#### **Contract#97-211-026**

**KindillMining, Inc.**

**AmendmentNo.2**

** **

#### **EXHIBIT10.67**

 

#### **AMENDMENTNO. 2 TO COAL SUPPLY AGREEMENT**

 

 

**THIS AMENDMENT NO. 2 COAL SUPPLY AGREEMENT**(“AmendmentNo. 2”) is entered into effective as of January 1, 2002, by and betweenLOUISVILLE GAS AND ELECTRIC COMPANY, (hereinafter referred to as “**Buyer**”)a Kentucky corporation, whose address is 220 West Main Street, Louisville,Kentucky 40202, KINDILL MINING, INC., (hereinafter referred to as “**Seller**”)an Indiana corporation, whose address is 1216 East County Road, 900 South,Oakland City, Indiana 47660; and HORIZON NR, LLC, (hereinafter referred to as **“Guarantor”**)a Delaware limited liability corporation, whose address is 2000 Ashland Drive,Ashland, Kentucky 41101.  Inconsideration of the agreements herein contained, the parties hereto agree asfollows.

 

**1.0****                               AMENDMENTS**

 

The Agreement heretoforeentered into by the parties, dated effective July 1, 1997 and identified by theContract Number set forth above, as amended by Amendment No. 1 dated effectiveJanuary 1, 2001(hereinafter together referred to as the “Agreement”), is herebyfurther amended as follows:

 

**2.0****                               TERM**

 

Section 2 **Term**, is deleted in its entirety andreplaced with the following:

 

“The term of thisagreement shall commence on July 1, 1997 and continue through December 31,2005.”

 

**3.0****                               QUANTITY**

 

3.1           Section 3.0 **Quantity**, is deletedin its entirety and replaced with the following:

 

3.2           Section 3.1 **Base Quantity**

 

“Seller shall sell anddeliver and Buyer shall purchase and accept delivery of the following annualbase quantity of coal (“Base Quantity”), to be delivered on a ratable monthlybasis:

 
| **YEAR**     |   | **BASE QUANTITY (TONS)** |           |
|--------------|--------|--------------------------|----------------|
|         |   |                     |           |
| 2002         |   | 700,000                  |           |
| 2003  - 2005 |   | 900,000                  |  per year |

 

1

----

 

3.3          Section 3.2, **Underdeliveries**, ishereby added as follows:

 

If Seller delivers 85% orless of the ratable monthly quantity hereunder during any one calendar month(the “Underdeliveries”) and such Underdeliveries are not excused by a validforce majeure event, the Base Price that was in effect in 2001 shall beautomatically and immediately reinstated, effective on the first day of themonth during which the Underdeliveries occurred.  If such Underdeliveries exceed 15% during any sixty (60) dayperiod, Buyer shall have the immediate right to offset cover costs againstpayments due Seller and Seller acknowledges and agrees it shall be responsiblefor all cover costs resulting from such Underdeliveries.  If Buyer chooses not to cover, suchUnderdeliveries shall be made up at Buyer’s sole option per Buyer’s schedule.

 

Notwithstanding thisspecific remedy, the parties agree that Buyer’s remedies for Sellers’underdeliveries and defaults shall be cumulative and not exclusive and shallinclude contractual, legal and equitable remedies.

 

 

**4.0          QUALITY**

 

Section 6.1 **Specifications**, sub-sections (b), (c),and (e) are hereby deleted in their entireties.

 

**5.0****                               PRICE**

 

5.1           Section8.1 **BasePrice**, is hereby deleted in its entirety and replaced with thefollowing provision:

 

Section 8.1 **BasePrice**. “The base price (“Base Price”) of the coal to besold hereunder will be firm and in accordance with the following:

 
| **BASE PRICE** |   |
|----------------|--------|
|           |   |   |   |
| **YEAR**       |   | **PRICE  ($Per MMBTU)** |   |
|           |   |   |   |
| 2002  - 2005   |   | $ | .95455 FOB  railcar |   |
|                |        |  |  |  |

 

 

The parties heretoacknowledge Buyer has paid Seller $1.00/MMBtu for all coal received on andafter January 1, 2002. As of May 31, 2002, 391,261.8tons of coal have been received by Buyer.  On and after the date all parties have fully executed thisAgreement, Buyer will begin receiving a credit of $1 per ton for all coaldelivered by Seller to Buyer, which credit shall continue until alloverpayments have been recouped by Buyer.

