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Item 1A. Risk Factors

2021-03-15 compared with 2020-03-18 · 135 added, 145 removed, 546 unchanged (34% of the section changed)

Investment in our common stock is subject to various risks, including risks and uncertainties inherent in our business.

The following sets forth factors related to our business, operations, financial position, or future financial performance or cash flows, which could cause an investment in our securities to decline and result in a loss.

These risks include, but are not limited to, the following:

• Risks relating to our industry and the global economy , such as those associated with declines in coal prices, our ability to obtain financing and other services, competition, decreased demand for coal, Chinese governmental policies, loss of customers, customer creditworthiness and global economic disruptions.

• Risks relating to regulatory and legal developments , such as those associated with regulatory requirements and costs, climate change regulations, environmental laws and treaties, unfavorable tax actions, decreases in demand for energy, environmental cleanup costs, permit approvals, maintenance of internal controls and healthcare regulations and costs.

• Risks relating to our operations , such as those associated with mining and other conditions beyond our control, decreased demand for coal, the complexity of mining in Central Appalachia, disruptions in transportation services, the availability of skilled workers, product specification requirements, higher than estimated employee benefit, property reclamation or mine closure costs, the availability of coal reserves, unionization, cybersecurity, our dependence upon third parties and our ability to make capital investments.

• Risks relating to our liquidity , such as those associated with our indebtedness, our ability to obtain or renew surety bonds, limitations imposed on us by our credit facility, access to funds when needed and debt service.

• Risks relating to the ownership of our common stock , such as those associated with compliance with securities laws, the availability of an orderly trading market for our common stock, dilution or other effects resulting from the issuance of additional securities, impediments to our acquisition by a third party and limited fora for stockholder litigation matters.

These risks, and others, are reviewed in greater detail below.

The realization of any of these risks could cause an investment in our securities to decline and result in a loss.

Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

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Those prices depend upon factors beyond our control (some of which are described in more detail in other risk factors below), including:

the demand for domestic and foreign coal and coke, which depends significantly on the demand for electricity and steel;

• the demand for domestic and foreign coal and coke, which depends significantly on the demand for steel and electricity;

• the price and availability of natural gas, other alternative fuels and alternative steel production technologies;

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• the proximity to and availability, reliability and cost of transportation and port facilities.

Continued low coal prices, or further declines in coal prices, in the U.S.

A period of sustained continued low coal prices, or further declines in coal prices, in the U.S.

and other countries may materially adversely affect our operating results and cash flows, as well as the value of our coal reserves and may cause the number of risks that we face to increase in likelihood, magnitude and duration.

Sustained low demand for metallurgical coal (or “met coal”), or further declines in demand, by U.S.

and foreign steel producers, including negative effects resulting from the imposition of tariffs, could reduce the price of our met coal, which would reduce our revenues.

Contura produces met coal that is sold directly to both U.S.

A period of sustained low demand for metallurgical coal (or “met coal”), by U.S.

and foreign steel producers and the potential for negative trade impacts resulting from changing tariff policies, could reduce the price of our met coal, which would reduce our revenues.

Alpha produces met coal that is sold directly to both U.S.

and foreign steel industry customers and indirectly to foreign steel industry customers through U.S.-based companies.

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On March 8, 2018, President Trump signed proclamations imposing a 25% tariff on imports of steel mill products and a 10% tariff on imports of wrought and unwrought aluminum.

Contura’s export customers include foreign steel producers who may be affected by the tariffs to the extent their production is imported into the U.S.

Alpha’s export customers include foreign steel producers who may be affected by the tariffs to the extent their production is imported into the U.S.

Conversely, demand for met coal from our domestic customers may increase.

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Foreign government policies related to coal production and consumption could negatively impact pricing and demand for our products.

Continuing low demand for thermal coal, or further declines in demand, by North American electric power generators could reduce the price of our thermal coal, which would reduce our revenues.

Thermal coal accounted for approximately 23.4% of our coal revenues for the year ended December 31, 2019.

The majority of our sales of thermal coal were to U.S.

electric power generators.

The North American demand for thermal coal is affected primarily by:

the overall demand for electricity, which is in turn influenced by the global economy and the weather, among other factors (for example, mild North American winters typically result in lower demand);

the availability, quality and price of competing fuels, such as natural gas, nuclear fuel, oil and alternative energy sources such as wind, solar, and hydroelectric power, which may change over time as a result of, among other things, technological developments and state or federal regulatory or statutory fuel subsidies or energy use mandates;

increasingly stringent environmental and other governmental regulations, including air emission standards for coal-fired power plants;

the coal inventories of utilities.

Many North American electric power generators have shifted from coal to natural gas-fired power plants.

Despite ongoing advancements in the availability and deployment of advanced coal and emissions reduction technologies, we expect that new power plants in the near-term will be fired by natural gas because natural gas-fired plants are less expensive to construct than coal-fired plants and natural gas is a cleaner-burning fuel, with plentiful supplies and low cost at the current time.

Increasingly stringent regulations have also reduced the number of new power plants being built, particularly coal-fired power plants.

A reduction in the amount of coal consumed by North American electric power generators would reduce the amount of thermal coal that we sell and the price that we receive for it, thereby reducing our revenues and adversely impacting our earnings and the value of our coal reserves.

In addition, uncertainty caused by federal and state regulations could cause thermal coal customers to be uncertain of their coal requirements in future years, which could adversely affect our ability to sell coal to such customers under multi-year sales contracts.

Our ability to obtain financing and other services, and the form and degree of these services available to us, may be significantly limited by the lending, investment and similar policies of financial institutions and insurance companies regarding carbon energy producers and the environmental impacts of coal combustion.

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This competition affects domestic and foreign coal prices and our ability to retain or attract coal customers.

Increased competition from the Illinois basin, the threat of increased production from competing mines, and natural gas price declines with large basis differentials have all historically contributed to soft market conditions.

The threat of increased production from competing mines and natural gas price declines with large basis differentials have all historically contributed to soft market conditions.

In the past, high demand for coal and attractive pricing brought new investors to the coal industry, leading to the development of new mines and added production capacity.

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We cannot provide assurance that we will be able to compete on the basis of price or other factors with companies that in the future may benefit from favorable foreign trade policies or other arrangements.

internationally in U.S.

dollars and, as a result, general economic conditions in foreign markets and changes in foreign currency exchange rates may provide our foreign competitors with a competitive advantage.

