**Exhibit 10.45**

 

**BARGE TRANSPORTATIONAGREEMENT**

 

This is a barge transportation agreement between LOUISVILLE GAS ANDELECTRIC COMPANY (LG&E) effective January 1, 2002 and between KENTUCKYUTILITIES COMPANY (KU) effective July 1, 2002, both Kentucky corporations,whose addresses are 220 West Main Street, Louisville, Kentucky, 40202(collectively “Buyer”) and CROUNSE CORPORATION, a Kentucky corporation, whoseaddress is 2626 Broadway, Paducah, Kentucky 42002-8109 (“Carrier”).

 

**RECITALS**

 

1**.****                                      **LG&E owns and operates a generating plantknown as Mill Creek Station which is located on the Kentucky side of the OhioRiver at Mile point 626.4 (“Mill Creek”). The coal barge unloader currently atMill Creek is a clamshell type digger with an average dig rate of about one thousand(1,000) tons per hour. The limestone barge unloader currently at Mill Creek isan excavator equipped with a clamshell bucket with an average dig rate of aboutfour hundred (400) tons per hour.

 

2.                                            LG&E owns and operates a generating plantknown as Trimble County Station which is located on the Kentucky side of theOhio River at Mile point 571.4 (“Trimble County”). The coal barge unloadercurrently at Trimble County is a bucket-ladder style digger with an average digrate of about three thousand and fifty (3,050) tons per hour. The limestonebarge unloader currently at Trimble County is a clamshell type digger with anaverage dig rate of about four hundred and sixty-five (465) tons per hour.

 

3.                                       LG&E owns and operates a generating plantknown as Cane Run Station which is located on the Kentucky side of the OhioRiver at Mile point 617.0 (“Cane Run”). The

 

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coal and limestone unloader will be anexcavator that digs the material out of the barge as the barge passes beneaththe excavator. The coal and limestone unloader is designed with an average digrate of about one thousand and six hundred (1,600) tons per hour.

 

4.                                       KU owns and operates a generating plant knownas Ghent Station which is located on the Kentucky side of the Ohio River atMile point 535.8 (“Ghent”). The coal and limestone unloader  is a bucket-ladder style digger with anaverage dig rate of about one thousand and eight hundred (1,800) tons per hour.

 

5.                                       For purposes hereof, the term “Buyer” shallrefer to LG&E relative to the coal and limestone that is delivered toLG&E, and shall refer to KU relative to the coal and limestone that isdelivered to KU.

 

6.                                       Jefferson County Riverport Authority is atransloading facility located on the Kentucky side of the Ohio River at Milepoint 618.00 (“Riverport”). The barge unloader is a clamshell type digger withan average dig rate of about four hundred (400) tons per hour.

 

**AGREEMENTS**

 

The parties hereto agree asfollows:

 

1.                                       **General. **Carrier will transport coal and limestone by barge to Mill Creek, CaneRun, Trimble County, Ghent, and Jefferson County Riverport. Buyer willcompensate Carrier therefor, under all the terms and conditions of thisAgreement.

 

2.                                       **Term.**** **The term of this Agreement (the “Term”) shall commence January 1,2002 for Louisville Gas and Electric Company and July 1, 2002 for KentuckyUtilities Company and shall continue through December 31, 2007 subject tothe following. The rates and other terms and conditions set forth in thisAgreement are subject to review for any reason, at the request of either party,for revisions to become effective on January 1, 2005. Either party mayrequest such a review by giving the other party written notice of such

 

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request by October 1, 2004. The partiesshall then use their best efforts to negotiate in good faith an agreement onnew rates and/or other terms and conditions between October 1, 2004 and November 30,2004. If the parties do not reach an agreement on new rates and/or other termsand conditions by December 1, 2004, then this Agreement will terminate asof December 31, 2004 without liability due to such termination for eitherparty.

 

3.                                       **Cargo**.  Carrier will transport under the terms of thisAgreement all solid fuel and limestone purchased by Buyer for delivery by barge(the “Cargo”), except for (a) distress Cargo already in barges belonging toother carriers, (b) Cargo purchased under spot contracts from suppliers havingcontracts with other carriers, (c) Cargo purchased from loading points notcovered by Section 7 and (d) Cargo which is purchased FOB Destination,except that the Cargo transported by another carrier during any calendar monthpursuant to exceptions (a) through (d) shall not exceed ten percent (10%) ofthe total Cargo (in tons) purchased by Buyer for delivery by barge during suchcalendar month. These restrictions shall not apply if Buyer requires more Cargotransportation than Carrier can provide within the time frame Buyer requires forloading, regardless of whether such non-performance is excused or unexcused,and regardless or whether Buyer’s delivery requirements are of an urgent ornon-urgent nature. Buyer agrees to provide Carrier as much notice aspracticable and Carrier agrees to confirm whether or not barges are available promptly.If barges belonging to another carrier are docked at the Buyer’s plant withCarrier’s barges, then Buyer shall pay demurrage to Carrier at the greater of(i) the same terms and conditions which would govern such other barge carrier’sright to recover demurrage or (ii) the terms of Section 8 herein.Notwithstanding any projections of Buyer’s barging requirements or any priorbarging requirements of Buyer, Buyer has no obligation to have any Cargo transportedunder this Agreement at any time, but promises only that all Cargo actuallydelivered by

 

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barge to Buyer will be delivered under thisAgreement, subject to the exceptions set forth above.

