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l <br />• application, payment or division of such production royalty payment between <br />Lessors or between Lessors and others. Lessors shall have the right at <br />reasonable times to inspect Lessee's books for the purpose of verifying the <br />amount of coal so mined and shipped and Lessors shall have the right at <br />reasonable times and upon request to inspect the operation of Lessee. <br />4) At each five year renewal, the price per ton shall be adjusted <br />with the Index, or an index of similar industrial usage to correspond with <br />industry changes. <br />5) Lessee shall have the right to remove all or any part of the cog) <br />from said real estate by deep mining, slope, shaft, or strip mining methods <br />whichever it deems advisable. ]t is understood that the surface of the real <br />estate described herein may be excavated in whole or in part to remove the <br />overburden in connection with the removal of any coal by ony of the mining <br />methods described above and Lessee shall restore the surface of the real <br />estate to a reasonable facsimile of the original terrain and in compliance <br />with the laws of the State of Colorado and the United States applicable to <br />such mining operations. <br />61 Lessors hereby represent and warrant that they are the owners of <br />the coal underlying said real estate and have the right to orant to Lessee <br />the right to remove the coal from said real estate as herein set forth. <br />• 7) It is understood that the type of operation contemplated by Lessee <br />necessitates the acquisition of coal leases covering other property from <br />. which coal may be mined and removed. The rate and extent of mining and <br />removal operations on the real estate described herein shall be at the sole <br />tscretion of Lessee; howev rt,Lessee must maintain minimum monthly produc- <br />ion requirements of ~,~.00~ n$k for seven (7) months for each year of this <br />Tease and all Extensions the e6'f, commencing one hundred eighty (180) days <br />after all required permits necessary to open and operate the mine are <br />issued. Failure to meet minimum production tonnages for any year during the <br />term of this lease will grant Lessors the option to terminate this Lease <br />with ~~ days notice to Lessees. Lessors' failure to execute this option <br />does not constitute a waiver of the same. <br />8) If the mineral interests described herein are encumbered by a <br />mortgage, lien or other charge, Lessee shall have the right to pay such <br />mortgage, Tien, or other charge if it should become delinquent and deduct <br />the same from the production royalties payable to Lessors hereunder. <br />9) Lessors shall pay all taxes and assessments levied or assessed <br />against the rea) estate described herein during the term of this Coal Lease; <br />Lessee shall pay all taxes and assessments levied or assessed against any <br />improvements, structures, and appurtenances which it places on said rear <br />estate; Lessee shall pay all taxes and assessments levied or assessed <br />against any machinery and equipment owned by Lessee and located on said real <br />• estate; and Lessee shall pay all severance taxes imposed on account of the <br />removal of coal from the real estate described herein. <br />10) This Coal Lease shall supersede and render null and void all prior <br />leases between Lessor and Lessee covering the herein described real estate <br />and shill include, but nct be limited tn, any leases executed between Lessor <br />-2- <br />