Coal is sold internationally in U.S.

dollars and, as a result, general economic conditions in foreign markets and changes in foreign currency

exchange rates may provide our foreign competitors with a competitive advantage.

If our competitors’ currencies decline against the U.S.

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In addition, trade conflicts between the United States and other nations that result in the imposition of barriers to trade, such as import tariffs, could materially and adversely affect the international demand and pricing for our coal.

The current presidential administration has taken actions, including imposing tariffs on certain goods imported into the U.S., that have resulted in other nations adopting retaliatory measures such as the imposition of tariffs upon goods imported from the U.S.

The United States has, during recent years, taken actions, including imposing tariffs on certain goods imported into the U.S., that have resulted in other nations adopting retaliatory measures such as the imposition of tariffs upon goods imported from the U.S.

into those nations.

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to intensify, potentially resulting in additional downward pressure on domestic coal prices and our business, financial condition or results of operations.

Competition with natural gas and renewable energy sources, and factors affecting these industries could have an adverse impact on coal demand.

Our coal competes with natural gas and renewable energy sources, and the price of these sources can therefore affect coal sales.

The natural gas market has been volatile historically and prices in this market are subject to wide fluctuations in response to relatively minor changes in supply and demand.

Changes in supply and demand could be prompted by any number of factors, such as worldwide and regional economic and political conditions;

the level of global exploration, production and inventories;

natural gas prices;

and transportation availability.

If natural gas prices decline significantly, it could lead to reduced coal sales and have a material adverse effect on our financial condition, results of operations and cash flows.

In addition, state and federal mandates for increased use of electricity from renewable energy sources also have an impact on the market for our coal.

Several states have enacted legislative mandates requiring electricity suppliers to use renewable energy sources to generate a certain percentage of power.

There have been numerous proposals to establish a similar uniform, national standard although none of these proposals have been enacted to date.

Possible advances in technologies and incentives, such as tax credits, to enhance the economics of renewable energy sources could make these sources more competitive with coal.

Any reduction in the amount of coal consumed by electric power generators could reduce the price of coal that we mine and sell, thereby reducing our revenues and materially and adversely affecting our business and results of operations.

Future Chinese governmental policies may continue to be detrimental to the global coal market and negatively affect our business, financial condition or results of operations.

Chinese governmental policies as well as trade disputes in Asian markets may continue to be detrimental to the global coal market and negatively affect our business, financial condition or results of operations.

The Chinese government has from time to time implemented regulations and promulgated new laws or restrictions on its domestic coal industry, sometimes with little advance notice, which may impact worldwide coal demand, supply and prices.

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It is possible that policy changes by the Chinese government may be detrimental to the global coal market and, thus, negatively affect our business, financial condition or results of operations.

In addition, similar actions by government entities in countries that produce and/or consume large quantities of coal and other energy related commodities, such as India, may have a material impact on the prices at which we sell our product.

Further, similar actions by government entities in countries that produce and/or consume large quantities of coal and other energy related commodities, such as India, may have a material impact on the prices at which we sell our product.

In addition, certain trade disputes in Asian markets, such as those between China and Australia, have resulted in increased coal supply and lower prices in non-Asian markets to which we export our coal.

Should these disputes endure, continued lower prices in certain of our export markets may have significant negative effects on our business, financial condition or results of operations.

The concurrent loss of, or significant reduction in, purchases by several of our largest customers could materially and adversely affect our revenues and profitability.

Our largest customer during the year ended December 31, 2019 accounted for approximately 11.6% of our coal revenues, and coal sales to our 10 largest customers accounted for approximately 55.7% of our coal revenues.

Our largest customer during the year ended December 31, 2020 accounted for approximately 16% of our total revenues, and coal sales to our 10 largest customers accounted for approximately 63% of our total revenues.

These customers could decide to discontinue purchasing coal from us in the volumes that they have previously purchased or decide to not purchase at all.

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If this concurrent loss or significant reduction were to happen, our revenues and profitability could be materially and adversely affected.

Continuing low demand for thermal coal, or further declines in demand, by North American electric power generators could reduce the price of our thermal coal, which would reduce our revenues.

Thermal coal accounted for approximately 13% of our coal revenues for the year ended December 31, 2020.

The majority of our sales of thermal coal were to U.S.

electric power generators.

The North American demand for thermal coal is affected primarily by:

• the overall demand for electricity, which is in turn influenced by the global economy and the weather, among other factors (for example, mild North American winters typically result in lower demand);

• the availability, quality and price of competing fuels, such as natural gas, nuclear fuel, oil and alternative energy sources such as wind, solar, and hydroelectric power, which may change over time as a result of, among other things, technological developments and state or federal regulatory or statutory fuel subsidies or energy use mandates;

• increasingly stringent environmental and other governmental regulations, including air emission standards for coal-fired power plants;

• the coal inventories of utilities.

Many North American electric power generators have shifted from coal to natural gas-fired power plants.

Increasingly stringent regulations have also reduced the number of new power plants being built, particularly coal-fired power plants.

We may not be able to extend our existing long-term supply contracts or enter into new ones, and our existing supply contracts may contain certain provisions that may reduce protection from short-term coal price volatility, which could adversely affect the profitability of our operations.

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Accordingly, supply contracts with terms of one year or more may provide only limited protection during adverse or volatile market conditions.

Competition with natural gas and renewable energy sources, and factors affecting these industries could have an adverse impact on coal demand.

Our coal competes with natural gas and renewable energy sources, and the price of these sources can therefore affect coal sales.

The natural gas market has been volatile historically and prices in this market are subject to wide fluctuations in response to relatively minor changes in supply and demand.

Changes in supply and demand could be prompted by any number of factors, such as worldwide and regional economic and political conditions;

the level of global exploration, production and inventories;

natural gas prices;

and transportation availability.

If natural gas prices decline significantly, it could lead to reduced coal sales and have a material adverse effect on our financial condition, results of operations and cash flows.

In addition, state and federal mandates for increased use of electricity from renewable energy sources also have an impact on the market for our coal.

Several states have enacted legislative mandates requiring electricity suppliers to use renewable energy sources to generate a certain percentage of power.

There have been numerous proposals to establish a similar uniform, national standard although none of these proposals have been enacted to date.