 

**4.****                                     ****Delivery.**

 

(a)                                  Carrier will receive Cargo at the loadingpoints listed in Section 7 hereof. Carrier will furnish empty barges atthe Loading Points in adequate numbers and at such times as to permit loadingof the Cargo in accordance with the Cargo suppliers’ reasonable operatingschedules and Buyer’s supply requirements. Buyer’s contracts with its Cargosuppliers shall require them, at their own expense, to load the Cargo into thebarges with due diligence and dispatch and otherwise comply with the reasonablerequirements of Carrier’s barging operation. The Cargo suppliers shall have theright to refuse to load any barges they consider unseaworthy or any bargescontaining water or other foreign matter. In the case of limestone loading,Buyer’s limestone supplier shall be responsible for cleaning barges to itsreasonable satisfaction. Carrier will deliver the loaded barges to Buyer’sunloading dock or other point designated by Buyer at such times as to permitthe unloading of the Cargo in accordance with Buyer’s reasonable operatingschedules.

 

(b)                                 At Mill Creek, Ghent, Trimble Countylimestone, and Jefferson County Riverport, Carrier shall properly and securelymoor the loaded barges at the unloading dock and notify the appropriateperson(s) that such mooring has been completed in accordance with theprovisions set forth in Appendix A, which is attached hereto. Buyer at its ownexpense shall have the Cargo unloaded out of the barges with due diligence anddispatch and otherwise comply with the reasonable requirements of Carrier’s bargingoperation.

 

(c)                                  At Trimble County and Cane Run, the Carriershall notify the appropriate person(s) of incoming barges at least six (6)hours prior to the arrival of each tow, in accordance with the provisions setforth in Appendix A. Carrier shall provide the designated

 

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plant personnel with periodic updates of theexpected day of all tow arrivals. Carrier’s coal tows shall be unloaded on astand-by basis, upon arrival, at Trimble County and Cane Run with Carrier beingresponsible for all placement, shifting and decking services at the plant.Buyer shall provide adequate shoreside personnel and equipment (including theshuttle barge) for the operation of the unloading system. The coal bargesgenerally will be standby unloaded as follows: The Carrier shall provide a boatand all deck-hands and tying services and shall shuttle the coal barges to andaway from the barge unloader; and shall leave with all empty coal barges.Carrier’s services shall be provided in accordance with the provisions setforth in Appendix A, which is attached hereto. After the barges are unloaded,Buyer shall notify Carrier that such unloading has occurred and Carrier shallremove the unloaded barges promptly. Buyer shall operate the unloader. Whencircumstances make standby unloading impractical in Buyer’s discretion or inthe event Buyer claims that force majeure conditions prevent the unloading of atow, then the Buyer shall have the option of: (1) reconsigning the tow toanother of the Buyer’s plants, (2) having Carrier properly and securely moorthe coal barges at the unloading dock and notifying the appropriate person(s)that such mooring has been completed and Buyer hiring a harbor boat to providefleet security for the loaded tow, or (3) requesting Carrier remain at theplant with the tow and compensating Carrier at the applicable hourly rate of$225 per hour, subject to the same adjustments set forth in subsection 7(b).

 

(d)                                 Except as otherwise expressly providedherein, Carrier shall supply at its own expense all labor, supervision,equipment and facilities, and shall pay all expenses and taxes whatsoever,incurred in connection with its performance under this Agreement.

 

**5.****                                     ****Description of Barges.******All barges used by the Carrier shall be ingood and seaworthy condition, shall have two (2) interior side slope sheets, atleast one (1) interior end

 

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slope sheet, shall not be wider thanthirty-five (35) feet, and shall have a minimum capacity of fifteen hundred(1,500) tons of coal.

 

**6.****                                     ****Compliance with SafetyProcedures and Laws.**

 

(a) Carrier represents and warrants that it is in the business of riverbarge transportation and that it possesses a high degree of professionalexpertise in all facets of river barge transportation and promises that it willexercise that degree of care of persons so skilled and that it will at alltimes provide adequate skilled personnel, equipment, facilities, and capital totransport Cargo safely in accordance with the terms of this Agreement.

 

(b) Without limiting the generality of the provisions of subsection (a)above, the Carrier will at all times in its performance under this Agreementcomply with all applicable laws and regulations of any kind and all proceduresand provisions set forth in Appendix A attached hereto.

 

7.                                       **Rates**

 

(a)                                  Subject to the adjustments set forth insubsections 6(b) and 6(c) hereof, Buyer shall pay to the Carrier the followingrates per ton:

 

