EXHIBIT 10.2
COAL SUPPLY AGREEMENT
BETWEEN
INDIANAPOLIS POWER & LIGHT COMPANY
AND
TRIAD MINING OF INDIANA, INC.
AND
MARINE COAL SALES COMPANY
TABLE OF CONTENTS
SECTION PAGE
1. TERM . . . . . . . . . . . . . . . . . . 3
2. QUANTITY. . . . . . . . . . . . . . . . . 3
3. SOURCE OF COAL AND DELIVERIES . . . . . . . . 4
4. QUALITY . . . . . . . . . . . . . . . . . 5
5. BASE PRICE FOR COAL . . . . . . . . . . . . 7
6. ADJUSTMENTS TO BASE PRICE . . . . . . . . . . 8
7. CALORIFIC COST ADJUSTMENTS. . . . . . . . . . 14
8. WEIGHTS . . . . . . . . . . . . . . . . . 15
9. SAMPLING AND ANALYSIS. . . . . . . . . . . . 16
10. BILLING AND PAYMENT . . . . . . . . . . . . 17
11. RECORDS AND AUDITS. . . . . . . . . . . . . 17
12. FORCE MAJEURE. . . . . . . . . . . . . . . 18
13. COMPLIANCE WITH ANTI-POLLUTION LAWS AND
REGULATIONS, ETC. . . . . . . . . . . . . . 18
14. NOTICES . . . . . . . . . . . . . . . . . 19
15. WAIVERS AND REMEDIES . . . . . . . . . . . . 20
16. ARBITRATION. . . . . . . . . . . . . . . . 21
17. SUCCESSORS AND ASSIGNS . . . . . . . . . . . 21
18. HEADINGS NOT TO AFFECT CONSTRUCTION . . . . . . 21
19. WRITTEN INSTRUMENT. . . . . . . . . . . . . 21
20. LIMITATION OF LIABILITY OF MARINE. . . . . . . 22
21. EXECUTION OF COUNTERPARTS . . . . . . . . . . 22
22. CONSTRUCTION OF AGREEMENT . . . . . . . . . . 22
EXHIBIT A . . RESERVE LOCATION
EXHIBIT B . . CURRENT PUBLISHED EMISSION STANDARD
EXHIBIT C . . MARKETING AND SALES SERVICE AGREEMENT
EXHIBIT D . . COAL PREPARATION PLANT FLOW DIAGRAM
COAL SUPPLY AGREEMENT
THIS AGREEMENT, made and entered into as of this 7th day of December,
1994 by and among Triad Mining of Indiana, Inc. ("Seller"), an Indiana
corporation, with offices at Owensboro, Kentucky, Marine Coal Sales Company
("Marine"), a Delaware corporation, with offices at Carmel, Indiana, and
Indianapolis Power & Light Company ("Buyer"), with offices at Indianapolis,
Indiana.
RECITALS
WHEREAS, Buyer is a public utility rendering electric utility and
steam service over certain areas within the State of Indiana; and
WHEREAS, Buyer intends to purchase, in accordance with the terms and
conditions stated herein, a supply of bituminous coal for use at various
stations as needed and determined by Buyer ("Stations"). The coal shall be
of the qualities and characteristics set forth in this Agreement to assure
compliance with the applicable sulfur dioxide emission limitations imposed
by governmental authorities having jurisdiction thereover.
WHEREAS, Seller owns, leases, or controls (as such term is commonly
used in the coal industry), bituminous coal reserves in Greene County,
Indiana as identified in Exhibit "A" attached. Seller intends to supply to
Buyer coal in accordance with the terms and conditions of this Agreement
which shall assure compliance with the applicable sulfur dioxide emission
limitations imposed by governmental authorities having jurisdiction
thereover. A copy of the current regulations is attached as Exhibit "B";
and
WHEREAS, Seller has entered into a Marketing and Sales Service
Agreement ("Sales Service Agreement") with Marine, a copy of which is
attached hereto, for informational purposes, as Exhibit "C". A copy of any
amendment thereto will be furnished promptly to Buyer by Seller, and will
be incorporated into Exhibit "C".
NOW THEREFORE, in consideration of the premises and the mutual
covenants and agreements of the parties hereinafter set forth, it is hereby
agreed by and between the parties hereto as follows:
SECTION 1. TERM.
(a) The term of this Agreement shall commence as of the first date written
above and shall continue in effect through December 31, 2000.
(b) Buyer has sole option to extend the term of this Agreement for any
period up to five (5) years subject to reserve tonnage verification
and price negotiation. Buyer shall notify Seller of the exercise of
such option on or before August 25, 1999. Should Buyer and Seller not
mutually agree upon price by December 31, 1999, Seller shall not sell
coal, to another buyer, at a price lower than quoted by Seller to
Buyer. Such restriction on Seller shall be effective until December
31, 2001.
SECTION 2. QUANTITY.
(a) The quantity of coal to be sold and purchased under this Agreement
shall be 300,000 tons per Contract Year of Coal having a sulphur
dioxide content not to exceed 2.0 pounds per million British Thermal
Units (MMBTU), as described in Section 4(a) and 4(b), and an
additional 250,000 tons per Contract Year of coal having a sulphur
dioxide content not to exceed 2.4 pounds per MMBTU, as described in
Section 4(a) and 4(b), for a total of 550,000 tons per contract year.
"Ton" shall be defined as a short ton of 2,000 pounds avoirdupois
weight. "Contract Year" shall be defined as a period beginning on
January 1 and ending on the succeeding December 31. If the first year
is a partial Contract Year, the quantities will be prorated coincident
with the number of days available for shipment from the date of
commencement of shipments through the end of the calendar year.
(b) On or before November 1 of each Contract Year, Buyer shall retain the
right, upon written notice to Seller, to increase or decrease either,
or both, of the two different quantities in Section 2(a) above for the
next Cotnract Year by an amount not greater than 10%.
(c) Buyer shall have the right of first refusal regarding Spot Sales from
all reserves in the State of Indiana owned or controlled by Seller
presently or in the future. "Spot Sales" shall be defined as tonnage
sold under a contract term of one year or less, or tonnage sold under
a contract term of one year or less and subsequently extended by one
year increments. To exercise this right, Buyer must respond to Seller
by accepting or rejecting a bona fide offer within twenty-four (24)
hours after receipt of notice from Seller regarding another proposed
sale. Notice to Buyer shall include all terms and conditions of the
sale such as, but not limited tok, source, quality, quantity by month
and term, F.O.B. mine and delivered prices, means of delivery, F.O.B.
point, and premium or penalty provisions. Such notice shall
constitute an offer to sell to Buyer under the terms thereby defined.
