Exhibit 5
July 28, 2006
Peabody Energy Corporation
701 Market Street
St. Louis, Missouri 63103
Ladies and Gentlemen:
We have acted as counsel to Peabody Energy Corporation, a Delaware corporation (the “Company”), the Delaware subsidiaries of the Company named on Schedule I hereto (each, a “Delaware Guarantor” and collectively, the “Delaware Guarantors”) and the non-Delaware subsidiaries of the Company named on Schedule II hereto (each, a “Non-Delaware Guarantor” and collectively, the “Non-Delaware Guarantors,” taken together with the Delaware Guarantors, the “Guarantors”), in connection with the Registration Statement on Form S-3 (the “Registration Statement”) filed by the Company and the Guarantors with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”), relating to (i) debt securities, which may be either senior (“Senior Debt Securities”) or subordinated (the “Subordinated Debt Securities”) (collectively, the “Debt Securities”); (ii) guarantees of the Guarantors to be issued in connection with the Debt Securities (the “Guarantees”); (iii) shares of preferred stock of the Company, par value $0.01 per share (the “Preferred Stock”); (iv) shares of common stock of the Company, par value $0.01 per share (the “Common Stock”); (v) preferred stock purchase rights that initially trade together with the Common Stock pursuant to the Company’s preferred share purchase rights plan (the “Preferred Stock Purchase Rights”); (vi) warrants to purchase Debt Securities, Preferred Stock or Common Stock (the “Warrants”); (vii) units of the Company, consisting of any combination of two or more of the securities being registered pursuant to the Registration Statement; and (viii) Debt Securities and Guarantees, Preferred Stock and Common Stock that may be issued upon exercise of Warrants. The Debt Securities, the Guarantees, the Preferred Stock, the Common Stock, the Preferred Stock Purchase Rights, the Warrants and the Units are hereinafter referred to
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collectively as the “Securities.” The Securities may be issued and sold or delivered from time to time as set forth in the Registration Statement, any amendment thereto, the prospectus contained therein (the “Prospectus”) and supplements to the Prospectus (the “Prospectus Supplements”) pursuant to Rule 415 under the Securities Act in an indeterminate amount.
The Senior Debt Securities and the Guarantees thereof, if applicable, will be issued under an Indenture (the “Senior Indenture”) among the Company, the Guarantors, if applicable, and such trustee as shall be named therein (the “Senior Trustee”). The Senior Subordinated Debt Securities and the Subordinated Debt Securities and the Guarantees thereof, if applicable, will be issued under an Indenture (the “Subordinated Indenture”) among the Company, the Guarantors, if applicable, and such trustee as shall be named therein (the “Subordinated Trustee”). The Senior Indenture and the Subordinated Indenture are hereinafter referred to collectively as the “Indentures.”
The Senior Debt Security Warrants will be issued under a Senior Debt Security Warrant Agreement (the “Senior Debt Security Warrant Agreement”) among the Company, a debt security warrant agent to be named therein (the “Senior Debt Security Warrant Agent”) and the Senior Trustee. The Senior Subordinated Debt Security Warrants and the Subordinated Debt Security Warrants will be issued under a Subordinated Debt Security Warrant Agreement (the “Subordinated Debt Security Warrant Agreement”) among the Company, a debt security warrant agent to be named therein (the “Subordinated Debt Security Warrant Agent”) and the Subordinated Trustee. The Warrants relating to the Preferred Stock will be issued under a Preferred Stock Warrant Agreement (the “Preferred Stock Warrant Agreement”) between the Company and a preferred stock warrant agent to be named therein (the “Preferred Stock Warrant Agent”). The Warrants relating to the Common Stock will be issued under a Common Stock Warrant Agreement (the “Common Stock Warrant Agreement”) between the Company and a common stock warrant agent to be named therein (the “Common Stock Warrant Agent”). The Senior Debt Security Warrant Agreement, the Subordinated Debt Security Warrant Agreement, the Preferred Stock Warrant Agreement and the Common Stock Warrant Agreement, are hereinafter referred to collectively as the “Warrant Agreements.” Each of the Senior Debt Security Warrant Agent, Subordinated Debt Security Warrant Agent, Preferred Stock Warrant Agent and Common Stock Warrant Agent is referred to hereinafter as a “Counterparty.”
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We have examined the Registration Statement and the exhibits filed with the Commission on the date hereof. We also have examined the originals, or duplicates or certified or conformed copies, of such corporate records, agreements, documents and other instruments and have made such other investigations as we have deemed relevant and necessary in connection with the opinions hereinafter set forth. As to questions of fact material to this opinion, we have relied upon certificates or comparable documents of public officials and of officers and representatives of the Company and the Guarantors.
In rendering the opinions set forth below, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as duplicates or certified or conformed copies, and the authenticity of the originals of such latter documents. We also have assumed that (1) at the time of execution, authentication, issuance and delivery of the Senior Debt Securities, the Senior Indenture will be the valid and legally binding obligation of the Senior Trustee; (2) at the time of execution, authentication, issuance and delivery of the Senior Subordinated Debt Securities or Subordinated Debt Securities, as the case may be, the Subordinated Indenture will be the valid and legally binding obligation of the Subordinated Trustee; and (3) at the time of execution, countersignature, issuance and delivery of any Warrants, the related Warrant Agreement will be the valid and legally binding obligation of each Counterparty thereto.