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**CARGO – COAL**

 
| **LOADING POINT** | ** ** | **DESTINATION**     | ** ** |
|-------------------|------------|---------------------|------------|
| **River**         | ** ** | **Mile Point**      | ** ** | **Mill Creek** | ** ** | **Cane Run** | ** ** | **Trimble Co.** | ** ** | **Ghent** | ** ** | **Riverport** | ** ** |
| Monongahela       |       | 85 - 102            |       | 6.72 |   | 6.82 |   | 6.55 |   | 6.30 |   | 7.25 |   |
| Monongahela       |       | 61.2-84.9           |       | 6.06 |   | 6.16 |   | 5.89 |   | 5.64 |   | 6.59 |   |
| Monongahela       |       | 23.8-61.1           |       | 5.37 |   | 5.47 |   | 5.20 |   | 4.95 |   | 5.90 |   |
| Monongahela       |       | Below 23.7          |       | 4.68 |   | 4.78 |   | 4.51 |   | 4.26 |   | 5.21 |   |
| Ohio              |       | 0-84.2              |       | 3.62 |   | 3.72 |   | 3.45 |   | 3.20 |   | 4.15 |   |
| Ohio              |       | 84.3 - 126.5        |       | 3.22 |   | 3.32 |   | 3.05 |   | 2.80 |   | 3.75 |   |
| Ohio              |       | 126.6 —  237.5 |       | 3.04 |   | 3.14 |   | 2.87 |   | 2.62 |   | 3.57 |   |
| Ohio              |       | 237.6 -  279.3      |       | 2.67 |   | 2.77 |   | 2.50 |   | 2.25 |   | 3.20 |   |
| Ohio              |       | 279.4 -  305.6      |       | 2.12 |   | 2.22 |   | 1.95 |   | 1.70 |   | 2.65 |   |
| Ohio              |       | 305.7-317           |       | 2.02 |   | 2.12 |   | 1.85 |   | 1.60 |   | 2.55 |   |
| Ohio              |       | 317.1-360           |       | 1.97 |   | 2.07 |   | 1.80 |   | 1.55 |   | 2.50 |   |
| Ohio              |       | TTI405.9            |       | 1.71 |   | 1.81 |   | 1.54 |   | 1.29 |   | 2.24 |   |
| Ohio              |       | 470-531.5           |       | 1.60 |   | 1.70 |   | 1.43 |   | 1.18 |   | 2.13 |   |
| Ohio              |       | 535.2-620           |       | 1.05 |   | 1.15 |   | 1.25 |   | 1.34 |   | 1.58 |   |
| Ohio              |       | 620.1-720           |       | 1.19 |   | 1.29 |   | 1.54 |   | 1.63 |   | 1.72 |   |
| Ohio              |       | 721 - 776.1         |       | 1.54 |   | 1.64 |   | 1.89 |   | 1.98 |   | 2.07 |   |
| Ohio              |       | Evansville  784.1   |       | 1.63 |   | 1.80 |   | 1.97 |   | 2.06 |   | 2.23 |   |
| Ohio              |       | 785 - 846           |       | 1.98 |   | 2.18 |   | 2.33 |   | 2.42 |   | 2.61 |   |

 

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| **River**   | ** ** | **Mile Point** | ** ** | **Mill Creek** | ** ** | **Cane Run** | ** ** | **Trimble Co.** | ** ** | **Ghent** | ** ** | **Riverport** | ** ** |
|-------------|------------|----------------|------------|----------------|------------|--------------|------------|-----------------|------------|-----------|------------|---------------|------------|
| Ohio        |       | 851.8          |       | 2.13           |       | 2.23         |       | 2.48            |       | 2.57      |       | 2.66          |       |
| Ohio        |       | 853-918.5      |       | 2.16           |       | 2.35         |       | 2.50            |       | 2.58      |       | 2.78          |       |
| Ohio        |       | 918.6-962      |       | 2.30           |       | 2.40         |       | 2.65            |       | 2.74      |       | 2.83          |       |
| Big Sandy   |       | All Origins    |       | 2.17           |       | 2.27         |       | 2.00            |       | 1.75      |       | 2.70          |       |
| Kanawha     |       | Above 82.8     |       | 3.92           |       | 4.02         |       | 3.75            |       | 3.50      |       | 4.45          |       |
| Kanawha     |       | 67.7-82.7      |       | 3.77           |       | 3.87         |       | 3.60            |       | 3.35      |       | 4.30          |       |
| Kanawha     |       | Below 67.6     |       | 3.64           |       | 3.74         |       | 3.47            |       | 3.22      |       | 4.17          |       |
| Green       |       | Above 63.1     |       | 2.52           |       | 2.73         |       | 2.86            |       | 2.95      |       | 3.16          |       |
| Green       |       | 0-63.0         |       | 1.92           |       | 2.10         |       | 2.26            |       | 2.35      |       | 2.53          |       |
| Tennessee   |       | 0-25           |       | 2.35           |       | 2.45         |       | 2.70            |       | 2.79      |       | 2.88          |       |
| Upper Miss. |       | 98.5           |       | 3.99           |       | 4.09         |       | 4.34            |       | 4.43      |       | 4.52          |       |
| Upper Miss. |       | 125            |       | 4.86           |       | 4.96         |       | 5.21            |       | 5.30      |       | 5.39          |       |
| Upper Miss. |       | 161-185        |       | 6.07           |       | 6.17         |       | 6.42            |       | 6.51      |       | 6.60          |       |
| Lower Miss. |       | Mobile Bay     |       | 9.05           |       | 9.15         |       | 9.40            |       | 9.49      |       | 9.58          |       |
| Lower Miss. |       | 55.3 - 57 *    |       | 7.36           |       | 7.46         |       | 7.71            |       | 7.80      |       | 7.89          |       |

 

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*If shipped from Davant (Electro-Coal) Mile 55.3, Lower Mississippi, then deduct50.35 per ton.

 

**CARGO –LIMESTONE**

 
| ** **                        | ** ** | **DESTINATION** | ** ** |
|-----------------------------------|------------|-----------------|------------|
| **LOAD POINTS**                   | ** ** | **Mill Creek**  | ** ** | **Trimble Co.** | ** ** | **Ghent** | ** ** |
| ** **                        | ** ** | ** **      | ** ** | ** ** | ** ** | ** ** | ** ** |
| Cape Sandy (MP 674 Ohio River)    |       | $               | 0.78       |   | $ | 0.93 |   | $ | 0.95 |   |
| New Amsterdam (MP 653 Ohio River) |       | $               | 0.78       |   | $ | 093 |   | $ | 0.95 |   |

 

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**DEMURRAGE**

 
| Mill Creek, Jefferson  County Riverport, Trimble Co., & Ghent             |   | $150/demurrage debit |   |
|-------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|--------|
| Trimble Co. Coal and Cane  Run                                                                                                            |   | $225/demurrage debit |   |

 

Rates do not include switching and fleetingcharges at destinations (except Jefferson Riverport) or origins. Carrier shallnot be responsible for such charges. In the event the harbor service charges atJefferson Riverport are increased or decreased, the Carrier may increase ordecrease its rates accordingly. Rates from loading points not listed above willbe negotiated as required and shall be reasonably related to those set forthabove, taking into account differences in distance, operating conditions andloading conditions. If Buyer and Carrier cannot agree on a rate from aparticular loading point, then Buyer shall have the right to hire anothercarrier to transport Cargo from such loading point. Such tons transported byanother carrier shall not be subject to the limitations set forth in Section 3athrough 3d.