If Buyer refuses such offer, then Seller may sell that coal, to said
buyer only, under terms and conditions of that agreement shall remain
identical to the notice presented to Buyer throughout the life of that
agreement. So long as Seller complies in good faith with these
provisions, the provisions of Subsection 6(q) shall not apply.
SECTION 3. SOURCE OF COAL AND DELIVERIES.
(a) The source of coal shall be the reserves of Seller located in Greene
County, Indiana, identified on Exhibit A and nearby reserves which may
be acquired by Seller. Exhibit A will be updated as Seller acquires
additional reserves for this Agreement. Seller covenants that it will
not sell or contract to sell coal from said reserves in such manner
or quantity as to jeopardize its ability to perform under the terms
of this Agreement. Seller further covenants that coal from sources
not previously approved by Buyer in writing will not be included in
shipments to Buyer.
(b) Coal subject to this Agreement shall be delivered by Seller to Buyer
FOB trucks (to be arranged by Buyer) loaded at Seller's mine, or at
Buyer's option, FOB railcars (to be arranged by Buyer) at Seller's
rail siding (the location of which is set forth in Exhibit A).
Seller's rail siding(s) shall have the capacity to hold and load a
minimum of fifty-five 100-ton capacity railroad cars in accordance
with existing tariff or applicable rail contract or both. "Shipment"
shall be defined as a single train rail delivery or, if trucks are
used for transporting the coal, "Shipment" shall be defined as the sum
of one day's truck deliveries from any one of Seller's loading points
to any one of Buyer's Stations. Risk of loss shall follow title to
the coal. Title shall pass when coal is delivered to trucks or
railcards by Seller. Point of delivery for purposes of Sections 5 and
6 of this Agreement shall be FOB railcar or truck as the case may be.
Point of delivery for Purposes of Sections 4, 7 and 9 of this
Agreement shall be FOB Buyer's Station(s).
(c) Coal deliveries subject to this Agreement shall be made in
substantially equal monthly quantities subject to the vacation and
holiday schedules of Seller, Buyer and shippers and in accordance with
Buyer's shipping instructions.
(d) The primary destination of coal deliveries shall be Buyer's H.T.
Pritchard Station and C.C. Perry K Station. Buyer shall have the
right, but not the obligation, to direct shipments to any other of its
Stations.
SECTION 4. QUALITY.
The procedures outlined in Section 9 shall be used to determine the quality
of the coal received.
(a) All coal shipped pursuant to this Agreement shall consist of three
seams from the reserves identified in Exhibit A. The seams are
identified as the Lower Block, Upper Block and Shady Lane Seams. Coal
from the Lower Block and Upper Block shall be fully washed, crushed,
run-of-mine. Coal from the Shady Lane Seam shall be crushed,
run-of-mine and washed as necessary to obtain the 2.0 pounds of
sulphur dioxide per MMBTU product. All three seams will be crushed
to a size of 3" x 0", (with Buyer retaining the right to require a
size of 2" x 0" at its sole discretion; and Seller shall comply within
30 days of receipt of Buyer's notice), containing a maximum of 3%
minus 100 mesh fines. The products shall be of quality equal to or
better than the following characteristics on a Monthly Weighted
Average "As-Received" basis:
(1) 2.0 Pounds Of Sulphur Dioxide Product.
Moisture (maximum) 16.0%
Ash (maximum) 7.5%
Sulfur Dioxide(maximum) 2.0 lbs. SO2/MMBTU
Chlorine (maximum) 0.1%
Calorific Value (BTU per lb.) 11,450 minimum
Grindability (Hardgrove Index) 50 minimum
Slagging Factor (maximum) 1.0
Fouling Factor (maximum) .15
Ash Softening Temperature 2,250 degrees
Fahrenheit (Reducing H=W) minimum
(2). 2.4 Pounds Of Sulphur Dioxide Product
Moisture (maximum) 15.0%
Ash (maximum) 7.5%
Sulfur Dioxide (maximum) 2.4 lbs. SO2/MMBTU
Chlorine (maximum) 0.1%
Calorific Value (BTU per lb.) 11,450 minimum
Grindability (Hardgrove Index) 50 minimum
Slagging Factor (maximum) 1.0
Fouling Factor (maximum) .15
Ash Softening Temperature 2,250 degrees
Fahrenheit (Reducing H=W) minimum
If the quality of coal delivered by Seller fails to meet any one or
more of the standards set forth in this Subsection, Buyer shall be
entitled to exercise the remedies of Subsection 4(c).
(b) Coal delivered by Seller pursuant to this Agreement under
Subsection 4(b) shall additionally be subject to the following
quality specifications on an individual Shipment basis:
(1) 2.0 Pounds Of Sulphur Dioxide Product.
Moisture (maximum) 16.0%
Ash (maximum) 8.5%
Sulfur Dioxide (maximum) 2.05 lbs.
SO2/MMBTU
Chlorine (maximum) 0.1%
Calorific Value (BTU per lb.) 11,200 minimum
Grindability (Hardgrove Index) 48 minimum
Slagging Factor (maximum) 1.0
Fouling Factor (maximum) .15
Ash Softening Temperature 2,250 degrees
Fahrenheit (Reducing H=W) minimum
(2). 2.4 Pounds Of Sulphur Dioxide Product
Moisture (maximum) 16.0%
Ash (maximum) 8.5%
Sulfur Dioxide(maximum) 2.45 lbs. SO2/MMBTU
Chlorine (maximum) 0.1%
Calorific Value (BTU per lb.) 11,200 minimum
Grindability (Hardgrove Index) 48 minimum
Slagging Factor (maximum) 1.0
Fouling Factor (maximum) .15
Ash Softening Temperature 2,250 degrees
Fahrenheit (Reducing H=W) minimum
"Shipment" shall be as defined in Subsection 3(b), unless redefined
pursuant to Subsection 9(d). If the quality of coal delivered by
Seller fails to meet any one or more of the standards set forth in
this Subsection, Buyer shall be entitled to exercise the remedies
of Subsection 4(c).
