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<br /> Form 3400-12.
<br />
<br />_ ?Xn .
<br />(February 2005)
<br />PART 2. LEASE RIGHTS GRANTED
<br />This lease, entered into by and between the UNITED STATES OF AMERICA, hereinafter called lessor, through the Bureau of Land Management (BLM), and
<br />{Name and .Add ws)',
<br />FORM APPROVED
<br />OMB NO. 1004-0073
<br />Expires: January 31, 2007
<br />Number
<br />COC-67232
<br />UNITED STATES
<br />DEPARTMENT OF THE INTERIOR
<br />BUREAU OF LAND MANAGEMENT
<br />COAL LEASE
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<br />Ark Land Company. One CityPlace Dr., Ste.300, St. Louis, MS 63141
<br />hereinafter called lessee, is effective 03101/2007 , for a period of 20 years and for so long thereafter as coal is produced in commercial quantities from the leased lands,
<br />subject to readjustment of lease terms at the end of the 20tb lease year and each 10-year period thereafter.
<br />Sec. LThis lease is issued pursuant and subject to the terms and provisions of the:
<br />Mineral Lands Leasing Act of 1920, Act of February 25, 1920, as amended, 41 Stat. 437, 30 U.S.C. 181-287, hereinafter referred to as the Act;
<br />Mineral Leasing Act for Acquired Lands, Act of August 7, 1947, 61 Stat. 913,30 U.S.C. 351-359;
<br />and to the regulations and formal orders of the Secretary of the interior which are now or hereafter in force, when not inconsistent with the express and specific
<br />provisions herein.
<br />Sec. 2. Lessor, in consideration of any bonuses, rents, and royalties to be paid, and the conditions and covenants to be observed- as herein set forth, hereby grants and
<br />leases to lessee the exclusive right and privilege to drill for, mine, extract, remove, or otherwise process and dispose of the coal deposits in, upon, or under the following
<br />described lands;
<br />T. 13 S., R. 90 W., 60i P.M.
<br />sec. 35, lots 5 through 7, inclusive, and lots 9 through 16, inclusive, less and except land in coal leases C-1362 and CC)C-56447, as modified;
<br />sec. 36, W I/2SW I /4NW 1 /4, and W 1 /2S W 1/4, less and except land in coal lease COC-56447, as modified.
<br />T. 14 S., R. 90 W., 6`s P.M.
<br />sec. 1, lots 3, 4, S I/2NW 1/4, S W 114, W I /2N W 1 /4SE I/4, and S W l /4SEl/4;
<br />sec. 2, lots 1 through 4, inclusive, SI/2N1/2, and S1/2;
<br />sec. 11, N1/2N1/2;
<br />sec. 12, Nt/2NW1/4,and NW IAN E 114.
<br />Containing 1,517,13 acres, more or less, together with the right to construe such works, buildings, plants, structures, equipment and appliances and the right to use
<br />such on-lease rights-of-way which may be necessary and convenient in the exercise of the rights and privileges granted, subject to the conditions herein provided.
<br />PART 11, TERMS AND CONDITIONS
<br />See. 1. (a) RENTAL RATE -Lessee must pay lessor rental annually and in advance
<br />for each acre or fraction thereof during the continuance of the lease at the rate of
<br />S 3.00 for each lease year,
<br />(b) RENTAL CREDITS -Rental will not be credited against either production or
<br />advance royalties for any year.
<br />Sec. 2. (a) PRODUCTION ROYALTIES - The royalty will be 8.0 percent of
<br />the value ofthe coal as set forth in the regulations. Royalties are due to lessor the
<br />final day of the month succeeding the calendar month in which the royalty
<br />obligation accrues.
<br />(b) ADVANCE ROYALTIES - Upon request by the lessee, the BLM may accept, for
<br />a total of not more than 10 years, the payment of advance royalties in lieu of
<br />continued operation, consistent with the regulations. The advance royalty will be
<br />based on a percent of the value of a minimum number of tons determined in the
<br />manner established by the advance royalty regulations in effect at the time the lessee
<br />requests approval to pay advance royalties in lieu of continued operation.
<br />Sec, 3. BONDS - Lessee must maintain in the proper office a lease bond in the
<br />amount of S 605,000.00. The BLM may require an increase in this amount
<br />when additional coverage is determined appropriate.
<br />Sec. 4. DILIGENCE,- This lease is subject to the conditions of diligent development and
<br />continued operation, except that these conditions are excused
<br />when operations under the lease are interrupted by strikes, the elements, or
<br />casualties not attributable to the lessee. The lessor, in the public interest, may
<br />suspend the condition of continued operation upon payment of advance royalties
<br />in accordance with the regulations in existence at the time of the suspension.
<br />Lessee's failure to produce coal in commercial quantities at the end of 10 years
<br />will terminate the lease, Lessee must submit an operation and reclamation plan
<br />pursuant to Section 7 of the Act not later than 3 years after lease issuance.
<br />The lessor reserves the power to assent to or order the suspension of the
<br />terms and conditions of this lease in accordance with, inter alias Section 39 of
<br />the Mineral Leasing Act, 30 U.S.C. 209.
<br />5, LOGICAL MINING UNIT (LMU) - Either upon approval by the lessor of the
<br />lessee's application or at the direction of the lessor, this lease will become an
<br />LMU or part of an LMU, subject to the provisions set forth in the regulations.
<br />The stipulations established in an LMU approval in effect at the time of LMU
<br />approval will supersede the relevant inconsistent terms of this lease so long as
<br />the lease remains committed to the LMU. If the LMU of which this lease is a
<br />part is dissolved, the lease will then be subject to the lease terms which would
<br />have been applied if the lease had not been included in an LMU.
<br />(Continued on page 2)
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