 

(b)                                 The rates set forth in subsection 7(a)as adjusted per this section shall apply to Cargo loaded commencing January 1,2002 for LG&E and commencing July 1, 2002 for KU. Rates will beadjusted each quarter thereafter as follows:

 

(1) Twenty percent (20%) ofthe base rate shall remain fixed for the Term of this Agreement.

 

(2) Fifty-five percent (55%)of the base rate (hereinafter the “55% component”) shall change in proportionto changes in the first published PPI Industrial Commodities Index Less Fuelsand Related Products and Power found in Table 8 of the Producer Price Indexes,published monthly by the U.S. Department of Labor, Bureau of Labor Statistics(hereinafter the “PPI”). The change in this component shall be calculated bymultiplying a fraction, the denominator of which shall be the average PPI forApril, May, and June, 2001 (the average base index first published for theperiod is 143.6), and the

 

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numerator of which shall be the average PPIfor the three-month period ending November 30, February 28, May 31,or August 31 (hereinafter the “calculation period”) times the initialfifty-five percent (55%) component. The effective date of the changes in thiscomponent shall be January 1, April 1, July 1, or October 1as the case may be, for the remainder of the Term of this Agreement, commencingJanuary 1, 2002 for LG&E and July 1, 2002 for KU.

 

(3) Twenty percent (20%) ofthe base rate (hereinafter the “20% Component”) shall change in proportion tochanges in the average of (a) the posted price of #2 diesel fuel atCatlettsburg, Kentucky and (b) the Ohio Valley Marine Service posted price atthe mouth of the Green River (together, the “Diesel Posted Prices”). The changein the 20% Component shall be calculated by multiplying a fraction, thedenominator of which shall be the average Diesel Posted Prices on the first (1st)day of each of the months of April, May, and June 2001(the average baseDiesel Posted Prices for the period is 86.7 cents per gallon), and thenumerator of which shall be the average Diesel Posted Prices on the first (1st)day of each of the months for the three (3) month periods beginning September,December, March and June (hereinafter the “Calculation Period”) timesthe initial 20% Component. The effective date of the changes in this componentshall be the first day of the calendar quarter following the end of theCalculation Period (January 1, April 1, July 1, or October 1,as the case may be), for the remainder of the Term of this Agreement, beginningJanuary 1, 2002 for LG&E and beginning July 1, 2002 for KU.

 

(4) Five percent *(5%)*of the base rate (the “5% Component”)represents federal taxes: the Inland Waterway Fuel Tax, Deficit Reduction Tax,and Leaking Underground Storage Tank Tax (collectively, the “Taxes”). Theaverage base for the tax for the period is 24.4 cents per gallon, which amountis comprised of Inland Waterway taxes in the amount of 20.0 cents per gallon,Deficit Reduction taxes in the amount of 4.3

 

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cents per gallon, and Leaking UndergroundStorage Tank taxes in the amount of .10 cents per gallon). This 5% Componentwill change to the extent of any future changes in the amount of Taxes, andshall be adjusted effective on the first (1st) day of the calendar monthfollowing the effective date of any change that occurs on or after January 1,2002, (except when such change is effective on the first (1st) day of suchmonth, in which case the adjustment shall be made as of such date).

 

(c)                                  Changes in the PPI.  The current index of 1982 = 100 applies tothe PPI. Should this index be revised or a new one adopted, the parties shallmake an appropriate adjustment, either in accordance with publishedinstructions from the Bureau of Labor Statistics regarding such revision or, ifno such instructions are published, by a proportionate revision which willfairly reflect such change in the index.

 

(d)                                 Rates will be adjusted for the cost of anygovernment-imposed tolls or other government charges (“Governmental Impositions”)enacted after the effective date of this Agreement which are assessed on rivertransportation and assessed against the Carrier for carrying Cargo under thisAgreement. Such rate adjustments will be effective as of the effective date ofsuch tolls or charges. Governmental Impositions shall not apply to: Taxes, asdefined in the preceding section, changes in taxes on fuel, which changes shallbe covered in sections 7(b)(3) and 7(b)(4) hereof, any noncompliance existingas of the effective date of this Agreement, financing costs and taxes, incometax or property taxes or related costs, any penalties, interest, fines, costsof arbitration, mediation, litigation, or any other type of dispute resolutionthrough all stages of appeal, payment of judgments against Carrier or Carrier’saffiliates, or on instruments or documents evidencing the same or on theproceeds thereof, and wages, benefits and retirement. In order to constitute aGovernmental Imposition, it must be imposed against the barging industry eitheron a regional, state or national basis. Carrier must notify Buyer in writing

 