(c) If coal delivered by Seller fails to meet any one or more of the
quality specifications included in any one of Subsections 4(a) or
4(b), then Buyer, at its option, may immediately suspend future
deliveries of any and all coal subject to this Agreement until
Seller gives assurances acceptable to Buyer that it has corrected
such deviations. If 1) such assurances are not given within thirty
(30) days following such suspension, and 2) Seller uses its best
efforts to meet the quality specifications and is unable to do so,
then Buyer's remedies shall be limited to terminating this
Agreement without further obligation to Seller except Buyer shall
be entitled to recover any and all excess costs of purchasing
Replacement Coal as provided in I.C.26-1-2- 712. "Replacement
Coal" is defined as coal purchased by Buyer during the remaining
term of this Agreement under terms and conditions not substantially
different from those contained in this Agreement, and price must be
negotiated in good faith.
(d) In order to assure environmental compliance, Seller shall collect
representative samples, analyze the samples, and advise Buyer of
Seller's determination of the sulphur content expressed in pounds
of sulphur dioxide per million Btu's or percent sulphur, whichever
is applicable, of each Shipment prior to loading into trucks or
railcars.
(e) Seller warrants that coal delivered to Buyer shall not contain
extraneous materials that would render the coal, in Buyer's sole
opinion, unsuitable for use at Buyer's Station(s). Extraneous
materials include, but are not limited to, slate, shale, fireclay,
rock, stone, dirt, mud, wood and rags. Should any Shipment(s) of
coal containing such extraneous material be delivered to any of
Buyer's Stations then Buyer may immediately reject such Shipment(s)
and title to such Shipment(s) shall revert to Supplier.
(f) THE QUALITY SPECIFICATIONS SET FORTH IN THIS SECTION 4 SHALL BE IN
LIEU OF ANY OTHER WARRANTY OF QUALITY, EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO, ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
(g) For purposes of this Agreement pounds of sulfur dioxide per million
BTU shall be calculated according to the following:
Pounds of SO2 per MMBTU =
(%S X 20,000)/(As-received BTU/pound)
Percent sulfur and As-received BTU per pound shall be determined in
accordance with Section 9.
SECTION 5. BASE PRICE FOR COAL.
The Base Price per net ton for coal shall be $23.00 for the 2.0 pound SO2
per MMBTU and 2.4 pound SO2 per MMBTU products. The Base Price shall be
adjusted according to the provisions of Section 6, and as adjusted shall
also be the Adjusted Base Price.
SECTION 6. ADJUSTMENTS TO BASE PRICE.
CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(a) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(1) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(2) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(3) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(4) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(b) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(c) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(d) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(e) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(f) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(1) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(2) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(3) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(4) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(g) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(h) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(i) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(j) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(k) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(l) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(m) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(n) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(1) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(i) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(ii) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(iii) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(iv) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(2) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(3) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(o) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(p) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(q) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(r) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
SECTION 7. CALORIFIC COST ADJUSTMENT.
(a) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(b) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
(c) CONFIDENTIAL PORTIONS OF THIS CONTRACT DATED
DECEMBER 7, 1994 BETWEEN INDIANAPOLIS
POWER & LIGHT COMPANY AND
TRIAD MINING OF INDIANA, INC. AND
MARINE COAL SALES COMPANY HAVE BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION
PURSUANT TO 17 CFR 240.24b-2
SECTION 8. WEIGHTS.
(a) The weight of coal shipped shall be determined on scales maintained
by Seller. The weights thus determined shall be accepted as the
quantity of coal for which invoices are to be rendered and payments
made in accordance with Section 10. Seller shall arrange for such
scales to be properly inspected and approved at least twice each
year by either the railroad, a mutually acceptable representative
agency, or the scale manufacturer in accordance with the applicable
standards established by the carrier or the appropriate weighing
and inspection bureau, and subject to verification by Buyer and all
carriers involved in the delivery to Buyer's Station(s). Seller
shall notify Buyer in advance of all scale inspections, and Buyer
shall have the right to have a representative present.
(b) Buyer shall have the right to have a representative present at any
and all times to observe the weighing of the coal. If Buyer should
at any time question the accuracy of the scales, Buyer shall so
advise Seller, who shall arrange for the scales to be tested,
subject to Buyer's rights detailed in Subsection 8(a). Such tests
shall be conducted by the railroad, the Indiana State Bureau of
Weights and Measures, a mutually acceptable representative agency
or the scale manufacturer. Tests shall be performed in accordance
with the applicable standards established by the carrier or the
appropriate weighing and inspection bureau. If such tests show
Seller's scales to be in error, said scales shall be adjusted to an
accurate condition. If any such inspection or test reveals an
error in weight in excess of one-half percent (1/2%), then weights
of the coal measured on that scale during the period commencing
with the date on which the accuracy was questioned to the date that
scale is correctly calibrated shall be adjusted in proportion to
the calibration error. Invoices submitted during this period shall
be adjusted in accordance with said adjustment to weights. No
adjustments shall be made to invoices submitted prior to the time
the accuracy of the scales was questioned.
(c) Buyer retains the option to weigh coal deliveries on Buyer's scales
at any time and for any reason from time to time. If Buyer chooses
to exercise this option, then Buyer will notify Seller in writing
and the rights and responsibilities of Seller per Subsections 8(a)
and 8(b) shall be assumed by Buyer, and the rights and
responsibilities of Buyer thereunder shall be assumed by Seller.
SECTION 9. SAMPLING AND ANALYSIS.
(a) Each day that coal is delivered hereunder, Buyer shall take or
cause to be taken representative samples of such coal. Buyer shall
further cause to be determined by proper analysis the quality and
characteristics of the coal. Sampling shall consist of
representative samples, manually gathered, from at least 20% of the
railcars or trucks in each Shipment or by mechanical sampling
systems where available. Analysis of each Shipment shall be
performed in general accordance with ASTM procedures. Buyer shall
furnish semi-monthly to Marine and Triad a report showing the
quality of the coal on a Shipment basis. Seller shall have the
right to have a representative present at any and all times to
observe the sampling and analysis. Results of sampling and
analysis by Buyer shall determine the quality of each Shipment.
