exv10w61






Exhibit 10.61




SUBSCRIPTION AGREEMENT




Armstrong Energy, Inc.

7733 Forsyth Boulevard, Suite 1625

St. Louis, Missouri 63105




Ladies and Gentlemen:




     1. Subscription. Subject to the terms and conditions of this subscription agreement
(this “Agreement”), Subscriber hereby irrevocably subscribes for the number of shares of Series A
Convertible Preferred Stock, par value $.01 per share (the “Subscribed Shares”), of Armstrong
Energy, Inc., a Delaware corporation (the “Company”), set forth on the signature page to this
Agreement, at a purchase price of $100.00 per share. Concurrently with the delivery of this
Agreement, Subscriber is delivering to the Company the aggregate purchase price for the Subscribed
Shares in the amount and form(s) of consideration as set forth on the signature page to this
Agreement.



     2. Acceptance of Subscription. It is understood and agreed that the Company shall have
the right to accept or reject this subscription, in whole or in part, and that the same shall be
deemed to be accepted by the Company only when it is signed by an authorized officer of the
Company, at which time this Agreement shall become effective and binding. In the event this
Agreement is rejected by the Company, the purchase price for the Subscribed Shares will be returned
promptly to Subscriber without interest or deduction for any expenses.



     3. Terms and Conditions. Subscriber understands and agrees that this subscription is
made subject to the Company’s right to reject this subscription, in whole or in part.



     4. Representation and Warranties of Subscriber. Subscriber hereby represents and
warrants to and covenants with the Company and each officer, employee and agent of the Company
that:




     a. Subscriber understands that (i) the Subscribed Shares are being offered and sold
under exemptions from registration provided for in the Securities Act of 1933, as amended
(the “Securities Act”), (ii) Subscriber is purchasing an interest in the Company without
being furnished any offering literature or prospectus, and (iii) this transaction has not
been reviewed by the United States Securities and Exchange Commission (“SEC”) or by any
administrative agency charged with the administration of the securities or “blue sky” laws
of any state.




     b. The Subscribed Shares are being purchased for Subscriber’s own investment portfolio
and account (and not on behalf of, and without the participation of, any other person) with
the intent of holding the Subscribed Shares for investment and without the



 









 






intent of participating, directly or indirectly, in a distribution of the Subscribed Shares and
not with a view to, or for resale in connection with, any distribution of the Subscribed Shares or
any portion thereof, nor is Subscriber aware of the existence of any distribution of the Company’s
securities.




     c. Prior to Subscriber’s decision to purchase the Subscribed Shares, Subscriber:




     (i) has been afforded access to, and given an opportunity to review, all
available information relating to the Company; and




     (ii) has been given the opportunity to ask questions of and receive answers from
the representatives of the Company.




     d. Subscriber acknowledges receipt of all information requested of the Company, that
Subscriber deemed necessary in order to enable him to make an informed decision concerning an
investment in the Subscribed Shares. Subscriber has evaluated the risk of investing in the
Subscribed Shares and is acquiring the Subscribed Shares based only upon such Subscriber’s
independent examination and judgment as to the prospects of the Company as determined from the
information obtained directly by Subscriber from the Company.




     e. Subscriber acknowledges that the Subscribed Shares were not offered to Subscriber by means
of publicly disseminated advertisements of sales literature, nor is Subscriber aware of any offers
made to other persons by such means.




     f. Subscriber makes one of the following representations regarding its status as an
“accredited investor” and certain related matters. [Please check the applicable subparagraph.]




	 	o	 	1. Subscriber is a trust with total assets in excess of $5,000,000 whose
purchase is directed by a person with such knowledge and experience in financial and
business matters that such person is capable of evaluating the merits and risks of
the prospective investment.
	 
	 	o	 	2. Subscriber is a bank, insurance company, investment company registered
under the Investment Company Act of 1940, a broker or dealer
registered pursuant to Section 15 of the Securities Exchange Act of 1934, a
business development company, a Small Business Investment Company licensed by the
U.S. Small Business Administration, a plan with total assets in excess of
$5,000,000 established and maintained by a state for the benefit of its employees,
or a private business development company as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940.
	 