We have assumed further that (1) at the time of execution, authentication, issuance and delivery of any Senior Debt Securities, Senior Subordinated Debt Securities or Subordinated Debt Securities and the related Guarantees, if applicable, the Indentures will have been duly authorized, executed and delivered by the Company and the Guarantors, if applicable and (2) if applicable, execution, delivery and performance by each Non-Delaware Guarantor of the Guarantees will not violate the laws of its jurisdiction of incorporation or any other applicable laws (excepting the law of the State of New York and the federal laws of the United States). We have assumed further that at the time of execution, countersignature, issuance and delivery of any Warrants, the related Warrant Agreement will have been duly authorized, executed and delivered by the Company.
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Based upon the foregoing, and subject to the qualifications, assumptions and limitations stated herein, we are of the opinion that:
1. With respect to the Debt Securities, assuming (a) the taking of all necessary corporate action to approve the issuance and terms of any Debt Securities, the terms of the offering thereof and related matters by the Board of Directors of the Company, a duly constituted and acting committee of such Board or duly authorized officers of the Company (such Board of Directors, committee or authorized officers being referred to herein as the “Board”) and (b) the due execution, authentication, issuance and delivery of such Debt Securities, upon payment of the consideration therefor provided for in the applicable definitive purchase, underwriting or similar agreement approved by the Board and otherwise in accordance with the provisions of the applicable Indenture and such agreement, such Debt Securities will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms.
2. With respect to the Guarantees, assuming (a) the taking of all necessary corporate action to approve the issuance and terms of the Guarantees and related matters by the Board of Directors of each Guarantor (or in the case of a Subsidiary Guarantor that is a partnership or a limited liability company, the Board of Directors of the general partner or member(s), as applicable), a duly constituted and acting committee of such Board or duly authorized officers of each Guarantor, (b) the due execution, authentication, issuance and delivery of the Debt Securities underlying such Guarantees, upon payment of the consideration therefor provided for in the applicable definitive purchase, underwriting or similar agreement approved by such Board and otherwise in accordance with the provisions of the applicable Indenture and such agreement and (c) the due issuance of such Guarantees, such Guarantees will constitute valid and legally binding obligations of the Guarantors enforceable against the Guarantors in accordance with their terms.
3. With respect to the Preferred Stock, assuming (a) the taking by the Board of Directors of the Company of all necessary corporate action to authorize and approve the issuance of the Preferred Stock, (b) due filing of a Certificate of Designations with the Secretary of State of the State of Delaware and (c) due issuance and delivery of the Preferred Stock, upon payment therefor in accordance with the applicable definitive underwriting agreement approved by the Board of Directors of the Company, the Preferred Stock will be validly issued, fully paid and nonassessable.
4. With respect to the Common Stock, assuming (a) the taking by the Board of Directors of the Company of all necessary corporate action to authorize and approve the issuance of the Common Stock and (b) due issuance and delivery of the Common Stock, upon payment therefor in accordance with the applicable definitive underwriting agreement approved by the Board of Directors of the Company, the Common Stock will be validly issued, fully paid and nonassessable.
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5. With respect to the Warrants, assuming (a) the taking of all necessary corporate action by the Board to approve the execution and delivery of a related Warrant Agreement in the form to be filed as an exhibit to the Registration Statement and (b) the due execution, countersignature, issuance and delivery of such Warrants, upon payment of the consideration for such Warrants provided for in the applicable definitive purchase, underwriting or similar agreement approved by the Board and otherwise in accordance with the provisions of the applicable Warrant Agreement and such agreement, such Warrants will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms.
Our opinions set forth in paragraphs 1, 2 and 5 above are subject to the effects of (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, (ii) general equitable principles (whether considered in a proceeding in equity or at law) and (iii) an implied covenant of good faith and fair dealing.
We do not express any opinion herein concerning any law other than the law of the State of New York, the federal law of the United States and the Delaware General Corporation Law (including the statutory provisions, all applicable provisions of the Delaware Constitution and reported judicial decisions interpreting the foregoing).
We hereby consent to the filing of this opinion letter as Exhibit 5 to the Registration Statement and to the use of our name under the caption “Legal Matters” in the Prospectus included in the Registration Statement.
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| | | Very truly yours, |
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| | | /s/ Simpson Thacher & Bartlett LLP |
| | | |
| | | SIMPSON THACHER & BARTLETT LLP |
Schedule I
Delaware Guarantors
American Land Development, LLC
American Land Holdings of Illinois, LLC
American Land Holdings of Indiana, LLC
American Land Holdings of Kentucky, LLC
Appalachia Mine Services, LLC
Arid Operations Inc.
Beaver Dam Coal Company
Big Sky Coal Company
Black Beauty Holding Company, LLC
Black Stallion Coal Company, LLC
Black Walnut Coal Company
Bluegrass Mine Services, LLC
BTU Empire Corporation
BTU Western Resources, Inc.