(b) If Seller should at any time question either Buyer's sampling
methods or the results of any of Buyer's analyses, Seller shall
have the right, at its expense, to have the coal sampled at
destination and analyzed by a commercial testing laboratory, which
will be chosen mutually by the Parties. Tests shall be performed
using standards developed by ASTM, Bureau of Mines, or other
mutually acceptable procedures. The results of such sampling and
analysis shall be accepted as the quality of the coal for each
Shipment so sampled.
(c) If Buyer's sample is from less than 20% of a Shipment, the results
of Seller's sample and analysis shall determine the quality and
characteristics of such Shipment.
(d) Buyer has the right to require sampling and analysis on a more
frequent basis and as necessary in order to assure compliance with
applicable environmental standards. In such event, the term
"Shipment" in Subsection 3(b) shall be redefined by Buyer to the
extent required to assure such compliance.
SECTION 10. BILLING AND PAYMENT.
(a) As provided in the Sales Service Agreement, Marine shall be
responsible for the rendering of invoices to Buyer. After the 15th
day of each month, Marine shall render an invoice to Buyer covering
the coal shipped during the first fifteen (15) days of that month.
After the last day of each month, Marine shall render an invoice to
Buyer covering the coal shipped during the sixteenth day through
the last day of that month. Buyer shall, within ten (10) business
days after receipt of each invoice, pay to Seller's account at
National City Bank of Louisville, by cash or check, in United
States funds, the net amount of that invoice. Each invoice shall
be for the Adjusted Base Price approved by Buyer, in effect at the
time of shipment.
(b) As soon as practical after all pertinent data has been received
relating to quality, Buyer shall issue to Marine a debit or credit
memo giving effect to all adjustments for the month's shipments
relative to quality as detailed in Section 7. If additional
amounts are due from Buyer, Buyer shall pay to Seller's account at
National City Bank of Louisville, by cash or check, in United
States funds, the net amount of each invoice within ten (10)
business days after receipt. If credits are due, Buyer shall
deduct the amount of any credit memo from the next payment due.
(c) Payment shall be deemed to have been made on the date that any
check is deposited in the United States Mail.
SECTION 11. RECORDS AND AUDITS.
(a) Seller and Marine shall keep accurate and satisfactory records and
books of account showing all financial and technical data required
for purposes of administering this Agreement.
(b) Each time the Base Price is adjusted in accordance with any
provision of Section 6, Marine shall furnish to Buyer a detailed
statement showing the calculations of the Adjusted Base Price and
the basis for the proposed adjustment.
(c) Buyer shall have the right at all times and at any time, upon
reasonable and written notice, to examine or to cause a nationally
recognized accounting firm or mining engineering firm to examine
the reserves, mine, and records of Seller and Marine as they
pertain to this Agreement. The cost of such examination shall be
borne by Buyer.
SECTION 12. FORCE MAJEURE.
(a) The term "force majeure" shall mean any and all causes beyond the
control and without the fault or negligence of the Party failing to
perform. Such causes shall include but not be limited to acts of
God, acts of the public enemy, insurrections, riots, labor
disputes, boycotts, labor and material shortages, fires,
explosions, floods, breakdowns of or damage to equipment or
facilities, interruptions to transportation, embargoes, acts of
military authorities, or other causes of a similar nature whether
or not foreseen or foreseeable which wholly or partly prevent the
mining, loading and/or delivery of the coal by Seller; or the
receiving, unloading, accepting, and/or utilizing of the coal by
Buyer. Settlement of labor disputes shall be deemed beyond the
control and without the fault or negligence of the Party
experiencing such event. Documentation verifying a condition of
force majeure shall be made available by the Party invoking the
provisions of this Section.
(b) If, because of a verifiable condition of force majeure, either
Party is unable to carry out any of its obligations under this
Agreement (except for obligation of either Party to pay money in
connection with the performance of this Agreement), that Party
shall promptly give written notice to the other Party. The
obligation of the Party giving notice shall be suspended to the
extent made necessary by said force majeure during its continuance.
However, the Party giving notice shall use commercially reasonable
efforts to eliminate the force majeure with a minimum of delay.
Any deficiencies in deliveries of the coal caused by a condition of
force majeure shall not be made up except by mutual consent.
(c) During a period in which Buyer invokes a condition of force
majeure, Seller, in the absence of mutual agreement to make up
deficient deliveries, may sell to others the coal otherwise
designated for Buyer. Likewise, during a period in which Seller
invokes a condition of force majeure, Buyer, in the absence of
mutual agreement to make up deficient deliveries, may buy from
others the coal otherwise to have been purchased from Seller.
SECTION 13. COMPLIANCE WITH ANTI-POLLUTION LAWS AND
REGULATIONS, ETC.
(a) The Parties to this Agreement recognize that, during the term of
this Agreement, legislative bodies, regulatory agencies or courts
having competent jurisdiction over the subject matter of this
Agreement may enact laws or regulations, or issue orders such as,
but not limited to, those relating to air pollution, the effect of
which will make it impossible or impractical for Buyer to utilize
the coal subject to this Agreement at H.T. Pritchard Station for
the 2.4 pounds of sulphur dioxide per mmBTU product, or C.C. Perry
K Station for the 2.0 pounds of sulphur dioxide per mmBTU product
without changing or altering its present equipment. Such laws,
regulations or orders may pertain to, but would not necessarily be
limited to, the sulfur content of the coal. If any such laws,
regulations or orders are imposed, Buyer shall provide written
notice to Seller of same as soon as practicable.
(b) If Buyer in its sole reasonable opinion, is unable to utilize the
coal with its present equipment at H.T. Pritchard Station for the
2.4 pounds of sulphur dioxide per MMBTU product, or C.C. Perry K
Station for the 2.0 pounds of sulphur dioxide per MMBTU product,
then Buyer shall give Seller notice of termination of this
Agreement which will be effective one hundred twenty (120) days
from receipt of notice. Buyer shall not be obligated to take any
of the products at any of its other Stations. Seller shall have
the exclusive right to notify Buyer that it desires to submit a
proposal for replacement coal within thirty (30) days after receipt
of notice. If Seller's proposal for supplying replacement coal to
Buyer is not submitted within sixty (60) days, the exclusive right
to negotiate shall expire immediately and this Agreement shall
terminate on the date specified in Buyer's notice of termination.
If the Parties are unable to reach a new agreement concerning
replacement fuel within sixty (60) days after submittal of a bona
fide proposal by Seller, this exclusive right shall likewise
expire. Upon termination under this Section, neither Party to this
Agreement shall have any further liability to the other except to
pay for coal delivered prior to termination and for which payment
has not yet been tendered.