Possible advances in technologies and incentives, such as tax credits, to enhance the economics of renewable energy sources could make these sources more competitive with coal.

Our ability to collect payments from our customers could be impaired if their creditworthiness and financial health deteriorate.

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• federal and state agencies and citizen groups have increasingly focused on the amount of selenium and other constituents in mine-related water discharges;

MSHA and the states of Pennsylvania, Virginia and West Virginia have implemented and proposed changes to mine safety and health requirements to impose more stringent health and safety controls, enhance mine inspection and enforcement practices, increase sanctions, and expand monitoring and reporting;

• MSHA and the states of Virginia and West Virginia have implemented and proposed changes to mine safety and health requirements to impose more stringent health and safety controls, enhance mine inspection and enforcement practices, increase sanctions, and expand monitoring and reporting;

• GHG emissions reductions are being considered that could increase our costs, require additional controls, or compel us to limit our current operations.

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In addition, due in part to the extensive and comprehensive regulatory requirements, violations of laws, regulations and permits occur at our operations from time to time and may result in significant costs to us to correct the violations, as well as substantial civil or criminal penalties and limitations or shutdowns of our operations.

We are also required to comply with the November 2014 Consent Decree with EPA and several government agencies.

In particular, President Biden and the current Congressional majorities have expressed support for policies that may result in stricter environmental, health and safety standards applicable to our operations and those of our customers.

For example, on January 20, 2021, President Biden issued an executive order titled “Executive Order on Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis,” (the “January 20 Executive Order”) which among other things, calls for a review of regulations and other executive actions issued during the prior Presidential administration to assess whether they are, in the view of the Biden administration, sufficiently protective of public health and the environment, including with respect to climate change, and consistent with science.

See “Environmental and Other Regulatory Matters—Clean Water Act—Wastewater Discharge.”

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Various international, federal, regional, foreign and state proposals are currently in place or being considered to limit emissions of GHGs, including possible future U.S.

treaty commitments, new federal or state legislation, and regulation under existing environmental laws by the EPA and other regulatory agencies and litigation by private parties.

commitments, new federal or state legislation, and regulation under existing environmental laws by the EPA and other regulatory agencies and litigation by private parties.

These include:

the 2015 Paris climate summit agreement, which resulted in voluntary commitments by 197 countries (although on June 1, 2017, the Trump administration announced that the U.S.

will withdraw from the agreement) to reduce their GHG emissions and could result in additional firm commitments by various nations and states with respect to future GHG emissions;

the ACE Rule, which requires reductions in GHG emissions from existing fossil fuel-fired power plants, and new source performance standards for GHG emissions for new, modified or reconstructed fossil fuel-fired power plants, or any regulation that replaces them;

• the 2015 Paris climate summit agreement, which resulted in voluntary commitments by 197 countries to reduce their GHG emissions and could result in additional firm commitments by various nations and states with respect to future GHG emissions.

On June 1, 2017, the Trump administration announced that the U.S.

would withdraw from the agreement, but the Biden administration has subsequently taken steps to rejoin the agreement;

• state and regional climate change initiatives implementing renewable portfolio standards or cap-and-trade schemes;

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• private litigation against coal companies or power plant operators based on GHG-related concerns.

On March 28, 2017, President Trump signed the Executive Order for Promoting Energy Independence and Economic Growth (“March 2017 Executive Order”), which directed the EPA to review and, if appropriate, suspend, revise or rescind, both the CPP and the Power Plant NSPS as necessary to ensure consistency with the goals of energy independence, economic growth and cost-effective environmental regulation.

In response to the March 2017 Executive Order, in December 2018, EPA proposed to revise the Power Plant NSPS.

Among other things, the EPA proposed an emission standard for newly constructed coal-fired units that would require the most efficient demonstrated steam cycle (i.e., supercritical steam conditions for large EGUs and best available subcritical steam conditions for small EGUs) in combination with the best operating practices, instead of CCS.

The outcome of these rulemakings is uncertain and likely to be subject to extensive notice and comment and litigation.

On August 3, 2015, the EPA released a final rule establishing the Power Plant NSPS.

The final rule requires that newly constructed fossil fuel-fired steam generating units achieve an emission standard for carbon dioxide of 1,400 lb CO2/MWh-gross.

The standard is based on the performance of a supercritical pulverized coal boiler implementing partial CCS.

Modified and reconstructed fossil fuel fired steam generating units must implement the most efficient generation achievable through a combination of best operating practices and equipment upgrades, to meet an emission standard consistent with best historical performance.

In addition, on July 8, 2019, the EPA published the ACE Rule, a replacement of the CPP.

In contrast to the CPP, which called for the shifting of electricity generation away from coal-fired sources towards natural gas and renewables, the ACE Rule focuses on reducing GHG emissions from existing coal-fired plants by requiring states to mandate the implementation of a range of technologies at power plants designed to improve their heat rate (i.e., decrease the amount of fuel necessary to generate the same amount of electricity).

The ACE Rule is the subject of legal challenges, the outcome of which is uncertain.

More stringent standards for carbon dioxide pollution as a result of these rulemakings could further reduce demand for coal,

and our business would be adversely impacted.

However, on January 19, 2021, the Court of Appeals of the District of Columbia struck down the ACE rule.

The EPA has since announced an intent to consider new regulations governing carbon emissions from existing power plants.

More stringent standards for carbon dioxide pollution as a result of these rulemakings could further reduce demand for coal, and our business would be adversely impacted.

In addition, certain banks and other financing sources have taken actions to limit available financing for the development of new coal-fueled power plants, which also may adversely impact the future global demand for coal.

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The degree to which any particular law, regulation or policy impacts us will depend on several factors, including the substantive terms involved, the relevant time periods for enactment and any related transition periods.

Considerable uncertainty is associated with these regulatory initiatives and legal developments, as the content of proposed legislation and regulation is not yet fully determined, many of the new regulatory initiatives remain subject to governmental and judicial review, and, with respect to federal initiatives, the current U.S.

presidential administration and/or Congress (including congressional proposals such as the Green New Deal) may further impact their development.

Considerable uncertainty is associated with these regulatory initiatives and legal developments, as the content of proposed legislation and regulation is not yet fully determined and many of the new regulatory initiatives remain subject to governmental and judicial review.

In particular, President Biden and the current Congressional majorities have expressed support for the regulation of GHG emissions.