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of the obligation to complywith such laws (if Carrier anticipates meeting the conditions that wouldrequire Carrier to comply with such laws) within thirty (30) days of the timeCarrier becomes aware of such laws, setting forth the specific law orregulation and the anticipated actual or actual financial impact on Carrier’sdelivery of Cargo hereunder, and the anticipated or actual effective date.Additionally, the applicable base price hereunder shall be increased only ifthe price adjustment is allocated evenly to all effected cargo transported byCarrier, so that Buyer is allocated only its proportionate share of suchGovernmental Imposition, and the base price shall be decreased for any savingsresulting from changes in such Governmental Imposition. The base price can notbe increased due to Governmental Impositions (a) on an annual basis, more thanfive percent (5%) per ton of the rates effective January 1, 2002; and (b)on a cumulative basis during the Term, more than fifteen percent (15%) per tonof the rates effective January 1, 2002. If (a) the annual increase ofGovernmental Impositions is more than five percent (5%) of the rates effectiveon January 1, 2002, or (b) if the total amount of Governmental Impositionsis more than fifteen percent (15%) of the rates effective January 1, 2002,on a cumulative basis during the Term of this Agreement, Carrier may terminatethis Agreement upon not less than sixty (60) days’ written notice to Buyer.Alternatively, Buyer may agree, by forwarding written notice to Carrier withinsixty (60) days after receiving Carrier’s written notice of termination toaccept the cumulative Base Rate increase of more than fifteen percent (15%).Carrier shall notify Buyer of any such changes within the time frames set forthabove and supply sufficient documentation for Buyer to verify any such change.Either Buyer or Carrier may request a base price adjustment, which shall becomprised of no more than the reasonable actual costs directly associated withthe effect of such change on the Cargo to be transported hereunder. Suchadjustment shall be made effective on the first day of the calendar monthfollowing the effective date of any change,

 

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(except when such change iseffective on the first day of the month, in which case the adjustment shall bemade as of such date).

 

(e)                                  The calculations for changes in thecomponents of the base rate are to be made to three (3) decimal places, withthe total being rounded to two (2) decimal places.

 

(f)                                    The term “ton” as used herein shall mean anet ton of two thousand (2000) pounds avoirdupois weight.

 

**8.****                                     ****Demurrage.**

 

(a)                                  Free Time At Mill Creek, Ghent, JeffersonCounty Riverport, and TrimbleCounty Limestone Destinations. Buyer shall be allowed four (4) “FreeUnloading Days” within which to unload each of the barges delivered to Buyer atMill Creek (coal and limestone), Ghent (coal and limestone), JeffersonRiverport (coal and limestone) and Trimble County Limestone pursuant to thisAgreement. An “Unloading Day” shall commence at 7:00 a.m. and continue until7:00 a.m. on the next day. The calculation of “Free Unloading Days” for eachbarge, for purpose of the unloading demurrage accounts described in Sub-section c,below, shall commence at the first (1st) 7:00 a.m. following the delivery ofsuch barge to Buyer and notification is given to Buyer that the first (1st)barge is moored to the Buyer’s dock and ready to unload, and shall runcontinuously thereafter for a period of ninety six (96) hours. “ActualUnloading Days” for each barge, for purpose of said demurrage accounts, shallcommence concurrently with the commencement of the “Free Unloading Days” andshall continue until the first (1St) 7:00 a.m. following the timethat Carrier’s dispatcher has been notified that the barge is actually unloadedand ready for pick up (for a barge unloaded and said notification given beforethe first (1st) 7:00 a.m. following delivery, the “Actual UnloadingDays” would be zero).

 

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(b)                                 Free Time At Trimble County Coal and Cane RunDestinations. Buyer shall beallowed per barge tow, one (1) hour per barge plus one (1) additional hour as “FreeUnloading Hours” within which to unload the barge tow delivered to Buyer atTrimble County Coal and Cane Run Stations. For example, if a barge tow of six(6) barges is delivered, seven (7) free unloading hours shall be allowed Buyerwithin which to unload the six (6) delivered barges (one (1) hour per bargeplus one (1) hour equals seven (7) hours). The calculation of “Free UnloadingHours” for the purpose of the unloading demurrage accounts described in Sub-section (d)below, shall commence when Buyer is notified that the first (1St)barge is located under the unloader and is ready to unload, except that, ifBuyer for any reason, except for force majeure, is not prepared to unload suchbarge or has another barge line’s barge under the unloader, then Free UnloadingHours shall begin when Carrier notifies Buyer that it has arrived and is readyto begin unloading. “Actual Unloading Hours” for each barge tow, for purpose ofsaid demurrage accounts, shall commence concurrently with the commencement ofthe “Free Unloading Hours” and shall continue until Carrier is notified byBuyer that the barge tow is actually unloaded and ready for removal. Fractionsof an hour shall be rounded up to the nearest one-half hour.

 

In the event a Crounse coal tow arrives at Trimble County within lessthan twelve hours after the completion of the free unloading time for theprevious Crounse coal tow, the free time for the second coal tow shall notcommence until the twelfth hour following completion of the free time for thefirst Crounse coal tow. For example, if a ten (10) barge Crounse coal towarrives at 0200 hours, the free time would expire at 1300 hours (eleven hourslater). If a second Crounse coal tow arrives at 1100 hours, the free time forthe second Crounse coal tow shall not commence until 0100 hours the next day(twelve hours after the completion of the free unloading time for the firstCrounse coal tow). This exception shall

 

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not apply to barges in either tow if such bargeswere diverted from a plant other than Trimble County.

 

The plant shall maintain a log of start and stop times for theunloading of each tow and shall communicate such times to Carrier’s towboatpilothouse personnel, as requested, in order for both parties to mutuallyreconcile free time calculations. Unloading shall be considered complete oncethe bucket unloader has completed its unloading cycle (and been cleared fromthe cargo box) for the last barge in that tow.