SECTION 14. NOTICES.
(a) Any notice, request, consent, demand, report or statement given to
or made upon either Party to this Agreement by the other under any
of the provisions of this Agreement shall be in writing, unless it
is otherwise specifically provided in this Agreement, and shall be
treated as duly delivered when either (i) personally delivered to
the designated agent of the Party being notified (listed as
follows), (ii) sent by express courier mail service, or (iii)
deposited in the United States Mail, postage prepaid and properly
addressed, or (iv) sent by telecopier.
(b) Mail to Buyer's designated agent shall be addressed to:
Indianapolis Power & Light Company
25 Monument Circle
P.O. Box 1595
Indianapolis, IN 46206-1595
Attn: Vice President - Fuel Supply
with a copy to:
Indianapolis Power & Light Company
25 Monument Circle
P.O. Box 1595
Indianapolis, IN 46206-1595
Attn: Senior Vice President
Secretary & General Counsel
Mail to Seller's designated agent shall be addressed to:
Marine Coal Sales Company
645 West Carmel Drive
Suite 190
Carmel, IN 46032
Attn: President
with copies to:
Triad Mining of Indiana, Inc.
401 Frederica Street
Building A, Suite 101
Owensboro, KY 42302
Attn: President
SECTION 15. WAIVERS AND REMEDIES.
(a) In any one or more instances, the failure of either Party to this
Agreement to insist upon strict performance of any provision of
this Agreement by the other, or to take advantage of any right or
rights provided by this Agreement, shall not be construed as a
waiver of any provision or the relinquishment of any right or
rights respecting any subsequent nonperformance of any provision.
The Agreement shall therefore continue and remain in full force and
effect.
(b) Each remedy specifically provided under this Agreement is
non-exclusive and shall be taken and construed as cumulative and in
addition to any other remedy provided herein or by law.
(c) No default (including but not limited to failure to meet or exceed
all quality specifications in Section 4 hereof) by either Party to
this Agreement in the performance of any covenants or obligations
under this Agreement, which except for this subsection would be the
legal basis for a right of rescission or termination of this
Agreement by the other party, shall give or result in such a right
unless and until the defaulting Party shall fail to correct or
commence actions necessary to correct such default within thirty
(30) days after written notice of claim of default is given to
defaulting Party by the Party claiming default.
SECTION 16. ARBITRATION.
Any controversy or claim arising out of or relating to this Agreement, or
the alleged breach thereof (whether or not arbitra-tion has been
specifically mentioned in any section of this Agree-ment), shall be settled
by arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Associa-tion and judgment upon the award rendered by
the arbitrator(s) may be entered in any court having jurisdiction thereof.
Each Party shall choose one arbitrator and the third arbitrator shall be
chosen pursuant to the Rules of the American Arbitration Associa-tion. Each
Party agrees to pay the award of the arbitration within sixty (60) days of
receipt of the arbitrators' decision. It is the intent of the Parties that
arbitration be used to resolve disputes under this Agreement as quickly as
possible and, therefore, the arbitrators shall be requested to render a
decision within ninety (90) days of the date the dispute is referred to
arbitration. Each Party shall bear the cost of the arbitrator selected by
that Party and the Parties shall share equally the cost of the third
arbitra-tor. Discovery rules pursuant to the Federal Rules of Civil Proce-
dure shall be applicable to any arbitration under this Agreement.
SECTION 17. SUCCESSORS AND ASSIGNS.
This Agreement may not be assigned by either Seller or Buyer without the
written consent of the other Party, except as a pledge, assignment to secure
indebtedness, or other security arrangement to secure indebtedness incurred
for the purpose of or in connection with performance under this Agreement.
SECTION 18. HEADINGS NOT TO AFFECT CONSTRUCTION.
The headings to the respective sections and paragraphs of this Agreement are
inserted for convenience of reference and are neither to be taken to be any
part of the provisions hereof nor to control or affect the meaning,
construction or effect of the same.
SECTION 19. WRITTEN INSTRUMENT.
This written instrument contains the entire agreement between the Parties
and there are no other understandings or agreements, oral or written,
between said Parties. Any amendments to this Agreement shall be made in
writing and signed by both Parties. Purported amendments not in writing and
signed shall be null and void.
SECTION 20. LIMITATION OF LIABILITY OF MARINE.
Marine is a Party to this Agreement for the marketing, negotiating, and
administrative purposes stated herein and in the Sales Service Agreement
attached hereto as Exhibit "C". In no event shall Marine be held liable for
the performance or non-performance of any obligations relating to the
delivery or failure in the delivery of coal in the quantity required to be
supplied hereunder at any time during the term hereof.
SECTION 21. EXECUTION OF COUNTERPARTS.
This instrument may be executed in any number of counterparts, and all such
counterparts shall constitute but one and the same instrument.
SECTION 22. CONSTRUCTION OF AGREEMENT.
This instrument shall be governed by and construed in accordance with the
laws of the State of Indiana.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized respective corporate officers or
representatives, all as of the date December 7, 1994.
INDIANAPOLIS POWER & LIGHT COMPANY
By /s/ Ramon L. Humke
Ramon L. Humke
President and Chief Operating Officer
ATTEST:
/s/ Donald W. Knight
TRIAD MINING OF INDIANA, INC.
By /s/ Timothy Aull
Timothy Aull, President
ATTEST:
/s/ Richard E. Miller
MARINE COAL SALES COMPANY
By /s/ Larry F. Kaelin
Larry F. Kaelin, President
ATTEST:
/s/ Richard E. Miller
EXHIBIT A
[Narrative Description of Map: Exhibit A to this Contract is a map
detailing the location of the coal reserves in Greene County, Indiana]
EXHIBIT B
326 IAC 7-4-11 Morgan County sulfur dioxide emission limitations
Authority: IC 13-1-1-4; IC 13-7-7
Affected: IC 13-1-1; IC 13-7
Sec. 11. Indianapolis Power and Light (IPL) Pritchard Generating
Station shall comply with the sulfur dioxide emission limitations in pounds
per million Btu and other requirements as follows:
Emission
Facility Description Limitations
(1) Units 1 and 2 0.37 each
(2) Units 3, 4, 5, and 6 on and before
September 30, 1990 6.0 each
Unit 3 after September 30, 1990 0.37
Units 4, 5, and 6 after September 30,
1990 3.04 each
(3) As an exception to the emission limitations specified in subdivision
(2), after September 30, 1990, at any time in which IPL burns coal on Unit
3, sulfur dioxide emissions from Units 3, 4, 5, and 6 shall be limited to
two and fifty-seven hundredths (2.57) pounds per million Btu each.