	 	o	 	3. Subscriber is an employee benefit plan and either all investment
decisions are made by a bank, savings and loan association, insurance company, or
registered investment advisor, or Subscriber has total assets in




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	 	 	 	excess of $5,000,000 or, if such plan is a self-directed plan, investment
decisions are made solely by persons who are accredited investors.






	 	o	 	4. Subscriber is (A) a corporation, (B) partnership, (C) business trust,
or (D) an organization described in section 501(c)(3) of the Internal Revenue Code
and has total assets in excess of $5,000,000.
	 
	 	o	 	5. If Subscriber is not an entity described in paragraphs (f)(l) through
(f)(4), Subscriber represents that each of its equity owners is either (i) an entity
described in paragraphs (f)(2) through (f)(4); or (ii) an individual who (A) has an
individual net worth, or a joint net worth with such individual’s spouse, in excess
of $1,000,000, excluding the value of the primary residence of such individual,
or (B) has had an individual income in excess of $200,000 in each of the two most
recent years, or a joint income with one’s spouse in excess of $300,000 in each of
those years, and has a reasonable expectation of reaching the same income level in
the current year, or (C) is a manager or executive officer of the Company.
	 
	 	o	 	6. If Subscriber is an individual, Subscriber represents that it (i) has a
net worth, either individually or upon a joint basis with Subscriber’s spouse, of at
least $1,000,000, excluding the value of the primary residence of Subscriber, (ii) has
had an individual income in excess of $200,000 for each of the two most recent years,
or a joint income with Subscriber’s spouse in excess of $300,000 in each of those
years, and has a reasonable expectation of reaching the same income level in the
current year, or (iii) is a manager or executive officer of the Company.
	 
	 	o	 	7. Subscriber cannot make any of the representations set forth
in paragraphs (f)(l) through (f)(6) above.






     g. Subscriber is knowledgeable and experienced in finance, securities and investments and has
had sufficient experience analyzing and investing in securities similar to the Subscribed Shares
so as to be capable of evaluating the merits and risks of an investment in the Subscribed Shares.
Subscriber is able to bear the economic risk of an investment in the Subscribed Shares.




     h. Subscriber acknowledges that the Subscribed Shares are speculative investments that
involve a high degree of risk and Subscriber can sustain a complete loss of
this investment in the Subscribed Shares. Subscriber has no need for liquidity in
Subscriber’s investment in the Subscribed Shares.




     i. Subscriber acknowledges that Subscriber must continue to bear the economic
risk of the investment in the Subscribed Shares for an indefinite period and recognizes that the
Subscribed Shares are being sold without registration for any subsequent sale under the Securities
Act and applicable state securities laws.



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     j. Subscriber has received and carefully read and is familiar with the Company’s
Certificate of Incorporation (as amended), Bylaws and other organizational documents.




     k. The Subscribed Shares will not be offered for sale, sold or transferred by
Subscriber other than pursuant to (i) an effective registration under the Securities Act or
in a transaction which is otherwise in compliance with the Securities Act; and (ii)
evidence satisfactory to the Company of compliance with the applicable securities laws. The
Company shall be entitled to rely upon an opinion of counsel satisfactory to it with
respect to compliance with the above laws.




     l. A legend indicating that the Subscribed Shares have not been registered under
applicable federal and state securities laws and referring to the restrictions on
transferability and sale of the Subscribed Shares may be placed on any certificate(s) or
other document delivered to Subscriber or any substitute therefor and any transfer agent of
the Company may be instructed to require compliance therewith.




     m. Subscriber represents that Subscriber has the power and authority to sign this
Agreement and provide the funds required for this investment.




     n. Subscriber hereby certifies under the penalties of perjury that the taxpayer
identification number provided below is true, correct and complete.




     o. Subscriber acknowledges that Subscriber understands the meaning and legal
consequences of the representations, warranties and covenants set forth in this Section 4
and that the Company has relied and will rely upon such representations, warranties,
covenants and certifications.



