Exhibit 10.40

EXECUTION COPY

ASSET PURCHASE AGREEMENT

AMONG

ROSEBUD MINING COMPANY,

("Buyer")

BUCKEYE INDUSTRIAL MINING CO.

("Company")

AND

EVERGREEN ENERGY INC.

("Parent")

March 12,
2010

---



TABLE OF CONTENTS

PageARTICLE 1

1DEFINITIONS

11.1

Definitions.

11.2

Accounting Terms

1ARTICLE 2

1PURCHASE AND SALE OF ASSETS

12.1

Purchase and Sale

12.2

Excluded Assets

22.3

Assumed Liabilities

32.4

Excluded Liabilities

32.5

Non-Assignment of Assets

42.6

Amounts Held in Trust

4ARTICLE 3

4PURCHASE PRICE

43.1

Purchase Price

43.2

Payment of the Purchase Price

43.3

Determination and Payment of the Closing Indebtedness

43.4

Escrow

43.5

Allocation of Purchase Price

5ARTICLE 4

5REPRESENTATIONS AND WARRANTIES CONCERNING THE PARENT

54.1

Authority; Capacity and Representation

54.2

Execution and Delivery; Enforceability

54.3

Noncontravention

5ARTICLE 5

6REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY

65.1

Organization and Good Standing; Authority; Enforceability

65.2

Other Ventures

65.3

Noncontravention

65.4

Consents and Approvals

75.5

Absence of Certain Changes or Events

75.6

Taxes

85.7

Employees

85.8

Compliance with Laws

8


---



Page5.9

Environmental Matters

85.10

Real and Personal Properties

95.11

Intellectual Properties

125.12

Financial Statements

125.13

Material Contracts

135.14

Litigation

145.15

Brokerage

145.16

Material Suppliers and Customers

145.17

Licenses and Permits

145.18

Employee Benefit Plans and Other Compensation Arrangements

145.19

Redbud West Point Ash Disposal Facility

155.20

Acquired Assets

155.21

No Additional Representations

15ARTICLE 6

16REPRESENTATIONS AND WARRANTIES OF BUYER

166.1

Organization; Authorization

166.2

Execution and Delivery; Enforceability

166.3

Governmental Authorities; Consents

166.4

Brokerage

166.5

Financing

176.6

Solvency

176.7

Due Diligence Investigation

17ARTICLE 7

17CONDITIONS PRECEDENT

177.1

Conditions to Buyer's Obligations

177.2

Conditions to Sellers' Obligations

19ARTICLE 8

19THE CLOSING

19ARTICLE 9

20COVENANTS OF SELLERS

209.1

Conduct of Business

209.2

Access

209.3

Change of Names

20


ii

---



Page9.4

Exercise of Redbud Option to Acquire Permits

20ARTICLE 10

21COVENANTS OF BUYER

2110.1

Access

2110.2

Notices of Certain Events

2110.3

Employees

21ARTICLE 11

21ADDITIONAL COVENANTS OF BUYER AND SELLERS

2111.1

Termination

2111.2

Effect of Termination

2211.3

Updating of Disclosure Letter

2211.4

Pre-Closing Publicity

2311.5

Post-Closing Publicity

2311.6

Expenses

2311.7

No Assignments

2311.8

Confidentiality Agreement

2311.9

Satisfaction of Closing Conditions

2311.10

Tax Cooperation: Allocation of Taxes

2311.11

Replacement of Bonds and Letters of Credit

2411.12

Covenant Not to Compete

24ARTICLE 12

25INDEMNIFICATION

2512.1

Indemnification of Buyer

2512.2

Limitations on Indemnification

2512.3

Indemnification of Parent

2612.4

Procedures Relating to Indemnification

2612.5

Limitation of Remedies

2812.6

Subrogation

28ARTICLE 13

28CERTAIN DEFINITIONS

28ARTICLE 14

34CONSTRUCTION; MISCELLANEOUS PROVISIONS

3414.1

Notices

34


iii

---



Page14.2

Entire Agreement

3514.3

Modification

3514.4

Governing Law; Jurisdiction and Venue

3514.5

Specific Performance

3514.6

Binding Effect

3614.7

Headings

3614.8

Number and Gender; Inclusion

3614.9

Counterparts

3614.10

Third Parties

3614.11

Disclosure Letter and Exhibits

3614.12

Time Periods

3614.13

Construction

36


iv

---



ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (this "Agreement") is entered into as of the
12th day of March, 2010, among Rosebud Mining Company, a Pennsylvania corporation ("Buyer"), Evergreen Energy Inc., a Delaware corporation
("Parent"), and Buckeye Industrial Mining Co., an Ohio corporation (the "Company," and together
with Parent, collectively, "Sellers," and each individually, a "Seller").

RECITALS:

A.    The
Company is engaged in the business of (i) operating surface and underground coal mines in four (4) Ohio counties (Carroll, Columbiana, Jefferson and
Stark); (ii) mining, processing and selling coal to electric utilities and industrial and institutional end-users; and (iii) ash removal and disposal and the operation of an
ash monofill located in the State of Ohio (collectively, the "Business").

B.    Parent
owns certain assets used in the operations of the Business.

C.    Buyer
desires to purchase the assets used primarily in the operations of the Business, and Sellers desire to sell such assets of the Business to Buyer, all upon the terms
and conditions hereinafter set forth.

Now,
therefore, in consideration of the mutual representations, warranties, covenants and agreements set forth in this Agreement, Buyer and Sellers hereby agree as follows:

ARTICLE 1

DEFINITIONS

1.1Definitions.Certain terms used in this Agreement shall have the meanings set forth
inArticle 13, or elsewhere herein as indicated inArticle 13.

1.2Accounting Terms.Accounting terms used in this Agreement and not otherwise defined herein shall have the
meanings attributed to them under GAAP except as may otherwise be specified herein.

ARTICLE 2

PURCHASE AND SALE OF ASSETS

2.1Purchase and Sale.Subject to the terms and conditions of this Agreement, at the Closing, Sellers shall
sell, assign, transfer and deliver to Buyer, free and clear of all Liens, except for Permitted Liens, and Buyer shall purchase from Sellers, all of Sellers' right, title and interest in and to the
following assets used primarily in the operation of the Business as of the Closing Date (collectively, the "Acquired Assets"), which Acquired Assets
include:



---





2.2Excluded Assets.Notwithstanding anything contained in Section 2.1hereof to the contrary, Sellers are not selling,
and Buyer is not purchasing (i) any assets of the Company set forth in Sections 2.2(a)-(l)below and (ii) any assets of Sellers not used primarily in the operation of the Business, all of
which shall be
retained by Sellers (collectively, the "Excluded Assets"). To the extent that any of the Excluded Assets are located at the Real Property, Sellers shall
be provided a reasonable period after the Closing Date, but not to exceed sixty (60) days, to remove, at Sellers' expense, all such Excluded Assets. The Excluded Assets include:



2

---





2.3Assumed Liabilities.As further consideration for the purchase of the Acquired Assets and consummation of
the other transactions contemplated hereby, on the Closing Date, Buyer shall assume and agree to perform and discharge in full, when due, all liabilities of the Company and the Business arising under
or associated with (collectively, the "Assumed Liabilities"):



Buyer
is assuming only the Assumed Liabilities and is not assuming any other liability or obligation. All such other liabilities and obligations shall be retained by and remain liabilities and
obligations of Sellers.

2.4Excluded Liabilities.Except for the assumption by Buyer of the Assumed Liabilities, Sellers will retain all
liabilities relating to the Business (including, for clarity, all accounts payable of the Company and all Indebtedness of the Company, each as of the Closing Date) and, except for the Assumed
Liabilities, Buyer shall not assume nor be liable or responsible for, whether as a successor or otherwise, any obligation or liability of Sellers or the Business of any kind or nature whatsoever,
specifically including any obligations or liabilities associated with the material Contracts that Buyer is not taking assignment of and are specifically excluded in Section 2.1(e)above (such
liabilities collectively referred to herein as the "Excluded
Liabilities").

