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<br />OPTION FOR SURFACE
<br />• LEASE AGREEMEIJT
<br />This Option for Surface Lease Agreement (liereinaf ter, "Agreement"), made as
<br />of this '~~ day of f-~.r~.,.r,i 1987, between PAPUULAS LAND
<br />i
<br />COMPANY, a Colorado corporation with of (ices in Craig, Colorado (hereinafter,
<br />"Grantor") and PEABODY COAL COMPANY, a Delaware corporation with principal
<br />offices in Sf. Louis, Missouri (hereinafter, "Grantee");
<br />In consideration of the mutual covenants herein contained, the parties agree as
<br />follows:
<br />I. Grant of Option. Grantor hereby grants unto Grantee, upon the terms and
<br />conditions hereinafter set forth, the exclusive right, privilege, and option to lease
<br />from Grantor the following described land in Rautt County, Colorado:
<br />Parcel A (Subject to federal coal reservations)
<br />Township 5 North, Range 88 West
<br />Section 13: W$SWS'.
<br />Section 23: E&, SY:SWY.
<br />Section 24: WhWY:, SEYSWY.
<br />Section 25: Nh, SW4'., IJWS'SEY.
<br />Section 26: EY:
<br />Section 34: E4':fJWf~, Lot 9
<br />Section 35: NE4., Lots I, 2, 3, S, 6, 7, 8,
<br />• 9,10,11,12
<br />Township 4 North, Range 88 West
<br />Section I I: Lots I, 2, SEY.
<br />Section 12: Lots 3 and 4
<br />Township 5 North, Range 87 West
<br />Section 30: Lot 2
<br />Parcel B (Subject to tee coal reservation of third
<br />parties)
<br />Township S North, Range 68 West
<br />Section 25: SY:SEk, NEWSEY.
<br />Parcels A and B together containing 2,747.92 acres, more or less, (hereinafter,
<br />"Property") for the purpose of conducting surface and/or underground mining activities
<br />and related operations upon the Property.
<br />2. Option Term and Payments.
<br />(A) Initial Term. The initial term of this Option shall be eighteen (IS)
<br />months from the date hereof (hereinafter, "Initial Term"). As consideration far this
<br />Initial Term, Grantee shall pay Grantor the Initial Option Payment, as is more partic-
<br />ularly set forth in the "Ancillary Agreement in (IpHnn t~• r -~-- -- '- --"'
<br />(hereinof ter, "Ancillary Option Agreement") between Grantee and Grantor of even
<br />. date herewith, fo which reference is hereby made. The terms and conditions of said
<br />
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