In prior Congressional sessions, legislative proposals regulating GHG emissions (such as the Green New Deal) have been introduced and Congressional leadership may introduce similar legislation this Congressional term.

We routinely attempt to evaluate the potential impact on us of any proposed laws, regulations or policies, which requires that we make several material assumptions.

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• implementation of the EPA’s CSAPR to significantly reduce nitrogen oxide and sulfur dioxide emissions from power plants in 28 states, and the CSAPR Update Rule, issued in September 2016, requiring further reductions in nitrogen oxides in 2017 in 22 states subject to CSAPR during the summertime ozone season;

continued implementation of the EPA’s MATS, which impose stringent limits on emissions of mercury and other toxic air pollutants from electric power generators, issued in December 2011 and in effect pending completion of judicial review proceedings and subject to a new draft rule proposed in December 2018 that reverses certain findings that served as the basis for MATS;

• continued implementation of the EPA’s MATS, which impose stringent limits on emissions of mercury and other toxic air pollutants from electric power generators, issued in December 2011 and in effect pending completion of judicial review proceedings;

• implementation of the EPA’s August 2014 final rule on cooling water intake structures for power plants;

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These costs make coal more expensive to use and make it a less attractive fuel source of energy for our customers.

are currently being constructed, all of which reduce demand for coal, the amount of coal that we sell and the prices that we receive for it, thereby reducing our revenues and adversely impacting our earnings and the value of our coal reserves.

Accordingly, some existing power generators have switched to other fuels that generate fewer emissions and others are likely to switch, some power plants have closed and others are likely to close, and no coal-fired plants are currently being constructed, all of which reduce demand for coal, the amount of coal that we sell and the prices that we receive for it, thereby reducing our revenues and adversely impacting our earnings and the value of our coal reserves.

In addition, regulations regarding sulfur dioxide emissions under the Clean Air Act, including caps on emissions and the price of emissions allowances, have a potentially significant impact on the demand for our coal based on its sulfur content.

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Any of these consequences could result in a decrease in revenues from some of our operations, which could adversely affect our business and results of operations.

Internal Revenue Service could withhold tax refunds and refundable credits and assert a right to setoff against pre-petition claims of the U.S.

government during the Alpha Bankruptcy, which could have a material adverse effect upon the Company’s assets.

As of December 31, 2019, the Company has recorded approximately $33.1 million of federal income tax receivable and approximately $33.1 million of federal deferred tax asset related to refundable Alternative Minimum Tax (AMT) credits.

In addition, the Company has recorded a non-current federal income tax receivable of approximately $64.2 million related to a net operating loss (NOL) carryback claim.

Because the U.S.

government was a creditor in the Predecessor Alpha bankruptcy proceedings, it is possible that the U.S.

Internal Revenue Service (IRS) could withhold some or all of the tax refund attributable to the NOL carryback claim and the AMT refundable credits and assert a right to set off the tax refund and refundable credits against the U.S.

government’s pre-petition bankruptcy claims.

Internal Revenue Service could withhold tax refunds and assert a right to setoff against pre-petition claims of the U.S.

government during the Alpha Natural Resources, Inc.

bankruptcy, which could have a material adverse effect upon the Company’s assets.

As of December 31, 2020, the Company has recorded $64.2 million of current federal income tax receivable and associated interest receivable of $5.2 million related to a net operating loss (“NOL”) carryback claim.

Because the federal government was a creditor in the Alpha Natural Resources, Inc.

bankruptcy proceedings, it is possible that the federal government could withhold some or all of the tax refund attributable to the NOL carryback claim and assert a right to set off the tax refund and associated interest receivable against its prepetition bankruptcy claims.

If the IRS were to take such actions, the Company would vigorously defend its position.

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The Navigable Waters Protection Rule narrows the jurisdiction of the CWA relative to Clean Water Rule by, among other things, excluding from the scope of the definition of “waters of the United States” certain ephemeral streams and wetlands not adjacent to jurisdictional water bodies.

The Navigable Water Protection Rule is likely to be the subject of legal challenges and its ultimate impact on our operations is uncertain.

The Navigable Water Protection Rule is likely to be the subject of legal challenges and potential reconsideration by the EPA and its ultimate impact on our operations is uncertain.

Additionally, we may rely on nationwide permits under the CWA Section 404 program for some of our operations.

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Although we have no estimates at this time, our costs to satisfy these conditions could be substantial.

commencing or continuing exploration or production operations, and as a result, adversely affect our coal production, cash flows and profitability.

Future changes or challenges to the permitting and mine plan modification and approval process could cause additional increases in the costs, time, and difficulty associated with obtaining and complying with the permits and could delay or prevent commencing or continuing exploration or production operations, and as a result, adversely affect our coal production, cash flows and profitability.

Federal and state regulatory agencies have the authority to order any of our facilities to be temporarily or permanently closed under certain circumstances, which could materially adversely affect our ability to meet our customers’ demands.

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Any of these actions could have a material adverse effect on our business and results of operations.

We have obligations under various settlement agreements with state and federal agencies in relation to the Alpha Restructuring settlement and the failure to meet these obligations could result in the termination of such settlement agreements, the revocation of permits and regulatory or enforcement actions, among other things.

In connection with the Alpha Restructuring settlement, Alpha and Contura entered into a number of agreements with state and federal agencies regarding the funding, performance and bonding of reclamation and other environmental restoration obligations with respect to mine properties retained by Alpha under the Alpha Restructuring.

These agreements have been amended from time to time in connection with sales by Alpha of certain of these properties.

These agreements require Contura to make periodic payments to certain accounts designated to fund reclamation and other activities at various facilities and also impose bonding, reporting and other obligations.

A failure by Contura to fulfill our obligations under these agreements could be considered an event of default which could result in, among other things, the cancellation of certain permits, a termination of the agreement, termination of the right to use the funds in the Restricted Cash Reclamation Account, the Water Treatment Restricted Cash Account or the Mitigation Account and the taking of any regulatory or enforcement action that an agency enforcing such default is permitted to take.

Our systems and procedures for internal control over financial reporting or the disclosure controls related to them have, and may have in the future, material weaknesses, which may adversely affect the value of our common stock.

We have obligations under various settlement agreements with state and federal agencies in relation to the Alpha Natural Resources, Inc.