3

---



2.5Non-Assignment of Assets.This Agreement shall not constitute an agreement to assign or transfer
any assets of Sellers, if an attempted transfer or assignment thereof, with the approval, authorization or consent of, or granting or issuance of any license or permit by, any third party thereto
(with respect thereto), would constitute a breach thereof or in any way negatively affect the rights of Sellers or Buyer, as the assignee or transferee of such asset, as the case may be, thereunder.
If the Closing occurs and such authorization, consent, approval, license or permit is required for the transfer or assignment of any asset of Sellers at or before the Closing, but not obtained,
Sellers will cooperate with Buyer without further consideration (other than as provided in clause (b) of thisSection 2.5) in any
arrangement reasonably acceptable to Buyer and Sellers, designed to both (a) provide Sellers with the
benefits of any such asset, and (b) cause Buyer to bear all costs and obligations of or under any such asset. Any transfer or assignment to Buyer of any asset that shall require the consent,
approval, authorization of, or granting of any license or permit by any third party for such assignment or transfer as provided hereunder shall be made subject to such consent, approval,
authorization, license or permit being obtained.

2.6Amounts Held in Trust.Any amounts received by Buyer after the Closing with respect to any Excluded Asset
shall be held by Buyer in trust for Sellers until promptly paid to Sellers. Likewise, any amounts received by Sellers after the Closing with respect to any Acquired Asset shall be held by Sellers in
trust for Buyer until promptly paid to Buyer. Any such money received by Buyer or Sellers shall be paid over to the proper party within ten (10) business days after receipt.

ARTICLE 3

PURCHASE PRICE

3.1Purchase Price.The aggregate purchase price for all of Acquired Assets (the
"Purchase Price") shall be an amount equal to Twenty Seven Million Eight Hundred Fifty Two Thousand Dollars ($27,852,000).

3.2Payment of the Purchase Price.Subject to the terms and conditions of this Agreement, at the Closing, Buyer
shall: (a) pay and deliver the Purchase Priceminusthe Closing Indebtedness andminusthe
Escrowed Funds to Sellers by means of a wire transfer of immediately available cash funds to the account specified by Sellers prior to the Closing (the "Sellers'
Account"); and (b) pay the Indebtedness of the Company identified inSection 3.2(c)of the Disclosure Letter (the
"Closing Indebtedness") as provided for inSection 3.3below.

3.3Determination and Payment of the Closing Indebtedness.At the Closing, Buyer will wire, on Sellers' behalf,
in immediately available funds, pursuant to appropriate Pay-Off Documents and instructions provided by Parent, the Closing Indebtedness. At least five (5) Business Days prior to the
Closing Date, Sellers will deliver to Buyer executed payoff letters with respect to the Closing Indebtedness that set forth (i) the amount to be paid on the Closing, together with the recipient
thereof and the related wire transfer instructions, and (ii) that the payment of such amount will result in a release of the Company from all obligations and of all Liens relating to such
Closing Indebtedness (the "Pay-Off Documents").

3.4Escrow.On the date hereof, Buyer, Sellers and KeyBank, N.A. (the "Escrow
Agent") are entering into an escrow agreement, in the form ofExhibit Aattached hereto (the
"Escrow Agreement"), pursuant to which an amount equal to ten percent (10.0%) of the Purchase Price (the "Escrowed
Funds") shall be deposited into escrow for the purposes of (i) establishing a good faith deposit by Buyer to evidence its intention to consummate the transactions
contemplated hereby and which may be refunded to Buyer pursuant toSection 11.2and (ii) from and after the Closing, securing Sellers'
obligations, if any, underArticle 12hereof and shall be distributed to Sellers upon the expiration of the General Survival Period, subject to
any pending claims for indemnification.

4

---



3.5Allocation of Purchase Price.The Purchase Price shall be allocated in accordance with a schedule to be
mutually agreed upon by the parties following the Closing. After the Closing, Buyer and Sellers shall make consistent use of the agreed upon allocation for all purposes (including financial and
regulatory reporting purposes and Tax purposes). Buyer and Sellers further agree to file, as applicable, their respective U.S. federal income Tax Returns and Form 8594 and, to the extent not in
conflict with applicable Law, their other Tax Returns reflecting such allocation and any other reports required by Section 1060 of the Code, in accordance with such allocation. Each party
agrees to prepare and timely file all applicable IRS forms, to cooperate with the other party in the preparation of such forms and to furnish the other party with a copy of such forms prepared in
draft, within a reasonable period before the due date thereof. In addition, each party agrees to notify the other party in the event any taxing authority takes or purports to take a position
inconsistent with the agreed-upon allocations.

ARTICLE 4

REPRESENTATIONS AND WARRANTIES CONCERNING THE PARENT

Except as set forth in the Disclosure Letter attached hereto and made a part hereof, Parent represents and warrants to Buyer as
follows:

4.1Authority; Capacity and Representation.Parent possesses all requisite legal right, power, authority and
capacity (corporate or otherwise) to execute, deliver and perform this Agreement, and each other agreement, instrument and document to be executed and delivered by Parent in connection therewith (the
"Parent Ancillary Agreements"), and consummate the transactions contemplated herein and therein. The execution, delivery and performance by Parent of
this Agreement and such Parent Ancillary Agreements and the consummation by Parent of the transactions contemplated hereby and thereby
have been duly and validly authorized (by all requisite corporate action) on the part of Parent. Parent is duly organized, validly existing and in good standing under the laws of its jurisdiction of
organization.

4.2Execution and Delivery; Enforceability.This Agreement has been, and each Parent Ancillary Agreement will
upon delivery be, duly executed and delivered by Parent and constitutes, or will upon such delivery constitute, the legal, valid and binding obligation of Parent, enforceable in accordance with its
terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors' rights or by
principles of equity (the "Enforceability Exceptions").

4.3Noncontravention.



5

---





ARTICLE 5

REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY

Except as set forth in the Disclosure Letter attached hereto and made a part hereof, the Company represents and warrants to Buyer as
follows:

5.1Organization and Good Standing; Authority; Enforceability.



5.2Other Ventures.Except as set forth inSection 5.2of
the Disclosure Letter, the Company does not own, of record or beneficially, any equity ownership interest in any other Person, nor is it a partner or member of any partnership, limited liability
company or joint venture.

5.3Noncontravention.



6

---





5.4Consents and Approvals.Section 5.4of the Disclosure
Letter sets forth a true and complete list of each material consent, waiver, authorization or approval of any Governmental Authority or any other Person that is required in connection with the
execution, delivery and performance of this Agreement.

5.5Absence of Certain Changes or Events.Except as set forth in Section 5.5of the Disclosure Letter, since
January 1, 2010:



7

---







5.6Taxes.



5.7Employees.There are no pending controversies, grievances or claims by any employee or former employee of
the Company with respect to his or her employment, termination of employment or any employee benefits (other than routine claims for benefits), except such that would not have a Material Adverse
Effect. Except as set forth inSection 5.7of the Disclosure Letter, the Company is not a party to any collective bargaining agreement nor, to
the Company's Knowledge, is there pending or underway any union organizational activities or proceedings with respect to employees of the Company. Section 5.7of the Disclosure Letter sets forth a
complete list, as of the date hereof, of all employees of the Company who, for the twelve
(12) month period ended December 31, 2009, received aggregate employment compensation in the form of salary and bonus in excess of One Hundred Fifty Thousand Dollars ($150,000). There is
no labor strike, slowdown or stoppage pending or, to the Company's Knowledge, threatened in writing against the Company.

5.8Compliance with Laws.Except as set forth in Section 5.8of the Disclosure Letter, the Company is and has been
conducting the Business in compliance, in all material respects, with all
applicable Laws relating to the Acquired Assets and the operation and conduct of the Business, and no assertion of a violation of any such Laws has been received or, to the Company's Knowledge, is
threatened. Notwithstanding the foregoing or anything to the contrary in this Agreement, the representations or warranties in thisSection 5.8shall NOT apply to Environmental Laws and Buyer may look only to the representations or warranties inSection 5.9as they may relate to the
Company's compliance with Environmental Laws.

