notice of claim will be presumed to
be a Loss subject to indemnification hereunder, provided that the Indemnitor
shall not be precluded from subsequently challenging its obligation to indemnify
the Indemnitee for such Loss except to the extent that such delay has prejudiced
the Indemnified Party’s defense against such claim.
9.6    Other Matters Relating to Indemnification.
(a)    Limitations on Liability for Seller. Except for claims with respect to
the Seller’s Fundamental Representations, the Seller shall not be required to
indemnify any Purchaser Indemnittee for any Loss, or any series of related
Losses, (i) pursuant to Section 9.2(a) that do not exceed $50,000 (the “De
Minimis Claim Amount”); provided, however, that, to the extent any such Loss, or
series of related Losses, exceeds the De Minimis Claim Amount with respect to
any Loss, or series of related Losses, the full amount of such Loss shall be
applied to the Deductible, and (ii) except to the extent that the aggregate
amount of such Losses exceeds $5,000,000 (the “Deductible”), and then only to
the extent that the aggregate of such Losses exceeds the Deductible.
(b)    Cap on Liability for Seller. (i) The Seller’s aggregate liability for all
claims made pursuant to Section 9.2(a) other than claims with respect to the
Seller’s Fundamental Representations shall not exceed $30,000,000, and (ii) the
Seller’s aggregate liability for all claims

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made with respect to the Seller’s Fundamental Representations or pursuant to
Sections 9.2(b) through (k) shall not exceed the Base Purchase Price.
(c)    Qualifications. For purposes of this Article IX, all qualifications as to
materiality or Material Adverse Effect contained in any representation,
warranty, covenant or agreement contained herein will be disregarded for
purposes of determining the amount of any Loss, but not for purposes of
determining whether a Loss has occurred.
(d)    Exclusive Remedy. The indemnification rights of the parties under this
Article IX are the sole and exclusive remedy after the Closing for claims
seeking monetary damages available to the Purchaser Indemnitees and the Seller
Indemnitees, as applicable, for breaches of any of the representations,
warranties, covenants and agreements contained in this Agreement.
(e)    Tax Treatment of Indemnification Payments. Except as otherwise required
by applicable Law, the parties shall treat any indemnification payment made
hereunder as an adjustment to the consideration payable under this Agreement.
(f)    Interest on Losses. Any and all Losses hereunder shall bear interest from
the date actual expenditure is made by the Indemnified Party until paid by the
Indemnitor at the “prime rate” as published in The Wall Street Journal, Eastern
Edition on the date such expenditure was made by the Indemnitee.
(g)    Insurance. Payments by an Indemnitor in respect of any Loss shall be
reduced by the amount of any insurance proceeds and any indemnity, contribution
or other similar payment received by the Indemnitee in respect of any such
claim. The Indemnitee shall reasonably cooperate with the Indemnitor and use its
commercially reasonable efforts to recover or assist the Indemnitor to recover
under any applicable insurance policies or applicable indemnity, contribution or
other similar agreements for any Losses; provided that the foregoing shall not
be deemed or construed to require the Indemnitee to resolve any claims for
recovery prior to submitting a claim for indemnification to the Indemnitor.
(h)    Tax Benefits. Payments by an Indemnitor in respect of any Loss shall be
reduced by an amount equal to the cash value Tax benefit (if any) (i) actually
recognized by the Indemnitee incurring the Loss as a current deduction in the
taxable year such Loss was incurred, or (ii) reasonably expected to be realized
in the next taxable year following the year such Loss was incurred.
(i)    No Duplication; Subsequent Payments. No Indemnitee shall be entitled to
recover any Loss to the extent (i) indemnification of such amount would
constitute a duplicative payment for the same Loss, whether because it
constitutes a breach of more than one representation, warranty, covenant or
agreement or being addressed by more than one clause under Section 9.2 or
Section 9.3 or otherwise or (ii) such amount has had the effect of reducing the
Purchase Price pursuant to Sections 2.3 or 2.4. If any Indemnitee receives
payment or reimbursement from any source for any amount for which such
Indemnitee has previously received payment from an Indemnitor pursuant to either
Section 9.2 or 9.3, such Indemnitee shall promptly pay the full amount of such
payment or reimbursement to such Indemnitor.

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(j)    Mitigation. In the event of any breach giving rise to an indemnification
obligation under this Article IX, each Indemnitee shall take, or cause its
Affiliates to take, reasonable steps to mitigate the Losses arising from such
breach.
ARTICLE X    
MISCELLANEOUS
10.1    Notices. All notices, requests and other communications hereunder must
be in writing and will be deemed to have been duly given only if (a) delivered
personally against written receipt, (b) sent by facsimile or e-mail
transmission, (c) mailed by registered or certified mail, postage prepaid,
return receipt requested, or (d) mailed by reputable international overnight
courier, fee prepaid, to the parties hereto at the following addresses or
facsimile numbers:
If to the Seller:
Vectren Utility Services, Inc.
One Vectren Square
211 N.W. Riverside Drive
Evansville, IN 47708
Attention: Ronald E. Christian
Facsimile No.: (812) 491-4169
Email: rchristian@vectren.com

with copies to:
Baker Botts LLP
30 Rockefeller Plaza
New York, NY 10112
Attention: William S. Lamb
Facsimile No.: (212) 259-2557
Email: bill.lamb@bakerbotts.com
Wyatt, Tarrant & Combs, LLP
250 West Main Street, Suite 1600
Lexington, KY 40507-1746
Attention: Karen Greenwell
Facsimile No.: (859) 259-0649
Email: kgreenwell@wyattfirm.com
If to the Purchaser:    
Sunrise Coal, LLC
1183 East Canvasback Dr.
Terre Haute, IN 47802
Attention: Brent Bilsland
Facsimile No.: (812) 299-2810

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Email: bbilsland@sunrisecoal.com
with a copy to:
Morgan, Lewis & Bockius LLP
300 S. Grand Avenue, Twenty-Second Floor
Los Angeles, CA 90017
Attention: Ingrid A. Myers
Facsimile No.: (213) 612-2501
Email: imyers@morganlewis.com
All such notices, requests and other communications will be deemed given, (w) if
delivered personally as provided in this Section 10.1, upon delivery, (x) if
delivered by facsimile or email transmission as provided in this Section 10.1,
upon confirmed receipt, (y) if delivered by mail as provided in this
Section 10.1, upon the earlier of the fifth Business Day following mailing and
receipt, and (z) if delivered by overnight courier as provided in this
Section 10.1, upon the earlier of the second Business Day following the date
sent by such overnight courier and receipt (in each case regardless of whether
such notice, request or other communication is received by any other Person to
whom a copy of such notice is to be delivered pursuant to this Section 10.1).
Any party hereto may change the address to which notices, requests and other
communications hereunder are to be delivered by giving the other parties hereto
notice in the manner set forth herein.
10.2    Amendments and Waivers. No amendment of this Agreement will be effective
unless it is in writing and signed by the parties hereto. No waiver of any
provision of this Agreement will be effective unless it is in writing and duly
signed by the party granting the waiver, and no such waiver will constitute a
waiver of satisfaction of any other provision of this Agreement. No failure or
delay by any party in exercising any right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof of the exercise of any other right, power
or privilege.
10.3    Expenses. Each of the parties hereto shall pay their own fees and
expenses incurred in connection with negotiating and preparing this Agreement,
the Ancillary Agreements and consummating the transactions contemplated hereby,
including fees and disbursements of their respective attorneys, accountants,
brokers, finders and investment bankers. If the transaction is consummated,
except as otherwise provided in this Agreement, all fees and expenses, including
legal, accounting, investment banking, broker’s and finder’s fees and expenses
incurred by the Seller, the Company or its Subsidiaries in connection with this
transaction shall be deemed expenses of the Seller and shall be borne by the
Seller (the “Transaction Expenses”).
10.4    Assignment and Delegation. No party may assign any part of its rights,
or delegate any of its obligations, under this Agreement, except that the
Purchaser may assign or delegate its rights and obligations under this
Agreement, in whole or in part, (a) to one or more of its Affiliates (provided
that no such assignment or delegation prior to the Closing shall relieve the
Purchaser of its obligations hereunder), (b) to any subsequent purchaser of the
Company or its Subsidiaries or all or any significant portion of the assets of
the Company or its Subsidiaries or (c) to its lenders as collateral security for
its obligations under any of its secured debt financing arrangements.

69

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10.5    Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns. If a permitted assignment of rights occurs (a) the
non‑assigning party will be deemed to have agreed to perform in favor of the
assignee, (b) a contemporaneous delegation will be deemed to have occurred, and
(c) the assignee will be deemed to have assumed the assignor’s performance
obligations in favor of the non‑assigning party, except in each case where
evidence exists to the contrary.
10.6    Governing Law. All matters relating to or arising out of this Agreement,
any Ancillary Agreement or the transactions contemplated hereby or thereby
(whether sounding in contract, tort or otherwise) will be governed by and
construed in accordance with the laws of the State of Indiana, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of Indiana or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Indiana.
10.7    Consent to Jurisdiction. Each party hereto irrevocably submits to the
exclusive jurisdiction of any state or federal court located in Vigo County in
the State of Indiana for the purposes of any Action arising out of this
Agreement or the Ancillary Agreements or any transaction contemplated hereby or
thereby, and agrees to commence any such Action only in such courts. Each party
further agrees that service of any process, summons, notice or document by U.S.
registered mail to such party’s respective address set forth herein shall be
effective service of process for any such Action. Each party irrevocably and
unconditionally waives any objection to the laying of venue of any Action
arising out of this Agreement, Ancillary Agreements or the transactions
contemplated hereby or thereby in such courts, and hereby irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such Action brought in any such court has been brought in an inconvenient
forum. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE ANCILLARY
AGREEMENTS AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY OR THE ACTIONS
OF SUCH PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT
HEREOF AND THEREOF.
10.8    Specific Performance: Limitation on Damages.
(a)    The parties agree that irreparable damage would occur if any provision of
this Agreement were not performed in accordance with the terms hereof and that
the parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy to which they are entitled at law or in equity.
(b)    In no event shall any Party to this Agreement be liable to any other
Party for any punitive, incidental, consequential, special or indirect damages,
including loss of future revenue or income, damages for loss of business
reputation or opportunity relating to the breach or alleged breach of this
Agreement, or diminution of value, or any damages based on any type of multiple
(except to the extent such damages are claimed against or recovered from an
Indemnitee in connection with a Third Party Claim).

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10.9    “As Is” Sale; No Reliance. EXCEPT FOR THOSE REPRESENTATIONS AND
WARRANTIES CONTAINED IN ARTICLE III AND ARTICLE IV (INCLUDING THE RELATED
PORTIONS OF THE SELLER’S DISCLOSURE SCHEDULE) AND THE CERTIFICATES DELIVERED BY
THE SELLER AT THE CLOSING, (a) THE COMPANY AND ITS SUBSIDIARIES ARE BEING
TRANSFERRED “AS IS, WHERE IS, WITH ALL FAULTS,” AND (b) THE PURCHASER
ACKNOWLEDGES THAT IT HAS NOT RELIED ON, AND THE SELLER EXPRESSLY DISCLAIMS, ANY
OTHER REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED,
AS TO THE CONDITION, VALUE OR QUALITY OF THE COMPANY OR ITS SUBSIDIARIES OR THE
INTERESTS OR THE PROSPECTS (FINANCIAL OR OTHERWISE), RISKS AND OTHER INCIDENTS
OF THE COMPANY AND ITS SUBSIDIARIES, INCLUDING WITH RESPECT TO THE EXISTENCE,
NATURE, QUALITY OR QUANTITY OF ANY COAL RESERVES.
10.10    Certain Limitations. Notwithstanding anything in this Agreement to the
contrary, this Agreement may only be enforced against, and any claim, action,
suit or other legal proceeding based upon, arising out of, or related to this
Agreement, or the negotiation, execution or performance of this Agreement, may
only be brought against the entities that are expressly named as parties hereto
or their successors and permitted assigns, except pursuant to the Seller
Guaranty. No past, present or future director, officer, employee, incorporator,
manager, member, partner, stockholder, Affiliate, agent, attorney or other
Representative of any party hereto or of any Affiliate of any party hereto, or
any of their successors or permitted assigns, shall have any liability for any
obligations or liabilities of any party hereto under this Agreement or for any
claim or Action based on, in respect of or by reason of the transactions
contemplated hereby, except pursuant to the Seller Guaranty.
10.11    Counterparts. The parties may sign this Agreement in several
counterparts, each of which will be deemed an original but all of which together
will constitute one instrument. Execution and delivery of this Agreement may be
effected by means of an exchange of facsimile or other electronic copies.
10.12    Third Party Beneficiaries. This Agreement does not and is not intended
to confer any rights or remedies upon any Person, including any employee, any
beneficiary or dependents thereof, or any collective bargaining representative
thereof, other than the parties to this Agreement; provided, however, that in
the case of Article IX, the other Indemnitees and their respective heirs,
executors, administrators, legal representatives, successors and assigns are
intended third party beneficiaries of the provisions contained in such Article.
10.13    Entire Agreement. This Agreement, the Ancillary Agreements, the
Exhibits, the Schedules and the other documents, instruments and other
agreements specifically referred to in this Agreement or those documents or
delivered under this Agreement or those documents constitute the final and
entire agreement between the parties on the subject matter of this Agreement.
This Agreement supersedes all prior oral or written agreements or policies
relating to this Agreement, except for the Confidentiality Agreement, which will
continue in full force and effect in accordance with its terms, subject to
Section 6.6.

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10.14    Captions. All captions contained in this Agreement are for convenience
of reference only, do not form a part of this Agreement and shall not affect in
any way the meaning or interpretation of this Agreement.
10.15    Severability. If any provision of this Agreement is held invalid,
illegal or unenforceable in any jurisdiction, the remainder of this Agreement,
or application of that provision to any Persons or circumstances, or in any
jurisdiction, other than those as to which it is held unenforceable, will not be
affected by that unenforceability and will be enforceable to the fullest extent
permitted by Law.
10.16    Interpretation; Disclosure Schedules. The parties hereto have
participated jointly in the negotiation and drafting of this Agreement, and any
rule of construction or interpretation otherwise requiring this Agreement to be
construed or interpreted against any party by virtue of the authorship of this
Agreement shall not apply to the construction and interpretation hereof. The
Disclosure Schedules have been arranged for purposes of convenience in
separately titled sections corresponding to sections of this Agreement;
provided, however, that each section of the Disclosure Schedules shall be deemed
to incorporate by reference all information disclosed in any other section of
the Disclosure Schedules to the extent such disclosure and the applicability of
such information is readily apparent on its face.  Capitalized terms used in the
Disclosure Schedules and not otherwise defined therein have the meanings given
to them in this Agreement.  The information contained in this Agreement and in
the Disclosure Schedules and Exhibits hereto is disclosed solely for purposes of
this Agreement, and no information contained herein or therein shall be deemed
to be an admission by any party hereto to any third party of any matter
whatsoever (including any violation of law or breach of contract).
[Signature page follows.]

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the date first written above.
SUNRISE COAL, LLC

By: /s/ Brent Bilsland                
Name: Brent Bilsland
Title: President
VECTREN UTILITY SERVICES, INC.

By: /s/ Ronald E. Christian            
Name: Ronald E. Christian
Title: Vice President, Secretary and
Assistant Treasurer
VECTREN FUELS, INC.

By: /s/ Randy L. Beck            
Name: Randy L. Beck
Title: President

[SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]

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Annex I
Coal Inventory Methodology
Stockpile Surveying Methodology
The methods currently being utilized at the Seller’s Mining Operations to
measure and calculate stockpile volumes, as described below, shall be used to
determine stockpile volumes. Representatives of the Purchaser’s engineering
staff must be present before and during the surveying of the stockpiles at the
Mining Operations, to make certain that both parties are in agreement that the
agreed procedures were followed. The parties shall cooperate and work together
in good faith to negate any problems that may arise during the surveying of the
stockpiles.
Oaktown
Vectren Fuels, Inc.’s Oaktown operation consists of a coal preparation and
handling system that keeps the individual mine stockpiles, both on the clean and
raw side, separate for each mine – Oaktown 1 & Oaktown 2. There are two separate
clean stockpiles and two separate raw stockpiles – 4 piles total. There is also
one small clean stockpile of purchased coal, mixed, stacked near the rail.
The separated stockpiles are graded and shaped with dozers upon leaving the
stacking tubes. Each dozer is equipped with a GPS tracking device that provides
real-time feedback as the dozer passes over the stockpile to aid in measuring
stockpile volumes. Each of the stockpiles at Oaktown 1 & Oaktown 2 must be
properly graded and shaped prior to surveying, to allow for accurate measurement
of the piles by dozer passes.
In addition to the data gathered by the dozer/GPS units, measurements of the
base of each stockpile and areas of each stockpile outside the influence of
reclaim feeders are directly measured by mobile/hand-held surveying units. The
raw data from the dozer/GPS units and the mobile/hand-held surveying units are
combined for each stockpile, input into CAD-based software, and used to generate
stockpile volumes.
Prosperity
There is only one slope at Vectren Fuels Inc.’s Prosperity mine, so there are
only two stockpiles - one raw stockpile and one clean stockpile at this mine.
Stockpiles at the Prosperity mine are measured using direct surveying methods,
consisting of a total station and/or mobile/hand-held laser device. Areas of the
stockpiles that can be safely and directly traversed, the base of each stockpile
and those outside the influence of reclaim feeders, are measured directly with
GPS units. Areas of the stockpiles outside these safe areas are measured with a
hand-held laser.

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General
Once the pile volumes are established, assumptions of both recovery and density
must be made to establish tonnage in both the raw and clean stockpiles.
Densities & Recoveries
Clean
The clean coal stockpiles at the Oaktown and Prosperity mine locations will be
assumed to have a clean coal loose density of 55 lb/ft3. Recovery for clean coal
stockpiles will be assumed to be 100% (i.e., a value of 1.0 will be used in the
calculation of stockpile tonnage).
Raw
The raw coal stockpiles at the Oaktown and Prosperity mine locations will be
assumed to have a raw coal loose density of 80.0 lb/ft3.
Recovery for raw coal stockpiles will be determined for each of the Oaktown 1,
Oaktown 2 and Prosperity mines, based on plant recovery data from such mine
during the 120 day period ending on the day prior to the date on which the coal
inventory is determined pursuant to the Agreement. The average recovery for the
raw coal stockpiles for each mine (i.e., Oaktown 1, Oaktown 2 and Prosperity),
over the 120-day period, will be the recovery used in the calculation of tonnage
for that mine.
Calculation of Stockpile Tonnages
Clean:
Tonnages for each clean coal stockpile will be calculated based on the surveyed
volume for that stockpile, and applying a loose coal density of 55 lb/ft3 and a
100% recovery.
For example, assume a volume of one thousand loose cubic yards (1,000 c.y.).
Utilizing the density and recovery stated above, the clean tons would be:
(1,000 c.y.)x(27 ft3/1c.y)x(55 lb/ft3)x(1 ton/2000 lb)x(1.0) = 742.5 tons of
clean coal
Note: There are 27 cubic feet in a cubic yard. There are 2,000 pounds in a ton.
Raw:
Tonnages for each raw coal stockpile will be calculated based on the surveyed
volume for that stockpile, and applying a loose coal density of 80.0 lb/ft3 and
the average recovery for the applicable mine (i.e., Oaktown 1, Oaktown 2 and
Prosperity) over the 120 day period as described above. Thus, each raw coal
stockpile may have a different recovery based on each mine’s individual
properties

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For example, assume a volume of one thousand loose cubic yards (1,000 c.y.).
Utilizing the density stated above and assuming a recovery of 60%, the clean
tons would be:
(1,000 c.y.)x(27 ft3/1c.y)x(80.0 lb/ft3)x(1 ton/2000 lb)x(0.6) = 648 tons of
clean coal
Note: There are 27 cubic feet in a cubic yard. There are 2,000 pounds in a ton.