     5. Survival. All representations, warranties, covenants and certifications contained
in this Agreement shall survive the acceptance of this Agreement. Subscriber acknowledges and
agrees that this Agreement shall survive (a) changes which are not material in the transactions,
documents and instruments contemplated herein, and (b) the death or disability of Subscriber.



     6. Governing Law. This Agreement shall be construed in accordance with and governed
in all respects by the laws of the State of Delaware.



     7. Assignment. This Agreement is not assignable by Subscriber without the prior
written consent of the Company. Any attempted assignment without such consent shall be void ab
initio.



     8. No Waiver. The failure of any party to insist upon strict performance of any
covenant or obligation hereunder, irrespective of the length of time for which such failure
continues, shall not be a waiver of such party’s right to demand strict compliance in the future.
No consent or waiver, express or implied, to or of any breach or default in the performance of any
obligation hereunder shall constitute a consent or waiver to or of any other breach or default in
the performance of the same or any other obligation hereunder.




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     9. Gender. Pronouns in masculine, feminine and neuter genders shall be construed to
include any other gender, and words in the singular form shall be construed to include the plural
and vice versa, unless the context clearly otherwise requires.



     The agreements and representations made by Subscriber herein extend to and apply to all of the
Subscribed Shares.



*   *   *   *   *   *   *   *   *




[Remainder of this page left intentionally blank]









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	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	Date: January 12, 2012	 	YORKTOWN ENERGY PARTNERS IX, L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Yorktown IX Company LP, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Yorktown IX Associates LLC, its general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Bryan H. Lawrence
 

	 	 
	 

	 	 	 	Name: Bryan H. Lawrence	 	 
	 

	 	 	 	Title: Managing Member	 	 
	 
	 	 	 	 	 	 
	 

	 	Address:
	 	410 Park Avenue, 19th Floor 
New York, New York 10022-4407	 	 






	 	 	 	 	 	 	 

	 

	 	Total Number of Shares:
	 	 	300,000	 
	 

	 	Aggregate Subscription Price:
	 	 	$30,000,000.00	 
	 

	 	Method of Payment:
	 	 	Cash by wire transfer of

immediately available

funds

	 
	 	 	 	 	 	 
	 

	 	Taxpayer ID No,: 27-3125579	 	 	 	 






ACCEPTED on January _, 2012




ARMSTRONG ENERGY, INC.




	 	 	 	 	 

	By:
	 	 	 	 
	 

	 	 

Martin D. Wilson, President
	 	 






[Signature Page to Armstrong Energy, Inc. Subscription Agreement]











 









 








	 	 	 	 	 	 	 

	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	Date: January _, 2012	 	YORKTOWN ENERGY PARTNERS IX, L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:   Yorktown IX Company LP, its general partner
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:   Yorktown IX Associates LLC, its general partner
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 
	 

	 	Name:

	 	 
	 

	 	Title:

	 	 
	 
	 	 	 	 	 	 
	 

	 	Address:
	 	 410 Park Avenue, 19th Floor 
New York, New York 10022-4407	 	 






	 	 	 	 	 	 	 

	 

	 	Total Number of Shares:
	 	 	300,000	 
	 

	 	Aggregate Subscription Price:
	 	 	$30,000,000.00	 
	 

	 	Method of Payment:
	 	 	Cash by wire transfer of

immediately available

funds

	 
	 	 	 	 	 	 
	 

	 	Taxpayer ID No.: 27-3125579	 	 	 	 






ACCEPTED on January 13, 2012




ARMSTRONG ENERGY, INC.




	 	 	 	 	 

	By:

	 	/s/ Martin D. Wilson
 

Martin D. Wilson, President
	 	 






[Signature Page to Armstrong Energy, Inc. Subscription Agreement]