5.9Environmental Matters.To the Knowledge of the Company and Parent, Section 5.9(a)of the Disclosure Letter contains
a list of all environmental studies, analyses and reports prepared during the last five years
and in the Company's possession or reasonably available to the Company relating to any Business Facility and the Business (collectively, the "Environmental
Reports"), and Sellers have made

8

---



available
to Buyer copies of all such Environmental Reports, if any. Except (i) as set forth in the Environmental Reports and (ii) set forth in Section 5.9(b)of the Disclosure Letter:



5.10Real and Personal Properties.



9

---





10

---





11

---





5.11Intellectual Properties.



5.12Financial Statements.Buyer has been provided copies of: (a) the audited consolidated financial
statements of the Company as of and for the fiscal years ended December 31, 2007 and 2008 (collectively, the "Audited Financial Statements"); and
(b) the unaudited consolidated financial statements of the Company as of and for the twelve (12) month period ended December 31, 2009 (the "Interim
Financial Statements"). The Audited Financial Statements have been prepared in accordance

12

---



with
GAAP, consistently applied, and present fairly the consolidated financial position of the Company as of the dates indicated and the results of operations for the periods then ended. The Interim
Financial Statements have been prepared in accordance with GAAP, consistently applied, and present fairly the consolidated financial position of the Company as of the date indicated and the results of
operations for the period then ended, subject in each case to: (i) normal yearend adjustments; and (ii) the absence of disclosures normally made in footnotes.

5.13Material Contracts.Section 5.13of the Disclosure
Letter sets forth a listing as of the date hereof of all of the currently effective written agreements of the following types to which any of the Company is a party or by which any material assets of
the Company are bound or subject:



13

---



Correct
and complete copies of each Contract required to be identified inSection 5.13of the Disclosure Letter, including amendments thereto
(collectively, the "Material Contracts"), have been made available to Buyer. Except as would not have a Material Adverse Effect on the Business, as of
the date of this Agreement: (i) all of the Material Contracts are in full force and effect and, to the Company's Knowledge, are enforceable against the Company and the other parties thereto, in
accordance with their respective terms, subject in each case to the Enforceability Exceptions, (ii) the Company has performed in all material respects all obligations required to be performed
by it pursuant to such Material Contracts, and (iii) to the Company's Knowledge, there are no existing written threats of default, breaches or violations of any of such Material Contracts by
any other party thereto.

5.14Litigation.Except as set forth inSection 5.14of
the Disclosure Letter, as of the date of this Agreement, there are no actions, suits, arbitrations, proceedings, investigations or claims of any kind whatsoever, at Law or in equity, pending against
or brought by the Company that: (a) if decided adversely to the Company, would have a Material Adverse Effect on the Business; or (b) could reasonably be expected to prevent or
materially delay the consummation of the transactions contemplated hereby.

5.15Brokerage.No Person is or will become entitled, by reason of any agreement or arrangement entered into or
made by or on behalf of the Company, to receive any commission, brokerage, finder's fee or other similar compensation in connection with the consummation of the transactions contemplated by this
Agreement, other than fees which shall be paid by Parent.

5.16Material Suppliers and Customers.Except as set forth in Section 5.16of the Disclosure Letter, no customer which
accounted for more than ten percent (10%) of the aggregate sales of the Company, and no
supplier which accounted for more than ten percent (10%) of the aggregate purchases of the Company, in the twelve (12) month period ended December 31, 2009, has delivered to the Company
any written notice which cancelled, materially modified, or otherwise terminated its relationship with the Company or materially decreased its services, supplies or materials to the Company or its
usage or purchase of the services or products of the Company.

5.17Licenses and Permits.Section 2.1(c)of the
Disclosure Letter lists and correctly describes each Permit, whether for coal mining, reclamation or other operational purposes, together with the name of the Governmental Authority or entity issuing
such Permit. Except as set forth inSection 5.17of the Disclosure Letter, such Permits are valid and in full force and effect and will not be
terminated or impaired or become terminable as a result of the transactions contemplated hereby and any necessary renewal applications have been timely filed. There are no Permits which have not been
obtained by Sellers which are required for the operation of the Business as presently conducted and as proposed to be conducted as of the Closing Date.

5.18Employee Benefit Plans and Other Compensation Arrangements.Set forth in Section 5.18(a)of the Disclosure Letter is
a list of all material "employee benefit plans" (as defined in Section 3(b) of ERISA), with
respect to which the Company currently is the sponsor or is obligated to make contributions under the plan terms (collectively, the "Plans").

Except
as set forth inSection 5.18(b)of the Disclosure Letter:



14

---







5.19Redbud West Point Ash Disposal Facility.



5.20Acquired Assets.The Acquired Assets include all assets currently used primarily in the operation of the
Business as currently conducted.

5.21No Additional Representations.EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN ARTICLE 4 AND THIS ARTICLE 5 (AS
MODIFIED BY THE DISCLOSURE LETTER), SELLERS EXPRESSLY DISCLAIM ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, AS TO THE CONDITION, VALUE OR QUALITY OF THE COMPANY OR ANY
OF THE ACQUIRED ASSETS, AND SELLERS SPECIFICALLY DISCLAIM ANY REPRESENTATION OR WARRANTY OF MERCHANTABILITY, USAGE, SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE WITH RESPECT TO ANY OF THE
ACQUIRED ASSETS, OR AS TO THE WORKMANSHIP THEREOF, OR THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR PATENT, IT BEING UNDERSTOOD THAT SUCH ACQUIRED ASSETS ARE BEING ACQUIRED "AS IS, WHERE IS"
ON THE CLOSING DATE, AND IN THEIR PRESENT CONDITION, AND BUYER SHALL RELY ON ITS OWN EXAMINATION AND INVESTIGATION THEREOF. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN ARTICLE 4 AND
ARTICLE 5 HEREOF (AS MODIFIED BY THE DISCLOSURE LETTER), SELLERS HEREBY DISCLAIM ALL LIABILITY AND RESPONSIBILITY FOR ANY REPRESENTATION, WARRANTY, STATEMENT, OR INFORMATION MADE, COMMUNICATED, OR
FURNISHED (ORALLY OR IN WRITING) TO BUYER OR ITS AFFILIATES OR REPRESENTATIVES (INCLUDING ANY OPINION, INFORMATION, PROJECTION, OR ADVICE THAT MAY HAVE BEEN OR MAY BE

15

---



PROVIDED
TO BUYER BY ANY DIRECTOR, OFFICER, EMPLOYEE, AGENT, CONSULTANT, OR REPRESENTATIVE OF PARENT OR THE COMPANY OR ANY OF ITS AFFILIATES). NEITHER PARENT NOR THE COMPANY MAKES ANY REPRESENTATIONS
OR WARRANTIES TO BUYER REGARDING ANY PROJECTION OR FORECAST REGARDING FUTURE RESULTS OR ACTIVITIES OR THE PROBABLE SUCCESS OR PROFITABILITY OF THE COMPANY.

ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to Sellers as follows:

6.1Organization; Authorization.Buyer is a Pennsylvania corporation, duly organized, validly existing and in
good standing under the laws of the Commonwealth of Pennsylvania. Buyer has all requisite corporate power and authority to execute, deliver and perform this Agreement and each other agreement,
instrument and document to be executed and delivered by Buyer pursuant hereto (the "Buyer Ancillary Agreements"). The execution, delivery and
performance of this Agreement and such other Buyer Ancillary Agreements and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly and validly authorized (by
corporate action or otherwise) on the part of Buyer.

6.2Execution and Delivery; Enforceability.This Agreement has been, and each Buyer Ancillary Agreement will
upon such delivery be, duly executed and delivered by Buyer and constitutes, or will upon such delivery constitute, the legal, valid and binding obligation of Buyer, enforceable in accordance with its
terms, except as such enforcement may be limited by the Enforceability Exceptions.

6.3Governmental Authorities; Consents.