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Annex II
Working Capital Methodology
 
 
 
 
 
 
 
 
Target
 
 
 
Net Working Capital
 
 
Net Working Capital
 
 
 
Adjustment
 
 
Dec-13
 
May-13
 
Methodology
 
Current Assets
 
 
 
 
 
 
  Cash (1)
$
—

 
$
—

 
 
 
  Accounts Receivable - Trade
11,358,597

 
11,944,070

 
 
 
  Advance Royalties (2)
2,760,819

 
2,337,309

 
 
 
  Coal Inventory
26,172,398

 
39,301,479

 
 
 
  Prepaid Expenses
437,306

 
1,621,075

 
 
 
  Parts Inventory (3)
13,299,584

 
13,378,468

 
 
 
Total Current Assets
54,028,704

 
68,582,401

 
 
 
 
 
 
 
 
 
 
Less:
 
 
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
  Accounts Payable
13,475,718

 
9,905,313

 
 
 
  Accrued Liabilities
7,256,429

 
4,391,588

 
 
 
  Accrued Property and Sales Tax (4)
1,230,559

 
1,088,620

 
 
 
  Mine and Rail Reclamation Obligations (5)
11,814,287

 
12,089,156

 
 
 
Total Current Liabilities
33,776,993

 
27,474,677

 
 
 
 
 
 
 
 
 
 
Net Working Capital
$
20,251,711

 
$
41,107,724

 
$
20,856,013

(6
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Cash is excluded from purchased balance sheet, however, the net working
capital will be adjusted at closing to cover cash necessary for uncleared or
undeposited checks and drafts
(2) Includes both current and long-term Advanced Royalities assets
(3) Parts inventory is classified as Materials and Supplies Inventory on the
audited and interim balance sheets
(4) Accrued Property and Sales Tax is classified as Accrued Taxes and
Liabilities on the interim balance sheet
(5) Mine and Rail Reclamation Obligations are classified as "Long-Term
Liabilities" on the interim balance sheet
(6)Illustrative net working capital adjustment using a 5/31/13 closing date
 
 
 
 
 
 
 

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Annex III
Net Plant Value Methodology
 
 
 
 
 
 
 
Target
 
 
 
Net Plant
 
Net Plant
 
 
 
Adjustment
 
Dec-13
 
May-13
 
Methodology
Net Plant:
 
 
 
 
 
  Property and Equipment
153,752,764

 
155,118,651

 
 
  Mining Property
2,638,358

 
2,629,578

 
 
  Mine Development Costs
133,935,423

 
133,196,787

 
 
  Asset Retirement Obligation Assets
7,662,111

 
7,460,311

 
 
Total Net Plant
$
297,988,656

 
$
298,405,327

 
$
416,671

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Annex IV
Example Purchase Price Calculation
 
Purchase
 
 
 
Price
 
 
 
Methodology
 
 
 
 
 
 
  Base Purchase Price
296,000,000

 
From Section 2.1
  Plus: Net Working Capital Adjustment
20,856,013

 
From Annex II
  Plus: Net Plant Adjustment
416,671

 
From Annex III
  Less: Indebtedness Amount
—

 
From Schedule 2.3(c)
Purchase Price
$
317,272,684

 
For Illustrative Purposes Only
 
 
 
 

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Exhibit A
Seller Guaranty
This GUARANTY, dated as of the ____ day of _________, 2014, is entered into by
Vectren Enterprises, Inc. an Indiana corporation (“Enterprises”), to and for the
benefit of Sunrise Coal, LLC, an Indiana limited liability company (the
“Purchaser”).
WITNESSETH:
WHEREAS, VECTREN UTILITY SERVICES, INC., an Indiana corporation (“VUSI”), is a
wholly owned subsidiary of Enterprises;
WHEREAS, pursuant to that certain Stock Purchase Agreement, dated as of June 30,
2014 (the “Purchase Agreement”), by and among the Purchaser, VUSI and VUSI’s
wholly owned subsidiary, VECTREN FUELS, INC., an Indiana corporation (“Fuels”),
VUSI has agreed to sell to the Purchaser, and the Purchaser has agreed to
purchase from VUSI, all of the capital stock of Fuels, subject to and in
accordance with the terms and conditions of the Purchase Agreement; and
WHEREAS, as a condition precedent to the Purchaser consummating that
transactions contemplated by the Purchase Agreement and performing its
obligations thereunder, and as an inducement to the Purchaser entering into the
Purchase Agreement, Enterprises has agreed to execute and deliver this Guaranty
for the benefit of the Purchaser;
NOW, THEREFORE, in consideration of the foregoing premises and the following
covenants and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, Enterprises covenants with the Purchaser as
follows:
1.    Guaranty. For value received and in consideration of the direct and
indirect benefits to be derived by Enterprises in connection with the
transactions contemplated by the Purchase Agreement, with effect from the date
of this Guaranty, Enterprises hereby guarantees VUSI’s full and prompt payment
as and when due of all amounts owed by VUSI under Article IX of the Purchase
Agreement, subject in all respects to all of the conditions, limitations, and
qualifications set forth in the Purchase Agreement (the “Obligations). This is a
continuing Guaranty of payment and not merely of collection. Subject to the
provisions of Section 4, this Guaranty shall terminate upon the earlier of the
termination of the Obligations or the date which is three (3) years from the
date of this Guaranty; provided, however, that this Guaranty and Enterprise’s
liability hereunder shall survive any such termination with respect to any
claims made by the Purchaser under the Purchase Agreement if such claims are
made prior to such termination.
2.    Waiver. Enterprises hereby expressly waives notice from the Purchaser of
its acceptance of and reliance upon this Guaranty. Enterprises consents to any
extensions of time for the payment of the Obligations and to any changes in the
terms of the Purchase Agreement, and waives any notices thereof. Enterprises
also waives promptness, diligence, presentment to or demand of payment from
anyone liable upon the Obligations, and presentment, notice of

--------------------------------------------------------------------------------

 

dishonor, protest and all other notices whatsoever. No waiver, amendment,
release or modification of this Guaranty shall be established by conduct, custom
or course of dealing, but solely by an instrument in writing duly executed by
Enterprises and the Purchaser. The Purchaser’s failure or delay in exercising
any right, remedy or power hereunder shall not operate as a waiver thereof, nor
shall any single or partial exercise by the Purchaser of any right, remedy or
power hereunder preclude the Purchaser from any other or future exercise of any
right, remedy or power. Each and every right, remedy and power granted to the
Purchaser hereunder or allowed to it by law or other agreement shall be
cumulative with and not exclusive of any other.
3.    Waiver of Defenses. The liability of Enterprises under this Guaranty, and
Enterprises’ obligations under this Guaranty shall not be impaired or released
as a result of (a) any change of the time, manner or terms of payment of any of
the Obligations; (b) any renewal or increase of any of the Obligations; (c) any
release or partial release of any other guarantor or other obligor in respect of
any of the Obligations; (d) any modification, amendment, waiver or renewal of,
or consent to departure from, any agreement or instrument relating to any of the
Obligations; (e) the Purchaser’s exercise or failure to exercise any rights
against VUSI, Enterprises or others or any other action or inaction by the
Purchaser in respect of any of the Obligations; (f) with respect to any of the
foregoing, the lack of notice to or consent by Enterprises; or (g) any other
circumstance which might otherwise constitute a defense available to, or
discharge of, a surety or a guarantor excepting payment. Nothing herein is
intended to deny Enterprises, and Enterprises shall have and may assert any and
all of the defenses, set-offs, counterclaims and other rights which VUSI is or
may be entitled to assert that arise from or out of the Purchase Agreement,
except for defenses arising out of the bankruptcy, insolvency, dissolution or
liquidation of VUSI. The obligations of Enterprises hereunder are several from
VUSI or any other person, and are primary obligations concerning which
Enterprises is the principal obligor. There are no conditions precedent to the
enforcement of this Guaranty, except as expressly contained herein.
4.    Reinstatement Provision. If the Purchaser receives any payment or payments
on account of the Obligations, which payment or payments of any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver, or any other party under
any bankruptcy act or code, state or federal law, common law or equitable
doctrine, then to the extent of any sum not finally retained by the Purchaser,
Enterprises’ obligations to the Purchaser hereunder shall be reinstated and this
Guaranty, shall remain in full force and effect (or be reinstated) until payment
of the Obligations shall have been made to the Purchaser, which payment shall be
due on demand.
5.    Assignment. This Guaranty shall be binding upon Enterprises and upon its
successors and assigns and shall be for the benefit of the Purchaser and its
successors and assigns. Enterprises may not assign this Guaranty or the
obligations hereunder without the express written consent of the Purchaser and
such assignment will not be unreasonably withheld. Any purported assignment in
violation of this Section 5 shall be void and without effect.

6.    Applicable Law. This Guaranty shall be governed by and construed in
accordance with the laws of the State of Indiana, without giving effect to laws
of such state that would require the application of the laws of any other state.

--------------------------------------------------------------------------------

 

7.    Severability. In case any clause, provision or section of this Guaranty,
or any application thereof, is for any reason held to be illegal, invalid, or
inoperable, Enterprises and the Purchaser shall negotiate an equitable
adjustment to such affected provisions of this guaranty with a view towards
effecting the purpose and intent of the Guaranty, and subject to such adjustment
such illegality, invalidity or inoperability shall not affect the remainder
thereof or any other clause, provision or section, and each such clause,
provision or section shall be deemed to be effective and operative in the manner
and to the fullest extent permitted by law.
8.    Only Agreement. This Guaranty is the entire and only agreement between
Enterprises and the Purchaser with respect to the guaranty of the Obligations of
VUSI by Enterprises.
9.    Representations and Warranties. Enterprises represents and warrants to the
Purchaser that: (a) it is a corporation duly incorporated and validly existing
under the laws of the State of Indiana; (b) it has all requisite power and
authority to execute and to deliver and to perform all of its obligations under
this Guaranty; (c) the execution, delivery and performance of this Guaranty by
Enterprises are within its corporate powers and have been duly authorized by all
necessary corporate actions; (d) this Guaranty constitutes a legally valid and
binding agreement of Enterprises, subject only to insolvency, bankruptcy,
moratorium, reorganization, fraudulent conveyance or similar laws affecting
creditors’ rights generally and by general principles of equity; (e) the
execution, delivery and performance of this Guaranty will not violate any
provision of any requirement of law or contractual obligation of Enterprises
(except to the extent that any such violation would not reasonably be expected
to have a material adverse effect on Enterprises’ ability to perform this
Guaranty); (f) no consent or authorization of, filing with, or other act by or
in respect of, any arbitrator or governmental authority and no consent of any
other person (including, without limitation, any stockholder or creditor of
Enterprises) is required in connection with the execution, delivery,
performance, validity or enforceability of this Guaranty, other than any which
have been obtained or made prior to the date hereof and remain in full force and
effect; and (g) no litigation, investigation or proceeding of or before any
arbitrator or governmental authority is pending or, to the knowledge of
Enterprises, threatened by or against Enterprises relating to this Guaranty or
that would have a material adverse effect on Enterprises’ ability to perform
this Guaranty.
10.    Collection Expenses. If the Purchaser is required to pursue any remedy
against Enterprises hereunder, Enterprises shall pay to the Purchaser upon
demand, all reasonable attorneys’ fees and expenses and all other reasonable
costs, expenses and fees incurred by the Purchaser in successfully enforcing
this Guaranty.
11.    Notices. Any notices given or required to be given hereunder shall be
given to Enterprises and the Purchaser, as applicable, by being either:
(a) delivered personally against written receipt, (b) sent by facsimile or
e-mail transmission, (c) mailed by registered or certified mail, postage
prepaid, return receipt requested, or (d) mailed by reputable international
overnight courier, fee prepaid, to Enterprises or the Purchaser, as applicable,
at the following addresses or facsimile numbers:

--------------------------------------------------------------------------------

 

If to Enterprises:        Vectren Enterprises, Inc.
Attention: Office of the Treasurer
One Vectren Square
Evansville Indiana 47708
Phone: (812) 491-4080
Fax No.: (812) 491-4346
E-mail: rgoocher@vectren.com
With an additional notice to:    Vectren Corporation
Attention: Ronald E. Christian
One Vectren Square
Evansville, Indiana 47708
Phone: (812) 491-4202
Fax No.: (812) 491-4238
E-mail: rchristian@vectren.com
If to the Purchaser:        Sunrise Coal, LLC
Attention: Brent Bilsland
1183 East Canvasback Dr.
Phone: (812) 298-3702
Fax No.: (812) 299-2810
E-mail: bbilsland@sunrisecoal.com
All such notices, requests and other communications will be deemed given, (w) if
delivered personally as provided in this Section 11, upon delivery, (x) if
delivered by facsimile or email transmission as provided in this Section 11,
upon confirmed receipt, (y) if delivered by mail as provided in this Section 11,
upon the earlier of the fifth business day following mailing and receipt, and
(z) if delivered by overnight courier as provided in this Section 11, upon the
earlier of the second business day following the date sent by such overnight
courier and receipt (in each case regardless of whether such notice, request or
other communication is received by any other Person to whom a copy of such
notice is to be delivered pursuant to this Section 11). Enterprises or the
Purchaser may change the address to which notices to it are to be sent upon
written notice to the Purchaser or Enterprises, respectively.
12.    Modification. This Guaranty may not be amended or modified unless the
changes are in writing and signed by both Enterprises and the Purchaser.
13.    JURY TRIAL WAIVER.     ENTERPRISES HEREBY IRREVOCABLY WAIVES ANY AND ALL
RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS GUARANTY.
[signature page follows]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, Enterprises has executed and delivered this Guaranty
effective as of the day and year first above written.
                                            
Vectren Enterprises, Inc.

By:                         
Name :                     
Title:                         

Accepted:

Sunrise Coal, LLC

By:                         
Name:                         
Title:                         

--------------------------------------------------------------------------------

Exhibit B-1
Interim Services Agreement (Oaktown #1)
See attached.

Exhibit B-2
Interim Services Agreement (Oaktown #2)
See attached.

--------------------------------------------------------------------------------

Exhibit B-3
Interim Services Agreement (Prosperity)
See attached.

--------------------------------------------------------------------------------

Exhibit C-1
Contractor Termination Agreement (Oaktown)
See attached.

--------------------------------------------------------------------------------

Exhibit C-2
Contractor Termination Agreement (Prosperity)
See attached.

--------------------------------------------------------------------------------

Exhibit D-1
Lafayette Termination Notice (Oaktown)
See attached.

--------------------------------------------------------------------------------

Exhibit D-2
Lafayette Termination Notice (Prosperity)
See attached.

--------------------------------------------------------------------------------

B-1
INTERIM OPERATING AGREEMENT
THIS INTERIM OPERATING AGREEMENT (this “Agreement”), dated as of the __28th_day
of __June________, 2014, is made and entered into by and between Black Panther
Mining, LLC, an Indiana limited liability company (“BPM”), and Oaktown Fuels No.
1 Mine, LLC, an Indiana limited liability company (“Owner”).
RECITALS
A. BPM and Owner are parties to the Contract Mining Agreement dated January 14,
2000 (as amended, the “CMA”) whereby BPM operates the Oaktown Mine for Owner.
B. Pursuant to the CMA, the permits for or relating to the operation of the
Oaktown Mine, including the permits listed on Exhibit A attached hereto, have
been issued in the name of BPM (collective, the “Permits”).
C. BPM, Owner, Vectren Fuels, Inc., SFI Coal Sales, LLC, and Vectren Utility
Services, Inc. have entered into an agreement whereby the CMA will be terminated
(the “Termination Agreement”) effective as of the date of the closing (the
“Closing Date”) of the transaction contemplated by the Stock Purchase Agreement
dated as of June [30], 2014 between Vectren Utility Services, Inc. (Owner’s
remote parent) and Sunrise Coal, LLC .
D. Pursuant to the Termination Agreement, BPM, Owner and the other parties
thereto have agreed to cooperate to effect the transfer of the Permits to Owner
or its designees, which transfer may occur subsequent to the Closing Date.
E. As a condition to the Termination Agreement, and in order to effect the
transition from operation of the Oaktown Mine by BPM to operation by Owner or
its designee, BPM has agreed to enter into this Interim Operating Agreement.
In consideration of the premises and mutual covenants set forth herein and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
AGREEMENT
1. INTERIM OPERATIONS. Subject to any required consent or approval by the
governmental authority that issues or administrates a Permit, BPM hereby grants
Owner and its designees the right to operate the Oaktown Mine under and pursuant
to the Permits, subject to the terms and conditions of this Agreement, during
the period from and after the Closing Date and continuing until the date on
which such Permits are transferred to Owner or its designee. Owner and each of
its designees shall operate solely as an independent contractor and not as an
agent,

--------------------------------------------------------------------------------

employee or servant of BPM. BPM shall have no right or obligation in any way to
direct, supervise or control the mining and reclamation activities of Owner.
Except as otherwise provided in this Agreement, as between BPM and Owner, all of
Owner’s operations shall be at the sole cost and expense of Owner, and any
benefit gained from such operations shall likewise be for the sole account and
benefit of Owner. To the extent that the process of transferring the Permits has
not been commenced prior to the Closing Date, BPM agrees that Owner shall have
the right (at its sole cost and expense) to prepare, submit and obtain approval
of any necessary applications for the transfer or re-issuance of the Permits;
provided that BPM shall have an opportunity to review any such filing in
advance. BPM and Owner or its designee shall reasonably cooperate and coordinate
with each other as necessary for Owner or such designee to submit and obtain
approvals for the transfer or re-issuance of the Permits. None of Owner or its
designees shall receive any compensation from BPM, and BPM shall receive no
compensation from Owner in connection with the operations of the Oaktown Mine or
the transfer or re-issuance of the Permits as contemplated herein.
2. NOTICES.
If BPM or Owner receives a notice of violation, a cessation order or any other
correspondence, order, citation or communication of any kind under any of the
Permits following the Closing Date but before the transfer or re-issuance of a
Permit, BPM shall give Owner, or Owner shall give BPM, as applicable, prompt
written notice thereof. Any notice or other communication given under this
Agreement shall be in writing and shall be: (i) delivered personally; (ii) sent
by documented overnight delivery service; (iii) sent by facsimile transmission,
provided that a confirmation copy thereof is sent no later than the Business Day
following the day of such transmission by documented overnight delivery service
or first class mail, postage prepaid (certified or registered mail, return
receipt requested); or (iv) sent by first class mail, postage prepaid (certified
or registered mail, return receipt requested). Such notice shall be deemed to
have been duly given: (w) on the date of the delivery, if delivered personally;
(x) on the Business Day after dispatch by documented overnight delivery service,
if sent in such manner; (y) on the date of facsimile transmission, if so
transmitted; or (z) on the fifth Business Day after sent by first class mail,
postage prepaid, if sent in such manner. Notices or other communications shall
be directed to the following addresses:
Notices to BPM

Black Panther Mining, LLC
11700 Water Tank Road
Cynthiana, IN 47612

Notices to Owner:

Oaktown Fuels Mine No. 2, LLC
1183 Canvasback Dr.
Terre haute, IN 47802

--------------------------------------------------------------------------------

Attention: President

with copies to:

________________________
________________________
________________________
________________________

Any party may at any time change its address for service from time to time by
giving notice to the other party in accordance with this Section 3.
3.    VIOLATIONS, ABATEMENT AND INSPECTION. (a) During the term of this
Agreement, the Owner shall be responsible for compliance with all obligations of
the terms of the Permits and all laws and regulations applicable to the Permits
and the operations performed pursuant thereto (the “Permit Obligations”). If BPM
or Owner receives a notice of violation, cessation order or other notice
relating to a failure to comply with the Permit Obligations (a “Violation”),
Owner will promptly take action to abate or otherwise resolve the Violation.
Owner will give BPM notice when the Violation has been abated. (b) If Owner
fails to timely abate a Violation, BPM shall notify Owner of its intention to
undertake abatement activities. If after such notice, Owner does not undertake
remedial action, BPM shall be entitled to undertake remedial actions on its own
behalf. (c) During term of this Agreement, BPM, its agents, engineers or other
related persons on its behalf, shall have the right, but not the obligation, to
enter onto the Oaktown Mine premises (the “Property”), for the purpose of
ascertaining the condition of the operations located on the Property, and the
status of Owner’s compliance with the Permits, provided that BPM shall not in
any event interfere with the operation at the Oaktown Mine or on the Property,
and that BPM shall, and shall cause its representatives to, comply with all of
Owner’s (or its designee’s) safety and security policies in effect at such time.
BPM shall give Owner reasonable prior notice of its intent to make inspections
or enter the Property and shall provide Owner (or its designee) with an
opportunity to have Owner’s representative accompany the representatives of BPM
while they are on the Property. Operator shall cooperate in good faith to
facilitate BPM’s exercise its rights under this Section 3.
4.    COVENANTS OF OWNER. Owner covenants to BPM that Owner will operate the
Oaktown Mine and conduct coal mining and processing operations any other
activity conducted under the Permits in substantial compliance with the Permits
and any applicable laws, and Owner will not materially deviate from any methods
of operation established as a condition of the Permits (as they may be amended)
at any time following the execution of this Agreement and prior to receipt of
written approval of such deviation from the relevant governmental authority or
the transfer or reissuance of the relevant Permit. Notwithstanding anything to
the contrary herein, none of Owner or its designees shall be under any
obligation, nor shall this Interim Operating Agreement be construed to impose
any obligation on Owner or any of its designees, to conduct coal mining or
processing operations on the Property.

