In 1993, Cyprus and the University each began working with the Department of
Fish and Wildlife Resources concerning wildlife management areas on their
respective properties. The University was renegotiating its long-term
understanding with the Department concerning Robinson Forest as a Wildlife
Management Area. Cyprus was considering placing its lands into a similar area
with the Department. In discussions with the Department, it was determined
that a three-way arrangement among the University, Cyprus, and the Department
for joint management of the University and Cyprus areas would further the
history of cooperation of the three entities on wildlife research involving
forested coal mined lands in Eastern Kentucky and could lead to the
establishment of one of the state's largest wildlife management areas.

Commissioner Tom Bennett of the Department of Fish and Wildlife was
instrumental in suggesting that one way that the University and Cyprus could
settle the disposition of the disputed royalties was by transferring the
royalties to the Department for use in connection with those Wildlife
Management areas: funding additional personnel, both wildlife biologists and
conservation enforcement officers, over and above the level usually provided
by the Department; for other related uses by the Department directly for the
benefit of the University and Cyprus Wildlife Management areas; and for other
more general wildlife purposes that would benefit the people of Kentucky, with
an emphasis on wildlife education and extension, particularly relating to
wildlife issues of Eastern Kentucky.

Accordingly, if this arrangement is approved by both the University, Cyprus
and the Department, the following events would occur:

    1.  Cyprus and the University would each execute a Wildlife Management
         Area agreement with the Department.

    2.  Cyprus and the University would execute a settlement agreement
         whereby the disputed royalties would be transferred to the Kentucky
         Department of Fish and Wildlife Resources under procedures to be
         agreed upon by the parties.

    3.  The University and Cyprus would iivide ownership of Harbert Knob as
         follows: Cyprus would execute a quitclaim deed to the University for
         that portion of Harbert Knob claimed by Cyprus lying within the
         currently unmined portion of the Bear Branch watershed. The
         University would execute a quitclaim deed to Cyprus for that portion
         of Harbert Knob claimed by the University that has been mined by Arch
         pursuant to the University's lease with Arch.

    4.   The University, Cyprus, and the Department would enter into a
         Memorandum of Understanding further detailing the use of the funds
         incorporating the concepts set out above.



Action taken:    Approved   /        Disapproved           Other_      _



Date:  Marh 1, 1994