6.4Brokerage.No Person is or will become entitled, by reason of any agreement or arrangement entered into or
made by or on behalf of Buyer, to receive any commission, brokerage, finder's fee or

16

---



other
similar compensation in connection with the consummation of the transactions contemplated by this Agreement.

6.5Financing.Buyer has and will continue to have readily available funds to consummate the transactions
contemplated by this Agreement and each Buyer Ancillary Agreement.

6.6Solvency.



6.7Due Diligence Investigation.Buyer has had an opportunity to discuss the business, management, operations
and finances of the Company with the Company's executive officers, directors, employees, agents, representatives and Affiliates, and has had an opportunity to inspect the facilities of the Company.
Buyer has conducted its own independent investigation of the Company. In making its decision to execute and deliver this Agreement and to consummate the transactions contemplated by this Agreement,
Buyer has relied solely upon the representations and warranties of Sellers set forth in this Agreement (and acknowledges that such representations and warranties are the only representations and
warranties made by the Company or Parent, as the case may be), and has not relied upon any other information provided by, for or on behalf of Sellers, or their respective agents or representatives, to
Buyer in connection with the transactions contemplated by this Agreement. Buyer has entered into the transactions contemplated by this Agreement with the understanding, acknowledgement and agreement
that no representations or warranties, express or implied, are made with respect to any projection or forecast regarding future results or activities or the probable success or profitability of the
Company. Buyer acknowledges that no current or former stockholder, director, officer, employee, affiliate or advisor of Sellers has made or is making any representations, warranties or commitments
whatsoever regarding the subject matter of this Agreement, express or implied, except as set forth in Articles 4 and 5.

ARTICLE 7

CONDITIONS PRECEDENT

7.1Conditions to Buyer's Obligations.The obligation of Buyer to consummate the closing of the transaction
contemplated in this Agreement is subject to the satisfaction or waiver, at or before the Closing, of the following conditions set forth in thisSection 7.1:



17

---





Any
agreement or document to be delivered to Buyer pursuant to thisSection 7.1, the form of which is not attached to this Agreement as an
exhibit, shall be in form and substance reasonably satisfactory to Buyer.

18

---



7.2Conditions to Sellers' Obligations.The respective obligations of Sellers to consummate the closing of the
transaction contemplated in this Agreement are subject to the satisfaction, at or before the Closing, of the following conditions set forth in thisSection 7.2:



Any
agreement or document to be delivered to Sellers pursuant to thisSection 7.2, the form of which is not attached to this Agreement as an
exhibit, shall be in form and substance reasonably satisfactory to Sellers.

ARTICLE 8

THE CLOSING

The consummation of the transactions contemplated herein (the "Closing") will take
place on the date that is no later than the third (3rd) Business Day following the satisfaction or waiver (to the extent permitted by applicable Law) of all of the conditions set forth in Article 7hereof and shall take place at the Cadiz, Ohio offices of Buyer or at such other time and place as to which Buyer and Sellers

19

---



may
agree in writing. The date on which the Closing actually occurs is referred to herein as the "Closing Date." The transfers and deliveries described
inArticle 7shall be mutually interdependent and shall be regarded as occurring simultaneously, and, any other provision of this Agreement
notwithstanding, no such transfer or delivery shall become effective or shall be deemed to have occurred until all of the other transfers and deliveries provided for in Article 7shall also have
occurred or been waived in writing by the party entitled to waive the same. Such transfers and deliveries shall be
deemed to have occurred and the Closing shall be effective as of 11:59 p.m. on the Closing Date

ARTICLE 9

COVENANTS OF SELLERS

9.1Conduct of Business.During the period between the date of this Agreement until the earlier to occur of the
termination of this Agreement in accordance withSection 11.1or the Closing Date (the "Pre-Closing
Period"), except as otherwise expressly provided for in this Agreement or the Disclosure Letter or except to the extent Buyer otherwise consents in writing, the Company shall:
(a) be operated in the ordinary course of business, consistent with past practice, and (b) use commercially reasonable efforts to preserve intact its respective business organizations
and relationships with Persons doing business with the Company, as applicable. Without limiting the generality of the foregoing, except as contemplated by this Agreement, during the
Pre-Closing Period, without the prior written consent of Buyer, which consent will not be unreasonably withheld or delayed, the Company shall not to take, or agree (whether in writing or
otherwise) to take, any action that would result in a violation ofSection 5.5hereof.

9.2Access.During the Pre-Closing Period, Buyer and its representatives (including any financing
sources and their respective representatives) shall have reasonable access during normal business hours to the personnel, facilities, counsel, accountants, consultants, representatives and books and
records (consistent with applicable privacy Laws and subject to the Confidentiality Agreement) of the Company to conduct such necessary inspections as Buyer may reasonably request. Any inspection
pursuant to thisSection 9.2will be conducted in such a manner as not to interfere with the conduct of the business of the Company and in no
event will any provision hereof be interpreted to require the Company to permit any inspection, or to disclose any information, that the Company determine in good faith may violate any of its
obligations with respect to confidentiality. Buyer and its representatives will not contact any of the employees, landlords, customers or suppliers of the Company without the prior written consent of
Buyer, it being acknowledged that any and all such contacts will be arranged by Sellers and that Buyer and Sellers will mutually agree on the timing and manner of contact with all employees,
landlords, customers, suppliers and other third parties.

9.3Change of Names.Promptly following the Closing, but in any event within thirty (30) days after the
Closing Date, Sellers shall provide evidence to Buyer of the change of the name of the Company to a name that does not bear the name "Buckeye" or "Buckeye Industrial Mining Co." or any
variations or derivations thereof.

9.4Exercise of Redbud Option to Acquire Permits.Promptly after the execution of this Agreement, the Company
shall exercise its option to acquire those permits from The Redbud Company, Inc., an Ohio corporation ("Redbud"), described under the Service Agreement, dated August 28, 1995 (as
amended, the "Service Agreement"), in accordance with the Company's purchase option under the Service Agreement.

20

---



ARTICLE 10

COVENANTS OF BUYER

10.1Access.Buyer shall, for a period of seven (7) years after the Closing Date, during normal business
hours and upon reasonable advance notice, provide Sellers and their designees and representatives with such access to the books and records related to the Acquired Assets as may be reasonably
requested by
Sellers, who shall be entitled, at their expense, to make extracts and copies of such books and records. Buyer agrees that it shall not, during such seven (7) year period, destroy or cause or
permit to be destroyed any material books or records relating to the Business without first obtaining the consent of Sellers (or providing to Sellers notice of such intent and a reasonable opportunity
to copy such books or records, at Sellers' expense, at least thirty (30) days prior to such destruction).

10.2Notices of Certain Events.Buyer agrees to notify Sellers in writing promptly upon the Buyer's or its
authorized representatives' discovery of any information prior to the Closing Date relating to Sellers or the operations (including the financial condition, assets and properties) of the Business
which constitutes (or would constitute) or indicates (or would indicate) a breach of any representation, warranty or covenant of Sellers contained herein.

10.3Employees.



ARTICLE 11

ADDITIONAL COVENANTS OF BUYER AND SELLERS

11.1Termination.This Agreement may be terminated:



21

---





11.2Effect of Termination.If this Agreement is terminated pursuant to Section 11.1, then all provisions of this
Agreement shall thereupon become void without any liability on the part of any party hereto to any
other party heretoexceptthat (x) thisSections 11.2, 11.6and11.8andArticle 14shall survive any
such
termination and (y) nothing herein shall relieve any party from any liability for any willful or intentional breach hereof occurring prior to such termination. If this Agreement is terminated
(i) by Sellers pursuant toSection 11.1(b)(ii), then Buyer and Sellers shall jointly instruct Escrow Agent to release the Escrowed Funds
to Sellers, as liquidated damages and not as a penalty; and (ii) for any reason other than by Sellers pursuant toSection 11.1(b)(ii),
then Buyer and Sellers shall jointly instruct Escrow Agent to release the Escrowed Funds to Buyer.