 

(c)                                  Demurrage Accounts For Mill Creek, Ghent,Jefferson County Riverport, andTrimble County Limestone. Carrier shall maintain separate unloadingdemurrage accounts for Mill Creek, Ghent, Jefferson County Riverport, andTrimble County Limestone, in which one (1) credit shall be entered for each daythe Actual Unloading Days for a barge are less than four (4) days for thatbarge, and in which one (1) debit shall be entered for each day the ActualUnloading Days for a barge exceed four (4) days for that barge. Separatedemurrage accounts for coal and limestone shall be kept at Mill Creek, Ghentand Trimble County.

 

At the end of each month during the Term of this Agreement, thedemurrage accounts shall be balanced and settled for that period (hereinaftercalled “Accounting Period”) by canceling one (1) debit with one (1) credit ineach demurrage account and by the payment by Buyer to Carrier of one hundredand fifty dollars ($150), subject to the same adjustments set forth in subsection 7(b),for each such demurrage debit not so canceled. In the event the total creditsexceed the total debits in the account at the end of any Accounting Period,such excess credits shall be canceled and shall not carry over to the nextAccounting Period. At Buyer’s request, but not more frequently than once permonth, Carrier shall send Buyer a summary of the current demurrage accounts.

 

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(d)                                 Demurrage Accounts For Trimble County Coaland Cane Run. Carrier shallmaintain unloading demurrage accounts for Trimble County coal and Cane Run, inwhich Buyer will receive one (1) credit for each hour the “Actual UnloadingHours” are less than the “Free Unloading Hours” and one (1) debit shall beentered for each hour the Actual Unloading Hours exceed the Free UnloadingHours.

 

At the end of each month during the Term of this Agreement, thedemurrage accounts shall be balanced and settled for that one month period(hereinafter called “Accounting Period”) by canceling one (1) debit with one(1) credit in each demurrage account and by the payment by Buyer to Carrier oftwo hundred and twenty-five dollars ($225), subject to the same adjustments setforth in subsection 7(b), for each such demurrage debit not so canceled.  In the event the total credits exceed thetotal debits in the account at the end of any Accounting Period, such excesscredits shall be canceled and shall not carry over to the next Accounting Period.At Buyer’s request, but not more frequently than once per month, Carrier shallsend Buyer a summary of the current demurrage accounts.

 

**9.****                                     ****Payment.**

 

The method of determiningthe weight of the Cargo for the purpose of calculating payment to the Carrierhereunder shall be the same method used for the purpose of calculating paymentto the Cargo set forth in Buyer’s various coal supply and limestone agreements.For all tons of Cargo unloaded pursuant to the provisions of Section 4,between the first (1st) and fifteenth (15th) days of any calendarmonth, Buyer shall make payment to Carrier for the transportation of such tonsof Cargo, between each loading point and each delivery point, by thetwenty-fifth (25th) of such month of transportation. If the twenty-fifth (25th)is not a regular workday, payment shall be made on the next regular workday.Within approximately fifteen (15) days after the end of each calendar month,Buyer shall provide to

 

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Carrier the number of tons ofCargo transported between each loading point and each delivery point duringsuch calendar month under this Agreement. On the basis of this quantityinformation, Carrier shall submit an invoice to Buyer for receipt by Buyer onor before the twentieth (20th) of the month. Buyer shall make payment of suchinvoice (less the payment made for the tons of Cargo transported between thefirst (1st) of the month and the fifteenth (15th) of the month) bythe twenty-fifth (25th) of the month following delivery. If the twenty-fifth(25th) is not a regular workday, payment shall be made on the nextregular workday. Two (2) invoices will be sent to Buyer. The invoice forLouisville Gas and Electric will be sent to the following address:

 

Louisville Gas and ElectricCompany P.O. Box 32010

Louisville, Kentucky 40232

Attn: Manager, LG&E/KU Fuels

 

The invoice for KentuckyUtilities will be sent to the following address:

 

Kentucky Utilities Company

P.O. Box 32010

Louisville, Kentucky 40232

Attn: Manager, LG&E/KU Fuels

 

**10.****                              ****Indemnification.**

 

The parties agree to defend,indemnify and hold harmless each other from any claim, demand, suit, loss, costor expense or any damage which may be asserted, claimed or recovered against orfrom one of them by reason of any damage to property, including property ofothers, or injury, including death, sustained by any person or personswhomsoever to the extent such damage, injury or death arises out of any act oromission by the offending party, its officers, employees or parties engaged byit, in its performance of this agreement. Neither party shall be liable to theother party for consequential, punitive, or

 

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exemplary damages.

 

**11.****                              ****Insurance.******At all times, the Carrier will carry andmaintain at its own cost (a) protection and indemnity insurance, includingtower’s liability, collision liability, and wharfinger’s liability, in theamount of at least five (5) million dollars per occurrence and (b) cargoinsurance which shall fully insure the Cargo at the then current cost of thatCargo to Buyer, and (c) pollution insurance in the amount of at least five (5)million dollars. Certificates of insurance satisfactory in form to Buyer andsigned by the Carrier’s insurer shall be supplied by the Carrier to Buyerevidencing that the above insurance is in force and that not less than thirty(30) calendar days written notice will be given to Buyer prior to anycancellation or material reduction in coverage under the policies. TheContractor shall cause its insurer to name Buyer as an additional namedinsured, and waive all subrogation rights against Buyer for all losses orclaims arising from performance hereunder. Evidence of Buyer’s status as anadditional insured, a statement that such status shall not prejudice any rightsto which Buyer would have been entitled were Buyer not an additional insured,and evidence of such waiver of subrogation satisfactory in form and substanceto Buyer shall be exhibited in the Certificate of Insurance mentioned above.Carrier’s liability shall not be limited to its insurance coverage.

