Mine Cost performance is measured by loss and damage to equipment and Pit top costs per tonne produced. The Company will, at its discretion, set annual targets for each of these performance measures for each Employee for the period from January to December each year. They will be set out in a document that will be given to each Employee prior to January each year. A payment will be made to each Employee in respect of each of these performance measures based on actual performance compared to the annual target. Employees will be paid a monthly performance payment based on year to date actual performance in respect of these performance measures.
Mine Cost. (a) The Mine Cost shall be equal to TWCC’s actual cash costs for operating the Mine in a manner consistent with the Approved AOP, including the following items determined and allocated in accordance with GAAP, unless specifically agreed upon otherwise by the Parties.
(i) Costs of mine labor and supervision, including wages and salaries, overtime, shift differentials (of miners and supervisory personnel), costs of Subcontractors and contract laborers, severance costs (only to the extent that (A) such severance costs are consistent with written plans or policies of TWCC in existence as of the Effective Date, that have been provided to NRG on or prior to the Effective Date or are otherwise consistent with amendments, supplements or modifications to such plans that have been approved by NRG, in writing, after the Effective Date and (B) such severance costs are caused directly by a material decrease in AOP Volumes that is not consistent with the Mine Plan (including NRG’s exercise of its Supply Suspension rights under subsection 3.3 of this LSA), but in no event shall severance costs associated with terminating employees at or in anticipation of the end of the Lignite Supply Term be Mine Costs), payroll taxes (including social security taxes, workers’ compensation, and other taxes levied by local, state, and federal governmental bodies on wages and salaries) and fringe benefits (including holidays, vacations, sick leave, long-term disabilities costs, health, welfare and group insurance plans, and (subject to the provisions of Section 7.2(e)) pension benefits and post-retirement medical benefits, and other fringe benefits generally provided in the coal and lignite mining industries, in each case to the extent that such fringe benefits are consistent with written plans or policies of TWCC in existence as of the Effective Date that have been provided to NRG on or prior to the Effective Date or are otherwise consistent with amendments, supplements or modifications to such plans that have been approved by NRG, in writing, after the Effective Date); provided, however, that any unfunded pension obligations with respect to TWCC employees as of the Effective Date shall remain the obligation of TWCC and NRG shall have no liability therefor;
(ii) Materials and supplies, including consumables expended or consumed in the mining, processing, and/or delivery of lignite and in the performance of reclamation (including Final Reclamation) activities, costs of maintenance and rep...