(4) Prior to October 31, 1989, IPL shall modify the two (2) stacks
servings Units 3, 4, 5, and 6 to increase the height of each stack to at
least two hundred and eighty-one (281) feet above grade.
(5) Prior to February 28, 1989, IPL shall submit completed engineering
plans and drawings of flue gas conditioning systems for Units 4 and 5 to the
department. Prior to May 31, 1990, IPL shall complete installation of flue
gas conditioning systems for Units 4 and 5.
(6) After September 30, 1990, on a day for which Unit 3 does not burn
any coal, the limitations in subdivision (2) are in effect, and compliance
shall be determined as specified in 326 IAC 7-2-1(c).
(7) After September 30, 1990, on a day for which unit 3 burns any coal,
the limitations in subdivision (3) are in effect. As an exception to the
requirements of 326 IAC 7-2-1(c)(1) on a day for which Unit 3 burns any
coal, if the thirty (30) day rolling weighted average for any unit is above
two and fifty-seven hundredths (2.57) pounds per million Btu, then 326 IAC
7-2-1(c)(1) does not apply, and the daily average emission rate for that
unit for that day shall not exceed two and fifty-seven hundredths (2.57)
pounds per million Btu.
(8) After September 30, 1990, for the purposes of determining compliance
under 326 IAC 7-2-1(b), stack tests performed on Units 3, 4, 5, and 6 shall
demonstrate compliance with the most stringent set of limits in effect at
any time during the day prior to or during the test based on the Unit 3
operating status and fuel type as indicated by the log maintained pursuant
to subdivision (9).
(9) After September 30, 1990, IPL shall maintain and make available to
the department upon request a log of the operating status and fuel type used
for Unit 3. In addition, in the quarterly report required by 326 IAC 7-2-
1(a), IPL shall submit to the department a daily summary indicating fuel
type for Unit 3, and, for days on which Unit 3 burned any coal and any
thirty (30) day rolling weighted average was greater than two and fifty-
seven hundredths (2.57) pounds per million Btu, IPL shall submit to the
department the daily average sulfur content, heat content, and sulfur
dioxide emission rate for Units 3, 4, 5, and 6.
(Air Pollution Control Board, 326 IAC 7-4-11;
filed Aug 28, 1990, 4:50 p.m.: 14 IR 76)
326 IAC 7-4-2 Marion County sulfur dioxide emission limitations
Authority: IC 13-1-1-4; IC 13-7-7
Affected: IC 13-1-1; IC 13-7
Sec. 2. The following sources and facilities located in Marion
County shall comply with the sulfur dioxide emission limitations in pounds
per million Btu (lbs./MMBtu) and pounds per hour (lbs./hr.), unless
otherwise specified, and other requirement:
(Material not relevant deleted)
(29) Indianapolis Power and Light Perry K shall comply with the sulfur
dioxide emission limitations in pounds per million Btu and other
requirements as follows:
Emission
Boiler Number Limitations
(A) 17 and 18 0.3
(B) 11, 12, 13, 14, 15, and 16 2.1
(C) As an alternative to the emission limitations in clause (B), sulfur
dioxide emissions from Boilers 11, 12, 13, 14, 15, and 16 may comply with
any one (1) of the sets of emission limitations in pounds per million Btu
as follows:
Emission
Boiler Number Limitations
(i) 13, 14, 15, and 16 0.0
11 and 12 4.4
(ii) 11, 12, 15, and 16 0.0
13 and 14 4.4
(iii) 11, 12, 13, and 14 0.0
15 and 16 4.4
(iv) 11, 12, 15, and 16 3.0
13 and 14 0.3
(v) 11 and 12 0.3
13, 14, 15, and 16 3.0
(D) The department or the Indianapolis Air Pollution Control Division
shall be notified prior to the reliance by Indianapolis Power and Light on
any one (1) of the sets of alternative emission limitations specified in
clause (C).
(E) A log of hourly operating status for each boiler shall be maintained
and made available to the department upon request. A daily summary
indicating which boilers were in service during the day shall be submitted
to the department quarterly. In addition, records of the daily average
sulfur content, heat content, and sulfur dioxide emission rate for each day
in which an alternative set of emission limitations specified in clause (C)
is used shall be submitted to the department quarterly.
(F) For the purposes of 326 IAC 7-2-1(c)(1), during thirty (30) day
periods in which Indianapolis Power and Light relies on more than one (1)
set of emission limitations specified in clauses (B) through (C), a separate
thirty (30) day rolling weighted average for each set of limitations shall
be determined. Each thirty (30) day rolling weighted average shall be based
on data from the previous thirty (30) operational days within the last
ninety (90) days for that set of limitations. If Indianapolis Power and
Light does not operate thirty (30) days under any one (1) set of limitations
within the last ninety (90) days, the rolling weighted average shall be
based on all operational days within the last ninety (90) days for that set
of limitations.
(G) Boilers 11 through 16 shall be limited to six and zero-tenths (6.0)
pounds per million Btu each until Boilers 11 through 16 achieve compliance
with the sulfur dioxide emission limitations specified in clauses (B)
through (C). Compliance with the emission limitations specified in clauses
(B) through (C) shall be achieved according to the following schedule:
(i) Complete engineering analysis of modifications by April 2,
1988.
(ii) Complete testing and design of modifications and place orders
for necessary equipment by May 2, 1989.
(iii) Complete installation of necessary equipment and achieve
compliance with emission limitations specified in clauses (B)
through (C) by June 2, 1990.
Exhibit C
MARKETING AND SALES SERVICE AGREEMENT
THIS AGREEMENT entered into as of this 8th day of November, 1990 is
between MARINE COAL SALES COMPANY ("Marine"), an Indiana partnership, and
TRIAD MINING OF INDIANA, INC. ("Triad"), an Indiana corporation.
