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<br />Form 3130-1
<br />• (October 1967)
<br />EXHIBIT C-II
<br />UNITED STATES
<br />DEPARTMENT OF THE INTERIOR
<br />BUREAU OF LAND MANAGEMENT
<br />COAL LEASE
<br />Land Office Serial Number
<br />C-0125516
<br />This lease, entered into on MAY 1 1969 , by the United States of America, the lessor,
<br />through the Bureau of Land Management, and
<br />Industrial Resources, Inc.
<br />P. 0. Box 1008
<br />Glenwood Springs, Colorado 81601
<br />,the lessee,
<br />pursuant and subject to the Perms and provisions of the act o[ February 25, 1920 (41 Stat. 43TJ, as amended, herein-
<br />after referred to as the act, and to all reasonable regulations of the Secretary of the Interior now or hereafter in force
<br />which are made a part hereof,
<br />WITNESSETH:
<br />• Sec. 1. Rights of Lessee. The lessor, in consideration of the rents and royalties to be paid and the conditions to be
<br />observed as hereinafter set forth does hereby grant and lease to the lessee the exclusive right and privilege to mine
<br />and dispose of all the coal in the following-described tracts of land, situated in the State of Colorado.
<br />T. 8 S. , R. 102 p. , 6th P.li.
<br />Sec. 2: All (Lots 5-33 incl..
<br /> Sim. ~~~~)
<br />Sec. 3s Lots 5-20 incl.,
<br /> S~ (all)
<br />Sec.' 4: Lots 5-15 incl.. 18,
<br /> 19. 20, N}S8}, SFJ~SS}
<br />Sec. 10: N;NW}
<br />containing 2522.72 acres, more or less, together with the right to construct all such works, buildings, plants,
<br />structures, and appliances as may be necessary and convenient for the mining and preparation of the coal for market,
<br />the manufacture of coke or other products of coal, the housing and welfare of employees, and subject to the conditions
<br />herein provided, to use so much of the surface as may reasonably be required in the exercise of the rights and privi-
<br />leges herein granted.
<br />Sec. 2. In consideration of the foregoing, the lessee
<br />hereby agrees:
<br />(a) Bond. To maintain the bond furnished upon
<br />the issuance of this lease, which bond is conditioned
<br />upon compliance with all the provisions of the lease,
<br />and to increase the amount o_r furnish such other bond
<br />"~---~ as'may be required--
<br />(b) Rental. To pay the lessor annually, in ad-
<br />vance, for each acre or fraction thereof covered by this
<br />lease, beginning with the date hereo[, the following
<br />rentals: 25 cents for the first year; 50 cents [or the
<br />second, third, fourth, and fifth years, respectively; and
<br />\~-'.} SI for tfie sixth and each succeeding year during the
<br />contrnuance of the lease, such rental for any year to Ix
<br />credited against the first royalties as they accrue under
<br />the lease during the year for which the rental was paid.
<br />(c) Royalty. To pay the lessor a royalty of
<br />cents on every ton of 2,000 pounds of coal mined during
<br />the first 20 years succeeding the execution of this
<br />]ease. Royalties shall be payable quarterly within
<br />30 days from the expiration of the quarter in which the
<br />coat is mined. See additional royalty on
<br />reverse side.
<br />(d) Minimum production. Beginning with the sixth
<br />year of the lease, except when operations are inter-
<br />rupted by strikes, the elements, or crsualties nM
<br />attributable to the lessee, or unless on application and
<br />showing made, operations shall be suspended when
<br />market conditions are such that the lessee cannot op-
<br />ecate except at a Ions or suspended [or the other
<br />reasons specified in section 39 of the act, to mine cost
<br />each year and pay a royalty thereon to a value of SI per
<br />acre or fraction thereo[. Operations under this lease
<br />shall be continuous except in circumstances described
<br />or unless the lessee shall pay a royalty, less rent, on
<br />such minimum amount of the leased deposits, for one
<br />year in advance, in which case operations may be
<br />suspended for that year.
<br />(e) Paymen[s. To make rental payments to the
<br />manager of the appropriate land office, except that
<br />when this lease becomes productive the rentals and
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