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(2) Tonnage Royalty. A tonnage royalty of $0.30 per _.. <br />• ton of 2,000 pounds of coal mined by surface or auger mining <br />methods from the Land and sold, or 2~ of Lessee's Royalty Basis <br />(defined below) for same, whichever would be greater for the par- <br />ticular calendar month of payment ("Tonnage Royalty"), payable by <br />the twenty-fifth (25th) day of each month for all such coal sold <br />by Lessee during the preceding calendar month; all amounts, of <br />every kind paid by Lessee to Lessor under this Lease (other than <br />Tonnage Royalty paid under this subparagraph (2)) shall consti- <br />tute a fund against which all Tonnage Royalty shall first be <br />credited or charged until the fund is exhausted, so that Tonnage <br />Royalty shall not be due and payable at any time except to the <br />extent that Tonnage Royalty exceeds the total of all previously <br />• paid amounts (against which Tonnage Royalty has not already been <br />charged). No Tonnage Royalty shall be required under this Lease <br />for any coal on or under the Land which is mined by underground <br />mining methods. <br />(b) "Royalty Basis" hereunder shall mean those components <br />of the invoice sales price of the coal, f.o.b. mine, which relate <br />to labor costs, costs of materials, supplies and services, all <br />taxes (but not sales, use, production, ad valorem, excise and <br />severance taxes), and all other items of direct expense and <br />profit, but subject to quality adjustments for premiums and pen- <br />alties for ash, sulphur, BTU and moisture characteristics of the <br />coal. In no event shall Royalty Basis be construed to include <br />governmental exactions which are imposed on a per ton basis or <br />• computed by reference to the realization from the coal, including <br />- 5 - <br />