EXHIBIT 10.25
Book 1463 of Photos, Page 581
3400-12 Serial Number
(April 1986) UNITED STATES WYW 127221
DEPARTMENT OF THE INTERIOR North Rochelle Tract
727983 BUREAU OF LAND MANAGEMENT
COAL LEASE (STAMP)
97 NOV -3 AM 9:00
RECEIVED
CHEYENNE, WYOMING
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PART I: LEASE RIGHTS GRANTED
This lease, entered into by and between the United States of America,
hereinafter called the lessor, through the Bureau of Land Management, and
(Name and Address)
TRITON COAL COMPANY
50 JEROME LANE
FAIRVIEW HEIGHTS, ILLINOIS 62208
hereinafter called lessee, is effective (date) January 1, 1998 for a period of
20 years and for so long thereafter as coal is produced in commercial quantities
from the leased lands, subject to readjustment of lease terms at the end of the
20th lease year and each 10-year period thereafter.
SEC. 1. This lease is issued pursuant and subject to the terms and provisions of
the:
X Mineral Lands Leasing Act of 1920, Act of February 25, 1920, as amended,
- --- 41 Stat. 437, 30 U.S.C. 181-287, hereinafter referred to as the Act;
Mineral Leasing Act for Acquired Lands, Act of August 7, 1947, 61 Stat.
- --- 913, 30 U.S.C. 351-359;
and to the regulations and formal orders of the Secretary of the Interior which
are now or hereafter in force, when not inconsistent with the express and
specific provisions herein.
SEC. 2. Lessor, in consideration of any bonuses, rents, and royalties to be
paid, and the conditions and covenants to be observed as herein set forth,
hereby grants and leases to lessee the exclusive right and privilege to drill
for, mine, extract, remove or otherwise process and dispose of the coal deposits
in, upon, or under the following described lands in Campbell County, Wyoming:
T.42 N., R. 70 W., 6th P.M., Wyoming
Sec. 4: Lots 5-16, 19 and 20;
Sec. 5: Lots 5-16;
T.43 N., R. 70 W., 6th P.M., Wyoming
Sec. 32: Lots 9-16;
Sec. 33: Lots 11-14.
containing 1481.93 acres, more or less, together with the right to construct
such works, buildings, plants, structures, equipment and appliances and the
right to use such on-lease rights-of-way which may be necessary and convenient
in the exercise of the rights and privileges granted, subject to the conditions
herein provided.
PART II. TERMS AND CONDITIONS
SEC. 1.(a) RENTAL RATE - Lessee shall pay lessor rental annually and in advance
for each acre or fraction thereof during the continuance of the lease at the
rate of $3.00 for each lease year.
(b) RENTAL CREDITS - Rental shall not be credited against either production or
advance royalties for any year.
SEC. 2.(a) PRODUCTION ROYALTIES - The royalty shall be 12 1/2 percent for coal
produced by strip or auger methods and 8 percent for coal produced by
underground mining methods of the value of the coal as set forth in the
regulations. Royalties are due to Lessor the final day of the month succeeding
the calendar month in which the royalty obligation accrues.
(b) ADVANCE ROYALTIES - Upon request by the Lessee, the authorized officer may
accept, for a total of not more than 10 years, the payment of advance royalties
in lieu of continued operation, consistent with the regulations. The advance
royalty shall be based on a percent of the value of a minimum number of tons
determined in the manner established by the advance royalty regulations in
effect at the time the lessee requests approval to pay advance royalties in lieu
of continued operation.
SEC. 3. BONDS - Lessee shall maintain in the proper office a lease bond in the
amount of $24,466,000. The authorized officer may require an increase in this
amount when additional coverage is determined appropriate.
SEC. 4. DILIGENCE - This lease is subject to the conditions of diligent
development and continued operation, except that these conditions are excused
when operations under the lease are interrupted by strikes, the elements, or
casualties not attributable to the lessee. The lessor, in the public interest,
may suspend the condition of continued operation upon payment of advance
royalties in accordance with the regulations in existence at the time of the
suspension. Lessee's failure to produce coal in commercial quantities at the end
of 10 years shall terminate the lease. Lessee shall submit an amended operation
and reclamation plan pursuant to Section 7 of the Act not later than 3 years
after lease issuance.