Restructuring settlement and the failure to meet these obligations could result in the termination of such settlement agreements, the revocation of permits and regulatory or enforcement actions, among other things.

In connection with the Alpha Natural Resources, Inc.

Restructuring settlement, we and Alpha Natural Resources, Inc.

entered into a number of agreements with state and federal agencies regarding the funding, performance and bonding of reclamation and other environmental restoration obligations with respect to mine properties retained by Alpha Natural Resources, Inc.

under the Alpha Natural Resources, Inc.

Restructuring.

These agreements have been amended from time to time in connection with sales by Alpha Natural Resources, Inc.

of certain of these properties.

These agreements require us to make periodic payments to certain accounts designated to fund reclamation and other activities at various facilities and also impose bonding, reporting and other obligations.

A failure to fulfill our obligations under these agreements could be considered an event of default which could result in, among other things, the cancellation of certain permits, a termination of the agreement and the taking of any regulatory or enforcement action that an agency enforcing such default is permitted to take.

Our systems and procedures for internal control over financial reporting or the disclosure controls related to them may in the future have material weaknesses, which may adversely affect the value of our common stock.

We are responsible for maintaining systems and documentation necessary to evaluate the effectiveness of our internal control over financial reporting.

These activities may divert management’s attention from other business concerns.

Further, we have determined that certain of our internal controls over financial reporting have deficiencies, significant deficiencies and material weaknesses.

If we are unable to correct these issues in a timely fashion, or if other internal controls issues arise, there could be a material adverse effect on our business, financial condition, results of operations and cash flows, and investors could lose confidence in our reported results, thus affecting our ability to finance our business.

To maintain and improve our controls and procedures, we must commit significant resources, may be required to hire additional staff and need to continue to provide effective management oversight, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

and improve our controls and procedures, we must commit significant resources, may be required to hire additional staff and need to continue to provide effective management oversight, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

federal income tax provisions currently available with respect to coal percentage depletion and exploration and development may be eliminated by future legislation.

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A substantial portion of our non-income taxes are levied as a percentage of gross revenues, while others are levied on a per ton basis.

Further, liabilities could arise in connection with audits of royalties previously paid to government entities in connection with our former PRB operations.

If such liabilities were to arise, or if non-income tax rates were to increase significantly, our results of operations could be materially and adversely affected.

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A decline in demand for met coal relative to thermal coal could cause us to shift coal from the met market to the thermal market, thereby reducing our revenues and profitability.

Mining in Central and Northern Appalachia is more complex and involves more regulatory constraints than mining in other areas of the U.S., which could affect our mining operations and cost structures in these areas.

The geological characteristics of Northern and Central Appalachian coal reserves, such as depth of overburden and coal seam thickness, make them complex and costly to mine.

Mining in Central Appalachia is more complex and involves more regulatory constraints than mining in other areas of the U.S., which could affect our mining operations and cost structures in these areas.

The geological characteristics of Central Appalachian coal reserves, such as depth of overburden and coal seam thickness, make them complex and costly to mine.

As mines become depleted, replacement reserves may not be available or, if available, may not be able to be mined at costs comparable to those of the depleting mines.

In addition, compared to mines in other areas of the country, permitting, licensing and other environmental and regulatory requirements are more costly and time consuming to satisfy.

These factors could materially adversely affect the mining operations and cost structures of, and our customers’ ability to use coal produced by, our mines in Northern and Central Appalachia.

These factors could materially adversely affect the mining operations and cost structures of, and our customers’ ability to use coal produced by, our mines in Central Appalachia.

Disruptions in transportation services and increased transportation costs could impair our ability to supply coal to our customers, reduce demand and adversely affect our business.

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In addition, much of our eastern coal is transported from our mines to our loading facilities by trucks owned and operated by third parties.

Disruption of any of these transportation services due to weather-related problems, mechanical difficulties, fuel and supply costs, strikes, lockouts, bottlenecks, terrorist attacks and other events could impair our ability to supply coal to our customers, resulting in decreased shipments and revenue.

Disruption of any of these transportation services due to weather-related problems, mechanical difficulties, fuel and supply costs, strikes,

lockouts, bottlenecks, terrorist attacks and other events could impair our ability to supply coal to our customers, resulting in decreased shipments and revenue.

Disruption in shipment levels over longer periods of time could cause our customers to look to other sources for their coal needs, negatively affecting our revenues and results of operations.

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We, along with the mining industry generally, are currently facing a shortage of experienced mechanics and certified electricians.

When coal producers compete for skilled miners,

recruiting challenges can occur and employee turnover rates can increase, which negatively affect operating efficiency and costs.

When coal producers compete for skilled miners, recruiting challenges can occur and employee turnover rates can increase, which negatively affect operating efficiency and costs.

If a shortage of skilled workers exists and we are unable to train or retain the necessary number of miners, it could adversely affect our productivity, costs and ability to expand production.

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We are responsible for certain liabilities under a variety of benefit plans and other arrangements with employees.

The unfunded status of these obligations as of December 31, 2019 included $102.9 million of workers’ compensation obligations, net of related prepaid and receivable amounts, $204.1 million of pension obligations, and $120.1 million of black lung obligations.

The unfunded status of these obligations, including discontinued operations, as of December 31, 2020 included $97.4 million of workers’ compensation obligations, net of expected insurance receivable amounts, $218.7 million of pension obligations, and $124.8 million of black lung obligations.

These obligations have been estimated based on assumptions including actuarial estimates, discount rates, and changes in health care costs.

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Furthermore, these obligations are primarily unfunded.

If these accruals are insufficient or our liability in a particular year is greater than currently anticipated, our future operating results and financial position could be adversely affected.

If these accruals are insufficient or our

liability in a particular year is greater than currently anticipated, our future operating results and financial position could be adversely affected.

In addition, significant changes from period to period could result in significant variability in our operating results, which could reduce comparability between periods and impact our liquidity.

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After we acquire coal reserves, we are required to obtain a permit to mine the reserves through the applicable state agencies prior to mining the acquired coal.

In part, permitting requirements provide that, under certain circumstances, we must obtain surface owner consent if the surface estate has been severed from the mineral estate, which is commonly known as a “severed estate.” At certain of our mines where we have obtained the underlying coal and the surface is held by one or more

owners, we are engaged in negotiations for surface rights with multiple parties.