In
the case of clause (i) of the last sentence of the immediately preceding paragraph, Buyer and Sellers acknowledge that it would be extremely impracticable and difficult to
ascertain the actual damages which would be suffered by Sellers if Buyer fails to consummate the purchase and sale contemplated herein as required under this Agreement. Buyer and Sellers have
considered carefully the loss to Sellers altering their customary course of managing the Business, and Sellers taking the Company and the Business off the market, all as a consequence of the
negotiation and execution of this Agreement; the personal expenses of Sellers incurred in connection with the preparation of this Agreement and Sellers' performance hereunder; and the other damages,
general and special, which Buyer and Sellers realize and recognize Sellers will sustain, but which Sellers cannot at this time calculate with absolute certainty. Based on all those considerations,
Buyer and Sellers have agreed that the damage to Sellers would reasonably be estimated to be an amount equal to the Escrowed Funds. Seller hereby agrees that its receipt of the Escrowed Funds pursuant
to this Section 11.2 is the sole and exclusive right or remedy that Seller has, or may be entitled to exercise or pursue, against Buyer, whether at law, or in equity, with respect to such
default.

11.3Updating of Disclosure Letter.From time to time prior to the Closing, Sellers shall have the right to
supplement or amend the Disclosure Letter with respect to any matter hereafter arising or discovered after the delivery of the Disclosure Letter pursuant to this Agreement. No such supplement or
amendment shall have any effect on the satisfaction of the condition to closing set forth inSection 7.1(c); provided,however, if the Closing shall occur, then Buyer (and each other Buyer Indemnitee) shall be
deemed to have waived any right or claim pursuant to the terms of this Agreement or otherwise, including pursuant toArticle 12hereof, with
respect to any and all matters disclosed pursuant to any such supplement or amendment made by the Company at or prior to the Closing.

22

---



11.4Pre-Closing Publicity.During the Pre-Closing Period, any public disclosures or
announcements relating to this Agreement or the transactions contemplated hereby will be made only as may be agreed upon in writing by Parent and Buyer, except as may be required by Law or by any
Governmental Authority or the rules of any stock exchange or trading system.

11.5Post-Closing Publicity.Following the Closing, no party shall make any public disclosure or
comment regarding the specific terms of this Agreement or the transactions contemplated herein without the prior approval of Buyer or Parent, as the case may be, which approval shall not be
unreasonably withheld, except as may be required by Law or by any Governmental Authority or the rules of any stock exchange or trading system or reasonably necessary to enforce any rights under this
Agreement. Each party shall be entitled to disclose or comment to any Person that a transaction has been consummated. In addition, nothing herein shall preclude communications or disclosures necessary
to implement the provisions of this Agreement, and Buyer and Parent and their respective Affiliates may make such disclosures as they may consider necessary in order to satisfy their legal or
contractual obligations to their lenders, shareholders, investors or other interested parties, or for general marketing purposes, without the prior written consent of Parent or Buyer, as the case may
be.

11.6Expenses.Buyer shall pay all fees and expenses incident to the transactions contemplated by this Agreement
which are incurred by Buyer or its representatives or are otherwise expressly allocated to Buyer hereunder, and Sellers shall pay all fees and expenses incident to the transactions contemplated by
this Agreement which are incurred by Sellers or their respective representatives or are otherwise expressly allocated to Sellers hereunder.

11.7No Assignments.No assignment or transfer (including by way of operation of law or a change in ownership of
fifty percent or more of the voting power of Buyer) of all or any part of this Agreement or any right or obligation hereunder may be made by any party hereto without the prior written consent of all
other parties hereto, and any attempted assignment or transfer without such consent shall be void and of no force or effect; provided, that (a) Buyer may assign any of its rights or delegate
any of its duties under this Agreement to any controlled Affiliate of Buyer provided, further, that no such
assignment shall relieve Buyer of its obligations hereunder; and (b) Buyer may assign its rights, but not its obligations, under this Agreement to any of its institutional financing sources.

11.8Confidentiality Agreement.Notwithstanding the execution of this Agreement, the parties acknowledge that
the confidentiality agreement executed by Buyer, dated December 15, 2009 (the "Confidentiality Agreement"), remains in full force and effect
pursuant to the terms thereof, except to the extent reasonably necessary for Buyer to enforce any of its rights under this Agreement, but shall terminate at the Closing.

11.9Satisfaction of Closing Conditions.During the Pre-Closing Period and subject to the terms and
conditions of this Agreement, Sellers, on the one hand, and Buyer, on the other hand, will use their respective commercially reasonable best efforts to take or cause to be taken all actions and to do
or cause to be done all things necessary under the terms of this Agreement or under applicable Laws to cause the satisfaction of the conditions set forth in Article 11and to consummate the
transactions contemplated by this Agreement, including using their respective commercially reasonable best
efforts to obtain all authorizations, consents, Permits, waivers or other approvals of all Governmental Authorities that may be or become necessary for its execution and delivery of, and the
performance of its obligations pursuant to, this Agreement, and the parties shall cooperate with each other with respect to each of the foregoing.

11.10Tax Cooperation: Allocation of Taxes.



23

---





11.11Replacement of Bonds and Letters of Credit.



11.12Covenant Not to Compete.



24

---





ARTICLE 12

INDEMNIFICATION

12.1Indemnification of Buyer.Subject to the limitations set forth in this Article 12, including those specifically set
forth inSections 12.2and 12.5hereof, following the Closing, Sellers, jointly and severally, shall indemnify, defend and hold harmless Buyer and its
officers, directors,
employees, stockholders,
Affiliates, successors and assigns (collectively, the "Buyer Indemnitees"), from and against any Losses based upon, arising out of, caused by or in
connection with: (a) any inaccuracy in, or breach of, any of the representations and warranties made by Sellers inArticles 4or 5, as
applicable; (b) any breach or nonperformance of any covenant or obligation made or incurred by (i) Sellers or, (ii) with
respect to pre-Closing covenants, the Company herein; and (c) the imposition against any Buyer Indemnitee of any Liabilities other than the Assumed Liabilities. Sellers do not make
and shall not be deemed to have made, nor is Buyer relying upon, any representation, warranty, covenant or obligation other than those representations, warranties, covenants and obligations that are
expressly set forth in this Agreement.

12.2Limitations on Indemnification.Notwithstanding any other provision of this Agreement, the indemnification
obligations provided for in this Agreement shall be subject to the limitations and conditions set forth in thisSection 12.2.



25

---





12.3Indemnification of Parent.From and after the Closing and subject to the limitations contained herein,
Buyer shall indemnify, defend, hold harmless, pay and reimburse Parent and its officers, directors, employees, stockholders, Affiliates, successors and assigns (collectively, the
"Seller Indemnitees"), from and against any Losses based upon, arising out of, resulting from, in connection with or otherwise caused by: (i) any
inaccuracy in any of the representations and warranties made by Buyer herein; (ii) any breach or nonperformance of any of the covenants made by Buyer herein; or (iii) the imposition
against any Seller Indemnitee of any of the Assumed Liabilities. Buyer does not make and shall not be deemed to have made, nor is Parent relying upon, any representation, warranty, covenant or
obligation other than those representations, warranties, covenants and obligations that are expressly set forth in this Agreement.

12.4Procedures Relating to Indemnification.



26

---





27

---





12.5Limitation of Remedies.Each party acknowledges and agrees that, should the Closing occur, the sole and
exclusive remedy with respect to any and all claims relating to this Agreement or the transactions contemplated hereby (other than claims of, or causes of action arising from, criminal activity, fraud
or claims of, or causes of action for which the sole remedy sought is equitable relief) shall be pursuant to the indemnification provisions set forth in this Article 12. In furtherance of the
foregoing, each of Buyer and Parent hereby waive on behalf of itself and all other Persons who might claim by,
through or under it, from and after the Closing, any and all rights, claims and causes of action (other than claims of, or causes of action arising from, criminal activity, fraud or claims of, or
causes of action for which the sole remedy sought is equitable relief) which any such other Person may have arising under or based upon any Law and that relates to the transaction contemplated herein
or to any aspect of the business of the Company (except pursuant to the indemnification provisions set forth in this Article 12). Nothing in this Section 12.5shall limit any Person's right to
seek and obtain any equitable relief to which any Person may be entitled.