The lessor reserves the power to assent to or order the suspension of the terms
and conditions of this lease in accordance with, inter alia, Section 39 of the
Mineral Leasing Act, 30 U.S.C. 209.
SEC. 5. LOGICAL MINING UNIT (LMU) - Either upon approval by the lessor of the
lessee's application or at the direction of the lessor, this lease shall become
an LMU or part of an LMU, subject to the provisions set forth in the
regulations.
Book 1463 of Photos, Page 582
WYW127221
Page 2 of 4
The stipulations established in an LMU approval in effect at the time of LMU
approval will supersede the relevant inconsistent terms of this lease so long as
the lease remains committed to the LMU. If the LMU of which this lease is a part
is dissolved, the lease shall then be subject to the lease terms which would
have been applied if the lease had not been included in an LMU.
SEC. 6. DOCUMENTS, EVIDENCE AND INSPECTION - At such times and in such form as
lessor may prescribe, lessee shall furnish detailed statements showing the
amounts and quality of all products removed and sold from the lease, the
proceeds therefrom, and the amount used for production purposes or unavoidably
lost.
Lessee shall keep open at all reasonable times for the inspection of any duly
authorized officer of the lessor, the leased premises and all surface and
underground improvements, works, machinery, ore stockpits, equipment, and all
books, accounts, maps, and records relative to operations, surveys, or
investigations on or under the leased lands.
Lessee shall allow lessor access to and copying of documents reasonably
necessary to verify lessee compliance with terms and conditions of the lease.
While this lease remains in effect, information obtained under this section
shall be closed to inspection by the public in accordance with the Freedom of
Information Act (5 U.S.C. 552).
SEC. 7. DAMAGES TO PROPERTY AND CONDUCT OF OPERATIONS - Lessee shall comply at
its own expense with all reasonable orders of the Secretary, respecting diligent
operations, prevention of waste, and protection of other resources.
Lessee shall not conduct exploration operations, other than casual use, without
an approved exploration plan. All exploration plans prior to the commencement of
mining operations within an approved mining permit area shall be submitted to
the authorized officer.
Lessee shall carry on all operations in accordance with approved methods and
practices as provided in the operating regulations, having due regard for the
prevention of injury to life, health, or property, and prevention of waste,
damage, or degradation to any land, air, water, cultural, biological, visual,
and other resources, including mineral deposits and formations of mineral
deposit not leased hereunder, and to other land uses or users. Lessee shall take
measures deemed necessary by lessor to accomplish the intent of this lease term.
Such measures may include, but are not limited to modification to proposed
siting or design of facilities, timing of operations, to itself the right to
lease, sell or otherwise dispose of the surface or other mineral deposits in the
lands and the right to continue existing uses and to authorized future uses upon
or in the leased lands, including issuing leases for minerals deposits not
covered hereunder, and approving easements or rights-of-way. Lessor shall
condition such uses to prevent unnecessary or unreasonable interference with
rights of lessee as may be consistent with concepts of multiple use and multiple
mineral development.
SEC. 8. PROTECTION OF DIVERSE INTEREST, AND EQUAL OPPORTUNITY - Lessee shall;
pay when due all taxes legally assessed and levied under the laws of the State
or the United States; accord all employees complete freedom of purchase; pay all
wages at lease twice each month in lawful money of the United States; maintain a
safe working environment in accordance with standard industry practices;
restrict the workday to not more than 8 hours in any one day for underground
workers except in emergencies; and take measure necessary to protect the health
and safety of the public. No person under the age of 16 years shall be employed
in any mine below the surface. To the extent that laws of the State in which the
lands are situated are more restrictive than the provisions in the paragraph,
then the State laws apply.