--------------------------------------------------------------------------------

5.    INDEMNITY OBLIGATIONS OF OWNER.
[1] Owner will indemnify, defend and hold harmless BPM and its, assigns and
successors in interest, and each of their respective stockholders, members,
partners, directors, officers, employees, agents, attorneys and representatives
(the “BPM Indemnified Persons”), from and against any actions, suits,
proceedings, demands, claims, investigations, penalties, assessments, judgments,
costs, liabilities or expenses, including reasonable attorneys’ fees and court
costs, incurred by any BPM Indemnified Person resulting from any failure by
Owner or its designee to comply with applicable law with respect to the Oaktown
Mine, including any surface operations related thereto after the Closing Date
and prior to the date on which the last of the Permits is transferred or
re-issued to Owner or its designees, or to operate the Oaktown Mine after the
Closing Date in accordance with a Permit, including any citation, notice of
violation or penalty assessed as a result of or in connection with such failure,
that occurs after the Closing Date and prior to the date on which such Permit is
transferred or re-issued to Owner or its designee, in each case except to the
extent directly resulting from the negligence or intentional misconduct of any
of the BPM Indemnified Persons (any of the foregoing, a “BPM Indemnified Loss”).
[2] Promptly after the receipt by any BPM Indemnified Person of notice of the
commencement or assertion of any action, suit, proceeding, demand, claim or
investigation by a third party (an “Asserted Liability”) that may result in a
BPM Indemnified Loss, such BPM Indemnified Person will give written notice
thereof (the “Claims Notice”) to Owner. The failure to give such Claims Notice
shall not relieve Owner from any obligation hereunder, except to the extent that
such failure causes actual harm to BPM. Owner shall have the right to assume the
control of the defense of such Asserted Liability, at Owner’s expense and with
counsel of its choice reasonably satisfactory to such BPM Indemnified Person;
provided, that Owner shall so notify such BPM Indemnified Person that it will
defend such Asserted Liability within fifteen (15) days after receipt of such
Claims Notice.
6.    DURATION. The term of this Agreement shall commence on the Closing Date
and shall automatically terminate without any action of the Parties as of the
date on which Owner or its designee obtains the consent or approval of the
relevant governmental authority to the transfer, assignment or re-issuance to
Owner or its designee of the last of the Permits, and shall thereafter be of no
further force or effect. Notwithstanding anything to the contrary in the
foregoing, the provisions of Section 5 of this Agreement and the rights and
obligations of the Parties thereunder arising during or relating to the period
between the Closing Date and the termination of this Agreement, shall survive
the termination of this Agreement.
7.    ASSIGNMENT. This Agreement may not be assigned by either party without the
prior written consent of the other party hereto. Any assignment permitted to be
made by either Owner or BPM to any person or entity pursuant to this Section 6
shall not relieve the assigning party from any of its obligations hereunder.
Notwithstanding anything to the contrary in the foregoing, Owner may assign a
security interest in this Agreement to its lenders and BPM hereby consents to
such assignment. Nothing in this Agreement shall be deemed or construed to
restrict or prohibit Owner from designating the rights granted pursuant to
Section 1 of this Agreement or

--------------------------------------------------------------------------------

subcontracting for the performance of any or all of its activities or operations
in connection with the Oaktown Mine.
8.    MODIFICATION. No term or provision of this Agreement may be changed,
waived, discharged or terminated orally, except by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought. No course of dealing between the parties shall be
effective to amend or waive any provision of this Agreement.
9.    GOVERNING LAW. This Agreement will be construed in accordance with and
governed by the internal laws of the State of Indiana (without reference to its
rules as to conflicts of law).
10.    SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal, or incapable of being enforced under applicable Law, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated herein are not affected in any manner adverse to any party. Upon
such determination that any term or other provision is invalid, illegal, or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in a mutually acceptable manner in order that the
transactions contemplated herein are consummated as originally contemplated to
the fullest extent possible.
11.    WAIVER. The failure of any party hereto to insist on the strict
performance of any provision of this Agreement or to exercise any right, power
or remedy upon breach hereof shall not limit such party’s right thereafter to
enforce any provision or exercise any right.
12.    EXPENSES. Except as otherwise expressly provided in this Agreement, all
costs and expenses incurred by the parties hereto in connection with the
consummation of the transactions contemplated hereby shall be borne solely and
entirely by the party that has incurred such expenses. In the event of a dispute
between or among the parties in connection with this Agreement and the
transactions contemplated hereby, each of the parties hereto agrees that the
prevailing party shall be entitled to reimbursement by the other party or
parties of reasonable expenses, including reasonable legal expenses, incurred in
connection with any related action or proceeding.
13.    WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TRIAL BY JURY IN
ANY CLAIM, ACTION, SUIT, ARBITRATION, INQUIRY, PROCEEDING OR INVESTIGATION TO
WHICH SUCH PARTY IS A PARTY INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY
WAY ARISING OUT OF, RELATED TO OR IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED IN THIS AGREEMENT.
14.    COUNTERPARTS. This Agreement may be executed and delivered (including by
facsimile transmission) in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

--------------------------------------------------------------------------------

15.    DUE AUTHORIZATION. BPM and Owner each represent and warrant to the other
that (i) it has the power and authority to enter into, execute, deliver and
carry out this Agreement, and (ii) the execution, delivery and performance of
this Agreement has been, and the individual that executes this Agreement on
behalf of BPM or Owner, respectively, has been, duly authorized by all proper
and necessary corporate or limited liability company action.
16.    PARTIES IN INTEREST. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto and their successors and permitted
assigns, and except for the rights of the BPM Indemnified Persons as set forth
in Section 5, nothing in this Agreement, express or implied, is intended to
confer upon any other person or entity any rights or remedies of any nature
whatsoever under or by reason of this Agreement.
[End of Text; Signature Page Follows]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
BPM:
By: /s/ Donald Blankenberger    

Name: Donald Blankenberger    

Title: President    

OWNER:

OAKTOWN FUELS MINE NO. 1, LLC

By: /s/ Randy L. Beck    

Name: Randy L. Beck    

Title: President    

STATE OF _______
)
 
 
)
:SS
COUNTY OF _________
)
 

The foregoing instrument was acknowledged before me this the ___ day of
______________, 2014, by ______________, as ___________of
_______________________________, on behalf of the corporation.
My commission expires: ___________________________________.
____________________________________
NOTARY PUBLIC

--------------------------------------------------------------------------------

STATE OF ______
)
 
 
)
:SS
COUNTY OF _________
)
 

The foregoing instrument was acknowledged before me this the ___ day of
___________, 2014, by ______________, as _____________ of
______________________________, on behalf of the company.
My commission expires: ___________________________________.
 
 

NOTARY PUBLIC

PREPARED BY:

_____________________________

61181302.1

--------------------------------------------------------------------------------

B-2
INTERIM OPERATING AGREEMENT
THIS INTERIM OPERATING AGREEMENT (this “Agreement”), dated as of the _28th__day
of _June_________, 2014, is made and entered into by and between Black Panther
Mining, LLC, an Indiana limited liability company (“BPM”), and Oaktown Fuels No.
2 Mine, LLC, an Indiana limited liability company (“Owner”).
RECITALS
A. BPM and Owner are parties to the Contract Mining Agreement dated January 14,
2000 (as amended, the “CMA”) whereby BPM operates the Oaktown Mine for Owner.
B. Pursuant to the CMA, the permits for or relating to the operation of the
Oaktown Mine, including the permits listed on Exhibit A attached hereto, have
been issued in the name of BPM (collective, the “Permits”).
C. BPM, Owner, Vectren Fuels, Inc., SFI Coal Sales, LLC, and Vectren Utility
Services, Inc. have entered into an agreement whereby the CMA will be terminated
(the “Termination Agreement”) effective as of the date of the closing (the
“Closing Date”) of the transaction contemplated by the Stock Purchase Agreement
dated as of June [30], 2014 between Vectren Utility Services, Inc. (Owner’s
remote parent) and Sunrise Coal, LLC .
D. Pursuant to the Termination Agreement, BPM, Owner and the other parties
thereto have agreed to cooperate to effect the transfer of the Permits to Owner
or its designees, which transfer may occur subsequent to the Closing Date.
E. As a condition to the Termination Agreement, and in order to effect the
transition from operation of the Oaktown Mine by BPM to operation by Owner or
its designee, BPM has agreed to enter into this Interim Operating Agreement.
In consideration of the premises and mutual covenants set forth herein and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
AGREEMENT
1. INTERIM OPERATIONS. Subject to any required consent or approval by the
governmental authority that issues or administrates a Permit, BPM hereby grants
Owner and its designees the right to operate the Oaktown Mine under and pursuant
to the Permits, subject to the terms and conditions of this Agreement, during
the period from and after the Closing Date and continuing until the date on
which such Permits are transferred to Owner or its designee. Owner and each of
its designees shall operate solely as an independent contractor and not as an
agent,

--------------------------------------------------------------------------------

employee or servant of BPM. BPM shall have no right or obligation in any way to
direct, supervise or control the mining and reclamation activities of Owner.
Except as otherwise provided in this Agreement, as between BPM and Owner, all of
Owner’s operations shall be at the sole cost and expense of Owner, and any
benefit gained from such operations shall likewise be for the sole account and
benefit of Owner. To the extent that the process of transferring the Permits has
not been commenced prior to the Closing Date, BPM agrees that Owner shall have
the right (at its sole cost and expense) to prepare, submit and obtain approval
of any necessary applications for the transfer or re-issuance of the Permits;
provided that BPM shall have an opportunity to review any such filing in
advance. BPM and Owner or its designee shall reasonably cooperate and coordinate
with each other as necessary for Owner or such designee to submit and obtain
approvals for the transfer or re-issuance of the Permits. None of Owner or its
designees shall receive any compensation from BPM, and BPM shall receive no
compensation from Owner in connection with the operations of the Oaktown Mine or
the transfer or re-issuance of the Permits as contemplated herein.
2. NOTICES.
(a) If BPM or Owner receives a notice of violation, a cessation order or any
other correspondence, order, citation or communication of any kind under any of
the Permits following the Closing Date but before the transfer or re-issuance of
a Permit, BPM shall give Owner, or Owner shall give BPM, as applicable, prompt
written notice thereof. Any notice or other communication given under this
Agreement shall be in writing and shall be: (i) delivered personally; (ii) sent
by documented overnight delivery service; (iii) sent by facsimile transmission,
provided that a confirmation copy thereof is sent no later than the Business Day
following the day of such transmission by documented overnight delivery service
or first class mail, postage prepaid (certified or registered mail, return
receipt requested); or (iv) sent by first class mail, postage prepaid (certified
or registered mail, return receipt requested). Such notice shall be deemed to
have been duly given: (w) on the date of the delivery, if delivered personally;
(x) on the Business Day after dispatch by documented overnight delivery service,
if sent in such manner; (y) on the date of facsimile transmission, if so
transmitted; or (z) on the fifth Business Day after sent by first class mail,
postage prepaid, if sent in such manner. Notices or other communications shall
be directed to the following addresses:
Notices to BPM

Black Panther Mining, LLC
11700 Water Tank Road
Cynthiana IN 47612
Attn: President

Notices to Owner:

Oaktown Fuels No. 1 Mine, LLC
1183 East Canvasback Dr.

--------------------------------------------------------------------------------

Terre Haute, IN 47802
Attention: President

(b) Any party may at any time change its address for service from time to time
by giving notice to the other party in accordance with this Section 3.
3.    VIOLATIONS, ABATEMENT AND INSPECTION. (a) During the term of this
Agreement, the Owner shall be responsible for compliance with all obligations of
the terms of the Permits and all laws and regulations applicable to the Permits
and the operations performed pursuant thereto (the “Permit Obligations”). If BPM
or Owner receives a notice of violation, cessation order or other notice
relating to a failure to comply with the Permit Obligations (a “Violation”),
Owner will promptly take action to abate or otherwise resolve the Violation.
Owner will give BPM notice when the Violation has been abated. (b) If Owner
fails to timely abate a Violation, BPM shall notify Owner of its intention to
undertake abatement activities. If after such notice, Owner does not undertake
remedial action, BPM shall be entitled to undertake remedial actions on its own
behalf. (c) During the term of this Agreement, BPM, its agents, engineers or
other related persons on its behalf, shall have the right, but not the
obligation, to enter onto the Oaktown Mine premises (the “Property”), for the
purpose of ascertaining the condition of the operations located on the Property,
and the status of Operator’s compliance with the Permits, provided that BPM
shall not in any event interfere with the operation at the Oaktown Mine or on
the Property, and that BPM shall, and shall cause its representatives to, comply
with all of Owner’s (or its designee’s) safety and security policies in effect
at such time. BPM shall give Owner reasonable prior notice of its intent to make
inspections or enter the Property and shall provide Owner (or its designee) with
an opportunity to have Owner’s representative accompany the representatives of
BPM while they are on the Property. Operator shall cooperate in good faith to
facilitate BPM’s exercise its rights under this Section 3.
4.    COVENANTS OF OWNER. Owner covenants to BPM that Owner will operate the
Oaktown Mine and conduct coal mining and processing operations any other
activity conducted under the Permits in substantial compliance with the Permits
and any applicable laws, and Owner will not materially deviate from any methods
of operation established as a condition of the Permits (as they may be amended)
at any time following the execution of this Agreement and prior to receipt of
written approval of such deviation from the relevant governmental authority or
the transfer or reissuance of the relevant Permit. Notwithstanding anything to
the contrary herein, none of Owner or its designees shall be under any
obligation, nor shall this Interim Operating Agreement be construed to impose
any obligation on Owner or any of its designees, to conduct coal mining or
processing operations on the Property.
5.    INDEMNITY OBLIGATIONS OF OWNER.
[1] Owner will indemnify, defend and hold harmless BPM and its, assigns and
successors in interest, and each of their respective stockholders, members,
partners, directors, officers, employees, agents, attorneys and representatives
(the “BPM Indemnified Persons”), from and against any actions, suits,
proceedings, demands, claims, investigations, penalties, assessments, judgments,
costs, liabilities or expenses, including reasonable attorneys’ fees and court
costs,

--------------------------------------------------------------------------------

incurred by any BPM Indemnified Person resulting from any failure by Owner or
its designee to comply with applicable law with respect to the Oaktown Mine,
including any surface operations related thereto after the Closing Date and
prior to the date on which the last of the Permits is transferred or re-issued
to Owner or its designees, or to operate the Oaktown Mine after the Closing Date
in accordance with a Permit, including any citation, notice of violation or
penalty assessed as a result of or in connection with such failure, that occurs
after the Closing Date and prior to the date on which such Permit is transferred
or re-issued to Owner or its designee, in each case except to the extent
directly resulting from the negligence or intentional misconduct of any of the
BPM Indemnified Persons (any of the foregoing, a “BPM Indemnified Loss”).
[2] Promptly after the receipt by any BPM Indemnified Person of notice of the
commencement or assertion of any action, suit, proceeding, demand, claim or
investigation by a third party (an “Asserted Liability”) that may result in a
BPM Indemnified Loss, such BPM Indemnified Person will give written notice
thereof (the “Claims Notice”) to Owner. The failure to give such Claims Notice
shall not relieve Owner from any obligation hereunder, except to the extent that
such failure causes actual harm to BPM. Owner shall have the right to assume the
control of the defense of such Asserted Liability, at Owner’s expense and with
counsel of its choice reasonably satisfactory to such BPM Indemnified Person;
provided, that Owner shall so notify such BPM Indemnified Person that it will
defend such Asserted Liability within fifteen (15) days after receipt of such
Claims Notice.
6.    DURATION. The term of this Agreement shall commence on the Closing Date
and shall automatically terminate without any action of the Parties as of the
date on which Owner or its designee obtains the consent or approval of the
relevant governmental authority to the transfer, assignment or re-issuance to
Owner or its designee of the last of the Permits, and shall thereafter be of no
further force or effect. Notwithstanding anything to the contrary in the
foregoing, the provisions of Sections 5 of this Agreement and the rights and
obligations of the Parties thereunder arising during or relating to the period
between the Closing Date and the termination of this Agreement, shall survive
the termination of this Agreement.
7.    ASSIGNMENT. This Agreement may not be assigned by either party without the
prior written consent of the other party hereto. Any assignment permitted to be
made by either Owner or BPM to any person or entity pursuant to this Section 6
shall not relieve the assigning party from any of its obligations hereunder.
Notwithstanding anything to the contrary in the foregoing, Owner may assign a
security interest in this Agreement to its lenders and BPM hereby consents to
such assignment. Nothing in this Agreement shall be deemed or construed to
restrict or prohibit Owner from designating the rights granted pursuant to
Section 1 of this Agreement or subcontracting for the performance of any or all
of its activities or operations in connection with the Oaktown Mine.
8.    MODIFICATION. No term or provision of this Agreement may be changed,
waived, discharged or terminated orally, except by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought. No course of dealing between the parties shall be
effective to amend or waive any provision of this Agreement.

--------------------------------------------------------------------------------

9.    GOVERNING LAW. This Agreement will be construed in accordance with and
governed by the internal laws of the State of Indiana (without reference to its
rules as to conflicts of law).
10.    SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal, or incapable of being enforced under applicable Law, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated herein are not affected in any manner adverse to any party. Upon
such determination that any term or other provision is invalid, illegal, or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in a mutually acceptable manner in order that the
transactions contemplated herein are consummated as originally contemplated to
the fullest extent possible.
11.    WAIVER. The failure of any party hereto to insist on the strict
performance of any provision of this Agreement or to exercise any right, power
or remedy upon breach hereof shall not limit such party’s right thereafter to
enforce any provision or exercise any right.
12.    EXPENSES. Except as otherwise expressly provided in this Agreement, all
costs and expenses incurred by the parties hereto in connection with the
consummation of the transactions contemplated hereby shall be borne solely and
entirely by the party that has incurred such expenses. In the event of a dispute
between or among the parties in connection with this Agreement and the
transactions contemplated hereby, each of the parties hereto agrees that the
prevailing party shall be entitled to reimbursement by the other party or
parties of reasonable expenses, including reasonable legal expenses, incurred in
connection with any related action or proceeding.
13.    WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TRIAL BY JURY IN
ANY CLAIM, ACTION, SUIT, ARBITRATION, INQUIRY, PROCEEDING OR INVESTIGATION TO
WHICH SUCH PARTY IS A PARTY INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY
WAY ARISING OUT OF, RELATED TO OR IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED IN THIS AGREEMENT.
14.    COUNTERPARTS. This Agreement may be executed and delivered (including by
facsimile transmission) in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
15.    DUE AUTHORIZATION. BPM and Owner each represent and warrant to the other
that (i) it has the power and authority to enter into, execute, deliver and
carry out this Agreement, and (ii) the execution, delivery and performance of
this Agreement has been, and the individual that executes this Agreement on
behalf of BPM or Owner, respectively, has been, duly authorized by all proper
and necessary corporate or limited liability company action.
16.    PARTIES IN INTEREST. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto and their successors and permitted
assigns, and except for the rights of the BPM Indemnified Persons as set forth
in Section 5, nothing in this Agreement, express

--------------------------------------------------------------------------------

or implied, is intended to confer upon any other person or entity any rights or
remedies of any nature whatsoever under or by reason of this Agreement.
[End of Text; Signature Page Follows]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
BPM:
By:/s/ Donald Blankenberger    

Name: Donald Blankenberger    

Title: President    

OWNER:

OAKTOWN FUELS MINE NO. 2, LLC

By: /s/ Randy L. Beck    

Name: Randy L. Beck    

Title: President    

STATE OF __________
)
 
 
)
:SS
COUNTY OF __________
)
 

The foregoing instrument was acknowledged before me this the ___ day of
______________, 2014, by ______________, as ___________of
_______________________________, on behalf of the corporation.
My commission expires: ___________________________________.
____________________________________
NOTARY PUBLIC

--------------------------------------------------------------------------------

STATE OF _________
)
 
 
)
:SS
COUNTY OF __________
)
 

The foregoing instrument was acknowledged before me this the ___ day of
____________, 2014, by ______________, as _____________ of
______________________________, on behalf of the company.
My commission expires: ___________________________________.
 