12.6Subrogation.Upon making any indemnity payment pursuant to Sections 12.1or12.3, as applicable, the indemnitor shall be subrogated to all rights of the
indemnitee or reimbursed party, as applicable, against any third party in respect of the Losses to which the payment related. The parties hereto will execute upon request all instruments reasonably
necessary to evidence and perfect the above described subrogation rights.

ARTICLE 13

CERTAIN DEFINITIONS

When used in this Agreement, the following terms in all of their tenses, cases and correlative forms shall have the meanings assigned
to them in thisArticle 13, or elsewhere in this Agreement as indicated in this Article 13:

"Affiliate" of a specified Person means any other Person which, directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with such specified Person. For purposes of this definition, "control" of any Person means possession,
directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting capital stock or membership interests, by
Contract, or otherwise.

"Agreement" means this Asset Purchase Agreement, as may be amended from time to time.

"Ancillary Agreements" is defined inSection 5.1(b).

"Assumed Contracts" is defined inSection 2.1(f).



"Audited Financial Statements" is defined inSection 5.12(a).

"Bonds" is defined inSection 11.11(a).

"Business" is defined in the Recitals of this Agreement.

"Business Day" means any other day than a Saturday, Sunday or day on which banking institutions in Cleveland, Ohio are authorized or
obligated pursuant to Law to be closed.

"Business Facility" means any Real Property on which the Company operates the Business.

"Buyer" is defined in the preamble of this Agreement.

"Buyer Indemnitees" is defined inSection 12.1.

28

---



"Cash Collateral" is defined inSection 11.11(b).

"Charter Documents" means the articles of incorporation, certificate of incorporation, code of regulations and by-laws (or
equivalent Charter Documents), as applicable, of any business entity.

"CERCLA" shall have the meaning assigned to such term in the definition of "Environmental Laws"

"Claims" means all claims, debts, losses, expenses, proceedings, covenants, liabilities, suits, judgments, damages, actions and causes of
action, obligations, accounts, and liabilities of any kind or character whatsoever, known or unknown, suspected or unsuspected, in contract or in tort, direct or indirect, at law or in equity.

"Closing" and "Closing Date" are defined in Article 7.

"Closing Indebtedness" is defined inSection 3.2.

"Code" means the United States Internal Revenue Code of 1986, as amended, and the regulations thereunder.

"Company" is defined in the preamble of this Agreement.

"Company Ancillary Agreements" is defined inSection 5.1(b).

"Company Intellectual Property" is defined inSection 2.1(d).

"Confidentiality Agreement" is defined inSection 11.8.

"Contract" means any contract, agreement, deed, mortgage, lease, license, instrument, note, commitment, undertaking, or arrangement,
whether oral or written.

"Disclosure Letter" is the confidential disclosure letter, dated as of the date hereof, delivered to Buyer in connection with the
execution and delivery of this Agreement (as may be modified from time to time prior to the Closing in accordance with the terms hereof).

"Disposal," "Storage," and "Treatment"
shall have the meanings assigned them at 42 U.S.C. § 6903(3), (33) and (34), respectively.

"Easement" means all easements, rights-of-way, licenses, and other rights of use in another Person's real property
(other than leases) held by the Company or appurtenant to any property owned or leased by the Company.

"Enforceability Exceptions" is defined inSection 4.2.

"Environmental Laws" shall mean any and all applicable laws, statutes, ordinances, rules, regulations, or orders in effect as of the
Closing Date or, if applicable, at any time prior to the Closing Date, of any Governmental Authority pertaining to pollution, preservation or protection of the environment, natural resources or human
health and safety, including without limitation the Clean Air Act, as amended, the Comprehensive Environmental, Response, Compensation, and Liability Act of 1980, as amended
("CERCLA"), the Federal Water Pollution Control Act, as amended, the Occupational Safety and Health Act of 1970, as amended, the Resource Conservation
and Recovery Act of 1976, as amended,
the Safe Drinking Water Act, as amended, the Toxic Substances Control Act, as amended, the Hazardous & Solid Waste Amendments Act of 1984, as amended, the Superfund Amendments and
Reauthorization Act of 1986, as amended, the Hazardous Materials Transportation Act, as amended, the Oil Pollution Act of 1990, as amended, any state or local Laws implementing the foregoing federal
laws, and any state or federal laws pertaining to mining, mine safety, the handling of production wastes, the use, maintenance, and closure of mining sites, the protection of environmentally sensitive
areas and threatened or endangered species, and all other environmental conservation or protection laws.

29

---



"Environmental Permits" means all permits, licenses, certificates, registrations, identification numbers, applications, consents,
approvals, variances, notices of intent, exemptions and similar requirements necessary for the ownership, use and/or operation of the Business Facilities and the Company to comply with Environmental
Laws.

"Environmental Reports" is defined inSection 5.9.

"Equipment" is defined inSection 2.1(b).

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder.

"Escrow Agent," "Escrow Agreement" and "Escrowed
Funds" are each defined inSection 3.4.

"Excluded Assets" is defined inSection 2.2.

"Excluded Liabilities" is defined inSection 2.4.

"Fundamental Reps" is defined inSection 12.2(a).

"GAAP" means generally accepted accounting principles, as in effect in the United States either from time to time as applied to periods
prior to the Closing Date or as applied on the Closing Date, as applicable, and in either case, applied on a basis consistent with the past practices of the Company.

"General Survival Period" is defined inSection 12.2(a).

"Governmental Authority" means any federal, state, local or foreign government or political subdivision thereof, or any agency or
instrumentality of any such government or political subdivision, or any self-regulated organization or other non-governmental regulating authority (to the extent that the
rules, regulations or orders of such authority have the force of law), or any arbitrator, tribunal or court of competent jurisdiction.

"Hazardous Material" means any chemical, substance, waste, material, pollutant, or contaminant, the exposure to, presence of, use,
Storage, Disposal, Treatment or transportation of which is regulated under or defined by Law.

"Hired Employees" is defined inSection 10.3(a).

"Improvements" shall mean any and all buildings, fixtures, utility lines and equipment, walls, fences, structures, betterments, and other
improvements to, of, on, or under the Real Property (including, without limitation, all strip mines and all shafts, structural supports, and other betterments installed or constructed for mining
operations) and any shafts, structural supports, roads and other betterments and improvements to, of, on or under any Real Property installed or constructed for or used in the Company's mining
operations.

"Indebtedness" means, as at any date of determination thereof (without duplication), all obligations (other than intercompany obligations)
of the Company in respect of: (a) any borrowed money or funded indebtedness or issued in substitution for or exchange for borrowed money or funded indebtedness (including obligations with
respect to principal, accrued interest, and any applicable prepayment charges or premiums); (b) any indebtedness evidenced by any note, bond, debenture or other debt security;
(c) capital lease obligations; (d) any indebtedness guaranteed by the Company (excluding intercompany debt and letters of credit and guarantees by a company of performance obligations of
another); and (e) any obligations with respect to any interest rate hedging or swap agreements. Notwithstanding the foregoing, the calculation of Indebtedness shall not include: (y) any
of the principal amount as of the Closing Date of any undrawn letters of credit, or (z) obligations of the Company under or with respect to any outstanding checks.

30

---



"Indemnification Cap" means an amount equal to ten percent (10.0%) of the Purchase Price.

"Indemnification Threshold" means an amount equal to one percent (1.0%) of the Purchase Price.

"indemnitee" and "indemnitor" are defined in Section 12.4(a).