Lessee will comply with all provisions of Executive Order No. 11246 of September
24, 1965, as amended, and the rules, regulations, and relevant orders of the
Secretary of Labor. Neither lessee nor lessee's subcontractors shall maintain
segregated facilities.
SEC. 9.(a) TRANSFERS
X This lease may be transferred in whole or in part to any person,
- --- association or corporation qualified to hold such lease interest.
This lease may be transferred in whole or in part to another public body,
- --- or to a person who will mine the coal on behalf of, and for the use of,
the public body or to a person who for the limited purpose of creating a
security interest in favor of a lender agrees to be obligated to mine the
coal on behalf of the public body.
This lease may only be transferred in whole or in part to another small
- --- business qualified under 13 CFR 121.
Transfers of record title, working or royalty interest must be approved in
accordance with the regulations.
(b) RELINQUISHMENTS - The lessee may relinquish in writing at any time all
rights under this lease or any portion thereof as provided in the regulations.
Upon lessor's acceptance of the relinquishment, lessee shall be relieved of all
future obligations under the lease or the relinquished portion thereof,
whichever is applicable.
SEC. 10. DELIVERY OF PREMISES, REMOVAL OF MACHINERY, EQUIPMENT, ETC. - At such
times as all portions of this lease are returned to lessor, lessee shall deliver
up to lessor the land leased, underground timbering, and such other supports and
structures necessary for the preservation of the mine workings on the leased
premises or deposits and place all workings in condition for suspension or
abandonment. Within 180 days thereof, lessee shall remove from the premises all
other structures, machinery, equipment, tools, and materials that it elects to
or as required by the authorized officer. Any such structures, machinery,
equipment, tools, and materials remaining on the leased lands beyond 180 days,
or approved extension thereof, shall become the property of the lessor, but
lessee shall either remove any or all such property or shall continue to be
liable for the cost of removal and disposal in the amount actually incurred by
the lessor. If the surface is owned by third parties, lessor shall waive the
requirement for removal, provided the third parties do not object to such
waiver. Lessee shall, prior to the termination of bond liability or at any other
time when required and in accordance with all applicable laws and regulations,
reclaim all lands the surface of which has been disturbed, dispose of all debris
or solid waste, repair the offsite and onsite damage caused by lessee's activity
or activities incidental thereto, and reclaim access roads or trails.
SEC. 11. PROCEEDINGS IN CASE OF DEFAULT - If lessee fails to comply with
applicable laws, existing regulations, or the terms, conditions and stipulations
of this lease, and the noncompliance continues for 30 days after written notice
thereof, this lease shall be subject to cancellation by the lessor only by
judicial proceedings. This provision shall not be construed to prevent the
exercise by lessor of any other legal and equitable remedy, including waiver of
the default. Any such remedy or waiver shall not prevent later cancellation for
the same default occurring at any other time.
SEC. 12. HEIRS AND SUCCESSORS-IN-INTEREST - Each obligation of this lease shall
extend to and be binding upon, and every benefit hereof shall insure to the
heirs, executors, administrators, successors, or assigns of the respective
parties hereto.
SEC. 13. INDEMNIFICATION - Lessee shall indemnify and hold harmless the United
States from any and all claims arising out of the lessee's activities and
operations under this lease.
SEC. 14. SPECIAL STATUTES - This lease is subject to the Clean Water Act (33
U.S.C. 1252 el.seq.), the Clean Air Act (42 U.S.C. 1857 el. seq.), and to all
other applicable laws pertaining to exploration activities, mining operations
and reclamation, including the Surface Mining Control and Reclamation Act of
1977 (30 U.S.C. 1201 el. seq.)
Book 1463 of Photos, Page 583
WYW127221
Page 3 of 4
SEC. 15. SPECIAL STIPULATIONS - In addition to observing the general obligations
and standards of performance set out in the current regulations, the lessee
shall comply with and be bound by the following stipulations. These stipulations
are also imposed upon the lessee's agents and employees. The failure or refusal
of any of these persons to comply with stipulations shall be deemed a failure of
the lessee to comply with the terms of the lease. The lessee shall require his
agents, contractors and subcontractors involved in activities concerning this
lease to include these stipulations in the contracts between and among them.