 

NOTARY PUBLIC

PREPARED BY:

_____________________________

61181302.1

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B-3
INTERIM OPERATING AGREEMENT
THIS INTERIM OPERATING AGREEMENT (this “Agreement”), dated as of the _28th__day
of __June________, 2014, is made and entered into by and between Five Star
Mining, LLC, an Indiana limited liability company (“Five Star”), and Prosperity
Mine, LLC, an Indiana limited liability company (“Owner”).
RECITALS
A. Five Star and Owner are parties to the Contract Mining Agreement dated
January 14, 2000 (as amended, the “CMA”) whereby Five Star operates the
Prosperity Mine for Owner.
B. Pursuant to the CMA, the permits for or relating to the operation of the
Prosperity Mine, including the permits listed on Exhibit A attached hereto, have
been issued in the name of Five Star (collective, the “Permits”).
C. Five Star, Owner, Vectren Fuels, Inc., SFI Coal Sales, LLC, and Vectren
Utility Services, Inc. have entered into an agreement whereby the CMA will be
terminated (the “Termination Agreement”) effective as of the date of the closing
(the “Closing Date”) of the transaction contemplated by the Stock Purchase
Agreement dated as of June [30], 2014 between Vectren Utility Services, Inc.
(Owner’s remote parent) and Sunrise Coal, LLC .
D. Pursuant to the Termination Agreement, Five Star, Owner and the other parties
thereto have agreed to cooperate to effect the transfer of the Permits to Owner
or its designees, which transfer may occur subsequent to the Closing Date.
E. As a condition to the Termination Agreement, and in order to effect the
transition from operation of the Prosperity Mine by Five Star to operation by
Owner or its designee, Five Star has agreed to enter into this Interim Operating
Agreement.
In consideration of the premises and mutual covenants set forth herein and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
AGREEMENT
1. INTERIM OPERATIONS. Subject to any required consent or approval by the
governmental authority that issues or administrates a Permit, Five Star hereby
grants Owner and its designees the right to operate the Prosperity Mine under
and pursuant to the Permits, subject to the terms and conditions of this
Agreement, during the period from and after the Closing Date and continuing
until the date on which such Permits are transferred to Owner or its designee.
Owner and each of its designees shall operate solely as an independent
contractor and not as an

--------------------------------------------------------------------------------

agent, employee or servant of Five Star. Five Star shall have no right or
obligation in any way to direct, supervise or control the mining and reclamation
activities of Owner. Except as otherwise provided in this Agreement, as between
Five Star and Owner, all of Owner’s operations shall be at the sole cost and
expense of Owner, and any benefit gained from such operations shall likewise be
for the sole account and benefit of Owner. To the extent that the process of
transferring the Permits has not been commenced prior to the Closing Date, Five
Star agrees that Owner shall have the right (at its sole cost and expense) to
prepare, submit and obtain approval of any necessary applications for the
transfer or re-issuance of the Permits; provided that Five Star shall have an
opportunity to review any such filing in advance. Five Star and Owner or its
designee shall reasonably cooperate and coordinate with each other as necessary
for Owner or such designee to submit and obtain approvals for the transfer or
re-issuance of the Permits. None of Owner or its designees shall receive any
compensation from Five Star, and Five Star shall receive no compensation from
Owner in connection with the operations of the Prosperity Mine or the transfer
or re-issuance of the Permits as contemplated herein.
2. NOTICES.
(a) If Five Star or Owner receives a notice of violation, a cessation order or
any other correspondence, order, citation or communication of any kind under any
of the Permits following the Closing Date but before the transfer or re-issuance
of a Permit, Five Star shall give Owner, or Owner shall give Five Star, as
applicable, prompt written notice thereof. Any notice or other communication
given under this Agreement shall be in writing and shall be: (i) delivered
personally; (ii) sent by documented overnight delivery service; (iii) sent by
facsimile transmission, provided that a confirmation copy thereof is sent no
later than the Business Day following the day of such transmission by documented
overnight delivery service or first class mail, postage prepaid (certified or
registered mail, return receipt requested); or (iv) sent by first class mail,
postage prepaid (certified or registered mail, return receipt requested). Such
notice shall be deemed to have been duly given: (w) on the date of the delivery,
if delivered personally; (x) on the Business Day after dispatch by documented
overnight delivery service, if sent in such manner; (y) on the date of facsimile
transmission, if so transmitted; or (z) on the fifth Business Day after sent by
first class mail, postage prepaid, if sent in such manner. Notices or other
communications shall be directed to the following addresses:
Notices to Five Star

Five Star Mining, LLC
11700 Water Tank Road
Cynthiana, IN 47612
Attn: President

Notices to Owner:

Prosperity Mine, LLC
1183 East Canvasback Dr.
Terre Haute, IN47802

--------------------------------------------------------------------------------

Attention: President
with copies to:

(b) Any party may at any time change its address for service from time to time
by giving notice to the other party in accordance with this Section 3.
3.    VIOLATIONS, ABATEMENT AND INSPECTION. (a) During the term of this
Agreement, the Owner shall be responsible for compliance with all obligations of
the terms of the Permits and all laws and regulations applicable to the Permits
and the operations performed pursuant thereto (the “Permit Obligations”). If
Five Star or Owner receives a notice of violation, cessation order or other
notice relating to a failure to comply with the Permit Obligations (a
“Violation”), Owner will promptly take action to abate or otherwise resolve the
Violation. Owner will give Five Star notice when the Violation has been abated.
(b) If Owner fails to timely abate a Violation, Five Star shall notify Owner of
its intention to undertake abatement activities. If after such notice, Owner
does not undertake remedial action, Five Star shall be entitled to undertake
remedial actions on its own behalf. (c) During the term of this Agreement, Five
Star, its agents, engineers or other related persons on its behalf, shall have
the right, but not the obligation, to enter onto the Prosperity Mine premises
(the “Property”), for the purpose of ascertaining the condition of the
operations located on the Property, and the status of Operator’s compliance with
the Permits, provided that Five Star shall not in any event interfere with the
operation at the Prosperity Mine or on the Property, and that BPM shall, and
shall cause its representatives to, comply with all of Owner’s (or its
designee’s) safety and security policies in effect at such time. BPM shall give
Owner reasonable prior notice of its intent to make inspections or enter the
Property and shall provide Owner (or its designee) with an opportunity to have
Owner’s representative accompany the representatives of BPM while they are on
the Property. Operator shall cooperate in good faith to facilitate BPM’s
exercise its rights under this Section 3.
Five Star shall give Operator reasonable prior notice of its intent to make
inspections or enter the Property and shall provide Operator with an opportunity
to have Operator’s agent or engineer accompany the representatives of Five Star.
Operator shall cooperate in good faith to facilitate Five Star’s exercise its
rights under this Agreement.
4.    COVENANTS OF OWNER. Owner covenants to Five Star that Owner will operate
the Prosperity Mine and conduct coal mining and processing operations any other
activity conducted under the Permits in substantial compliance with the Permits
and any applicable laws, and Owner will not materially deviate from any methods
of operation established as a condition of the Permits (as they may be amended)
at any time following the execution of this Agreement and prior to receipt of
written approval of such deviation from the relevant governmental authority or
the transfer or reissuance of the relevant Permit. Notwithstanding anything to
the contrary herein, none of Owner or its designees shall be under any
obligation, nor shall this Interim Operating Agreement be construed to impose
any obligation on Owner or any of its designees, to conduct coal mining or
processing operations on the Property.

--------------------------------------------------------------------------------

5.    INDEMNITY OBLIGATIONS OF OWNER.
[1] Owner will indemnify, defend and hold harmless Five Star and its, assigns
and successors in interest, and each of their respective stockholders, members,
partners, directors, officers, employees, agents, attorneys and representatives
(the “Five Star Indemnified Persons”), from and against any actions, suits,
proceedings, demands, claims, investigations, penalties, assessments, judgments,
costs, liabilities or expenses, including reasonable attorneys’ fees and court
costs, incurred by any Five Star Indemnified Person resulting from any failure
by Owner or its designee to comply with applicable law with respect to the
Prosperity Mine, including any surface operations related thereto after the
Closing Date and prior to the date on which the last of the Permits is
transferred or re-issued to Owner or its designees, or to operate the Prosperity
Mine after the Closing Date in accordance with a Permit, including any citation,
notice of violation or penalty assessed as a result of or in connection with
such failure, that occurs after the Closing Date and prior to the date on which
such Permit is transferred or re-issued to Owner or its designee, in each case
except to the extent directly resulting from the negligence or intentional
misconduct of any of the Five Star Indemnified Persons (any of the foregoing, a
“Five Star Indemnified Loss”).
[2] Promptly after the receipt by any Five Star Indemnified Person of notice of
the commencement or assertion of any action, suit, proceeding, demand, claim or
investigation by a third party (an “Asserted Liability”) that may result in a
Five Star Indemnified Loss, such Five Star Indemnified Person will give written
notice thereof (the “Claims Notice”) to Owner. The failure to give such Claims
Notice shall not relieve Owner from any obligation hereunder, except to the
extent that such failure causes actual harm to Five Star. Owner shall have the
right to assume the control of the defense of such Asserted Liability, at
Owner’s expense and with counsel of its choice reasonably satisfactory to such
Five Star Indemnified Person; provided, that Owner shall so notify such Five
Star Indemnified Person that it will defend such Asserted Liability within
fifteen (15) days after receipt of such Claims Notice.
6.    DURATION. The term of this Agreement shall commence on the Closing Date
and shall automatically terminate without any action of the Parties as of the
date on which Owner or its designee obtains the consent or approval of the
relevant governmental authority to the transfer, assignment or re-issuance to
Owner or its designee of the last of the Permits, and shall thereafter be of no
further force or effect. Notwithstanding anything to the contrary in the
foregoing, the provisions of Section 5 of this Agreement and the rights and
obligations of the Parties thereunder arising during or relating to the period
between the Closing Date and the termination of this Agreement, shall survive
the termination of this Agreement.
7.    ASSIGNMENT. This Agreement may not be assigned by either party without the
prior written consent of the other party hereto. Any assignment permitted to be
made by either Owner or Five Star to any person or entity pursuant to this
Section 6 shall not relieve the assigning party from any of its obligations
hereunder. Notwithstanding anything to the contrary in the foregoing, Owner may
assign a security interest in this Agreement to its lenders and Five Star hereby
consents to such assignment. Nothing in this Agreement shall be deemed or
construed to restrict or prohibit Owner from designating the rights granted
pursuant to Section 1 of this Agreement or

--------------------------------------------------------------------------------

subcontracting for the performance of any or all of its activities or operations
in connection with the Prosperity Mine.
8.    MODIFICATION. No term or provision of this Agreement may be changed,
waived, discharged or terminated orally, except by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought. No course of dealing between the parties shall be
effective to amend or waive any provision of this Agreement.
9.    GOVERNING LAW. This Agreement will be construed in accordance with and
governed by the internal laws of the State of Indiana (without reference to its
rules as to conflicts of law).
10.    SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal, or incapable of being enforced under applicable Law, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated herein are not affected in any manner adverse to any party. Upon
such determination that any term or other provision is invalid, illegal, or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in a mutually acceptable manner in order that the
transactions contemplated herein are consummated as originally contemplated to
the fullest extent possible.
11.    WAIVER. The failure of any party hereto to insist on the strict
performance of any provision of this Agreement or to exercise any right, power
or remedy upon breach hereof shall not limit such party’s right thereafter to
enforce any provision or exercise any right.
12.    EXPENSES. Except as otherwise expressly provided in this Agreement, all
costs and expenses incurred by the parties hereto in connection with the
consummation of the transactions contemplated hereby shall be borne solely and
entirely by the party that has incurred such expenses. In the event of a dispute
between or among the parties in connection with this Agreement and the
transactions contemplated hereby, each of the parties hereto agrees that the
prevailing party shall be entitled to reimbursement by the other party or
parties of reasonable expenses, including reasonable legal expenses, incurred in
connection with any related action or proceeding.
13.    WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TRIAL BY JURY IN
ANY CLAIM, ACTION, SUIT, ARBITRATION, INQUIRY, PROCEEDING OR INVESTIGATION TO
WHICH SUCH PARTY IS A PARTY INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY
WAY ARISING OUT OF, RELATED TO OR IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED IN THIS AGREEMENT.
14.    COUNTERPARTS. This Agreement may be executed and delivered (including by
facsimile transmission) in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

--------------------------------------------------------------------------------

15.    DUE AUTHORIZATION. Five Star and Owner each represent and warrant to the
other that (i) it has the power and authority to enter into, execute, deliver
and carry out this Agreement, and (ii) the execution, delivery and performance
of this Agreement has been, and the individual that executes this Agreement on
behalf of Five Star or Owner, respectively, has been, duly authorized by all
proper and necessary corporate or limited liability company action.
16.    PARTIES IN INTEREST. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto and their successors and permitted
assigns, and except for the rights of the Five Star Indemnified Persons as set
forth in Section 5, nothing in this Agreement, express or implied, is intended
to confer upon any other person or entity any rights or remedies of any nature
whatsoever under or by reason of this Agreement.
[End of Text; Signature Page Follows]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
FIVE STAR:
By:/s/ Donald Blankenberger    

Name: Donald Blankenberger    

Title: President    

OWNER:

P    ROSPERITY MINE, LLC

By: /s/ Randy L. Beck    

Name: Randy L. Beck    

Title: President    

STATE OF __________
)
 
 
)
:SS
COUNTY OF __________
)
 

The foregoing instrument was acknowledged before me this the ___ day of
______________, 2014, by ______________, as ___________of
_______________________________, on behalf of the corporation.
My commission expires: ___________________________________.
____________________________________
NOTARY PUBLIC

    

--------------------------------------------------------------------------------

STATE OF _________
)
 
 
)
:SS
COUNTY OF __________
)
 

The foregoing instrument was acknowledged before me this the ___ day of
____________, 2014, by ______________, as _____________ of
______________________________, on behalf of the company.
My commission expires: ___________________________________.
 
 

NOTARY PUBLIC

PREPARED BY:

_____________________________

61181302.1

    

--------------------------------------------------------------------------------

C-1
AGREEMENT

THIS AGREEMENT is entered into this __28th_________ day of __June________, 2014
among OAKTOWN FUELS MINE NO. 1, LLC, an Indiana limited liability company
(“Oaktown 1”); OAKTOWN FUELS MINE NO. 2, LLC, an Indiana limited liability
company (“Oaktown 2”); VECTREN FUELS, INC., an Indiana corporation (“VFI”); SFI
COAL SALES, LLC, an Indiana limited liability company (“SFI”); VECTREN UTILITY
SERVICES, INC., an Indiana corporation (“VUS”); and BLACK PANTHER MINING, LLC,
an Indiana limited liability company (“BPM”).

WHEREAS, Oaktown 1 and BPM entered into a Contract Mining Agreement dated
November 23, 2009 but effective as of January 1, 2008 (as amended, the “CMA”),
pursuant to which BPM agreed to provide certain services to Oaktown 1 in
connection with the operation of the Oaktown No. 1 mine (with all related
facilities, “Mine 1”); and

WHEREAS, that contract has subsequently been amended, inter alia, to make it
applicable to Oaktown 2 and to the operation of the Oaktown No. 2 mine (with all
related facilities, “Mine 2”); and

WHEREAS, VFI owns all of the outstanding ownership interests of SFI, which owns
all of the outstanding interests of each of Oaktown 1 and Oaktown 2; and

WHEREAS, VUS owns, or will own as of the Closing (as defined below), all of the
stock of VFI; and

WHEREAS, VUS is negotiating an agreement to sell the stock of VFI to Sunrise
Coal, LLC with the effect that VFI, Oaktown 1, and Oaktown 2 will become direct
and indirect subsidiaries of Sunrise Coal, LLC (the “Sale”); and

    

--------------------------------------------------------------------------------

WHEREAS, the parties desire that upon the closing of the Sale (the “Closing”)
the CMA will terminate and that the terms of this Agreement will be substituted
therefore.

NOW THEREFORE, for in and consideration of One-Hundred Dollars ($100.00), the
covenants, agreements and releases contained herein, the payments to be made
hereunder, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

ARTICLE 1:
DEFINITIONS

“Books and Records” means minute books; books of account; manuals; general,
financial, warranty and shipping records; invoices; customer and supplier lists;
correspondence; engineering, maintenance and operating records and data; mine
operations and inspection records; credit records of customers; computer files,
permits and permit applications and all other documents, records and files, but
not including any employee or personnel files.
“BPM Releasing Parties” has the meaning set forth in Section 13.1.
“Claims” has the meaning set forth in Section 13.1.
“Direct Labor and Associated Costs” means the wages of all hourly Mine 1
Employees and Mine 2 Employees, as applicable, including non-miners, and the
salaries of all salaried personnel employed by BPM for Mine 1 or Mine 2, as
applicable, including a mine superintendent, on-site managers and supervisors,
payments to consultants for Mine 1 or Mine 2, as applicable, if such consultants
were approved in writing in advance by Oaktown 1 or Oaktown 2, as applicable,
and all bonuses paid to, and the costs of all incentive, pension and retirement
programs for, such workers and employees, and all payroll burdens, including but
not limited to all costs associated with worker compensation such as premiums,
deductibles and self-insurance amounts associated therewith, other insurance and
benefit costs, in each case, to the extent directly allocable to the performance
by BPM of its obligations under the CMA for the operation of Mine 1 or Mine 2,
as applicable, and the production and delivery of coal from such mine.
“Excluded Costs” means (i) any local, state or federal gross, adjusted gross or
net income taxes; (ii) any fines, penalties, damage or assessments resulting
from a violation of mining laws or

    

--------------------------------------------------------------------------------

regulations, as the same may be in effect from time-to-time, where such
violation is flagrant, willful or intentional, or results from “high negligence”
or “reckless disregard,” as such terms are defined in applicable MSHA rules,
regulations, orders or releases in effect from time-to-time; (iii) deductibles
applicable to any of the insurance coverages required to be maintained pursuant
to the CMA to the extent the loss arises out of any grossly negligent, willful
or reckless act or failure to act by BPM or its employees, contractors or
agents; (iv) any indemnity obligation arising out of the CMA or this Agreement;
or (v) any liability arising from a breach of the CMA or this Agreement by BPM.
“Good Mining Practices” means such practices, acts or methods of operating a
coal mine and ancillary facilities as are generally accepted as reasonable, safe
and appropriate in the industry and in conformity with the requirements of all
applicable laws, regulations and permit requirements.
“Mine Contracts” has the meaning set forth in Section 4.1.
“Mine Employees” has the meaning set forth in Section 3.2.
“Mine 1 and Prep Plant MSHA Citations” has the meaning set forth in Section 7.1.
“Mine 2 MSHA Citations” has the meaning set forth in Section 8.1.
“Mine 1 Permits” has the meaning set forth in Section 5.1.
“Mine 2 Permits” has the meaning set forth in Section 6.1.
“Mine 1 Permit Citations” has the meaning set forth in Section 5.3.
“Mine 2 Permit Citations” has the meaning set forth in Section 6.3.
“MSHA” has the meaning set forth in Section 7.1.
“Oaktown 1 Books and Records” has the meaning set forth in Section 10.1.
“Oaktown 2 Books and Records” has the meaning set forth in Section 10.1.
“Oaktown 1 Equipment” has the meaning set forth in Section 11.1.
“Oaktown IP” has the meaning set forth in Section 9.
“Oaktown 1 Released Parties” has the meaning set forth in Section 13.1.
“Oaktown 2 Released Parties” has the meaning set forth in Section 13.2.
“Termination Fee” has the meaning set forth in Section 12.1.
“Vendors” has the meaning set forth in Section 4.1.
“VFI Released Parties” has the meaning set forth in Section 13.3.
“VUS Representative” has the meaning set forth in Section 3.7.