"Intellectual Property" means any of the following in any jurisdiction throughout the world: (a) patents, patent applications,
patent disclosures and inventions, including any provisionals, continuations, divisionals, continuations-in-part, renewals and reissues for any of the foregoing;
(b) Internet domain names, trademarks, service marks, trade dress, trade names, logos, slogans and corporate names and registrations and applications for registration thereof together with all
of the goodwill associated therewith; (c) copyrights (registered or unregistered) and copyrightable works and registrations and applications for registration thereof; (d) mask works and
registrations and applications for registration thereof; (e) computer Software (excluding all Off-the-Shelf Software), data, data bases and documentation thereof;
(f) trade secrets and other confidential information (including ideas, formulas, compositions, inventions (whether patentable or unpatentable and whether or not reduced to practice),
know-how, manufacturing and production processes and techniques, research and development information, drawings, specifications, designs, plans, proposals, technical data, copyrightable
works, financial and marketing plans and customer and supplier lists and information) (collectively, "Trade Secrets"); and (g) copies and
tangible embodiments thereof (in whatever form or medium).

"Interim Financial Statements" is defined inSection 5.12(b).

"Knowledge" with respect to any matter, means (a) with respect to Parent, matters within the actual knowledge of Thomas Stoner,
William Laughlin and Diana Kubik, and (b) with respect to the Company, matters within the actual knowledge of John Grisham, Jack Grinwis, Rosemary Lacher, and Gary Alkire.

"Law" means any federal, state, regional, local or foreign law, statute, ordinance, code, treaty, rule, regulation, order or requirement
of any Governmental Authority in effect on the date of this Agreement.

"Leased Real Property" is defined inSection 2.1(a).

"Leases" means all Contracts pursuant to which the Company leases the Leased Real Property.

"Legal Requirements" shall mean any federal, state, local, municipal, foreign, international, multinational or other constitution, law,
ordinance, principle of common law, code, regulation, statute, treaty or similar rule or requirement in effect as of the Closing Date or, if applicable, at any time prior to the Closing Date. With
respect to Real Property, "Legal Requirements" also include (i) all restrictive covenants, easements, operating agreements, and other matters of
record affecting use and/or development of the property, and (ii) all requirements of underwriting boards with respect to any insurance carried or required to be carried by the Company.

"Lessor Leases" is defined inSection 5.10(b).

"Liabilities" means all Indebtedness, obligations, claims and other liabilities of a Person, whether absolute, accrued, contingent, fixed
or otherwise or whether due or to become due.

"Lien" means any lien, charge, mortgage, pledge, easement, encumbrance, security interest, matrimonial or community interest, tenancy by
the entirety claim, adverse claim, or any other title defect or restriction of any kind.

"Loss" or "Losses" means any and all losses, liabilities, damages, costs, penalties,
judgments, deficiencies, awards, fines, expenses, actions, notices of violation, and notices of liability and any claims in respect thereof (including, without limitation, amounts paid in settlement
and reasonable costs of

31

---



investigation,
and legal fees and expenses) arising out of any incident, event, circumstance or proceeding asserted or initiated or otherwise occurring or existing in respect of any matter or any
claim or proceeding to enforce any indemnification rights in respect thereof;provided,however, Losses
relating to any claims for indemnification shall (a) specifically exclude punitive, exemplary, consequential or incidental damages, damages relating to lost profits, diminution of value, or
based upon any multiplier of profits, earnings or cash flow, including earnings before interest, tax, depreciation or amortization or any other valuation metric; and (b) be net of the amount of
any actual recoveries: (i) under any insurance policy covering such indemnifiable Losses of which the party seeking indemnification, or any of its Affiliates, is a beneficiary in connection
with the circumstances that give rise to the claim for indemnification); and (ii) under "pass-through" warranty coverage from a manufacturer or other third party that are actually
received by the party seeking indemnification, or any of its Affiliates, in connection with the circumstances that give rise to the claim for indemnification and, in either case, such indemnified
party shall seek full recovery under all such insurance policies or "pass-through" warranty coverage for any Losses to the same extent as they would if such Losses were not subject to
indemnification under this Agreement.

"Material Adverse Effect" means a material adverse effect on the business, condition, financial or otherwise, assets, liabilities, or
results of operations of the Company, taken as a whole;provided,however, that none of the following
will be deemed, either alone or in combination, to constitute, and none of the following will be taken into account in determining whether there has been or will be, a "Material Adverse Effect":
(a) changes in business or economic conditions affecting the economy or the Company' industries generally, (b) changes in stock markets or credit markets, (c) changes in Tax
rates, Law or GAAP, or the enactment or implementation of any new Law or Tax; (d) any event as to which Buyer has provided written consent hereunder; (e) an event or circumstance
disclosed in the Disclosure Letter, (f) natural disasters, acts of war, sabotage, terrorism, hostilities, military action or any escalation or worsening thereof, or (g) except for
purposes ofSections 4.3or5.3, the execution, delivery or performance of this Agreement
(including any announcement relating to this Agreement or the fact that Buyer is acquiring the Acquired Assets and any actions taken by any customer, supplier or employee of the Company in response to
such announcement) or any actions taken by Parent or the Company hereunder or in contemplation hereof, or any actions that Parent or the Company or any representative thereof is required to take
hereunder.

"Material Contracts" is defined inSection 5.13(l).

"Mineral Leases" means any lease of any mineral rights under which the Company is the tenant or lessee. Mineral Leases include those
Surface Leases, if any, under which the Company is granted an interest in some or all of the mineral rights.

"Monofill" is defined inSection 5.19(a).

"Montgomery" is defined inSection 2.1(l).

"Off-the-Shelf Software" means off-the-shelf personal computer software as such term is
commonly understood, that is commercially available under non-discriminatory pricing terms on a retail basis for less than $300 per seat and used solely on the desktop personal computers
of the Company.

"Order" means any judgment, injunction, award, decision, decree, ruling, verdict, writ or order of any nature of any Governmental
Authority.

"Owned Real Property" is defined inSection 2.1(a).

"Parent" is defined in the preamble to this Agreement.

"Parent Ancillary Agreements" is defined inSection 4.1.

"Pay-Off Documents" is defined inSection 3.3.

32

---



"Permits" is defined inSection 2.1(c).

"Permitted Liens" means: (a) mechanics', carriers', workmen's, repairmen's or other like Liens arising or incurred in the ordinary
course of business; (b) Liens arising under original purchase price conditional sales contracts and equipment leases with third parties entered into in the ordinary course of business and under
which the Company is not in default; (c) Liens arising by operation of Law, including Liens arising by virtue of rights of customers, suppliers and subcontractors in the ordinary course of
business under general principles of commercial law; (d) Liens for current Taxes and utilities not yet due and
payable or which are being contested in good faith and, in connection therewith, appropriate reserves have been set aside in accordance with GAAP; (e) imperfections of title or encumbrances, if
any, that do not, individually or in the aggregate, materially impair the continued use and operation of any asset to which they relate in the conduct of the business of the Company as presently
conducted; (f) leases, subleases and similar agreements set forth inSection 5.10(a)or in Section 5.13of the Disclosure Letter;
(g) easements, covenants, rights-of-way and other similar restrictions or
conditions of record or which would be shown by a current accurate survey of any of the Real Property; and (h): (i) zoning, building and other similar restrictions imposed by applicable Laws;
(ii) Liens that have been placed by any developer, landlord or other third party on property over which the Company have easement rights or, on any Real Property, under any lease or
subordination or similar agreements relating thereto; and (iii) unrecorded easements, covenants, rights-of-way and other similar restrictions on the Real Property none
of which, individually or in the aggregate, materially impairs the continued use and operation of such Real Property.

"Person" means an individual, a corporation, a limited liability company, a partnership, a trust, an unincorporated association, a
government or any agency, instrumentality or political subdivision of a government, or any other entity or organization.

"Plans" is defined inSection 5.18.

"Pre-Approved Matters" is defined inSection 5.10(e).

"Pre-Closing Period" is defined inSection 9.1.

"Prohibited Business" means offering to provide or providing any product or service competitive with the Company or the Business, in the
geographic areas where the Company or Buyer engages in business as of the Closing Date.

"Purchase Price" is defined inSection 3.1.

"Real Property" is defined inSection 2.1(a).

"Redbud" means Redbud Company, Inc., an Ohio corporation.

"Release" shall mean the depositing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, migrating,
dispersing, leaching, dumping or disposing.