These stipulations may be revised or amended, in writing, by the mutual consent
of the lessor and the lessee at any time to adjust to changed conditions or to
correct an oversight.
(a) CULTURAL RESOURCES - (1) Before undertaking any activities that may disturb
the surface of the leased lands, the lessee shall conduct a cultural resource
intensive field inventory in a manner specified by the authorized officer of the
BLM or of the surface managing agency, if different, on portions of the mine
plan area and adjacent areas, or exploration plan area, that may be adversely
affected by lease-related activities and which were not previously inventoried
at such a level of intensity. The inventory shall be conducted by a qualified
professional cultural resource specialist (i.e., archeologist, historian,
historical architect, as appropriate), approved by the authorized officer of the
surface managing agency (BLM, if the surface is privately owned), and a report
of the inventory and recommendations for protecting any cultural resources
identified shall be submitted to the Assistant Director of the Western Support
Center of the Office of Surface Mining, the authorized officer of the BLM, if
activities are associated with coal exploration outside an approved mining
permit area (hereinafter called Authorized Officer), and the Authorized Officer
of the surface managing agency, if different. The lessee shall undertake
measures, in accordance with instructions from the Assistant Director, or
Authorized Officer, to protect cultural resources on the leased lands. The
lessee shall not commence the surface disturbing activities until permission to
proceed is given by the Assistant Director or authorized officer. (2) The lessee
shall protect all cultural resource properties within the lease area from
lease-related activities until the cultural resource mitigation measures can be
implemented as part of an approved mining and reclamation or exploration plan.
(3) The cost of conducting the inventory, preparing reports, and carrying out
mitigation measures shall be borne by the lessee. (4) If cultural resources are
discovered during operations under this lease, the lessee shall immediately
bring them to the attention of the Assistant Director or Authorized Officer, or
the Authorized Officer of the surface managing agency, if the Assistant Director
is not available. The lessee shall not disturb such resources except as may be
subsequently authorized by the Assistant Director or Authorized Officer.
Within two (2) working days of notification, the Assistant Director or
Authorized Officer will evaluate or have evaluated any cultural resources
discovered and will determine if any action may be required to protect or
preserve such discoveries. The cost of data recovery for cultural resources
discovered during lease operations shall be borne by the surface managing agency
unless otherwise specified by the Authorized Officer of the BLM or of the
surface managing agency, if different.
(5) All cultural resources shall remain under the jurisdiction of the United
States until ownership is determined under applicable law.
(b) PALEONTOLOGICAL RESOURCES - If paleontological resources, either large and
conspicuous, and/or of significant scientific value are discovered during
construction, the find will be reported to the Authorized Officer immediately.
Construction will be suspended within 250 feet of said find. An evaluation of
the paleontological discovery will be made by a BLM approved professional
paleontologist within five (5) working days, weather permitting, to determine
the appropriate action(s) to prevent the potential loss of any significant
paleontological value. Operations within 250 feet of such discovery will not be
resumed until written authorization to proceed is issued by the Authorized
Officer. The lessee will bear the cost of any required paleontological
appraisals, surface collection of fossils, or salvage of any large conspicuous
fossils of significant scientific interest discovered during the operations.
(c) MULTIPLE MINERAL DEVELOPMENT - Operations will not be approved which, in the
opinion of the Authorized Officer, would unreasonably interfere with the orderly
development and/or production from a valid existing mineral lease issued prior
to this one for the same lands.
(d) OIL AND GAS/COAL RESOURCES - The BLM realizes that coal mining operations
conducted on Federal coal leases issued within producing oil and gas fields may
interfere with the economic recovery of oil and gas; just as Federal oil and gas
leases issued in a Federal coal lease area may inhibit coal recovery, BLM
retains the authority to alter and/or modify the resource recovery and
protection plans for coal operations and/or oil and gas operations on those
lands covered by Federal mineral leases so as to obtain maximum resource
recovery.
