Contract

#97-211-026




Kindill

Mining, Inc.




Amendment

No.2




 




EXHIBIT

10.67




 




AMENDMENT

NO. 2 TO COAL SUPPLY AGREEMENT




 




 




THIS AMENDMENT NO. 2 COAL SUPPLY AGREEMENT (“Amendment

No. 2”) is entered into effective as of January 1, 2002, by and between

LOUISVILLE 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.  In

consideration of the agreements herein contained, the parties hereto agree as

follows.




 




1.0                               AMENDMENTS




 




The Agreement heretofore

entered into by the parties, dated effective July 1, 1997 and identified by the

Contract Number set forth above, as amended by Amendment No. 1 dated effective

January 1, 2001(hereinafter together referred to as the “Agreement”), is hereby

further amended as follows:




 




2.0                               TERM




 




Section 2 Term, is deleted in its entirety and

replaced with the following:




 




“The term of this

agreement shall commence on July 1, 1997 and continue through December 31,

2005.”




 




3.0                               QUANTITY




 




3.1           Section 3.0 Quantity, is deleted

in its entirety and replaced with the following:




 




3.2           Section 3.1 Base Quantity




 




“Seller shall sell and

deliver and Buyer shall purchase and accept delivery of the following annual

base quantity of coal (“Base Quantity”), to be delivered on a ratable monthly

basis:




 




	

  YEAR


  	

   


  	

  BASE QUANTITY (TONS)


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

  2002


  	

   


  	

  700,000


  	

   


  
	

  2003

  - 2005


  	

   


  	

  900,000 


  	

   per year


  





 




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3.3          Section 3.2, Underdeliveries, is

hereby added as follows:




 




If Seller delivers 85% or

less of the ratable monthly quantity hereunder during any one calendar month

(the “Underdeliveries”) and such Underdeliveries are not excused by a valid

force majeure event, the Base Price that was in effect in 2001 shall be

automatically and immediately reinstated, effective on the first day of the

month during which the Underdeliveries occurred.  If such Underdeliveries exceed 15% during any sixty (60) day

period, Buyer shall have the immediate right to offset cover costs against

payments due Seller and Seller acknowledges and agrees it shall be responsible

for all cover costs resulting from such Underdeliveries.  If Buyer chooses not to cover, such

Underdeliveries shall be made up at Buyer’s sole option per Buyer’s schedule.




 




Notwithstanding this

specific remedy, the parties agree that Buyer’s remedies for Sellers’

underdeliveries and defaults shall be cumulative and not exclusive and shall

include 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           Section

8.1 Base

Price, is hereby deleted in its entirety and replaced with the

following provision:




 




Section 8.1 Base

Price. “The base price (“Base Price”) of the coal to be

sold hereunder will be firm and in accordance with the following:




 




	

  BASE PRICE


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

  YEAR


  	

   


  	

  PRICE

  ($Per MMBTU)


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

  2002

  - 2005


  	

   


  	

  $


  	

  .95455 FOB

  railcar


  	

   


  
					





 




 




The parties hereto

acknowledge Buyer has paid Seller $1.00/MMBtu for all coal received on and

after January 1, 2002. As of May 31, 2002, 391,261.8

tons of coal have been received by Buyer.  On and after the date all parties have fully executed this

Agreement, Buyer will begin receiving a credit of $1 per ton for all coal

delivered by Seller to Buyer, which credit shall continue until all

overpayments have been recouped by Buyer.




 




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5.2                                 Quality

Price Discounts, 

Sections 8.2(b)(i) and 8.2(b)(ii), are hereby deleted in their

entireties.




 




5.3           Section

8.3 Price

Review is hereby deleted in its entirety.




 




 




6.0                               GUARANTY

OF SELLER’S OBLIGATIONS.  As a

material inducement for Buyer’s entering into this Amendment No. 2, and in

consideration thereof, Guarantor hereby guarantees the full, prompt and

complete performance by Seller of all the terms and conditions of the Agreement

to be performed by Seller thereunder (the “Guaranty”).  Guarantor hereby indemnifies and holds Buyer

and Buyer’s successors and assigns harmless from and against all liability and

expense, including reasonable attorney’s fees, sustained by Buyer by reason of

the failure of Guarantor fully to perform and comply with the terms and

obligations of the Agreement, or by reason of any misrepresentation of

Guarantor hereunder.   It is understood

this is a continuing, absolute and unconditional Guaranty, co-extensive and

co-terminous with the Agreement between the Seller and Buyer, as it may be

further extended and amended by Buyer and Seller.  Guarantor hereby expressly waives notice of acceptance of this

Guaranty, notice of the defaults by Seller or of nonpayment or nonfulfillment

of any or all of Seller’s liabilities and obligations.  The delay or failure of Buyer to insist on

strict performance of any provision of this Agreement, or to take advantage of

any rights hereunder, shall not be construed as a waiver of such provision or

right or of the Guaranty.  The Guarantor

hereby expressly gives the Buyer and Seller from time to time, without notice

to Guarantor, authority and consent to give and make such extensions, renewals,

settlements, and compromises at it may deem proper with respect to any of the

duties or liabilities of the Seller under this Agreement.




 




7.0                               NOTICES




 




The following notice

provisions in Section 12.1, Form and Place of Notice, are hereby

revised as follows:




 




The copy address

listing Buyer’s Manager, Procurement Services is hereby deleted.




 




The notice addresses for

Seller 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                               EARLY

TERMINATION  




 




Section 13 Early

Termination is hereby deleted in its entirety.




 




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9.0                               STATUS

OF AGREEMENT




 




As amended herein, all

terms and conditions in the Agreement are hereby ratified and confirmed and

shall continue in full force and effect, including without limitation the

representations, warranties, non-waiver and indemnification provisions.




 




IN WITNESS WHEREOF,

the parties hereto have executed this Amendment No. 2 on the




day and year below

written, 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: 


  	

   


  	 

								





 




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