WHEREAS, Marine and Triad had entered into a Coal Mining and
Marketing Agreement dated as of November 8, 1990 which provides for the
execution of this Marketing and Sales Service Agreement between the same
parties; and
WHEREAS, the Coal Mining and Marketing Agreement obligates Triad to
construct and operate a coal mine near Switz City, Indiana utilizing coal
reserves from Ayrshire Land Company (the "Switz City Mine").
NOW, THEREFORE, in consideration of the covenants and promises set
forth herein, the parties agree as follows:
1. Term. The term of this Agreement shall commence upon the
execution hereof and shall continue until the later of the following:
(a) The permanent cessation of the production of coal from
the Switz City Mine; or
(b) The expiration of the initial term of the coal supply
agreement with Indianapolis Power & Light Company described in
Paragraph 7 of the Coal Mining and Marketing Agreement and further
described in Paragraph 9 of this Agreement.
2. Services to be Provided by Marine. With respect to coal to
be produced and sold from the mines described in Paragraph 1 above
(hereinafter called the "Subject Mines"), Marine shall provide such of the
following services as may be requested by Triad:
(a) Provide market research to determine markets for the
coal to be produced.
(b) Identify potential markets for such coal.
(c) Make presentations to potential customers for such coal.
(d) Conduct negotiations with customers; close and document
sales to customers; investigate creditworthiness.
(e) Obtain estimates and orders for coal from customers.
(f) Coordinate transportation arrangements with carriers.
(g) Send required shipping notices to customers.
(h) Handle customer complaints about quantity or quality.
(i) Prepare and send invoices and statements to customers.
(j) Calculate all price adjustments - both escalation and
quality adjustments; negotiate agreement on price revisions, if
required.
(k) Collect amounts due by customers.*
(l) Remit to Triad and, if applicable, to the carrier,
amounts due them.*
(m) Remit to appropriate governmental agency any applicable
sales, use or other taxes imposed on the sale of the coal.*
(n) Handle Force Majeure notices for Triad - issuance and
receipt.
(o) Assist Triad in obtaining replacement or substitute coal
if required.
* Not applicable to Coal Supply Agreement between
Indianapolis Power & Light Company ("IP&L") and Triad because of
provisions of Paragraph 7 of Coal Mining and Marketing Agreement
referenced above.
3. Compensation to Marine. In consideration of the services to
be provided by Marine hereunder and in further consideration of the
assignment of interests made by Marine to Triad pursuant to the Coal Mining
and Marketing Agreement, it is agreed that Marine shall receive the
following compensation for coal produced from the Subject Mines:
(a) A fee of 2.2% of gross realization on all coal sold to
"IP&L" pursuant to the Coal Supply Agreement described in Paragraph
2(c) of the Coal Mining and Marketing Agreement (the "IP&L Coal
Supply Agreement") during the initial term thereof.
(b) A fee of 2.2% of gross realization on all coal sold to
AMAX Coal Sales Company pursuant to the Option to Purchase Coal
Agreement described in Paragraph 2(b) of the Coal Mining and
Marketing Agreement during the five year term thereof.
(c) A fee of 2.2% of gross realization in the form of a
reduction in the price paid to Triad for coal purchased by Marine
from Triad pursuant to the provisions of Paragraph 5 of the Coal
Mining and Marketing Agreement, plus 50% of the average monthly
gross realization in excess of the price then in effect under the
IP&L Coal Supply Agreement.
(d) A fee of 2.2% of gross realization plus 20% of gross
realization in excess of the price then in effect under the IP&L
Coal Supply Agreement for all quantities of coal sold in excess of
400,000 tons per year.
(e) A fee of 2.2% of gross realization plus 20% of gross
realization in excess of the price then in effect under the IP&L
Coal Supply Agreement for all quantities of coal sold commencing
after the expiration of the periods involved with the arrangements
described in subparagraphs (b) and (c) of this Paragraph 3.
The term "gross realization" shall mean the gross proceeds received for coal
sold to a customer f.o.b. mine without deduction of the fee payable to
Marine but exclusive of any sales, use or other taxes based upon the sale
or use of the coal.
4. Coal Supply Agreements. In the case of coal sold to customers
falling into the categories set forth in subsections (d) and (e) of Section
3 above, Marine will consult with Triad on terms for sales of coal to such
customers. All such sales shall be made on terms acceptable to Triad in its
sole and absolute discretion.
5. Indemnification.
(a) Triad agrees to indemnify and save Marine harmless from
and against any and all liabilities, losses, claims, demands,
expenses or damages which are caused by any of the following: (i)
any willful or negligent act or omission of Triad in the operation
of the Subject Mines; (ii) any failure by Triad to comply with the
terms and conditions of this Agreement or the Coal Mining and
Marketing Agreement; (iii) any failure to comply with applicable
laws and regulations relating hereto. Triad agrees that it will
defend the interests of Marine in any claim or lawsuit covered by
this indemnification provision, including, but not limited to,
payment of all attorney fees, court costs, costs of settlements and
satisfaction of any judgments entered.
(b) Marine agrees to indemnify and save Triad harmless from
and against any and all liabilities, losses, claims, demands,
expenses or damages which are caused by any of the following: (i)
any willful or negligent act or omission of Marine in the sale of
coal produced from the Subject Mines; (ii) any failure by Marine to
comply with the terms and conditions of this Agreement or the Coal
Mining and Marketing Agreement; (iii) any failure to comply with
applicable laws and regulations relating hereto. Marine agrees
that it will defend the interests of Triad in any claim or lawsuit
covered by this indemnification provision, including, but not
limited to, payment of all attorney fees, court costs, costs of
settlements and satisfaction of any judgments entered.
6. Default of Triad.
(a) Events of Default. The following shall constitute
events of default by Triad hereunder:
(i) Failure to perform any material obligation
imposed on Triad set forth in the Coal Mining and Marketing
Agreement, in this Agreement, or in the Agreements described
in Paragraph 2 of the Coal Mining and Marketing Agreement.
(ii) The bankruptcy or insolvency of Triad or its
cessation of business as a going concern.
(b) Remedies for Default. Subject to the notice of default
and the cure period provisions of Paragraph 9 hereof, Marine shall
have the following remedies for an event of default committed by
Triad:
(i) To recover damages under applicable legal
theories.
(ii) To obtain equitable relief under applicable legal
theories.