(e) RESOURCE RECOVERY AND PROTECTION - Notwithstanding the approval of a
resource recovery and protection plan (R2P2) by the BLM, lessor reserves the
right to seek damages against the operator/lessee in the event (i) the
operator/lessee fails to achieve maximum economic recovery (MER) (as defined at
43 CFR 3480.0-5(21)) of the recoverable coal reserves or (ii) the
operator/lessee is determined to have caused a wasting of recoverable coal
reserves. Damages shall be measured on the basis of the royalty that would have
been payable on the wasted or unrecovered coal.
The parties recognize that under an approved R2P2, conditions may require a
modification by the operator/lessee of that plan. In the event a coalbed or
portion thereof is not to be mined or is rendered unmineable by the operation,
the operator/lessee shall submit appropriate justification to obtain approval by
the authorized officer (AO) to leave such reserves unmined. Upon approval by the
AO, such coalbeds or portions thereof shall not be subject to damages as
described above. Further, nothing in this section shall prevent the
operator/lessee from exercising its right to relinquish all or portion of the
lease as authorized by statute and regulation.
In the event the AO determines that the R2P2, as approved, will not attain MER
as the result of changed conditions, the AO will give proper notice to the
operator/lessee as required under applicable regulations. The AO will order a
modification if necessary, identifying additional reserves to be mined in order
to attain MER. Upon a final administrative or judicial ruling upholding such an
ordered modification, any reserves left unmined (wasted) under that plan will be
subject to damages as described in the first paragraph under this section.
Subject to the right to appeal hereinafter set forth, payment of the value of
the royalty on such unmined recoverable coal reserves shall become due and
payable upon determination by the AO that the coal reserves have been rendered
unmineable or at such time that the operator/lessee has demonstrated an
unwillingness to extract the coal.
The BLM may enforce this provision either by issuing a written decision
requiring payment of the MMS demand for such royalties, or by issuing a notice
of non-compliance. A decision or notice of non-compliance issued by the lessor
that payment is due under this stipulation is appealable as allowed by law.
(f) PUBLIC LAND SURVEY PROTECTION - The lessee will protect all survey
monuments, witness corners, reference monuments, and bearing trees against
destruction, obliteration, or damage during operations on the lease areas. If
any monuments, corners or accessories are destroyed, obliterated, or damaged by
this operation, the lessee will hire an appropriate county surveyor or
registered land surveyor to reestablish or restore the monuments, corners, or
accessories at the same location, using surveying procedures in accordance with
the "Manual of Surveying Instructions for the Survey of the Public Lands of the
United Sates." The survey will be recorded in the appropriate county records,
with a copy sent to the Authorized Officer.
Book 1463 of Photos, Page 584
WYW127221
Page 4 of 4
R2-FS-2820-13 (42)
NOTICE FOR LANDS OF THE NATIONAL FOREST SYSTEM
UNDER JURISDICTION OF
DEPARTMENT OF AGRICULTURE
The permittee/lessee must comply with all the rules and regulations of the
Secretary of Agriculture set forth at Title 36, Chapter II, of the Code of
Federal Regulations governing the use and management of the National Forest
System (NFS) when not inconsistent with the rights granted by the Secretary of
the Interior in the permit. The Secretary of Agriculture's rules and regulations
must be complied with for: (1) all use and occupancy of the NFS prior to
approval of an exploration plan by the Secretary of the Interior, (2) uses of
all existing improvements, such as forest development roads, within and outside
the area permitted by the Secretary of the Interior, and (3) use and occupancy
of the NFS not authorized by an exploration plan approved by the Secretary of
the Interior.
All matters related to this stipulation are to be addressed to:
District Ranger
2250 East Richards Street
Douglas, WY 82633
Telephone: 307-358-4690
who is the authorized representative of the Secretary of Agriculture.