    

--------------------------------------------------------------------------------

“WARN Act” has the meaning set forth in Section 3.3.
“Worker Claims” has the meaning set forth in Section 3.5.
ARTICLE 2:
EFFECTIVENESS

2.1    EFFECTIVENESS OF AGREEMENT PROVISIONS. This Agreement will be effective
as of the date first written above. Notwithstanding that this Agreement is
binding and effective upon its execution, the parties acknowledge that many of
the obligations and the releases contained herein will not be effective unless
and until the Closing of the Sale occurs, as indicated herein. Until the
Closing, the CMA will otherwise remain in full force and effect in accordance
with its terms, except to the extent it is expressly modified by this Agreement
as to pre-Closing periods and obligations.

2.2    TERMINATION OF AGREEMENT. At any time prior to the Closing, VUS may give
notice to BPM that the Closing will not occur. In such case, and upon such
notice from VUS, this Agreement will terminate, and the CMA will remain in full
force and effect except as expressly modified herein as to pre-Closing periods
and obligations.

ARTICLE 3:
EMPLOYEES

3.1    BPM AS EMPLOYER. The parties acknowledge that all of the workers who have
been directly involved in the operations at Mine 1 and Mine 2 (collectively the
“Mines”) are and have been employees of BPM. The parties further acknowledge
that following the Closing, none of those employees will be needed by BPM for
the operations at the Mines.

3.2    IDENTIFICATION AND TERMINATION OF EMPLOYEES. Attached hereto as Exhibit 1
is a true and complete list of all of the employees of BPM involved in the
operations at Mines or who are otherwise associated with the business of Oaktown
1 or Oaktown 2 (the “Mine Employees”). BPM agrees that it will, as of the
Closing, terminate the employment of the Mine Employees.

    

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3.3    WARN NOTICE. At the request of Oaktown 1and Oaktown 2, and within one (1)
day of its receipt of such request, BPM will provide the notification to the
Mine Employees required under the Worker Adjustment and Retraining Notification
Act (the “WARN Act”) regarding the termination of the Mine Employees in form and
substance satisfactory to Oaktown 1 and Oaktown 2. Oaktown 1 and Oaktown 2 will
provide a form of notice for BPM to use and will advise BPM as to the process
for serving the WARN Act notices. It is anticipated that the WARN Act notice
will be given on or about July 1, 2014. It is further anticipated that the
Closing of the Sale will occur, if at all, on or after sixty-one (61) days
following BPM’s giving of the WARN Act notification. The costs of giving such
notice will considered “Mining Costs” under the CMA and will be treated
accordingly.

3.4    BPM CONTINUING EMPLOYMENT OBLIGATIONS. Until the employment of each of
the Mine Employees is terminated, BPM will continue to be the employer of such
Employee for all purposes (subject to BPM’s absolute discretion as to the
continued employment of such employee), including without limitation providing
any employee benefits and being responsible for providing workers’ compensation
coverage and administering and resolving workers compensation claims, in
accordance with the terms of the CMA and the current practice of the parties in
the performance of the CMA. BPM represents that it has fully and properly paid
all wages and other benefits to all Employees, and BPM will ensure that all
wages and other employee benefits have been properly and fully paid to all Mine
Employees as of the Closing.

3.5    WORKER CLAIMS. Following the Closing and the termination of the CMA, BPM
will promptly notify VUS regarding any workers compensation claims or other
claims brought by or related to the Mine Employees (whether existing at the time
of Closing or subsequently filed “Worker Claims”) and the litigation and/or
resolution of same. Attached hereto as Exhibit 2 is a true and complete list of
all Worker Claims associated with Mine 1 as of the date of this Agreement.
Attached hereto as Exhibit 3 is

    

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a true and complete list of all Worker Claims associated with Mine 2. BPM will
supplement Exhibits 2 and 3 as of the date of Closing.
3.6    EMPLOYEE CERTIFICATE. At the Closing, BPM will provide a certification in
the form set forth on Exhibit 4 hereto that all Mine Employees have been fully
paid and provided with all applicable termination and other benefits, or if that
is not the case, it will provide a detailed list of unpaid wages and benefits.

3.7    RESOLUTION OF WORKER CLAIMS. Following the Closing and the termination of
the CMA (a) VUS will identify a representative to receive notices from BPM
regarding any Worker Claims or any other matters for which VUS may have any
liability hereunder (the “VUS Representative”); (b) BPM will promptly notify the
VUS Representative of any claim, demand or right of action asserted or any
action, suit or proceeding threatened or instituted with regard to any Employee
or any Worker Claim; (c) prior to the commencement of any negotiations or
litigation, and during the course of such negotiations or litigation, with
respect to any Employee or any Worker Claim, BPM will consult with VUS to obtain
its recommendations and direction with respect to the conduct thereof; (d) at
VUS’s option, VUS may assume (as BPM’s agent, designee or otherwise), the
management of any or all Claims relating to Employees or Worker Claims; (e) all
negotiations and litigation with respect to any Employee or any Worker Claim
will be conducted by or at the direction of VUS; (f) BPM will cooperate with VUS
in the handling of any Employee or Worker Claims and in the verification of all
costs and expenses associated therewith; (g) BPM will not settle or consent to
the entry of any award or judgment with regard to any Employee or any Worker
Claim without the consent of VUS.

3.8    PAYMENT OF WORKER CLAIMS. Following the Closing and subject to BPM’s
compliance with the terms and provisions of Section 3.7, VUS will indemnify and
hold harmless BPM for any out-of pocket costs (including any workers’
compensation payments that are not covered by insurance) associated with the
litigation or resolution of any Worker Claims, provided that such costs are
reasonable, verified and

    

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approved by VUS, in its reasonable discretion, incurred in accordance with this
Agreement and are not Excluded Costs.

3.9    PAYMENT OF LABOR COSTS. VUS will reimburse BPM for any Direct Labor and
Associated Costs for Mine Employees which are incurred by BPM prior to Closing
but which are not paid at or prior to the Closing and for which BPM had not
previously received funds in payment thereof, provided such costs have been
verified and approved by VUS in its reasonable discretion.

ARTICLE 4:
VENDORS

4.1    MINE CONTRACTS AND VENDORS. Exhibit 5 hereto is a true and complete list
of all of the material contracts (the “Mine Contracts”) between BPM and all
vendors for materials, supplies, or services in connection with the operation of
the Mines and the business activities of Oaktown 1 and Oaktown 2 (the
“Vendors”).

4.2    TRANSFER OF CONTRACTS. BPM agrees that, at the request of Oaktown 1 and
Oaktown 2, whether before or after the Closing, it will transfer to Oaktown 1 or
Oaktown 2 or their designees such of the Mine Contracts as they may request, so
that the contractual relationship with the Mine Vendors will be directly with
Oaktown 1 or Oaktown 2, as applicable. BPM will cooperate with Oaktown 1 and
Oaktown 2 in transferring the contracts and in establishing a relationship
between Oaktown 1 or Oaktown 2 or their designees and the Vendors.
Notwithstanding the transfer of the Mine Contracts, until the Closing, BPM will
be responsible for fulfilling all of the of the obligations under the Mine
Contracts consistent with past practices and will continue to communicate with
the Vendors on behalf of Oaktown 1 and Oaktown 2 as it has in the past. BPM will
terminate all unassumed Mine Contracts as of the Closing, and to the greatest
extent reasonably possible will do so in such a manner as to avoid any expense
or liability to BPM, Oaktown 1 or Oaktown 2. Any liability or expenses incurred
by BPM as a result of such termination that have been verified and approved by
VUS in its

    

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reasonable discretion will constitute a Mining Cost under the CMA and will be
treated accordingly, except to the extent they are Excluded Costs.

4.3    PAYMENT OF VENDORS. BPM will use its reasonable best efforts to cause all
claims for payment asserted by the Vendors for goods or services provided by
them in connection with the Mines prior to the Closing (“Vendor Claims”) to be
paid prior to, or as soon as possible after, the Closing. After the Closing, BPM
will continue to pay Vendor Claims, subject to VUS’ verification and approval of
same in its reasonable discretion and to the extent that BPM had not previously
received funds for the payment thereof. BPM will cooperate with VUS and will
provide VUS with all the information necessary to (a) verify the correctness of
any unpaid pre-Closing Mine 1 Vendor charges and (b) to contest any such charges
that VUS deems unjustified or unreasonable.

4.4    CERTIFICATE OF PAYMENT AND LIEN RELEASES. At the Closing BPM will provide
Oaktown 1, Oaktown 2 and VUS with a certificate in the form attached hereto as
Exhibit 6 regarding the Vendor charges. At the Closing, and thereafter with
respect to the Vendors that have not been paid in full as of the Closing, BPM
will also provide Oaktown 1, Oaktown 2 and VUS with such lien waivers from the
Vendors as they may request.

ARTICLE 5:
PERMITS - OAKTOWN 1

5.1    MINE 1 AND MINE 2 PERMITS. Attached hereto as Exhibit 7 is a true and
complete list of all permits and licenses of any kind which relate to or could
affect the operations of Mine 1 or the business of Oaktown 1 and Mine 2 and the
business of Oaktown 2 (the “Oaktown Permits”).

    

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5.2    TRANSFER OF PERMITS. BPM agrees that it will execute to be effective as
of the Closing, the Interim Operating Agreement for Mine 1 attached hereto as
Exhibit 8. Further, BPM agrees that at the Closing it will transfer, and execute
such documents as may be necessary to facilitate such transfer of, the Mine
Permits to Oaktown 1 or Oaktown 2 or their designees free and clear of all liens
and encumbrances arising by or through BPM. To the extent the permits are
encumbered by liens to support a line of credit, BPM covenants that it will not
draw on that line of credit prior to the release of any such liens.
Notwithstanding the foregoing, no transfer of permits will be completed unless
or until any bond or other financial surety affecting BPM has been replaced. BPM
hereby releases any claim it may have to any accrual by Oaktown 1or Oaktown 2 or
any of their affiliates for reclamation obligations.

5.3    MINE 1 VIOLATIONS. Attached hereto as Exhibit 9 is a true and complete
list of all unabated notices of violation, cessation orders, or other open
regulatory matters relating to the operations at Mine 1 other than the MSHA
citations which are addressed below (with any other such violations that may be
issued before or after the Closing with regard to Mine 1, the “Mine 1 Permit
Citations”). BPM will update Exhibit 9 at the Closing.

5.4    PAYMENT OF MINE 1 VIOLATIONS. Following the Closing, VUS will reimburse,
indemnify and hold harmless BPM from and against all out-of-pocket expenses
associated with the litigation and/or resolution of the Mine 1 Permit Citations,
provided that such expenses, are reasonable, were and are incurred in accordance
with the terms of this Agreement and the CMA, have been verified and approved by
VUS in its reasonable discretion and are not Excluded Costs.

5.5    RESOLUTION OF MINE 1 VIOLATIONS. Following the Closing, BPM will promptly
notify VUS of any claim, demand or right of action asserted or any action, suit
or proceeding threatened or instituted against BPM with regard to any Mine 1
Permit Citations. After the Closing, before it commences any negotiations or

    

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litigation with respect to any Mine 1 Permit Citation, and during the pendency
of same, BPM will consult with VUS to obtain its recommendations and direction
with respect to the conduct thereof. All negotiations and litigation with
respect to any Mine 1 Permit Citation will be conducted by or at the direction
of VUS, and BPM will not settle or pay any Mine 1 Permit Citation without the
prior consent of the VUS Representative. At the option of VUS, it may assume (as
BPM’s agent, designee or otherwise) the management of any or all Mine 1 Permit
Citations. BPM will cooperate with VUS in the handling of any Mine 1 Permit
Citations and in the verification of any costs or expenses related thereto.

ARTICLE 6:
OAKTOWN 2

6.1    TRANSFER OF PERMITS. BPM agrees that it will execute to be effective as
of the Closing, the Interim Operating Agreement for Mine 2 attached hereto as
Exhibit 10.

6.2    MINE 2 VIOLATIONS. Attached hereto as Exhibit 11 is a true and complete
list of all unabated notices of violation, cessation orders, or other open
regulatory matters relating to the operations at Mine 2 other than the MSHA
citations which are addressed below (with any other such violations that may be
issued before or after the Closing with regard to Mine 2, the “Mine 2 Permit
Citations”). BPM will update Exhibit 11 at the Closing.

6.3    PAYMENT OF MINE 2 VIOLATIONS. Following the Closing, VUS will reimburse,
indemnify and hold harmless BPM from and against all out-of-pocket expenses
associated with the litigation and/or resolution of the Mine 2 Permit Citations,
provided that such expenses were and are incurred in accordance with the terms
of this Agreement and the CMA, have been verified and approved by VUS in its
reasonable discretion and are not “Excluded Costs.”

    

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6.4    RESOLUTION OF MINE 2 VIOLATIONS. Following the Closing, BPM will promptly
notify VUS of any claim, demand or right of action asserted or any action, suit
or proceeding threatened or instituted against BPM with regard to any Mine 2
Permit Citations. After the Closing, before it commences any negotiations or
litigation with respect to any Mine 2 Permit Citation, and during the pendency
of same, BPM will consult with VUS to obtain its recommendations and direction
with respect to the conduct thereof. All negotiations and litigation with
respect to any Mine 2 Permit Citation will be conducted by or at the direction
of VUS, and BPM will not settle or pay any Mine 2 Permit Citation without the
prior consent of the VUS Representative. At the option of VUS, it may assume (as
BPM’s agent, designee or otherwise) the management of any or all Mine 2 Permit
Citations. BPM will cooperate with VUS in the handling of any Mine 2 Permit
Citations and in the verification of any costs or expenses related thereto.

ARTICLE 7:
MSHA VIOLATIONS – MINE 1

7.1    MINE 1 AND OAKTOWN PREP PLANT MSHA CITATIONS. Attached hereto as Exhibits
12 and Exhibit 13 are true and complete lists of all unabated notices of
violation, cessation orders, or other open matters relating to the Mine 1 and
Oaktown Prep Plant operations issued by the Mine Safety and Health
Administration (“MSHA”) (with any such citations that may be issued before or
after the Closing with regard to the pre-Closing activities of BPM, the “Mine 1
and Prep Plaint MSHA Citations”). BPM will update Exhibit 12 and Exhibit 13 at
the Closing.

7.2    PAYMENT OF MINE 1 AND PREP PLAINT MSHA CITATIONS. Following the Closing,
VUS will reimburse, indemnify and hold harmless BPM from and against all
out-of-pocket expenses associated with the litigation and/or

    

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resolution of the Mine 1 and Prep Plant MSHA Citations, provided that such
expenses are reasonable, were and are incurred in accordance with the terms of
the CMA and this Agreement, have been verified and approved by VUS in its
reasonable discretion and are not Excluded Costs.
7.3    RESOLUTION OF MINE 1 AND PREP PLAINT MSHA CITATIONS. Following Closing:
(a) BPM will promptly notify the VUS Representative of any claim, demand or
right of action asserted or any action, suit or proceeding threatened or
instituted with regard to any Mine 1 or Prep Plant MSHA Citation (b) prior to
the commencement of any negotiations or litigation, and during the course of
such negotiations or litigation, with respect to any Mine 1 or Prep Plant MSHA
Citation, BPM will consult with VUS to obtain its recommendations and direction
with respect to the conduct thereof; (c) at VUS’s option, VUS may assume (as
BPM’s agent, designee or otherwise) the management of any or all Mine 1 or Prep
Plant MSHA Citations; (d) all negotiations and litigation with respect to any
Mine 1 or Prep Plant MSHA Citation will be conducted by or at the direction of
VUS; (e) BPM will cooperate with VUS in the handling of any Mine 1 or Prep Plant
MSHA Citation and in the verification of any costs associated therewith, and (f)
BPM will not settle or consent to the entry of any award or judgment with regard
to any Mine 1 or Prep Plant MSHA Citation without the consent of VUS.

ARTICLE 8:
MSHA VIOLATIONS – MINE 2

8.1    MINE 2 MSHA CITATIONS. Attached hereto as Exhibit 14 is a true and
complete list of all unabated notices of violation, cessation orders, or other
open matters relating to the Mine 2 operations issued by MSHA(with any such
citations that may be issued before or after the Closing with regard to the
pre-Closing activities of BPM, the “Mine 2 MSHA Citations”). BPM will update
Exhibit 14 at the Closing.

8.2    PAYMENT OF MINE 2 MSHA CITATIONS. Following the Closing, VUS will
reimburse, indemnify and hold harmless BPM from and against all out-of-pocket
expenses associated with the litigation and/or resolution of the Mine 2 MSHA

    

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Citations, provided that such costs are reasonable, were and are incurred in
accordance with the terms of the CMA and this Agreement, have been verified and
approved by VUS in its reasonable discretion and are not Excluded Costs.

6.5    RESOLUTION OF MINE 2 MSHA CITATIONS. Following Closing: (a) BPM will
promptly notify the VUS Representative of any claim, demand or right of action
asserted or any action, suit or proceeding threatened or instituted with regard
to any Mine 2 2 MSHA Citation (b) prior to the commencement of any negotiations
or litigation, and during the course of such negotiations or litigation, with
respect to any Mine 2 MSHA Citation, BPM will consult with VUS to obtain its
recommendations and direction with respect to the conduct thereof; (c) at VUS’s
option, VUS may assume (as BPM’s agent, designee or otherwise) the management of
any or all Mine 2 MSHA Citations; (d) all negotiations and litigation with
respect to any Mine 2 MSHA Citation will be conducted by or at the direction of
VUS; (e) BPM will cooperate with VUS in the handling of any Mine 2 MSHA Citation
and the verification of any costs associated therewith, and (f) BPM will not
settle or consent to the entry of any award or judgment with regard to any Mine
2 MSHA Citation without the consent of VUS.

ARTICLE 9:
INTELLECTUAL PROPERTY

Attached hereto as Exhibit 15 is a list of all software programs and other
intellectual property used in the business of Oaktown 1 and Oaktown 2 (the
“Oaktown IP”). Exhibit 15 further identifies any consent needed for the transfer
of any item of Oaktown 1 IP. BPM will obtain any necessary consents to transfer
any Oaktown IP to Oaktown 1, Oaktown 2 or their designees, and at their request,
BPM will transfer all Oaktown IP to Oaktown 1, Oaktown 2 or their designee prior
to the Closing.

ARTICLE 10:
BOOKS AND RECORDS

    

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10.1CONTROL OF BOOKS AND RECORDS. (a) The parties acknowledge and agree that all
of the Books and Records relating to the operations of Mine 1 and the business
of Oaktown 1 (the “Oaktown 1 Books and Records”) are the property of Oaktown 1,
and following the Closing, the Oaktown 1 Books and Records will remain in the
ownership, custody and control of Oaktown 1. (b) The parties agree and
acknowledge and agree that all of the Books and Records relating to the
operations of Mine 2 and the business of Oaktown 2 (the “Oaktown 2 Books and
Records”) are the property of Oaktown 2, and following the Closing, the Oaktown
2 Books and Records will remain in the ownership, custody and control of Oaktown
2.

10.2ACCESS TO BOOKS AND RECORDS. (a) BPM will cooperate with Oaktown 1 in
securing the Oaktown 1 Books and Records prior to the Closing, and all Oaktown 1
Books and Records will be at Mine 1 at the Closing. Following the Closing, BPM
will provide Oaktown 1 such assistance as may be reasonably necessary for
Oaktown 1 to access the Oaktown 1 Books and Records, including providing
passwords, software assistance and other support. (b) BPM will cooperate with
Oaktown 2 in securing the Oaktown 2 Books and Records prior to the Closing, and
all Oaktown 2 Books and Records will be at Mine 2 at the Closing. Following the
Closing, BPM will provide Oaktown 2 such assistance as may be reasonably
necessary for Oaktown 2 to access the Oaktown 2 Books and Records, including
providing passwords, software assistance and other support.
 
10.3POST-CLOSING ACCESS AND COOPERATION. Notwithstanding the foregoing, Oaktown
1 and Oaktown 2 will provide BPM and VUS with full access to, and will permit
BPM and VUS to make copies (at their expense) of, the Oaktown 1 Books and
Records and the Oaktown 2 Books and Records upon prior request and during
regular business hours, as may be reasonably necessary or convenient for the
resolution of any Mine 1 or Mine 2 Employee Claims, Permit Citations or MSHA
Citations, or any other post-Closing matters for which BPM or VUS bears any
responsibility or

    

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obligation. BPM and VUS will cooperate in good faith to facilitate the
performance of all obligations and activities contemplated by this Agreement.