Caballo Coal Company
Central States Coal Reserves of Illinois, LLC
Central States Coal Reserves of Indiana, LLC
Central States Coal Reserves of Kentucky, LLC
Charles Coal Company, LLC
Cleaton Coal Company
Coal Properties, LLC
Coal Reserve Holding Limited Liability Company No. 1
Coal Reserve Holding Limited Liability Company No. 2
COALSALES, LLC
COALSALES II, LLC
COALTRADE International, LLC
COALTRADE, LLC
Colorado Coal Resources, LLC
Colorado Yampa Coal Company
Cook Mountain Coal Company, LLC
Cottonwood Land Company
Coulterville Coal Company, LLC
Cyprus Creek Land Company
Cyprus Creek Land Resources, LLC
Dodge Hill Holding JV, LLC
Dodge Hill of Kentucky, LLC
Dyson Creek Coal Company, LLC
Eastern Coal Company, LLC
Eastern Royalty Corp.
Fort Energy, LLC
Gallo Finance Company
Gold Fields Chile, LLC
Gold Fields Mining, LLC
I-1
Gold Fields Ortiz, LLC
Hayden Gulch Terminal, Inc.
Highland Mining Company, LLC
Highwall Mining Services Company
HMC Mining, LLC
Independence Material Handling, LLC
Indian Hill Company
Interior Holdings, LLC
James River Coal Terminal, LLC
Jarrell’s Branch Coal Company
Juniper Coal Company
Kayenta Mobile Home Park, Inc.
Logan Fork Coal Company
Martinka Coal Company, LLC
Midwest Coal Acquisition Corp.
Midwest Coal Reserves of Illinois, LLC
Midwest Coal Reserves of Indiana, LLC
Midwest Coal Resources, LLC
Mountain View Coal Company, LLC
Mustang Energy Company, L.L.C.
New Mexico Coal Resources, LLC
Patriot Coal Company, L.P.
Patriot Midwest Holdings, LLC
PDC Partnership Holdings, LLC
Peabody America, Inc.
Peabody Archveyor, L.L.C.
Peabody Cardinal Gasification, LLC
Peabody Coal Company, LLC
Peabody Development Company, LLC
Peabody Electricity, LLC
Peabody Energy Generation Holding Company
Peabody Energy Investments, Inc.
Peabody Energy Solutions, Inc.
Peabody Holding Company, LLC
Peabody Investments Corp.
Peabody Natural Gas, LLC
Peabody Natural Resources Company
Peabody PowerTree Investments, LLC
Peabody Recreational Lands, L.L.C.
Peabody Southwestern Coal Company
Peabody Terminals, LLC
Peabody Venezuela Coal Corp.
Peabody Venture Fund, LLC
Peabody-Waterside Development, L.L.C.
Peabody Western Coal Company
PEC Equipment Company, LLC
I-2
Pine Ridge Coal Company, LLC
Point Pleasant Dock Company, LLC
Pond Creek Land Resources, LLC
Pond River Land Company
Porcupine Production, LLC
Porcupine Transportation, LLC
Powder River Coal, LLC
Powder River Resources, LLC
Prairie State Generating Company, LLC
Randolph Land Holding Company, LLC
Rivers Edge Mining, Inc.
Riverview Terminal Company
School Creek Coal Company, LLC
Seneca Coal Company
Sentry Mining, LLC
Shoshone Coal Corporation
Snowberry Land Company
Star Lake Energy Company, L.L.C.
Thoroughbred, L.L.C.
Thoroughbred Generating Company, LLC
Thoroughbred Mining Company, L.L.C.
Twentymile Coal Company
West Roundup Resources, Inc.
I-3
Schedule II
| | | | | |
| Non-Delaware Guarantors | | Jurisdiction of Incorporation or Organization |
| Affinity Mining Company | | | | West Virginia |
| Arclar Company, LLC | | | | Indiana |
| Big Ridge, Inc. | | | | Illinois |
| Black Beauty Coal Company | | | | Indiana |
| Black Beauty Equipment Company | | | | Indiana |
| Black Beauty Resources, LLC | | | | Indiana |
| Black Hills Mining Company, LLC | | | | Illinois |
| Colony Bay Coal Company | | | | West Virginia |
| Dixon Mining Company, LLC | | | | Kentucky |
| Dodge Hill Mining Company, LLC | | | | Kentucky |
| EACC Camps, Inc. | | | | West Virginia |
| Eastern Associated Coal, LLC | | | | West Virginia |
| Falcon Coal Company | | | | Indiana |
| Grand Eagle Mining, Inc. | | | | Kentucky |
| Hillside Mining Company | | | | West Virginia |
| Kanawha River Ventures I, LLC | | | | West Virginia |
| Midco Supply and Equipment Corporation | | | | Illinois |
| North Page Coal Corp. | | | | West Virginia |
| Ohio County Coal Company | | | | Kentucky |
| Sterling Smokeless Coal Company, LLC | | | | West Virginia |
| Sugar Camp Properties | | | | Indiana |
| Union County Coal Company, LLC | | | | Kentucky |
| Yankeetown Dock, LLC | | | | Indiana |
II-1