 

**12.****                              ****Termination.******If either party hereto commits a materialbreach of any of its obligations under this Agreement at any time, then theother party has the right to give written notice describing such breach andstating its intention to terminate the Agreement no sooner than 30 days afterthe date of the notice (the “Notice Period”). If such material breach iscurable and the breaching party cures such material breach within the NoticePeriod, then the Agreement shall not be terminated due to such material breach.If such material breach is not curable or the breaching party fails to curesuch material breach within the

 

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Notice Period, then thisAgreement shall terminate at the end of the Notice Period in addition to allthe other rights and remedies available to the aggrieved party under thisAgreement and at law and in equity.

 

**13.****                              ****Force Majeure.******If either party hereto is delayed in orprevented from performing any of its obligations under this Agreement due toacts of God, war, riots, civil insurrection, acts of the public enemy, strikes,lockouts, fires, floods, or earthquakes, equipment breakdowns, or other causesbeyond the reasonable control of the affected party, then the obligations ofboth parties hereto shall be suspended to the extent made necessary by suchevent provided that such party gives written notice to the other party aspromptly as practicable of the nature and probable duration of the forcemajeure event. The party declaring force majeure shall exercise due diligenceto avoid and shorten the force majeure event and will keep the other partyadvised as to the continuance of the force majeure event. Services not providedduring any force majeure period shall be made up within a reasonable time atthe option of Buyer. If a force majeure event affects a material portion of theservices hereunder for more than twenty (20) days, the party not claiming forcemajeure may terminate the contract by forwarding written notice to the claimingparty. If the force majeure event claimed by Carrier is industry-wide, Buyermay not terminate this Agreement unless Buyer can obtain alternate rivertransportation services from another provider.

 

**14.****                              ****This section intentionallyleft blank.**

 

**15.****                              ****Independent Contractor.******Nothing in this Agreement shall be deemed tomake the Carrier or any of the Carrier’s employers or agents therepresentative, agent, or employee of Buyer. The Carrier shall be anindependent contractor and shall have responsibility for and control over thedetails and means for performance under this Agreement. Anything in thisAgreement which may appear to give Buyer the right to direct the Carrier as tothe details of

 

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its performance hereunder or toexercise a measure of control over the Carrier means that the Carrier shall besubject to the desires of Buyer only in the results achieved.

 

**16.****                              ****Equal Employment Opportunity**.  Tothe extent applicable, Carrier shall comply with all of the followingprovisions which are incorporated herein by reference:  Equal Opportunity regulations set forth in 41CRF §60-1.4(a) and (c) prohibiting discrimination against any employee orapplicant for employment because of race, color, religion, sex, or nationalorigin; Vietnam Era Veterans Readjustment Assistance Act regulations set forthin 41 CFR § 60-250.4 relating to the employment and advancement ofdisabled veterans and veterans of the Vietnam Era; Rehabilitation Actregulations set forth in 41 CFR § 60-741.4 relating to the employment andadvancement of qualified disabled employees and applicants for employment; theclause known as “Utilization of Small Business Concerns and Small BusinessConcerns Owned and Controlled by Socially and Economically DisadvantagedIndividuals” set forth in 15 USC § 637(d)(3); and subcontracting planrequirements set forth in 15 USC § 637(d).

 

**17.****                              ****Miscellaneous**

 

(a)                                  This Agreement shall be governed by thesubject to the law of the Commonwealth of Kentucky (excluding its conflictslaws).

 

(b)                                 All notices respecting this Agreement shallbe in writing and shall be addressed as follows:

 
|   | If to  LG&E: | Louisville  Gas and Electric Company            |
|--------|------------------|-------------------------------------------------|
|   |             | P.O. Box  32010                                 |
|   |             | Louisville,  Kentucky 40232                     |
|   |             | Attn:  Director Corporate Fuels and By Products |
|   |             |                                            |
|   |             |                                            |
|   | If to KU:        | Kentucky  Utilities                             |
|   |             | P.O. Box  32010                                 |
|   |             | Louisville,  Kentucky 40232                     |
|   |             | Attn:  Director Corporate Fuels and By Products |

 

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|   | If to  Carrier: | Crounse  Corporation     |
|--------|-----------------|--------------------------|
|   |            | 2626  Broadway           |
|   |            | Paducah,  Kentucky 42001 |
|   |            | Attn:  President         |

 

(c)                                  Attorneys’ Fees and Costs. If a dispute arises under this Agreement,the prevailing party shall be entitled to recover attorney’s fees and othercosts from the nonprevailing party.

 

(d)                                 Entire Agreement. This Agreement contains the entire agreementbetween the parties respecting the subject matter hereof and supersedes allprior or contemporaneous oral or written statements, understandings, andagreements.

 

(e)                                  Headings. The paragraph headings appearing in this Agreement are for convenienceonly and shall not affect the meaning or interpretation of this Agreement.

 

provision of this agreement, or to takeadvantage of any rights hereunder, shall not be construed as a waiver of suchprovision or right.

 

(f)                                    Waiver. The failure of either party to insist on strict performance of anyprovision of this agreement, or to take advantage of any rights hereunder,stall not be construed as a waiver of such provision or right.

 

(g)                                 Remedies Cumulative. Remedies provided under this Agreement shallbe cumulative and in addition to other remedies provided under this Agreementor by law or in equity.