NOTICE
CULTURAL AND PALEONTOLOGICAL RESOURCES - The Forest Service (FS) is responsible
for assuring that the leased lands are examined to determine if cultural
resources are present and to specify mitigation measures. Prior to undertaking
any surface-disturbing activities on the lands covered by this lease, the lessee
or operator, unless notified to the contrary by the FS, shall:
1. Contact the FS to determine if a site specific cultural resource inventory is
required. If a survey is required, then:
2. Engage the services of a cultural resource specialist acceptable to the FS to
conduct a cultural inventory of the area of proposed surface disturbance. The
operator may elect to inventory an area larger than the area of proposed
disturbance to cover possible site relocation which may result from
environmental or other considerations.
An acceptable inventory is to be submitted to the FS for review and approval at
the time a surface disturbing plan of operation is submitted.
R2-FS-2820-13 (92)
3. Implement mitigation measures required by the FS and BLM to preserve or avoid
destruction of cultural resource values. Mitigation may include relocation of
proposed facilities, testing, salvage, and recordation or other protective
measures. All costs of the inventory and mitigation will be borne by the lessee
or operator, and all data and materials salvaged will remain under the
jurisdiction of the U.S. Government as appropriate.
The lessee or operator shall immediately bring to the attention of the FS and
BLM any cultural or paleontological resources or any other objects of scientific
interest discovered as a result of surface operations under this lease, and
shall leave such discoveries intact until directed to proceed by FS and BLM.
FOREST SERVICE REGION 2 SENSITIVE SPECIES - The FS is responsible for assuring
that the leased lands are examined prior to undertaking any surface disturbing
activities to determine effects upon any plant or animal species listed as
sensitive by the Regional Forester. The findings of this examination may result
in some restrictions to the operator's plan or even disallow use and occupancy
that would lead to the listing of a sensitive species under the Endangered
Species Act of 1973.
ENDANGERED OR THREATENED SPECIES - The FS is responsible for assuring that the
leased land is examined prior to undertaking any surface-disturbing activities
to determine effects upon any plant or animal species listed or proposed for
listing as endangered or threatened, or their habitats. The findings of this
examination may result in some restrictions to the operator's plans or even
disallow use and occupancy that would be in violation of the Endangered Species
Act of 1973, by detrimentally affecting endangered or threatened species or
their habitats.
The lessee/operator may, unless notified by the FS that the above examinations
are not necessary, conduct the examinations on the leased lands at his
discretion and cost. These examinations must be done by or under the supervision
of a qualified resource specialist approved by the FS. Acceptable reports must
be provided to the FS identifying the anticipated effects of a proposed action
on endangered or threatened species or their habitats, and the anticipated
effects and impacts to Forest Service Region 2 Sensitive species that may occur
or have habitat in the area.
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The United States of America
Triton Coal Company By
- ------------------------------- -----------------------------------
Company or Lessee Name
/s/ John [illegible] /s/ [illegible]
- ------------------------------- -----------------------------------
(Signature of Lessee) (Signing Officer)
President State Director
- ------------------------------- -----------------------------------
(Title) (Title)
11/29/97 Dec. 18, 1997
- ------------------------------- -----------------------------------
(Date) (Date)
================================================================================
Title 18 U.S.C. Section 1001, makes it a crime for any person knowingly and
willfully to make to any department or agency of the United States any false,
fictitious or fraudulent statements or representations as to any matter within
its jurisdiction.
================================================================================
This form does not constitute an information collection as defined by 44 U.S.C.
3502 and therefore does not require OMB approval.
STATE OF WYOMING }
Campbell County } ss.
}
Filed for record this 22nd day of January A.D., 1998 at 10:08 o'clock A.M. and
recorded in Book 1463 of Photos on page 581-584 Fees $12.00.
RECORDED By
/s/ Susan Saunders ABSTRACTED Deputy /s/ Ameilia M. Snider
- --------------------------- INDEXED --------------------------
County Clerk and Ex-Officio CHECKED
Register of Deeds
727983