"Reserves" is defined inSection 2.1(g).

"Securities Act" means the Securities Act of 1933, as amended.

"Sellers" is defined in the preamble of this Agreement.

"Seller Ancillary Agreements" is defined inSection 4.1.

"Seller Indemnitees" is defined inSection 12.3.

"Sellers' Account" is defined inSection 3.2.

33

---



"Software" means, as they exist anywhere in the world, computer software programs, including all source code, object code, specifications,
databases, designs and documentation related to such programs.

"Surface Lease" means any lease of Leased Real Property and/or Improvements under which the Company is lessee or tenant (including,
without limitation, lease of any office, warehouse, or other space).

"Surety Holders" is defined inSection 11.11(b).

"Tax" or "Taxes" means: (a) any and all federal, state, provincial, local, foreign
and other taxes, levies, fees, imposts, duties, and similar governmental charges (including any interest, fines, assessments,
penalties or additions to tax imposed in connection therewith or with respect thereto) including, without limitation (i) taxes imposed on, or measured by income, gross receipts, franchise, or
profits, and (ii) license, payroll, employment, withholding, excise, severance, stamp, occupation, premium, windfall profits, customs duties, capital stock, social security (or similar),
unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, ad valorem capital gains, goods and
services, branch, utility, production and compensation taxes; and (b) any obligations to indemnify or otherwise assume or succeed to the Tax liability of any other Person.

"Taxing Authority" means any domestic or foreign national, state, provincial, multi-state or municipal or other local executive,
legislative or judicial government, court, tribunal, official, board, subdivision, agency, commission or authority thereof, or any other governmental body exercising any regulatory or taxing authority
thereunder having jurisdiction over the assessment, determination, collection or other imposition of any Tax.

"Tax Return" means any return, declaration, report, claim for refund, election, disclosure, estimate, or information return or statement
relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof required to be filed with any Taxing Authority with respect to Taxes.

"Third-Party Claim" is defined inSection 12.4(a)(i).

"Trade Secrets" is defined in the definition of "Intellectual Property."

"Transfer Tax" is defined inSection 11.10(b).

ARTICLE 14

CONSTRUCTION; MISCELLANEOUS PROVISIONS

14.1Notices.Any notice to be given or delivered pursuant to this Agreement shall be ineffective unless given
or delivered in writing, and shall be given or delivered in writing as follows:



34

---





or
in any case, to such other address for a party as to which notice shall have been given to Buyer and Sellers in accordance with this Section 14.1. Notices so addressed shall be deemed to have been
duly given (i) on the third business day after the day of registration, if
sent by registered or certified mail, postage prepaid, (ii) on the next Business Day following the documented acceptance thereof for next-day delivery by a national overnight air
courier service, if so sent, or (iii) on the date sent by facsimile transmission, if electronically confirmed. Otherwise, notices shall be deemed to have been given when actually received at
such address.

14.2Entire Agreement.This Agreement, the Disclosure Letter and Exhibits hereto constitute the exclusive
statement of the agreement among the Company, Buyer and Parent concerning the subject matter hereof, and supersedes all other prior agreements, oral or written, among or between any of the parties
hereto concerning such subject matter. All negotiations among or between any of the parties hereto are superseded by this Agreement, and there are no representations, warranties, promises,
understandings or agreements, oral or written, in relation to the subject matter hereof among or between any of the parties hereto other than those expressly set forth or expressly incorporated
herein.

14.3Modification.No amendment, modification, or waiver of this Agreement or any provision hereof, including
the provisions of this sentence, shall be effective or enforceable as against a party hereto unless made in a written instrument that specifically references this Agreement and that is signed by the
party waiving compliance.

14.4Governing Law; Jurisdiction and Venue.This Agreement shall be governed by and construed in accordance with
the Laws of the State of Ohio, without regard to the choice-of-laws or conflicts-of-law's provisions thereof. The parties agree that no action, suit or
proceeding at law, in equity or otherwise which in any way arises out of or relates to this Agreement or the transactions contemplated hereby shall be brought solely in the state or federal courts in
Cuyahoga County, Ohio and all objections to personal jurisdiction and venue in any action, suit or proceeding so commenced are hereby expressly waived by all parties hereto. The parties waive personal
service of any and all process on each of them and consent that all such service of process shall be made in the manner, to the party and at the address set forth in Section 14.1of this Agreement,
and service so made shall be complete as stated in such section.

14.5Specific Performance.Each party's obligation under this Agreement is unique. If any party should breach
its covenants under this Agreement, the parties each acknowledge that it would be impracticable
to measure the resulting damages; accordingly, the nonbreaching party or parties, in addition to any other available rights or remedies they may have under the terms of this Agreement, may sue in
equity for specific performance, and each party expressly waives the defense that a remedy in damages will be adequate.

35

---



14.6Binding Effect.This Agreement shall be binding upon and shall inure to the benefit of Buyer and Sellers
and the respective successors and permitted assigns.

14.7Headings.The article and section headings used in this Agreement are intended solely for convenience of
reference, do not themselves form a part of this Agreement, and may not be given effect in the interpretation or construction of this Agreement.

14.8Number and Gender; Inclusion.Whenever the context requires in this Agreement, the masculine gender
includes the feminine or neuter, the neuter gender includes the masculine or feminine, the singular number includes the plural, and the plural number includes the singular. In every place where it is
used in this Agreement, the word "including" is intended and shall be construed to mean "including, without limitation."

14.9Counterparts.This Agreement and each document delivered pursuant to this Agreement may be executed by the
parties in separate counterparts and by facsimile or by electronic mail with scan or attachment signature, each of which when so executed and delivered shall be deemed an original, and all such
counterparts shall together constitute one and the same instrument. Each counterpart may consist of a number of copies hereof or thereof each signed by less than all, but together signed by all of the
parties.

14.10Third Parties.Except as may otherwise be expressly stated herein, no provision of this Agreement is
intended or shall be construed to confer on any Person, other than the parties hereto, any rights hereunder. Buyer Indemnitees and Seller Indemnitees who are not otherwise parties to this Agreement
shall be third party beneficiaries of this Agreement.

14.11Disclosure Letter and Exhibits.The Disclosure Letter and Exhibits, if any, referenced in this Agreement
constitute an integral part of this Agreement as if fully rewritten herein. Notwithstanding anything to the contrary contained in this Agreement or in any of the sections of the Disclosure Letter, any
information disclosed in one section of the Disclosure Letter shall be deemed to be disclosed in such other sections of the Disclosure Letter and applicable to such other representations and
warranties to the extent that the disclosure is reasonably apparent from its face to be applicable to such other section of the Disclosure Letter and such other representations and warranties.
Disclosure of any fact or item in any section of the Disclosure Letter shall not be deemed to constitute an admission that such item or fact is material for the purposes of this Agreement. All
references in this document to "this Agreement" and the terms "herein," "hereof," "hereunder" and the like shall be deemed to include all of such sections of the Disclosure Letter and Exhibits.

14.12Time Periods.Any action required hereunder to be taken within a certain number of days shall, except as
may otherwise be expressly provided herein, be taken within that number of calendar days;providedthat if the last day for taking such action falls on
a Saturday, a Sunday, or a legal holiday, the period during which such action may be taken shall automatically be extended to the next business day.

14.13Construction.This Agreement and the other documents contemplated herein shall be deemed to have been
drafted by the parties and neither this Agreement nor any other document contemplated herein shall be construed against any party as the principal draftsperson hereof or thereof.

[Signature Page Follows]

36

---



IN WITNESS WHEREOF, Buyer, the Company and Parent have caused this Asset Purchase Agreement to be executed and delivered by their duly authorized representatives, as of the date first
written above.

BUYER:ROSEBUD MINING COMPANYName:

J. Clifford Forrest, IIIIts:

PresidentPARENT:EVERGREEN ENERGY INC.Name:Its:COMPANY:BUCKEYE INDUSTRIAL MINING CO.Name:Its:


---



EXHIBIT A

Escrow Agreement

[See
attached]

---



QuickLinks