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sold into an escrow account with Sun West until 5140,000 was <br />accumulated whereby Peerless would obtain a certificate of <br />deposit and would replace the letter of credit with same. <br />DCC, once production starts, would contribute 51.50 <br />per ton of coal mined and sold on a monthly basis to the Sun <br />West escrow account. Once 5140,000 is paid into the account <br />and Springer is released on its letter of credit, DCC will <br />contribute 51.50 per ton of coal mined and sold on a monthly <br />basis to a creditors' fundfund to be established to pay off <br />Peerless' unsecured creditors as to the principal amount of <br />their debts only. The creditors' fund would be distributed <br />on a quarterly basis (i.e. once every three months following <br />establishment of the fund). DCC would, however, pay the <br />Class Two claimant Springer 525,000 out of this fund prior <br />to pro rata payments to other creditors. <br />ARTICLE V <br />EXECUTORY CONTRACTS AND LEASES <br />Except as otherwise provided for herein, and subject <br />to confirmation of this Amended Plan, Peerless hereby <br />rejects pursuant to Section 1123(b)(2) of the Code all <br />executory contracts and leases not otherwise specifically <br />assumed, either in this Amended Plan or by separate motion <br />filed prior to the Confirmation Date. Peerless, upon <br />confirmation of the Plan, specifically rejects the Melco <br />Settlement Agreement, the Burnett Agreement and the Bank <br />Agreement. <br />ARTICLE VI <br />MEANS OF EXECUTION OF THE AMENDED <br />PLAN OF REORGANIZATION <br />In order for Debtor to fully explain its proposed <br />means of execution of the Amended Plan, a little background <br />is in order. Arness-McGriffin Coal Company ("AMCC") is the <br />title owner of a number of surface rights covering minerals <br />in the Durango, Colorado area. At one time, AMCC owed <br />approximately 190 acres of surface rights. Additionally, <br />AMCC was a party to a number of leases which allowed it to <br />develop a mine and extract coal reserves on the leased <br />property. <br />On May 24, 1984, Durango Coal Company ("DCC") entered <br />into a Sublease Agreement with AMCC covering all of AMCC's <br />leased property and surface rights. The Sublease Agreement <br />was for the purpose of allowing DCC to enter on AMCC's <br />properties to develop mining activities for the removal of <br />coal, oil, gas and other minerals. <br />