ARTICLE 11:
EQUIPMENT AND OTHER PERSONAL PROPERTY; LEASES AND EASEMENTS

11.1    OAKTOWN EQUIPMENT. The parties acknowledge that all of the equipment,
tools and inventory, including without limitation spare parts and materials used
or obtained for use in connection with the operations of the Mines and the
business of Oaktown 1 and Oaktown 2 (the “Oaktown Equipment”) has been
purchased, directly or indirectly, by Oaktown 1 and/or Oaktown 2 and that such
purchases were and are for the benefit of Oaktown 1 and/or Oaktown 2.

11.2    TRANSFER OF OAKTOWN EQUIPMENT. To formalize that ownership, and for
avoidance of doubt, BPM will simultaneously with the execution of this
Agreement, execute the bill of sale attached hereto as Exhibit 16 transferring
all of the Oaktown Equipment to Oaktown 1 and Oaktown 2.
  
11.3    CONTROL OF OAKTOWN EQUIPMENT. From the date of this Agreement, BPM will
maintain and operate the Oaktown Equipment in accordance with the CMA and will
use its best efforts to insure that none of the Oaktown Equipment is lost,
stolen or otherwise dissipated. At the Closing date, all of the Oaktown
Equipment will be physically on the premises of the Mines except for items that
are off site for repair. BPM will provide Oaktown 1 and Oaktown 2 with a list of
such items at the Closing.

11.4    OAKTOWN LEASES AND EASEMENTS. BPM agrees that as soon as practicable
after the execution of this Agreement it will transfer to Oaktown 1 or Oaktown 2
or their respective designees, as they each may direct, and by assignments in
form and substance reasonably satisfactory to Oaktown 1 or Oaktown 2 as
applicable, any and all leases, easements, rights-of-way, surface use agreements
and any and all other real

    

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property interests of any kind that relate to, affect or have any connection
with (a) the present or future operations of Mine 1 or Mine 2, (b) the present
or future business of Oaktown 1 or Oaktown 2, or (c) the real property used in
connection with those operations or businesses, including without limitation
those listed on the attached Exhibit 17.

ARTICLE 12:
TERMINATION PAYMENTS

12.1    LUMP-SUM TERMINATION FEE. At Closing, VUS will make a lump-sum payment
to BPM which will be calculated based on the spreadsheet and formulas contained
in Exhibit 18 to obtain the present value of the “Termination Fee” provided for
in Section X.E of the CMA (the “Termination Fee”). The Termination Fee will be
calculated at the Closing based on 111,438,256 tons as of December 31, 2013 and
adjusted for the actual tons mined between that date and the date of Closing.
Payment of the Termination Fee will be in full satisfaction of the obligations
of Oaktown 1 and Oaktown 2 for any Termination Fee pursuant to the CMA.

12.2    WAIVER OF ADDITIONAL NOTICE. Section X.B of the CMA requires Oaktown 1
and Oaktown 2 to give BPM sixty (60) days’ notice of a voluntary termination of
the CMA. BPM agrees that this Agreement serves as such notice, and that no
further notice will be required except for notice to BPM of the occurrence of
the Closing.
 
12.3    MANAGEMENT FEE. Within sixty (60) days following the Closing, VUS will
pay to BPM an amount equal to One Dollar and Fifty Cents ($1.50) multiplied
times the tons of: (a) coal contained in the clean coal stockpiles at Mine 1 and
Mine 2 and (b) the clean coal equivalent contained in the raw coal stockpiles at
Mine 1 and Mine 2 (determined based on the monthly mine production reports
prepared in the ordinary course of business and in accordance with past
practice), in each case for which BPM has not already been paid its Management
Fee provided for in the CMA (the “Termination Management Fee”).

    

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ARTICLE 13:
RELEASES AND TRANSFER OF CLAIMS

13.1    BPM RELEASE OF OAKTOWN 1. Effective as of the Closing, and except as
expressly provided below, BPM and its officers, members, partners, managers and
directors (individually and on behalf of any heirs, executors, administrators,
and successors and assigns, as applicable) (together, the “BPM Releasing
Parties”) do fully, finally, unconditionally, irrevocably and forever release,
acquit, completely discharge and hold harmless Oaktown 1 and its parent,
subsidiary and affiliated entities, and its and their current and former
members, shareholders, agents, employees, insurers, attorneys, officers,
directors, managers, board members, representatives, consultants, advisors,
parents, affiliates, subsidiaries, contractors, associates, personal
representatives, heirs, executors, trustees, beneficiaries, administrators,
insurance agents, persons or entities exercising subrogation rights, and the
successors, and assigns of each of them (together, the “Oaktown 1 Released
Parties”) from and against any and all manner of action and actions, cause and
causes of action, claims, demands, warranties, covenants, contracts, agreements,
promises, controversies, damages, variances, judgments, executions, costs,
losses, claims for court costs and attorneys’ fees, liabilities and obligations
of any kind or nature whatsoever, and rights, matured or unmatured, liquidated
or unliquidated, whether accrued or yet to accrue, known or unknown, asserted or
unasserted, contingent or absolute, suspected or unsuspected, direct or
derivative, in law, in equity or otherwise, that it has, or may have, for, on,
or by reason of any matter, cause or things whatsoever from the beginning of the
world to this day, including, but not limited to any and all claims, complaints,
liabilities, disputes, obligations, promises, agreements, controversies,
damages, actions, causes of action, rights, demands, costs, losses, and claims
for court costs and attorneys’ fees of any kind whatsoever (known or unknown)
(collectively, “Claims”) arising from, in connection with, or related to the CMA
and any other event, origin or agreement occurring or entered into prior to the
Closing, other than the obligations of VUS under this Agreement and the
obligations of Oaktown 1 under the Interim Operating Agreement for Mine 1.

    

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13.2    BPM RELEASE OF OAKTOWN 2. Effective as of the Closing, and except as
expressly provided below, BPM Releasing Parties do fully, finally,
unconditionally, irrevocably and forever release, acquit, completely discharge
and hold harmless Oaktown 2 and its parent, subsidiary and affiliated entities,
and its and their current and former members, shareholders, agents, employees,
insurers, attorneys, officers, directors, managers, board members,
representatives, consultants, advisors, parents, affiliates, subsidiaries,
contractors, associates, personal representatives, heirs, executors, trustees,
beneficiaries, administrators, insurance agents, persons or entities exercising
subrogation rights, and the successors, and assigns of each of them (together,
the “Oaktown 2 Released Parties”) from and against any and all Claims arising
from, in connection with, or related to the CMA and any other event, origin or
agreement occurring or entered into prior to the Closing, other than any
obligation of VUS under this Agreement and the obligations of Oaktown 2 under
the Interim Operating Agreement for Mine 2.

13.3    BPM RELEASE OF VFI AND SFI. Effective as of Closing, and except as
expressly provided below, BPM Releasing Parties do fully, finally,
unconditionally, irrevocably and forever release, acquit, completely discharge
and hold harmless VFI and SFI, and its and their parent, subsidiary and
affiliated entities and its and their current and former members, shareholders,
agents, employees, insurers, attorneys, officers, directors, manager ,board
members, representatives, consultants, advisors, parents, affiliates,
subsidiaries, contractors, associates, personal representatives, heirs,
executors, trustees, beneficiaries, administrators, insurance agents, persons or
entities exercising subrogation rights, and the successors, and assigns of each
of them (together, the “VFI Released Parties”) from and against any and all
Claims arising from, in connection with, or related to the CMA and any other
event, origin or agreement occurring or entered into prior to the Closing, other
than any obligation of VUS under this Agreement.

13.4    TRANSFER OF OAKTOWN 1 CLAIMS TO VUS. Effective as of the Closing, and
except as otherwise provided herein, Oaktown 1 hereby conveys to VUS any and all
manner of action and actions, cause and causes of action, claims, demands,

    

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controversies, damages, variances, costs, losses, claims for court costs and
attorneys’ fees, liabilities and obligations of any kind or nature whatsoever,
and rights, matured or unmatured, liquidated or unliquidated, whether accrued or
yet to accrue, known or unknown, asserted or unasserted contingent or absolute,
suspected or unsuspected, direct or derivative, in law, in equity or otherwise,
that it has, or may have against BPM for, on, or by reason of the CMA, any
indemnity thereunder or the performance or any other aspect thereof and any
other contract or matter existing at the time of this Agreement, other than the
Interim Operating Agreement.

13.5    TRANSFER OF OAKTOWN 2 CLAIMS TO VUS. Effective as of the Closing, and
except as otherwise provided herein, Oaktown 2 hereby conveys to VUS any and all
manner of action and actions, cause and causes of action, claims, demands,
controversies, damages, variances, costs, losses, claims for court costs and
attorneys’ fees, liabilities and obligations of any kind or nature whatsoever,
and rights, matured or unmatured, liquidated or unliquidated, whether accrued or
yet to accrue, known or unknown, asserted or unasserted, contingent or absolute,
suspected or unsuspected, direct or derivative, in law, in equity or otherwise,
that it has, or may have against BPM for, on, or by reason of the CMA, any
indemnity thereunder or the performance or any other aspect thereof and any
other contract or matter existing at the time of this Agreement, other than the
Interim Operating Agreement.

13.6    TRANSFER OF VFI AND SFI CLAIMS TO VUS. Effective as of the Closing, and
except as otherwise provided herein, VFI and SFI each hereby conveys to VUS any
and all manner of action and actions, cause and causes of action, claims,
demands, controversies, damages, variances, costs, losses, claims for court
costs and attorneys’ fees, liabilities and obligations of any kind or nature
whatsoever, and rights, matured or unmatured, liquidated or unliquidated,
whether accrued or yet to accrue, known or unknown, asserted or unasserted,
contingent or absolute, suspected or unsuspected, direct or derivative, in law,
in equity or otherwise, that it has, or may have against BPM for, on, or by
reason of the CMA or the performance or any other aspect thereof and any other
contract or matter existing at the time of this Agreement.

    

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ARTICLE 14:
INDEMNITY

14.1    VUS INDEMNITY. Following the Closing, VUS will and hereby does assume
all of the remaining obligations of Oaktown 1 and Oaktown 2 to BPM under the
CMA. The obligations thus assumed by VUS will be subject to all defenses,
offsets or other limitations provided for in the CMA and/or that would otherwise
be available to Oaktown 1 or Oaktown 2. In addition to the extent they are not
Excluded Costs and subject to the other provisions of this Agreement, VUS will
indemnify BPM for any Claims and expenses incurred by BPM as a result of: (a)
the Interim Operating Agreements for Mine 1 and Mine 2 (to the extent that such
Claims are not paid by Oaktown 1 or Oaktown 2); (b) Mine 1 Worker Claims; (c)
Mine 2 Worker Claims; (d) Vendor Claims; (e) the notice given by BPM under the
WARN Act; and (f) expenses incurred in connection with the performance of this
Agreement. With regard to any claims of BPM pursuant to item (a) of this
Section 14.1, BPM will timely present all such Claims to Oaktown 1 and Oaktown
2, as applicable, and will make reasonable efforts to obtain payment of same
from those entities, provided however, BPM need not institute litigation to
recover payment of those Claims, and if payment has not been received by BPM
within 90 days, BPM may submit the charge to VUS, and VUS will pay BPM within 10
days thereafter. If VUS pays any Claim of BPM made pursuant to item (a) of this
Section 14.1, BPM will assign the Claim under the relevant Interim Operating
Agreement to VUS.

14.2    BPM INDEMNITY. Following the Closing, BPM will indemnify and hold
harmless VUS from and against any and all Claims arising directly or indirectly
from (i) any breach of the CMA or this Agreement by BPM; (ii) any failure by BPM
to use Good Mining Practices at Mine 1 or Mine 2; (iii) any material inaccuracy
or breach of any representation or warranty by BPM contained in this Agreement
or in the CMA; (iv) any failure to abate any citation under any permit if the
citation was received prior to Closing, except to the extent such citation
cannot be fully abated prior to Closing despite BPM’s best efforts to do so; or
(v) any act or failure to act by BPM that is reckless or willful, or grossly
negligent.

    

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ARTICLE 15:
CONFIDENTIALITY

Following the Closing and/or the termination of the CMA, BPM will hold in
confidence and will not make public or divulge to a third party any information
obtained as a result or in the cause of the performance of the CMA except for
disclosures to its attorneys, auditors, valuation experts or accountants or as
compelled by law or regulation, or as may be required by any state or federal
regulatory agency, or pursuant to a confidentiality and non-disclosure agreement
duly executed by the recipient of the information and pursuant to which the
recipient covenants to take reasonable efforts to maintain such information in
confidence. If BPM is or could be legally compelled to disclose such
information, it will notify the other parties prior to making the disclosure.

ARTICLE 16:
REPRESENTATION AND WARRANTIES OF BPM

BPM hereby represents and warrants that the following are true as of the date
hereof and will be true as of the date of the Closing:

16.1    ORGANIZATION. BPM is a limited liability company validly organized and
existing under the laws of the State of Indiana and has corporate power and
authority to execute and deliver this Agreement and to carry on its business.

16.2    PERFORMANCE OF OBLIGATIONS. BPM has performed and will perform all of
its obligations in connection with Mine 1 and Mine 2 in accordance with Good
Mining Practices and all other requirements of the CMA.

    

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16.3    PAYMENT OF EMPLOYEE OBLIGATIONS. BPM has paid and/or provided to all of
the Mine 1 Employees and the Mine 2 Employees all of the wages, benefits and
other payments to which they are entitled, and in connection with such wages,
benefits and payments, BPM has properly withheld and paid over to the relevant
taxing authority all amounts required to be so withheld and paid over.

16.4    PAYMENT OF VENDORS. All accounts of Mine1Vendors and Mine 2 Vendors are
current, and no mechanic’s, carriers’, workmen’s, repairmen’s or other like
liens are or could be asserted against real or personal property of Oaktown 1 or
Oaktown 2.

ARTICLE 17:
ACCOUNTING

17.1    ACCOUNTING FOR PRE-CLOSING FUNDS. At the date of Closing, BPM will
provide VUS with a statement of the funds provided by Oaktown 1 or Oaktown 2 or
any of their affiliates to BPM pursuant to the CMA which remain in the bank
accounts or otherwise in the possession of BPM.

17.2    POST-CLOSING ACCOUNTING. On or before 60 days following the Closing, BPM
and VUS will account to each other for all funds paid and received pursuant to
the CMA following the Closing, and will continue to account to each other
thereafter as necessary to insure that all amounts paid and received are
properly accounted for.

ARTICLE 18:
MISCELLANEOUS

18.1    CHOICE OF LAW. The laws of the state of Indiana shall govern the
validity, interpretation, and performance of this Agreement.

    

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18.2    DISPUTE RESOLUTION. As a condition precedent to the initiation of
litigation, the President, Chief Executive Officer or Chief Operating Officer of
the ultimate parent corporation of each of VUS and BPM shall be given notice of
the dispute and shall meet in person on at least one (1) occasion in an attempt
to resolve the dispute. If the dispute is not resolved or such meeting does not
occur within ten (10) days of the date such meeting was requested, then any
party may pursue its legal or equitable remedies.

18.3    NOTICES. Any Notice, request or other communication permitted or
required by this Agreement to be given to any Party shall be in writing and
shall be given to such Party at its address set forth below or such other
address or as such Party may hereafter specify for the purpose by notice to the
other Party. Each such notice, request or other communication shall be effective
if given by overnight courier, when delivered at the address specified below (or
such other address as hereafter may be specified).

TO: OAKTOWN 1     
Oaktown Fuels Mine No. 1, LLC
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Randy Beck
Attn: Ronald E. Christian
TO: OAKTOWN 2
Pre-Closing
Oaktown Fuels Mine No. 2, LLC
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: President

    

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Attn: Secretary
    
TO BPM:
Black Panther Mining, LLC
11700 Water Tank Road
Cynthiana, IN 47612
Attn: President

With a copy to:

Terry G. Farmer
Bamberger, Foreman, Oswald & Hahn, LLP
7th Floor Hulman Building
20 N.W. 4th St.
Evansville, IN 47704-0657

TO VUS:
Vectren Utility Services, Inc.
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Ronald E. Christian

TO VFI:    
Vectren Fuels, Inc.
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Randy Beck
Attn: Ronald E. Christian

    

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To: SFI
SFI Coal Sales, LLC
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Ronald E. Christian
    
19.4    ENTIRE AGREEMENT; AMENDMENT. This Agreement contains the entire
understanding of the Parties and supersedes all previous communications,
representations or agreements, either oral or written, among the Parties with
respect to the subject matter hereof. No amendment to this Agreement shall be
effective unless approved and executed in writing by each party hereto.

19.5    STATUS OF PARTIES; NO THIRD PARTY BENEFICIARIES. This Agreement does not
create the relationship of joint venture, partnership, association, legal
representative or principal and agent between or among the parties. Except as
expressly provided in Article 16, there are no third party beneficiaries to this
Agreement.

19.6    SEVERABILITY. If any of the terms, covenants or conditions of this
Agreement or the application of any such term, covenant or condition shall be
held invalid as to any person or circumstances by any court having jurisdiction
in the premises, the remainder of this Agreement and the application of its
terms, covenants or conditions to such persons or circumstances shall not be
affected thereby but shall remain in force and effect.

19.7    NO WAIVER. Any waiver at any time by any party of its rights with
respect to any default or any other matter arising in connection with this
Agreement shall not be deemed a waiver with respect to any subsequent default or
matter.

    

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19.8    REMEDIES CUMULATIVE. The remedies provided by this Agreement shall be
cumulative and in addition to other remedies provided at law or in equity.

19.9    BINDING EFFECT. All of the respective covenants, undertakings and
obligations of each of the parties set forth in this Agreement (i) shall apply
to and bind all other persons, claiming by, through or under any of the parties
and their permitted successors or assigns; and (ii) shall be for the benefit of
the parties and their respective successors and assigns. All such covenants and
obligations shall be binding upon any Person which acquires any of the rights,
titles and interests of any party in, to and under this Agreement. Upon any
assignment of this Agreement not prohibited by the terms hereof and after
compliance with all requirements, concerning assignments contained in this
Agreement, the parties hereto shall look solely to the assignee to perform all
obligations assumed by the assignee and accruing from and after the assignment,
and the original party hereto assigning such obligations shall have no liability
hereunder with respect thereto.
[End of Text. Signature Page Follows.]

    

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the Effective Date.

OAKTOWN FUELS MINE NO. 1, LLC
                        

                        
By:_/s/ Randy L. Beck______________________

Its:__President_____________________________

OAKTOWN FUELS MINE NO. 2, LLC                    

                        
By:_____/s/ Randy L. Beck__________________

Its:___President____________________________

VECTREN FUELS, INC.    

                    

By:__/s/ Randy L. Beck______________________

Its:__President_____________________________

    

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SFI COAL SALES, LLC                

                    

By:_/s/ Randy L. Beck______________________

Its:_President______________________________

VECTREN UTILITY SERVICES, INC.                        

                        
By:___/s/ Ronald E. Christian_________________

Its:__Vice President_________________________

BLACK PANTHER MINING, LLC
                        

                                            
By:___/s/_Donald Blankenberger_______________

Its:__President_____________________________

61181004.8

61181004.12

    

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C-2
AGREEMENT

THIS AGREEMENT is entered into this _____28th______ day of __June 2014________
among PROSPERITY MINE, LLC, an Indiana limited liability company (“Prosperity”);
VECTREN FUELS, INC., an Indiana corporation (“VFI”); SFI COAL SALES, LLC, an
Indiana limited liability company (“SFI”); VECTREN UTILITY SERVICES, INC., an
Indiana corporation (“VUS”); and FIVE STAR MINING, INC., an Indiana corporation
(“Five Star”).