 

2

----

 

5.2                                 **QualityPrice Discounts**, Sections 8.2(b)(i) and 8.2(b)(ii), are hereby deleted in theirentireties.

 

5.3           Section8.3 **PriceReview** is hereby deleted in its entirety.

 

 

**6.0****                               GUARANTYOF SELLER’S OBLIGATIONS**.  As amaterial inducement for Buyer’s entering into this Amendment No. 2, and inconsideration thereof, Guarantor hereby guarantees the full, prompt andcomplete performance by Seller of all the terms and conditions of the Agreementto be performed by Seller thereunder (the “Guaranty”).  Guarantor hereby indemnifies and holds Buyerand Buyer’s successors and assigns harmless from and against all liability andexpense, including reasonable attorney’s fees, sustained by Buyer by reason ofthe failure of Guarantor fully to perform and comply with the terms andobligations of the Agreement, or by reason of any misrepresentation ofGuarantor hereunder.   It is understoodthis is a continuing, absolute and unconditional Guaranty, co-extensive andco-terminous with the Agreement between the Seller and Buyer, as it may befurther extended and amended by Buyer and Seller.  Guarantor hereby expressly waives notice of acceptance of thisGuaranty, notice of the defaults by Seller or of nonpayment or nonfulfillmentof any or all of Seller’s liabilities and obligations.  The delay or failure of Buyer to insist onstrict performance of any provision of this Agreement, or to take advantage ofany rights hereunder, shall not be construed as a waiver of such provision orright or of the Guaranty.  The Guarantorhereby expressly gives the Buyer and Seller from time to time, without noticeto Guarantor, authority and consent to give and make such extensions, renewals,settlements, and compromises at it may deem proper with respect to any of theduties or liabilities of the Seller under this Agreement.

 

**7.0****                               NOTICES**

 

The following noticeprovisions in Section 12.1, **Form and Place of Notice**, are herebyrevised as follows:

 

The copy addresslisting Buyer’s Manager, Procurement Services is hereby deleted.

 

The notice addresses forSeller are hereby deleted and replaced with the following:

 
| If to Seller: |   | Kindill  Mining                  |
|---------------|--------|----------------------------------|
|          |   | 1216  East County Road 800 South |
|          |   | Oakland  City, Indiana 47660     |

 

 

[No copy address.]

 

**8.0****                               EARLYTERMINATION**  

 

Section 13 **EarlyTermination** is hereby deleted in its entirety.

 

3

----

 

**9.0****                               STATUSOF AGREEMENT**

 

As amended herein, allterms and conditions in the Agreement are hereby ratified and confirmed andshall continue in full force and effect, including without limitation therepresentations, warranties, non-waiver and indemnification provisions.

 

**IN WITNESS WHEREOF,**the parties hereto have executed this Amendment No. 2 on the

day and year belowwritten, but effective as of the day and year first set forth above.

 

 
| **LOUISVILLE GAS AND ELECTRIC COMPANY** | **KINDILL MINING, INC.**                      |                |
|-----------------------------------------|-----------------------------------------------|---------------------|
|                                    |                                          |                |
|                                    |                                          |                |
| By:                                     |                                          |                | By: |   |   |
|                                    | Paul Thompson                                 |                |   |   |
|                                    | Senior Vice President —  Energy Services |                | Kent Holcomb |   |
|                                    |                                          |                | President |   |
|                                    |                                          |                |   |   |
| DATE:                                   |                                          |                | DATE: |   |   |
|                                    |                                          |                |   |
|                                    |                                          | **Guarantor:**      |   |
|                                    |                                          | **HORIZON NR, LLC** |   |
|                                    |                                          |                |   |
|                                    |                                          | By:                 |   |   |
|                                    |                                          |                |   |   |
|                                    |                                          | Its:                |   |   |
|                                    |                                          |                |   |   |
|                                    |                                          | DATE:               |   |   |
|                                         |                                               |                     |  |  |  |  |  |

 

4

----