 

(h)                                 Severability. If any provision of this Agreement is foundcontrary to law or unenforceable by any court of law, the remaining provisionsshall be severable and enforceable in accordance with their terms, unless suchunlawful or unenforceable provision is material to the transactionscontemplated hereby, in which case the parties shall negotiate in good faith asubstitute provision.

 

(i)                                     Binding Effect. This Agreement shall bind and inure to thebenefit of the

 

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parties and their successors and assigns.

 

(j)                                     Assignment.

 

(i)                                     Carrier shall not, without Buyer’s priorwritten consent, which consent may be withheld in Buyer’s sole opinion, makeany assignment, subcontracting or transfer of this Agreement by operation oflaw or otherwise, including without limitation any assignment or transfer assecurity for any obligation, and shall not assign or transfer the performanceof or right or duty to perform any obligation of Carrier hereunder; provided,however, that Carrier may assign the right to receive payments directly fromBuyer to a lender as part of any accounts receivable financing or otherrevolving credit arrangement which Carrier may have now or at any time duringthe Term of this Agreement, and provided further, that Buyer shall considerconsenting to an assignment to an affiliate of Carrier. Buyer shall notunreasonably withhold its consent to an assignment to an affiliate of Carrier,provided: (a) the affiliate’s balance sheet, financial statement, and businessexperience and capability are comparable to Carrier’s, (b) the majorityownership of the affiliate is comparable to Carrier’s, and (c) Carrier receivesBuyer’s prior written approval for the transfer.

 

(ii)                                  Buyer shall not, without Carrier’s priorwritten consent, which consent shall not be unreasonably withheld, assign thisAgreement or any right for the performance of or right or duty to perform anyobligation of Buyer hereunder; except that, without such consent, Buyer mayassign this Agreement in connection with a transfer by Buyer of all or amajority interest in the Buyer’s generating station that is the recipient ofthe coal to be delivered hereunder, or as part of a merger or consolidationinvolving Buyer.

 

(iii)                               In the event of an assignment or transfercontrary to the provisions of this section, the non-assigning party mayterminate this Agreement immediately.

 

(k)                                  Amendments. Except as otherwise provided herein, this Agreement may not beamended, supplemented or otherwise modified except by written instrument signedby both parties hereto.

 

The parties hereto haveexecuted this Agreement effective as of the date first written above butactually on the dates set forth below.

 
| LOUISVILLE GAS AND  ELECTRIC COMPANY | CROUNSE CORPORATION |   |   |
|--------------------------------------|---------------------|--------|--------|

 

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| KENTUCKY UTILITIES COMPANY      |                                      |   |   |
|---------------------------------|-------------------------------------------|--------|--------|
|                            |                                      |   |   |
|                            |                                      |   |   |
| By:                             | /s/   Victor  A. Staffieri |   |   |   |   |
| Title: Chief Executive  Officer |                                      |   |   |
| Date: 8/21/02                   |                                      |   |   |
|                                 |                                           |        |        |  |  |

 

**Appendix A to BargingAgreement**

 

Some specific minimum safety procedures are set forth below.This list in no way limits Carrier’s obligation to act safely at all times inits performance under this Agreement and to bear sole responsibility therefor.Additionally, while on Buyer’s property, Carrier will comply with Buyer’ssafety rules for contractors.

 

1.                                       Notice of Barge Transactions

 

At Mill Creek, Cane Run, Trimble County, and Ghent, the Carrier willnotify Buyer of any barge transaction as follows. The Carrier first willattempt to notify Buyer’s guard service at the loading dock by way of themarine radio located at the Guard House. If the Carrier is unable to contactthe guard service, the Carrier will notify the plant shift supervisor. If theCarrier is unable to notify the plant shift supervisor, the Carrier will notifythe material handling supervisor. The Carrier shall not leave the barges untilone of the Buyer’s employees or agents set forth above has been notified.

 

2.                                       Location of Barges

 

At all times, the Carrier further will be prepared to, and upon requestby

 

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Buyer will, immediately state the location of anybarge destined for Buyer and in the care and custody of Carrier from the timethat Buyer requests barge placement at a holding point to the time that Carrierdelivers the barges.

 

3.                                       Mooring

 

(a)                                  All barges that are moored at alldestinations and are to be left at the plant site shall be moored using boththe normal leaving lines supplied with each barge and a two inch (2”) fleetingline that is attached to each cell.

 

(b)                                 Life preservers shall be worn by everyoneworking on the barges.

 

(c)                                  For Trimble County and Cane Run, bargesgenerally will be standby unloaded as stated in Section 4 of thisAgreement. When circumstances dictate that barges will be moored at TrimbleCounty, the maximum number of barges to be moored in the coal area is thirty(30) and in the limestone area is eighteen (18). Barges will be moored no morethan three (3) abreast during rising river, falling river, high water, or icyconditions without a towboat in attendance.

 

(d)                                 For Mill Creek, the maximum number of bargesthat can be moored without a harbor boat in attendance is thirty-two (32).Barges shall not be moored wider than five (5) abreast under any conditions.

 

(e)                                  For Ghent, the maximum number of barges thatcan be moored without a harbor boat in attendance is thirty-two (32).

 

4.                                       Riverport

 

For barges destined for theRiverport, the Carrier will comply with all requirements and proceduresestablished by the Riverport pertaining to the Carrier’s performance hereunder.

 

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5.                                       Breakaway and Loose Barnes

 

If at any time and for any reason any barge breaks away from the dockor becomes loose, Carrier immediately will assist and cooperate in retrievingor securing such barge upon becoming aware of the situation.

 

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