WHEREAS, Prosperity and Five Star entered into a Contract Mining Agreement dated
November 23, 2009 but effective as of January 1, 2008 (as amended, the “CMA”),
pursuant to which Five Star agreed to provide certain services to Prosperity in
connection with the operation of the Prosperity mine (with all related
facilities, the “Mine”); and

WHEREAS, VFI owns all of the outstanding ownership interests of SFI which owns
all of the outstanding interests of Prosperity; and

WHEREAS, VUS owns, or will own as of the Closing (as defined below), all of the
stock of VFI; and
WHEREAS, VUS is negotiating an agreement to sell the stock of VFI to Sunrise
Coal, LLC with the effect that VFI, SFI and Prosperity will become direct and
indirect subsidiaries of Sunrise Coal, LLC (the “Sale”); and

WHEREAS, the parties desire that upon the closing of the Sale (the “Closing”)
the CMA will terminate and that the terms of this Agreement will be substituted
therefore.

NOW THEREFORE, for in and consideration of One-Hundred Dollars ($100.00), the
covenants, agreements and releases contained herein, the payments to be made
hereunder, and other

    

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good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

ARTICLE 1: DEFINITIONS
  
“Books and Records” minute books; books of account; manuals; general, financial,
warranty and shipping records; invoices; customer and supplier lists;
correspondence; engineering, maintenance and operating records and data; mine
operations and inspection records; credit records of customers; computer files,
permits and permit applications and all other documents, records and files, but
not including any employee or personnel files.

“Claims” has the meaning set forth in Section 11.1.
“Contracts” has the meaning set forth in Section 4.1.
“Deficiency Period” has the meaning set forth in Section 10.5.
“Direct Labor and Associated Costs” means the wages of all hourly the Employees,
including non-miners, and the salaries of all salaried personnel employed by
Five Star for the Mine, including a mine superintendent, on-site managers and
supervisors, payments to consultants for the Mine, if such consultants were
approved in writing in advance by Prosperity, and all bonuses paid to, and the
costs of all incentive, pension and retirement programs for, such workers and
employees, and all payroll burdens, including but not limited to all costs
associated with worker compensation such as premiums, deductibles and
self-insurance amounts associated therewith, other insurance and benefit costs,
in each case, to the extent directly allocable to the performance by Five Star
of its obligations under the CMA for the operation of the Mine, and the
production and delivery of coal from such mine.
“Employees” has the meaning set forth in Section 3.2.
“Excluded Costs” means (i) any local, state or federal gross, adjusted gross or
net income taxes; (ii) any fines, penalties, damage or assessments resulting
from a violation of mining laws or regulations, as the same may be in effect
from time-to-time, where such violation is flagrant, willful or intentional, or
results from “high negligence” or “reckless disregard,” as such terms are
defined

    

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in applicable MSHA rules, regulations, orders or releases in effect from
time-to-time; (iii) deductibles applicable to any of the insurance coverages
required to be maintained pursuant to the CMA to the extent the loss arises out
of any grossly negligent, willful or reckless act or failure to act by Five Star
or its employees, contractors or agents; (iv) any indemnity obligation arising
out of the CMA; or (v) any liability arising from a breach of the CMA by Five
Star.
“Five Star Releasing Parties” has the meaning set forth in Section 11.1.
“Good Mining Practices” means such practices, acts or methods of operating a
coal mine and ancillary facilities as are generally accepted as reasonable, safe
and appropriate in the industry and in conformity with the requirements of all
applicable laws, regulations and permit requirements.

“MSHA” has the meaning set forth in Section 6.1.
“MSHA Citations” has the meaning set forth in Section 6.1.
“Permits” has the meaning set forth in Section 5.1.
“Permit Citations” has the meaning set forth in Section 5.3.
“Prosperity Books and Records” has the meaning set forth in Section 8.1.
“Prosperity Equipment” has the meaning set forth in Section 9.1.
“Prosperity IP” has the meaning set forth in Article 7.
“Prosperity Released Parties” has the meaning set forth in Section 11.1.
“Termination Fee” has the meaning set forth in Section 10.2.
“Termination Management Fee” has the meaning set forth in Section 10.5.
“Vendors” has the meaning set forth in Section 4.1.
“VFI Released Parties” has the meaning set forth in Section 11.2.
“VUS Representative” has the meaning set forth in Section 3.6.
“WARN Act” has the meaning set forth in Section 3.3.
“Worker Claims” has the meaning set forth in Section 3.5.
ARTICLE 2: EFFECTIVENESS

2.1    EFFECTIVENESS OF AGREEMENT PROVISIONS. This Agreement will be effective
as of the date first written above. Notwithstanding that this Agreement is
binding and effective upon its execution, the parties acknowledge that many

    

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of the obligations and the releases contained herein will not be effective
unless and until the Closing of the Sale occurs, as indicated herein. Until the
Closing, the CMA will otherwise remain in full force and effect in accordance
with its terms, except to the extent it is expressly modified by this Agreement
as to pre-Closing periods and obligations.

2.2    TERMINATION OF AGREEMENT. At any time prior to the Closing, VUS may give
notice to Five Star that the Closing will not occur. In such case, and upon such
notice from VUS, this Agreement will terminate, and the CMA will remain in full
force and effect except as expressly modified herein as to pre-Closing periods
and obligations.

ARTICLE 3: EMPLOYEES

3.1    FIVE STAR AS EMPLOYER. The parties acknowledge that all of the workers
who have been directly involved in the operations at the Mine are and have been
employees of Five Star. The parties further acknowledge that following the
Closing, none of those employees will be needed by Five Star for the operations
at the Mine.

3.2    IDENTIFICATION AND TERMINATION OF EMPLOYEES. Attached hereto as Exhibit 1
is a true and complete list of all of the employees of Five Star involved in the
operations at the Mine or who are otherwise associated with the business of
Prosperity (“the Employees”). Five Star agrees that it will, as of the Closing,
terminate the employment of the Employees.

3.3    WARN NOTICE. At the request of Prosperity, and within one (1) day of its
receipt of such request, Five Star will provide the notification to the
Employees required under the Worker Adjustment and Retraining Notification Act
(the “WARN Act”) regarding the termination of the Employees, in form and
substance reasonably acceptable to Prosperity. Prosperity will provide a form of
notice for Prosperity to use and will advise Five Star as to the process for
serving the WARN Act notices. It is anticipated that the

    

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WARN Act notice will be given on or about July 1, 2014. It is further
anticipated that the Closing of the Sale will occur, if at all, on or after
sixty-one (61) days following Five Star’s giving of the WARN Act notification.
The costs of giving such notice will considered “Mining Costs” under the CMA and
will be treated accordingly.

3.4    FIVE STAR CONTINUING EMPLOYMENT OBLIGATIONS. Until the employment of each
of the Employees is terminated, Five Star will continue to be the employer of
such Employee for all purposes (subject to Five Star’s absolute discretion as to
the continued employment of such employee), including without limitation
providing any employee benefits and being responsible for providing workers’
compensation coverage and administering and resolving workers’ compensation
claims, in accordance with the terms of the CMA and the current practice of the
parties in the performance of the CMA. Five Star represents that it has fully
and properly paid all wages and other benefits to all of the Employees, and Five
Star will ensure that all wages and other employee benefits have been properly
and fully paid to all the Employees as of the Closing.

3.5     WORKER CLAIMS. Following the Closing and the termination of the CMA,
Five Star will promptly notify VUS regarding any workers compensation claims or
other claims brought by or related to the Employees (whether existing at the
time of Closing or subsequently filed “Worker Claims”) and the litigation and/or
resolution of same. Attached hereto as Exhibit 2 is a true and complete list of
all the Worker Claims as of the date of this Agreement. Five Star will
supplement Exhibit 2 as of the date of Closing.
 
3.6    EMPLOYEE CERTIFICATE. At the Closing Five Star will provide a
certification in the form set forth in Exhibit 3 hereto that all the Employees
have been fully paid and provided with all applicable termination and other
benefits to which they are entitled, or if that is not the case, it will provide
a detailed list of unpaid wages and benefits.

    

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3.7    RESOLUTION OF WORKER CLAIMS. Following the Closing and the termination of
the CMA, (a) VUS will identify a representative to receive notices from Five
Star regarding any Worker Claims or any other matters for which VUS may have any
liability hereunder (the “VUS Representative”); (b) Five Star will promptly
notify the VUS Representative of any claim, demand or right of action asserted
or any action, suit or proceeding threatened or instituted with regard to any
Employee or any Worker Claim; (c) prior to the commencement of any negotiations
or litigation, and during the course thereof, with respect to any Employee or
Worker Claim, Five Star will consult with VUS to obtain its recommendations and
direction with respect to the conduct thereof; (d) at VUS’s option, VUS may
assume (as Five Star’s agent, designee or otherwise) the management of any or
all Claims relating to Employees or Worker Claims; (e) all negotiations and
litigation with respect to any Employee or any Worker Claim will be conducted by
or at the direction of VUS; (f) Five Star will cooperate with VUS in the
handling of any Worker Claim or the verification of the expenses associated
therewith; (g) Five Star will not settle or consent to the entry of any award or
judgment with regard to a Employee or a Worker Claim without the consent of VUS.

3.8    PAYMENT OF WORKER CLAIMS. Following the Closing, and subject to Five
Star’s compliance with the terms and provisions of Section 3.7, VUS will
indemnify and hold harmless Five Star for any out-of pocket costs (including any
workers’ compensation payments that are not covered by insurance) associated
with the litigation or resolution of any Worker Claims, provided that such costs
are reasonable, verified and approved by VUS in its reasonable discretion,
incurred in accordance with this Agreement and are not Excluded Costs.

3.9    PAYMENT OF LABOR COSTS. VUS will reimburse Five Star for any Direct Labor
and Associated Costs for the Employees which are properly incurred by Five Star
prior to Closing but which are not paid at or prior to the Closing and for

    

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which Five Star had not previously received funds in payment thereof, provided
such costs have been verified and approved by VUS in its reasonable discretion.

ARTICLE 4: VENDORS

4.1     CONTRACTS AND VENDORS. Exhibit 4 hereto is a true and complete list of
all of the material contracts (the “ Contracts”) between Five Star and all
vendors for materials, supplies, or services in connection with the operation of
the Mine and the business activities of Prosperity (the “Vendors”).

4.2    TRANSFER OF CONTRACTS. Five Star agrees that, at the request of
Prosperity, whether before or after the Closing, it will transfer to Prosperity
or its designee such of the Contracts as Prosperity may request, so that the
contractual relationship with the Vendors will be directly with Prosperity or
its designee. Five Star will cooperate with Prosperity in transferring the
contracts and in establishing a relationship between Prosperity and the Vendors.
Notwithstanding the transfer of the Contracts, until the Closing, Five Star will
be responsible for fulfilling all of the obligations under the Contracts and
will continue to communicate with the Vendors on behalf of Prosperity as it has
in the past. Five Star will terminate all unassumed Contracts as of the Closing,
and to the greatest extent reasonably possible will do so in such a manner as to
avoid any expense or liability to Five Star or Prosperity. Any liability or
expenses incurred by Five Star as a result of such termination that have been
verified and approved by VUS in its reasonable discretion will constitute a
Mining Cost under the CMA and will be treated accordingly.

4.3    PAYMENT OF VENDORS. Five Star will use its reasonable best efforts to
cause all claims for payment asserted by the Vendors for goods or services
provided by them in connection with the Mine prior to the Closing (“Vendor
Claims”) to be paid prior to, or as soon as possible after the Closing. After
the Closing, Five Star will continue to pay Vendor Claims, subject to VUS’
verification and approval of same in its

    

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reasonable discretion and to the extent that Five Star had not previously
received funds for the payment thereof. Five Star will cooperate with VUS and
will provide VUS with all the information necessary to (a) verify the
correctness of any unpaid pre-Closing the Vendor charges and (b) to contest any
such charges that VUS deems unjustified or unreasonable.

4.4    CERTIFICATE OF PAYMENT AND LIEN RELEASES. At the Closing, Five Star will
provide Prosperity and VUS with a certificate in the form attached hereto as
Exhibit 5 regarding the Vendor charges. At the Closing, and thereafter with
respect to the Vendors that have not been paid in full as of the Closing, Five
Star will also provide Prosperity and VUS with such lien waivers from the
Vendors as they may request.

ARTICLE5: PERMITS

5.1     PERMITS. Attached hereto as Exhibit 6 is a true and complete list of all
permits and licenses of any kind which relate to or could affect the operations
of the Mine or the business of Prosperity (the “Permits”).

5.2    TRANSFER OF PERMITS. Five Star agrees that it will execute to be
effective as of the Closing, the Interim Operating Agreement for the Mine
attached hereto as Exhibit 7. Further, Five Star agrees that at the Closing it
will transfer, and execute such documents as may be necessary to facilitate such
transfer of, the Permits to Prosperity or its designee free and clear of all
liens and encumbrances arising by or through Five Star. To the extent the
permits are encumbered by liens to support a line of credit, Five Star covenants
that it will not draw on that line of credit prior to the release of any such
liens. No transfer of the permits will be completed unless and until any bond or
other financial surety affecting Five Star has been replaced. Five Star hereby
releases any claim it has or may have to any accrual by Prosperity or any of its
affiliates for reclamation obligations.

    

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5.3     VIOLATIONS. Attached hereto as Exhibit 8 is a true and complete list of
all unabated notices of violation, cessation orders, or other open regulatory
matters relating to the operations at the Mine, other than the MSHA citations
which are addressed below (with any other such violations issued before or after
the Closing with regard to the Mine, the “Permit Citations”). Five Star will
update Exhibit 8 at the Closing.

5.4    PAYMENT OF THE VIOLATIONS. Following the Closing, VUS will reimburse,
indemnify and hold harmless Five Star from and against all out-of-pocket
expenses associated with the litigation and/or resolution of the Permit
Citations, provided that such expenses are reasonable, were and are incurred in
accordance with the terms of this Agreement and the CMA, have been verified and
approved by VUS in its reasonable discretion and are not Excluded Costs.

5.5    RESOLUTION OF THE VIOLATIONS. Following the Closing, Five Star will
promptly notify VUS of any claim, demand or right of action asserted or any
action, suit or proceeding threatened or instituted against Five Star with
regard to any Permit Citations. After the Closing, before it commences any
negotiations or litigation with respect to any Permit Citation, Five Star will
consult with VUS to obtain its recommendations and direction with respect to the
conduct thereof. All negotiations and litigation with respect to any the Permit
Citation will be conducted by or at the direction of VUS, and Five Star will not
settle or pay any the Permit Citation without the prior consent of the VUS
Representative. At the option of VUS, it may assume (as Five Star’s agent,
designee or otherwise) the management of any or all Permit Citation. Five Star
will cooperate with VUS in the handling of any Permit Citation and in the
verification of any costs or expenses related thereto.

ARTICLE 6:
MSHA VIOLATIONS

6.1    MSHA CITATIONS. Attached hereto as Exhibit 9 is a true and complete list
of all unabated notices of violation, cessation orders, or other open matters

    

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relating to the Mine operations issued by the Mine Safety and Health
Administration (“MSHA”) (with any such citations that may be issued before or
after the Closing with regard to the pre-Closing activities of Five Star, the
“MSHA Citations”). Five Star will update Exhibit 9 at the Closing.

6.2    PAYMENT OF MSHA CITATIONS. Following the Closing, VUS will reimburse,
indemnify and hold harmless Five Star from and against all out-of-pocket
expenses associated with the litigation and/or resolution of the MSHA Citations,
provided that such costs are reasonable, were and are incurred in accordance
with the terms of the CMA and this Agreement, have been verified and approved by
VUS in its reasonable discretion and are not Excluded Costs.

6.3    RESOLUTION OF THE MSHA CITATIONS. Following the Closing: (a) Five Star
will promptly notify the VUS Representative of any claim, demand or right of
action asserted or any action, suit or proceeding threatened or instituted with
regard to any MSHA Citations; (b) prior to the commencement of any negotiations
or litigation with respect to any MSHA Citation following the Closing, and
during the pendency thereof, Five Star will consult with VUS to obtain its
recommendations and direction with respect to the conduct thereof; (c) at VUS’s
option, VUS may assume (as Five Star’s agent, designee or otherwise) the
management of any or all MSHA Citations; (d) all negotiations and litigation
with respect to any MSHA Citation will be conducted by or at the direction of
VUS; (e) Five Star will cooperate with VUS in the handling of any MSHA Citations
and in the verification of any costs associated therewith; and (f) Five Star
will not settle or pay any MSHA Citation without the prior consent of the VUS
Representative.

ARTICLE 7:
INTELLECTUAL PROPERTY

    

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PROSPERITY IP. Attached hereto as Exhibit 10 is a list of all software programs
and other intellectual property used in the business of Prosperity (the
“Prosperity IP”). Exhibit 10 further identifies any consent needed for the
transfer of any item of Prosperity IP. Five Star will obtain any necessary
consents to transfer any Prosperity IP to Prosperity or its designee, and at
Prosperity’s request, Five Star will transfer all Prosperity IP to Prosperity or
its designee prior to the Closing.

ARTICLE 8:
BOOKS AND RECORDS

8.1    CONTROL OF BOOKS AND RECORDS. The parties acknowledge that all of the
Books and Records relating to the operations of the Mine and the business of
Prosperity (the “Prosperity Books and Records”) are the property of Prosperity,
and following the Closing, the Prosperity Books and Records will remain in the
ownership, custody and control of Prosperity.

8.2        ACCESS TO BOOKS AND RECORDS. Five Star will cooperate with Prosperity
in securing the Prosperity Books and Records prior to the Closing and all
Prosperity Books and Records will be at the Mine at the Closing. Following the
Closing, Five Star will provide Prosperity such assistance as may be necessary
for Prosperity to access the Prosperity Books and Records, including providing
passwords, software assistance and other support.

8.3        POST-CLOSING ACCESS AND COOPERATION. Notwithstanding the foregoing,
Prosperity will provide Five Star and VUS with full access to, will permit Five
Star and VUS to make copies (at their expense) of, the Prosperity Books and
Records, upon prior written notice and during regular business hours, as may be
reasonably necessary or convenient for the resolution of any Employee Claims,
Vendor Claims, Permit Citations or MSHA Citations, or any other post-Closing
matters for which Five Star or VUS bears any responsibility or obligation. Five
Star and VUS will cooperate

    

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in good faith to facilitate the performance of all obligations and activities
contemplated by this Agreement.

ARTICLE 9:
EQUIPMENT AND OTHER

PERSONAL PROPERTY; LEASES AND EASEMENTS

9.1        PROSPERITY EQUIPMENT. The parties acknowledge that all of the
equipment, tools and inventory, including without limitation, spare parts and
materials, used or obtained for use in connection with the operations of the
Mine and the business of Prosperity (the “Prosperity Equipment”) has been
purchased, directly or indirectly, by Prosperity and that such purchases were
and are for the benefit of Prosperity.

9.2        TRANSFER OF PROSPERITY EQUIPMENT. To formalize that ownership, and
for avoidance of doubt, Five Star will simultaneously with     the execution of
this Agreement, execute the bill of sale attached hereto as Exhibit 11
transferring all of the Prosperity Equipment to Prosperity.

9.3        CONTROL OF PROSPERITY EQUIPMENT. From the date of this Agreement,
Five Star will maintain and operate the Prosperity Equipment in accordance with
the CMA and will use its best efforts to insure that none of the Prosperity
Equipment is lost, stolen or otherwise dissipated. At the Closing date, all of
the Prosperity Equipment will be physically on the Mine premises except for
items that are off site for repair. Five Star will provide Prosperity with a
list of such items at the Closing.

9.4     PROSPERITY LEASES AND EASEMENTS. As soon as is practicable after the
execution of this Agreement, Five Star will

    

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transfer to Prosperity or its designee and by assignments in form and substance
reasonably satisfactory to Prosperity any and all leases, easements,
rights-of-way, surface use agreements and any and all other real property
interests of any kind that relate to, affect of have any connection with (a) the
present or future operation of the Mine; (b) the present or future business of
Prosperity; or (c) the real property used in connection with those operations or
that business, including without limitation those listed on the attached Exhibit
12.

ARTICLE 10:
TERMINATION FEE

10.1     NO LUMP-SUM PAYMENT. The parties acknowledge and agree that more than
30,000,000 tons of coal have been mined from the reserves associated with the
Mine. Consequently, no lump-sum Termination Fee payment will be due to Five Star
pursuant to Section I.A.8 of the CMA on the termination of the CMA.