If we are unable to successfully negotiate surface rights with any or all of these surface owners, or to do so on commercially reasonable terms, we may be denied a permit to mine some or all of our coal or may find that we cannot mine the coal at a profit.

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Furthermore, if we decide to alter our plans to mine around the affected areas, we could incur significant additional costs to do so, which could increase our operating expenses considerably and could materially and adversely affect our results of operations.

If we are unable to complete permit transfers as expected or if there are complications in connection with the permit transfer process, it could materially and adversely affect our business and results of operations.

As previously disclosed, on December 8, 2017, Contura closed a transaction (“PRB Transaction”) with Blackjewel, LLC (“Blackjewel”) to sell the Eagle Butte and Belle Ayr mines located in the PRB (the “Western Mines” or “Western Assets”), and transfer the applicable permits.

Blackjewel and certain of its affiliates filed petitions for relief under Chapter 11 of the Bankruptcy Code after the transfer of the Western Mines from the Company to Blackjewel but prior to the transfer from the Company to Blackjewel of the permits associated with the Western Mines.

Also, as previously disclosed, Eagle Specialty Materials, LLC (“ESM”), an affiliate of FM Coal, LLC, subsequently agreed to acquire the Western Mines from Blackjewel and certain of its affiliates.

In connection with the closing of this transaction on October 18, 2019, we entered into an amended and restated binding term sheet with ESM and certain ESM-related parties (the “Term Sheet”).

Pursuant to the Term Sheet, we and certain of our affiliated companies agreed to, among other things, make certain cash payments to ESM and to an escrow account, to convey to ESM our interests in two ranches upon the release of such ranches as collateral by the Wyoming Department of Environmental Quality (“DEQ”) and to transfer to ESM the Company’s permits related to the Western Mines (the “Contura Permits”) once all applicable approvals for their transfer have been obtained.

Following the closing and until the earlier of the date of the permit transfers and August 30, 2020 (as may be extended by mutual agreement of the parties, with Contura not to unreasonably withhold its approval), we have consented to ESM’s operation of the Western Mines under our permits, subject to ESM’s compliance with a permit operating agreement.

In connection with the closing, ESM posted with the DEQ substitute bonds in the amount of approximately $238 million and DEQ released the bonds we had previously posted with DEQ to secure our obligations under the Contura Permits.

In connection with this transaction, we also entered into agreements with various governmental and private parties that release us and our affiliates from certain claims and liabilities.

Prior to the transfer of the Contura Permits to ESM, however, we will continue to have potential liability related to the Contura Permits, including in respect of reclamation obligations.

Further, if the permit transfer process is not completed as expected, or if there are complications in connection with the process, there could be material and adverse effects on our business and our results of operations.

Our workforce could become increasingly unionized in the future and our unionized or union-free workforce could strike, which could adversely affect the stability of our production and reduce our profitability.

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Any further unionization of our employees or the employees of third-party contractors who mine coal for us could adversely affect the stability of our production and reduce our profitability.

Certain of Contura’s subsidiaries have wage agreements with the UMWA that are subject to termination by either the employer or the UMWA, without cause, on July 31, 2020.

As is the case with our union-free operations, the union-represented employees could strike, which would disrupt our production, increase our costs and disrupt shipments of coal to our customers, and could result in the closure of affected mines, all of which could reduce our profitability.

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Our operations at times face potential conflicts with holders of other mineral interests such as coalbed methane, natural gas and oil reserves.

Some of these minerals are located on, or are adjacent to, some of our coal reserves and active operations,

potentially creating conflicting interests between us and the holders of those interests.

Some of these minerals are located on, or are adjacent to, some of our coal reserves and active operations, potentially creating conflicting interests between us and the holders of those interests.

From time to time we acquire these minerals ourselves to prevent conflicting interests from arising.

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Accordingly, actual or alleged defects in title or boundaries may exist, which may result in the loss of our right to mine on the property or in unanticipated costs to obtain leases or mining contracts to allow us to conduct our mining operations on the property, which could adversely affect our business and profitability.

Furthermore, some leases require us to produce a minimum quantity of coal and/or pay minimum production royalties.

Furthermore, some leases require us to produce a

minimum quantity of coal and/or pay minimum production royalties.

If those requirements are not met, the leasehold interest may terminate.

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A significant reduction in availability or increase in cost of these supplies, or the failure of third party coal producers to provide them in a timely fashion, could adversely affect our operations and increase our costs, which could adversely affect our operating results and cash flows.

We have previously and may in the future contract with third-parties to operate certain of our mines, and our results of operations could be adversely affected if these operators fail to operate the mines effectively.

We have previously and may in the future contract with third-parties to operate or reclaim certain of our mines, and our results of operations could be adversely affected if these operators are ineffective.

We have previously and may in the future contract with third parties to operate certain of our mines.

Under these arrangements we retain certain contractual rights of oversight over these mines, which are operated under our permits, but we do not control, and our employees do not participate in, the day-to-day operations of these mines.

Under these arrangements we retain certain contractual rights of oversight over these mines, which are operated under our permits or leases, but we do not control, and our employees do not participate in, the day-to-day operations of these mines.

Operational difficulties at these mines, increased competition for contract miners from other coal producers and other factors beyond our control could affect the availability, cost and quality of coal produced for us by contractors.

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Any increase in the per-ton compensation for services we pay for the production of contractor-produced coal could increase our costs and therefore lower our earnings and adversely affect our results of operations.

We also contract with third parties to perform reclamation services for properties that are no longer in operation.

If these third parties fail to meet their obligations under these contracts or are otherwise ineffective, it could increase our costs and therefore lower our earnings and adversely affect our results of operations.

Strategic transactions, including acquisitions, involve a number of risks, any of which could result in a material adverse effect on our business, financial condition or results of operations.

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Future transactions could also result in our assuming more long-term liabilities relative to the value of the acquired assets.

Further, acquisition accounting rules require changes in certain

assumptions made subsequent to the measurement period, as defined in current accounting standards, to be recorded in current period earnings, which could affect our results of operations.

Further, acquisition accounting rules require changes in certain assumptions made subsequent to the measurement period, as defined in current accounting standards, to be recorded in current period earnings, which could affect our results of operations.

We may be unable to generate sufficient taxable income from future operations, or other circumstances could arise, which may limit our ability to utilize our tax net operating loss carryforwards or maintain our deferred tax assets.