7. Default of Marine.
(a) Events of Default. The following shall constitute
events of default by Marine hereunder:
(i) Failure to perform any material obligation
imposed on Marine set forth in the Coal Mining and Marketing
Agreement or in this Agreement.
(ii) Failure to remit when due any funds received
from customers which are due to Triad or any third party.
(iii) The bankruptcy or insolvency of Marine or its
cessation of business as a going concern.
(b) Remedies for Default. Subject to notice of default and
the cure period provisions of Paragraph 9 hereof, Triad shall have
the following remedies for an event of default committed by Marine:
(i) To recover damages under applicable legal
theories.
(ii) To obtain equitable relief under applicable legal
theories.
8. Notices and Cure Provisions.
(a) Either party shall be entitled to exercise the remedies
for default available to it as set forth in Paragraph 7 and 8
hereof if the party alleged to be in default (the "Defaulting
Party") by the other party (the "Non-Defaulting Party") fails to
cure any such default within a period of thirty (30) days (the
"Cure Period") (except that the Cure Period for Paragraph 7(a)(ii)
shall be ten (10) days) after written notice of claim of such
default has been sent by the Non-Defaulting Party to the Defaulting
Party unless such default cannot reasonably be cured within the
Cure Period and the Defaulting Party can demonstrate that steps
have been taken to cure such default within a reasonable period of
time and the Defaulting Party proceeds with due diligence to cure
the default within a reasonable period of time.
9. Additional Agreement with IP&L. If the parties are successful
in negotiating an additional coal supply agreement with IP&L to be supplied
from the Petersburg Mine as described in Paragraph 8 of the Coal Mining and
Marketing Agreement, it is understood that Triad shall own and operate the
Petersburg Mine and that Marine shall be the exclusive sales agent for the
coal produced and sold from such Mine to IP&L for the initial terms of the
coal supply agreement with IP&L. The parties shall negotiate a Marketing
and Sales Service Agreement for the coal sold to IP&L from the Petersburg
Mine upon reasonable terms taking into account the sales price of the coal
and the costs of mining, preparing and delivering the coal to IP&L. If the
parties mutually agree, such Marketing and Sales Service Agreement may cover
other coal produced at the Petersburg Mine.
10. Assignment. This Agreement is personal to the parties hereto
and to the principals of such parties, and neither party shall transfer or
assign this Agreement to any third party without the prior written consent
of the other party.
11. Notices. All notices hereunder shall be in writing and shall
be given either by personal delivery or by the U.S. mails, courier service,
telex, telecopier, or any similar means, properly addressed to the Parties
as follows:
If notice is to Marine, addressed as follows:
Richard E. Miller, President
Marine Coal Sales Company
645 W. Carmel Drive - Suite 190
Carmel, Indiana 46032
If notice is to Triad, addressed as follows:
Joe M. Aull, President
Triad Mining of Indiana, Inc.
5000 Back Square Drive
Owensboro, Kentucky 42301
Either party may, by written notice to the other, change the person or
address to which notice (including copies thereof to other persons) are to
be sent.
12. Waivers. The failure of a party hereto to insist upon any one
or more instances of strict performance of any provision hereof or to take
advantage of any rights hereunder shall not be construed as a waiver of any
such provision or the relinquishment of any such rights. To be effective
any waiver must be in writing and must set forth clearly the right being
waived.
13. Arbitration. Except for the provisions hereof relating to
Events of Default and remedies therefor which shall not be subject to
arbitration, all other controversies or claims arising out of or relating
to this Agreement which are not resolved by negotiations between the parties
hereto shall be settled by arbitration in accordance with Commercial
Arbitration Rules of the American Arbitration Association, and judgment may
be entered on the award in any court having jurisdiction. Either party may
determine, in its sole discretion, that negotiations or continued
negotiations, would be unavailing.
14. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Indiana.
15. Headings. The headings in this Agreement are for convenience
only, and shall not be considered a part of, or used in the interpretation
of, this Agreement.
16. Construction. No understanding or agreements not expressly
stated herein shall be binding on the parties in the construction or
fulfillment hereof unless such understandings, or agreements are reduced to
writing and signed by the respective parties.
17. Amendments. No waiver, alteration or modification of any of
the provisions, or termination, of this Agreement shall be effective unless
in writing and fully executed by the party to be bound thereby.
18. Entire Agreement. This Agreement contains the entire
Agreement between the parties with respect to the subject matter hereof.
All previous and collateral agreements, representations, warranties,
promises and conditions of sale are superseded by this Agreement. Any
representation, promise or condition not incorporated in this Agreement
shall not be binding on either party.
19. Execution of Counterparts. This Agreement may be executed in
any number of counterparts, and all such counterparts shall constitute but
one and the same Agreement.
20. Severability. All agreements and covenants herein contained
are severable, and in the event any of them shall be held to be invalid by
any court having jurisdiction, all remaining agreements and covenants shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized respective corporate officers or
representatives, all as of the date first above written.
MARINE COAL SALES COMPANY,
a Partnership
ATTEST: By Marine Coal Sales, Inc.,
General Partner
/s/ Judy K. Van Abeele By: /s/Richard E. Miller
Secretary President
TRIAD MINING OF INDIANA, INC.
ATTEST:
/s/ Michael W. Howard By: /s/ Joseph M. Aull
CONSENT TO SUBSTITUTION OF PARTIES
WHEREAS, the undersigned entered into a certain Coal Marketing and
Sales Service Agreement dated November 8, 1990, (the "Agreement") with
Marine Coal Sales Company, an Indiana partnership ("MCSC-1"); and
WHEREAS, Marine Coal Sales Company, a Delaware corporation ("MCSC-
2") has acquired all rights, title and interest of MCSC-1 and has assumed
the obligation to perform all executory agreements to which MCSC-1 is a
party; and
WHEREAS, MCSC-1 was dissolved as of January 12, 1994;
NOW, THEREFORE, the undersigned hereby consents to the substitution
of MCSC-2 for MCSC-1 as a party to the Agreement as of January 12, 1994.
IN WITNESS WHEREOF, the undersigned has caused this Consent to
Substitution of Parties to be executed to be effective as of January 12,
1994.
TRIAD MINING OF INDIANA, INC.
By: /s/ Timothy R. Aull
Title: /s/ President
EXHIBIT D
[Narrative Description of Exhibit D: Exhibit D to this Contract is a
flowchart showing the process the coal to be delivered under the Contract
must complete.]