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<br />~c~z3o. <br />tl~e mine, without deduction for any sales tAmmissions, selling expenses or preparation <br />costs; provided that, if the coal is sold f.o b. wme other delivery point with the Lessee <br />hearing transportation expenses from the mouth of the mine to that delivery point, then <br />those transportation expenses shall be deducted from the Gross Proceeds !'-fore <br />computation of the royalty. <br />(b) if coal mined from the Leased Premises under the terms of this l.casc <br />is sold by the Lessee other than by a 1~nnn frde arm's length transaction or is ~ :•d or <br />otherwise disposed of by the Lessee, inc.uding by gasification, slurrification or comh; :tion, <br />then Gross Proceeds shall mean the prevailing fair market value of the coat at the tipple <br />or the mouth of the mine. The preva.,.nQ fair market value shall be determinal +vith <br />reference to 6nnn fide arm's length coal sale ttansactiens by others which are most <br />cempara.ble to the prevailing circumstances related to this Lease, giving consideration to <br />quantity, size and qualify of the coal, length of term and delivery of commitment of <br />conttacls, availability and mst of transportation, and other pertinent market conditions. <br />(c) Production royalty payments shall be free of any expense of explc+t:+tion, <br />mine development or operation. <br />(d) Production royalty payments are due and payable on or bef+~re the <br />twentieth (20t1t) da}• of each calendar month for the coal mined and removed, 2^.~ sold, <br />used or otherwise disposed of from the Leased Premises during the preceding c,.lendar <br />month. 'Ilse Ixssce shall furnish to the Lessors a statement of production and sale or <br />other disposition to accompany each royalty payment showing the amount of coal mined, <br />removed and sold or otherwise disposed of from the Leased Premises during the <br />preceding ralcndar month. <br />5. do ~`,'arrantics of Title. Lessor makes no warranties of title to the L..ased <br />Premises, either expressed or implied. <br />6. I.esct•r Interest. If Lessor owns less than a one-fourth (1/4) undivided <br />interest in and to the coal in, upon or underlying the Leased Premises, t1+en the <br />prcxluction royalty provided for herein shall be paid to Lessor only in the proprrtions <br />which its interests bear to the whole, undivnded ownership of the coal. <br />7. Conduct of Operafi++ns. Lessce shall conduct all ~pctations and maintain <br />J <br />