We acquired the core coal assets of Predecessor Alpha as part of Predecessor Alpha’s bankruptcy restructuring in transactions intended to be treated as a tax-free reorganization for U.S.

We acquired the core coal assets of Alpha Natural Resources, Inc.

as part of Alpha Natural Resources, Inc.’s bankruptcy restructuring in transactions intended to be treated as a tax-free reorganization for U.S.

federal income tax purposes.

As a result of these transactions, we inherited the tax basis of the core assets and the net operating loss and other carryforwards of Predecessor Alpha.

These carryforwards and tax basis were subject to reduction on December 31, 2016 due to the cancellation of indebtedness resulting from Predecessor Alpha’s bankruptcy restructuring.

Due to the change in ownership, the net operating loss and other carryforwards will be subjected to limitations on their use in future years.

As a result of these transactions, we inherited the tax basis of the core assets and the net operating loss and other carryforwards of Alpha Natural Resources, Inc.

These carryforwards and tax basis were subject to reduction on December 31, 2016 due to the cancellation of indebtedness resulting from Alpha Natural Resources, Inc.’s bankruptcy restructuring.

Due to the change in ownership, the net operating loss and other carryforwards will be subjected to limitations on their use in future years and additional changes in ownership in future years may further reduce the annual amount of the net operating loss and other carryforwards available to be utilized.

In addition, we do not have a long history of operating results, and if we are unable to generate profits in the future, we may be unable to utilize these carryforwards.

As of December 31, 2019, a valuation allowance of $133.0 million has been provided on federal and state net operating loss carryforwards and gross deferred tax assets not expected to provide future tax benefits.

As of December 31, 2020, a valuation allowance of $263.4 million has been provided on federal and state net operating loss carryforwards and other deferred tax assets not expected to provide future tax benefits.

Negative or unexpected consequences of the Tax Cuts and Jobs Act could affect our business.

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federal corporate tax law by, among other things, reducing the U.S.

federal corporate income tax rate to 21%, eliminating the corporate alternative minimum tax, providing a mechanism for corporations to monetize alternative minimum tax credits (“AMT Credits”) during the 2018 to 2021 tax years, limiting the tax deduction for interest expense to 30% of adjusted earnings, allowing immediate expensing for certain new investments, and, effective for net operating losses arising in taxable years beginning after December 31, 2017, eliminating net operating loss carrybacks, permitting indefinite net operating loss carryforwards, and limiting the use of net operating loss carryforwards to 80% of current year taxable income.

federal corporate income tax rate to 21%, eliminating the corporate alternative minimum tax, providing a mechanism for corporations to monetize alternative minimum tax credits (“AMT Credits”), limiting the tax deduction for interest expense to 30% of adjusted earnings, allowing immediate expensing for certain new investments, and, effective for net operating losses arising in taxable years beginning after December 31, 2017, eliminating net operating loss carrybacks, permitting indefinite net operating loss carryforwards, and limiting the use of net operating loss carryforwards to 80% of current year taxable income.

There are a number of uncertainties and ambiguities as to the interpretation and application of many of the provisions in the TCJA.

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Pursuant to the Second Amended Joint Plan of Reorganization of Debtors and Debtors in Possession, dated May 27, 2016, as modified and confirmed by the Order Confirming Second Amended Joint Plan of Reorganization of Debtors and Debtors in Possession, as Modified (Docket No.

3038), entered by the Bankruptcy Court on July 12, 2016, we have contingent revenue payment obligations to certain of Alpha’s creditors, which are recorded at fair market value and marked to market in each reporting period, with changes in value reflected in earnings.

3038), entered by the Bankruptcy Court on July 12, 2016, we have contingent revenue payment obligations to certain of Alpha Natural Resources Inc.’s creditors, which are recorded at fair market value and marked to market in each reporting period, with changes in value reflected in earnings.

Any change in fair value can have a significant impact on our earnings from period to period, including in the future.

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• result in a downgrade in the credit ratings of our indebtedness, which could harm our ability to incur additional indebtedness and result in more restrictive borrowing terms, including increased borrowing costs and more restrictive covenants, all of which could affect our internal cost of capital estimates and therefore impact operational and investment decisions.

Our ability to meet our debt service obligations will depend on our future cash flow from operations and our ability to restructure or refinance our debt, which will depend on the condition of the capital markets and our financial condition at that time.

We may incur additional secured or unsecured indebtedness in the future, subject to compliance with covenants in our existing debt agreements.

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Surety bond issuers and holders may not continue to renew the bonds, may demand less favorable terms upon renewal or may impose new or increased collateral requirements.

As of December 31, 2019, we had outstanding surety bonds with third parties of approximately $343.7 million .

As of December 31, 2020, we had outstanding surety bonds with third parties of approximately $351.6 million, including $134.2 million attributable to discontinued operations.

Surety bond issuers and holders may demand additional collateral, unfavorable terms or higher fees.

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The term loan credit facility permits us, subject to approval of the administrative agent and the lenders providing the financing, to request incremental term loans up to an aggregate amount of $50 million subject to certain conditions in the Credit Agreement, in increments not less than $25 million or the remaining availability.

In connection with the consummation of the Alpha Merger, we entered into the Amended and Restated Asset-Based Revolving Credit Agreement with a borrowing capacity of $225 million under a revolving credit facility.

In connection with the consummation of the Merger, we entered into the Amended and Restated Asset-Based Revolving Credit Agreement with a borrowing capacity of $225 million under a revolving credit facility.

The revolving credit facility matures on April 3, 2022.

Additionally, as a result of the Alpha Merger, we assumed a letter of credit agreement and a credit and security agreement which, among other things, include letter of credit facilities that provide for the issuance of letters of credit.

Additionally, as a result of the Merger, we assumed a letter of credit agreement and a credit and security agreement which, among other things, include letter of credit facilities that provide for the issuance of letters of credit.

The terms of our credit facilities impose operating and financial restrictions on us, which may limit our ability to respond to changing business and economic conditions.

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Our inability to maintain our term loan and revolving credit facilities could materially adversely affect our liquidity and our business.

At December 31, 2019, we were in compliance with the operating and financial covenants under the term loan and revolving credit facilities.

December 31, 2020, we are in compliance with the operating and financial covenants under the term loan and revolving credit facilities.