10.2    TERMINATION FEE. Following the Closing and the termination of the CMA,
in full satisfaction of the Termination Fee required by Section I.A.8 of the
CMA, Prosperity will pay to Five Star an amount equal to $.30 for each ton of
clean coal mined and sold after the Closing date from the reserves which are
currently part of the Mine plan, as and when such coal is mined, processed and
sold (the “Termination Fee”). For avoidance of doubt, the parties agree that as
of the date of this Agreement, the area constituting the Mine plan (the “Mine
Plan Area”) is indicated on the map attached hereto as Exhibit 13. Any reserve
areas or mineral interests added to the Mine Plan Area will not be subject to
the Termination Fee.

10.3    PAYMENT TERMS. Following the Closing and the termination of the CMA,
Prosperity will pay Five Star the Termination Fee for each ton of clean coal
mined and sold from the Mine Plan Area after the Closing date. The payment will
be

    

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made by Prosperity on or before the twentieth (20th) day of the calendar month
following the month during which such coal was sold. The payment will be made by
check to Five Star at the address set forth in Section 16.3, below, as it may be
amended in accordance with that Section. Five Star will have reasonable access,
on at least 72 hours’ notice and during business hours, for itself and its
representatives to such records of Prosperity as may be reasonably necessary for
Five Star to confirm the accuracy of the Termination Fee payments made to it.

10.4    WAIVER OF TERMINATION NOTICE. Section X.B of the CMA requires Prosperity
to give Five Star six (6) months’ notice of a voluntary termination of the CMA.
Five Star agrees that this Agreement serves as such notice, and that no further
notice will be required except for notice to Five Star of the occurrence of the
Closing.
  
10.5    TERMINATION MANAGEMENT FEE. Within sixty (60) days following the
Closing, VUS will pay to FIVE STAR an amount equal to One Dollar ($1.00)
multiplied times the tons of: (a) coal contained in the clean coal stockpiles at
the Mine and (b) the clean coal equivalent contained in the raw coal stockpiles
at the Mine (determined based on the monthly mine production reports prepared in
the ordinary course of business and in accordance with past practice), in each
case for which Five Star has not already been paid its Management Fee provided
for in the CMA (the “Termination Management Fee”).

10.6    DEFICIENCY MANAGEMENT FEE. If the Closing occurs less than six (6)
months following the execution of this Agreement, the difference between the
number days following the execution of this Agreement and 180 days will be
referred to hereafter as the “Deficiency Period.” Following the Closing, VUS
will pay to Five Star an amount equal to One Dollar and Thirty-Two and a Half
Cents ($1.325) multiplied times the applicable number of tons for each day of
the Deficiency Period, based on the attached Exhibit 14 which as of the date of
this Agreement were budgeted to be shipped

    

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during the Deficiency Period (the “Deficiency Management Fee”). Exhibit 15 shows
budgeted tons on a monthly basis. In determining the number of tons to be used
in calculating the Deficiency Management Fee, the budgeted tons for each day of
the Deficiency Period will be determined by dividing the monthly tons by the
number of days in the month.

10.7    RELEASE OF PURCHASE OPTION. In addition to any other release contained
herein, upon the Closing and termination of the CMA, Five Star hereby releases
any claim to a right to purchase the Mine as provided in Section X.C of the
agreement, or otherwise.

ARTICLE 11:
RELEASES AND TRANSFER OF CLAIMS

11.1        FIVE STAR RELEASE OF PROSPERITY. Effective as of the Closing, and
except as expressly provided below, Five Star and its officers, members,
partners, managers and directors (individually and on behalf of any heirs,
executors, administrators, and successors and assigns, as applicable) (together,
the “Five Star Releasing Parties”) do fully, finally, unconditionally,
irrevocably and forever release, acquit, completely discharge and hold harmless
Prosperity and its parent, subsidiary and affiliated entities, and its and their
current and former members, shareholders, agents, employees, insurers,
attorneys, officers, directors, managers, board members, representatives,
consultants, advisors, parents, affiliates, subsidiaries, contractors,
associates, personal representatives, heirs, executors, trustees, beneficiaries,
administrators, insurance agents, persons or entities exercising subrogation
rights, and the successors, and assigns of each of them (together, the
“Prosperity Released Parties”) from and against any and all manner of action and
actions, cause and causes of action, claims, demands, warranties, covenants,
contracts, agreements, promises, controversies, damages, variances, judgments,
executions, costs, losses, claims for court costs and attorneys’ fees,
liabilities and obligations of any kind or nature whatsoever, and rights,

    

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matured or unmatured, liquidated or unliquidated, whether accrued or yet to
accrue, known or unknown, asserted or unasserted, contingent or absolute,
suspected or unsuspected, direct or derivative, in law, in equity or otherwise,
that it has, or may have, for, on, or by reason of any matter, cause or things
whatsoever from the beginning of the world to this day, including, but not
limited to any and all claims, complaints, liabilities, disputes, obligations,
promises, agreements, controversies, damages, actions, causes of action, rights,
demands, costs, losses, and claims for court costs and attorneys’ fees of any
kind whatsoever (known or unknown) (collectively, “Claims”) arising from, in
connection with, or related to the CMA and any other event, origin or agreement
occurring or entered into prior to the Closing, other than the obligations of
VUS under this Agreement and the obligations of Oaktown 1 under the Interim
Operating Agreement.

11.2        FIVE STAR RELEASE OF VFI AND SFI. Effective as of Closing, and
except as expressly provided below, the Five Star Releasing Parties do fully,
finally, unconditionally, irrevocably and forever release, acquit, completely
discharge and hold harmless VFI, SFI and its and their parent, subsidiary and
affiliated entities and its and their current and former members, shareholders,
agents, employees, insurers, attorneys, officers, directors, board members,
representatives, consultants, advisors, parents, affiliates, subsidiaries,
contractors, associates, personal representatives, heirs, executors, trustees,
beneficiaries, administrators, insurance agents, persons or entities exercising
subrogation rights, and the successors, and assigns of each of them (together,
the “VFI Released Parties”) from and against any and all Claims arising from, in
connection with, or related to the CMA and any other event, origin or agreement
occurring or entered into prior to the Closing, other than any obligation of VUS
under this Agreement.

11.3        TRANSFER OF PROSPERITY CLAIMS TO VUS. Effective as of the Closing,
and except as otherwise provided herein, Prosperity hereby conveys to VUS any
and all manner of action and actions, cause and causes of action, claims,
demands, controversies, damages, variances, costs, losses, claims for court
costs and attorneys’ fees, liabilities and obligations of any kind or nature
whatsoever, and rights,

    

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matured or unmatured, liquidated or unliquidated, whether accrued or yet to
accrue, known or unknown, asserted or unasserted contingent or absolute,
suspected or unsuspected, direct or derivative, in law, in equity or otherwise,
that it has, or may have against Five Star for, on, or by reason of the CMA, any
indemnity thereunder or the performance or any other aspect thereof and any
other contract or matter existing at the time of this Agreement, other than the
Interim Operating Agreement.

11.4            TRANSFER OF VFI AND SFI CLAIMS TO VUS. Effective as of the
Closing, and except as otherwise provided herein, VFI and SFI each hereby
conveys to VUS any and all manner of action and actions, cause and causes of
action, claims, demands, controversies, damages, variances, costs, losses,
claims for court costs and attorneys’ fees, liabilities and obligations of any
kind or nature whatsoever, and rights, matured or unmatured, liquidated or
unliquidated, whether accrued or yet to accrue, known or unknown, asserted or
unasserted, contingent or absolute, suspected or unsuspected, direct or
derivative, in law, in equity or otherwise, that it has, or may have against
Five Star for, on, or by reason of the CMA or the performance or any other
aspect thereof and any other contract or matter existing at the time of this
Agreement, other than the Interim Operating Agreement.

ARTICLE 12:
INDEMNITY

12.1        VUS INDEMNITY. Following the Closing, VUS will and hereby does
assume all of the remaining obligations of Prosperity under the CMA. The
obligations thus assumed by VUS will be subject to all defenses, offsets or
other limitations provided for in the CMA and/or that would otherwise be
available to Prosperity. In addition, to the extent they are not Excluded Costs
and subject to the other provisions of this Agreement, VUS will indemnify Five
Star for any Claims and expenses incurred by Five Star as a result of: (a) the
Interim Operating Agreement (to the extent that such Claims are not paid by
Prosperity); (b) Worker Claims; (c) Vendor Claims; (d) the notice given by Five
Star under the WARN Act; and (e) expenses incurred in connection with the
performance of this Agreement. With regard to any claims of Five Star pursuant
to item

    

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(a) of this Section 12.1, Five Star will timely present all such Claims and
expenses to Prosperity and will make reasonable efforts to obtain payment of
same from Prosperity, provided however, Five Star need not institute litigation
to recover payment of those Claims, and if payment has not been received by BPM
within 90 days, BPM may submit the charge to VUS, and VUS will pay BPM within 10
days thereafter. If VUS pays any Claim of BPM made pursuant to item (a) of this
Section 14.1, BPM will assign the Claim under the relevant Interim Operating
Agreement to VUS. If VUS pays any Claim of Five Star made pursuant to item (a)
of this Section 12.1, Five Star will assign the Claim under the Interim
Operating Agreement to VUS.

12.2        FIVE STAR INDEMNITY. Following the Closing, Five Star will indemnify
and hold harmless VUS from and against any and all Claims arising directly or
indirectly from (i) any material inaccuracy or breach of the CMA or this
Agreement; (ii) any failure by Five Star to use Good Mining Practices at the
Mine; (iii) any material inaccuracy or breach of any representation or warranty
contained in this Agreement or in the CMA by Five Star; (iv) any failure to
abate any citation under any permit if the citation was received prior to
Closing except to the extent such citation cannot be fully abated prior to
Closing despite Five Star’s best efforts to do so; or (v) any act or failure to
act by or on behalf of Five Star that is willful or reckless, or grossly
negligent.

ARTICLE 13: CONFIDENTIALITY

Following the Closing and/or the termination of the CMA, Five Star will hold in
confidence and will not make public or divulge to a third party any information
obtained as a result or in the cause of the performance of the CMA except for
disclosures to its attorneys, auditors, valuation experts or accountants or as
compelled by law or regulation, or as may be required by any state or federal
regulatory agency, or pursuant to a confidentiality and non-disclosure agreement
duly executed by the recipient of the information and pursuant to which the
recipient covenants to

    

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take reasonable efforts to maintain such information in confidence. If Five Star
is or could be legally compelled to disclose such information, it will notify
the other parties prior to making the disclosure.

ARTICLE 14: REPRESENTATION AND WARRANTIES OF FIVE STAR

Five Star hereby represents and warrants that the following are true as of the
date hereof and will be true as of the date of the Closing:

14.1    ORGANIZATION. Five Star is a limited liability company validly organized
and existing under the laws of the State of Indiana and has corporate power and
authority to execute and deliver this Agreement and to carry on its business.

14.2    PERFORMANCE OF OBLIGATIONS. Five Star has performed and will perform all
of its obligations in connection with the Mine and in accordance with Good
Mining Practices and all other requirements of the CMA.
    
14.3    PAYMENT OF EMPLOYEE OBLIGATIONS. Five Star has paid and/or provided to
all of the Employees all of the wages, benefits and other payments to which they
are entitled, and in connection with such wages, benefits and payments, Five
Star has properly withheld and paid over to the relevant taxing authority all
amounts required to be so withheld and paid over.

14.4    PAYMENT OF VENDORS. All accounts of Vendors are current, and no
mechanic’s, carriers’, workmen’s, repairmen’s or other like liens are or could
be asserted against the real or personal property of Prosperity.

ARTICLE 15: ACCOUNTING

15.1    ACCOUNTING FOR PRE-CLOSING FUNDS. At the date of Closing, Five Star will
provide VUS with a statement of all funds provided by Prosperity

    

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to Five Star pursuant to the CMA which remain in the bank accounts of or are
otherwise in the possession of Five Star.

15.2    POST-CLOSING ACCOUNTING. On or before 60 days following the Closing,
Five Star and VUS will account to each other for all funds paid and received
pursuant to the CMA following the Closing, and will continue to account to each
other thereafter as necessary to ensure that all amounts paid and received are
properly accounted for.

ARTICLE 16: MISCELLANEOUS

16.1    CHOICE OF LAW. The laws of the state of Indiana shall govern the
validity, interpretation, and performance of this Mining Agreement.

16.2    DISPUTE RESOLUTION. As a condition precedent to the initiation of
litigation, the President, Chief Executive Officer or Chief Operating Officer of
the ultimate parent corporation of each of VUS and Five Star shall be given
notice of the dispute and shall meet in person on at least one (1) occasion in
an attempt to resolve the dispute. If the dispute is not resolved or such
meeting does not occur within ten (10) days of the date such meeting was
requested, then any party may pursue its legal or equitable remedies.

16.3    NOTICES. Any Notice, request or other communication permitted or
required by this Agreement to be given to any Party shall be in writing and
shall be given to such Party at its address set forth below or such other
address or as such Party may hereafter specify for the purpose by notice to the
other Party. Each such notice, request or other communication shall be effective
if given by overnight courier, when delivered at the address specified below (or
such other address as hereafter may be specified).

    

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TO: PROSPERITY
Fuels Mine No. 1, LLC
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Randy Beck
Attn: Ronald E. Christian
    
TO:     FIVE STAR

___Five Star Mining, Inc________
___11700 Water Tank Rd________
___Cynthania, IN_______________
____47612____________________
Attn: President

With a copy to:

Terry G. Farmer
Bamberger, Foreman, Oswald & Hahn, LLP
7th Floor Hulman Building
20 N.W. 4th St.
Evansville, IN 47704-0657

TO:    VUS
Vectren Utility Services, Inc.
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Ronald E. Christian

    

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TO:    VFI
Vectren Fuels, Inc.
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Ronald E. Christian
    
To: SFI
SFI Coal Sales, LLC
211 NW Riverside Drive
One Vectren Square
Evansville, IN 47708
Attn: Ronald E. Christian
    
16.4ENTIRE AGREEMENT; AMENDMENT. This Agreement contains the entire
understanding of the Parties and supersedes all previous communications,
representations or agreements, either oral or written, among the Parties with
respect to the subject matter hereof. No amendment to this Agreement shall be
effective unless approved and executed in writing by each party hereto.

16.5STATUS OF PARTIES; NO THIRD PARTY BENEFICIARIES. This Agreement does not
create the relationship of joint venture, partnership, association, legal
representative or principal and agent between or among the parties. Except as
expressly provided in Article 11, there are no third party beneficiaries to this
Agreement.

16.6SEVERABILITY. In the event that any of the terms, covenants or conditions of
this Agreement or the application of any such term, covenant or condition shall
be held invalid as to any person or circumstances by any court having
jurisdiction in the premises, the remainder

    

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of this Agreement and the application of its terms, covenants or conditions to
such persons or circumstances shall not be affected thereby but shall remain in
force and effect.

16.7NO WAIVER. Any waiver at any time by any party of its rights with respect to
any default or any other matter arising in connection with this Agreement shall
not be deemed a waiver with respect to any subsequent default or matter.

16.8REMEDIES CUMULATIVE. The remedies provided by this Agreement shall be
cumulative and in addition to other remedies provided at law or in equity.

16.9BINDING EFFECT. All of the respective covenants, undertakings and
obligations of each of the parties set forth in this Agreement (i) shall apply
to and bind all other persons, claiming by, through or under any of the parties
and their permitted successors or assigns; and (ii) shall be for the benefit of
the parties and their respective successors and assigns. All such covenants and
obligations shall be binding upon any Person which acquires any of the rights,
titles and interests of any party in, to and under this Agreement. Upon any
assignment of this Agreement not prohibited by the terms hereof and after
compliance with all requirements, concerning assignments contained in this
Agreement, the parties hereto shall look solely to the assignee to perform all
obligations assumed by the assignee and accruing from and after the assignment,
and the original party hereto assigning such obligations shall have no liability
hereunder with respect thereto.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the Effective Date.

PROSPERITY MINE, LLC
                        

    

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By:_/s/ Randy L. Beck______________________

Its:_President____________________________

VECTREN FUELS, INC.                

                    

By:__/s/ Randy L. Beck______________________

Its:_President______________________________

SFI COAL SALES, LLC                

                    

By:_/s/ Randy L. Beck_______________________

Its:__President_____________________________

VECTREN UTILITY SERVICES, INC.                        

                        

    

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By:_/s/ Ronald E. Christian___________________

Its:_Vice President__________________________

    

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FIVE STAR MINING, INC.
                        

                                            
By:_/s/ Donald Blankenberger_________________

Its:_President______________________________

61181004.3

61182033.11

    

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D-1
July 1, 2014
John A. Brandt
Lafayette Energy Company
200 Frontage Road, Suite 300
Burr Ridge, IL 60527

Re:
Oaktown Sales Marketing Agreement Dated May 25, 2010

Dear John:
As you may know, today Vectren publicly announced it has entered into an
agreement to sell Vectren Fuels, Inc. (“VFI”), which will include its
subsidiaries Oaktown Fuels Mine No. 1, LLC and Oaktown Fuels Mine No. 2, LLC. As
we discussed, this letter serves as notice to you that, upon closing of the sale
(the “Closing”), the above-referenced Sales Marketing Agreement (the
“Agreement”) will be terminated. We do not expect the Closing to occur prior to
September 1, 2014, and it could close as late as the end of November.
We have appreciated your work in performing the agreement, and we value our
relationship with you. If the sale should not close, we will need Lafayette to
continue its good work for VFI, and we would not want the Agreement to
terminate. We recognize that Section 7 of the Agreement requires that we give
Lafayette 30 days’ notice of termination. Consequently, we are sending you this
conditional notice of termination that the Agreement will terminate at the
Closing (which will be more than 30 days after the date of this letter), if a
Closing occurs. However, if the sale should not close, this notice will be
ineffective, and the Agreement will continue in effect uninterrupted.
If the Closing occurs and the Agreement terminates, VFI (under new ownership)
will perform its post-termination obligations to Lafayette by paying the
contract commissions on firm sales of coal as and when the payments for such
sales are received, in accordance with past practice. The attached schedule
shows the contracts or sales to which those post-termination commissions may be
applicable.
As we also discussed, we want to meet with you in the next few days to discuss
our current and future coal supply and sales situation and to discuss
Lafayette’s activities under the Agreement between now and the Closing, if it
occurs.
   

    

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Very Truly Yours,

/s/ Randy Beck

Randy Beck, President
Oaktown Fuels Mine No. 1, LLC
Oaktown Fuels Mine No. 2, LLC
Vectren Fuels, Inc.

61191319.3

    

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D-2
July 1, 2014
John A. Brandt
Lafayette Energy Company
200 Frontage Road, Suite 300
Burr Ridge, IL 60527

Re:
Sales Marketing Agreement Dated May 24, 2000

Dear John:
As you may know, today Vectren publicly announced it has entered into an
agreement to sell Vectren Fuels, Inc. (“VFI”), which will include its subsidiary
Prosperity Mine, LLC. As we discussed, this letter serves as notice to you that,
at or following the closing of the sale (the “Closing”), the above-referenced
Sales Marketing Agreement (the “Agreement”) will be terminated. We do not expect
the Closing to occur prior to September 1, 2014, and it could close as late as
the end of November.
We have appreciated your work in performing the agreement, and we value our
relationship with you. If the sale should not close, we will need Lafayette to
continue its good work for VFI, and we would not want the Agreement to
terminate. We recognize that Section 8 of the Agreement requires that we give
Lafayette 90 days’ notice of termination. Consequently, we are sending you this
conditional notice of termination that the Agreement will terminate at the
Closing (if it is more than 90 days after the date of this letter), or 90 days
after the date of this letter (if the Closing occurs sooner). However, if the
sale should not close, this notice will be ineffective, and the Agreement will
continue in effect uninterrupted.
If the Closing occurs and the Agreement terminates, VFI (under new ownership)
will perform its post-termination obligations to Lafayette by paying the
contract commissions on firm sales of coal as and when the payments for such
sales are received, in accordance with past practice. The attached schedule
shows the contracts or sales to which those post-termination commissions may be
applicable.
As we also discussed, we want to meet with you in the next few days to discuss
our current and future coal supply and sales situation and to discuss
Lafayette’s activities under the Agreement between now and the Closing, if it
occurs.

    

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Very Truly Yours,

/s/ Randy Beck

Randy Beck, President
Vectren Fuels, Inc.
Prosperity Mine, LLC

61191320.3