Pressure on our business, cash flow and liquidity could materially and adversely affect our ability to fund our business operations or react to and withstand changing market and industry conditions.

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Access to additional funds from liquidity-generating transactions or other sources of external financing may not be available to us and, if available, would be subject to market conditions and certain limitations including our credit rating and covenant restrictions in our credit facility.

Our ability to make the required payments on our indebtedness depends on the cash flow generated by our subsidiaries, which may be constrained by legal, contractual, market or operating conditions from paying dividends to us.

We will depend to a significant extent on the generation of cash flow by our subsidiaries and their ability to make that cash available to us, by dividend, debt repayment or otherwise.

These subsidiaries may not be able to, or be permitted to, make distributions to enable us to make payments in respect of our indebtedness.

Each of these subsidiaries is a distinct legal entity and, under certain circumstances, legal and contractual restrictions, as well as the financial condition and operating requirements of our subsidiaries, may limit our ability to obtain cash from our subsidiaries.

In the event that we do not receive distributions from our subsidiaries, we may be unable to make required payments of principal, premium, if any, and interest on our indebtedness.

The terms of our borrowing arrangements limit our and our subsidiaries’ ability to take certain actions, which may limit our operating and financial flexibility and adversely affect our business.

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These covenants could adversely affect our ability to finance our future operations or capital needs or to execute preferred business strategies.

In addition, complying with these covenants may make it more difficult for us to successfully execute our business strategy and compete against companies who

are not subject to such restrictions.

In addition, complying with these covenants may make it more difficult for us to successfully execute our business strategy and compete against companies who are not subject to such restrictions.

We regularly evaluate opportunities to enhance our capital structure and financial flexibility through a variety of methods, including repayment or repurchase of outstanding debt, amendment of our credit facility and other facilities, and other methods.

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On November 9, 2018, we entered into the Amended and Restated Asset-Based Revolving Credit Agreement.

Additionally, as a result of the Alpha Merger, we assumed an Amended and Restated Letter of Credit Agreement and a Credit and Security Agreement.

Additionally, as a result of the Merger, we assumed an Amended and Restated Letter of Credit Agreement and a Credit and Security Agreement.

Each of these agreements includes, among other things, provisions that provide for the issuance of letters of credit.

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An active, liquid and orderly trading market for our common stock may not be maintained, and our stock price may be volatile.

Contura’s common stock trades on the New York Stock Exchange under the ticker symbol “CTRA.” Active, liquid and orderly trading markets usually result in less price volatility and more efficiency in carrying out investors’ purchase and sale orders.

Alpha’s common stock trades on the New York Stock Exchange under the ticker symbol “AMR.” Active, liquid and orderly trading markets usually result in less price volatility and more efficiency in carrying out investors’ purchase and sale orders.

An active, liquid and orderly trading market for our common stock may not be maintained, however.

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Sales of substantial amounts of our common stock (including shares issued in connection with an acquisition), or the perception that such sales could occur, may adversely affect prevailing market prices of our common stock or the dividend amount payable per share on our common stock.

In addition, the issuance of shares of common stock upon the exercise of outstanding options and warrants will result in dilution to the interests of other stockholders.

In addition, the issuance of shares of

common stock upon the exercise of outstanding options and warrants would result in dilution to the interests of other stockholders.

We may issue preferred stock with terms that could adversely affect the voting power or value of our common stock.

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Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of the common stock.

If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our common stock or if our operating results do not meet their expectations, our stock price could decline.

The trading market for our common stock is influenced by the research and reports that securities or industry analysts publish about us or our business.

Securities and industry analysts currently publish these research reports, but there is no

guarantee they will continue to publish them in the future.

If securities or industry analysts initiate coverage and one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Moreover, if one or more of the analysts who cover our company downgrades our common stock or if our operating results do not meet their expectations, our stock price could decline.

Provisions in our organizational documents and the instruments governing our debt may discourage a takeover attempt, even if doing so might be beneficial to our stockholders.

Provisions contained in our second amended and restated certificate of incorporation (the “amended and restated certificate of incorporation”) and second amended and restated bylaws (the “amended and restated bylaws”) could impose impediments to the ability of a third-party to acquire us even if a change of control would be beneficial to our stockholders.

Provisions of our amended and restated certificate of incorporation and amended and restated bylaws impose various procedural and other requirements, which could make it more difficult for stockholders to effect certain corporate actions.

For example, our amended and restated certificate of incorporation authorizes our board of directors to determine the rights, preferences, privileges and restrictions of unissued series of preferred stock, without any vote or action by our stockholders.

Provisions contained in our certificate of incorporation and bylaws could impose impediments to the ability of a third-party to acquire us even if a change of control would be beneficial to our stockholders.

Provisions of our certificate of incorporation and bylaws impose various procedural and other requirements, which could make it more difficult for stockholders to effect certain corporate actions.

For example, our certificate of incorporation authorizes our board of directors to determine the rights, preferences, privileges and restrictions of unissued series of preferred stock, without any vote or action by our stockholders.

Thus, our board of directors can authorize the issuance of shares of preferred stock with voting or conversion rights that could adversely affect the voting or other rights of holders of our common stock.

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These provisions could prevent or deter a third-party from acquiring us even where the acquisition could be beneficial to our stockholders.

Our second amended and restated bylaws provide, subject to certain exceptions, that the Court of Chancery of the State of Delaware is the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or stockholders.

Our amended and restated bylaws provide, subject to limited exceptions, that the Court of Chancery of the State of Delaware is, to the fullest extent permitted by law, the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf;

Our bylaws provide, subject to certain exceptions, that the Court of Chancery of the State of Delaware is the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or stockholders.

Our bylaws provide, subject to limited exceptions, that the Court of Chancery of the State of Delaware is, to the fullest extent permitted by law, the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf;

(ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders;

(iii) any action asserting a claim against us, any director or our officers or employees arising pursuant to any provision of the Delaware General Corporation Law, our amended and restated certificate of incorporation (including any certificate of designations relating to any class or series of preferred stock) or our amended and restated bylaws;

(iii) any action asserting a claim against us, any director or our officers or employees arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation (including any certificate of designations relating to any class or series of preferred stock) or our bylaws;

or (iv) any action asserting a claim against us, any director or our officers or employees that is governed by the internal affairs doctrine.

Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and to have consented to the provisions of our amended and restated bylaws described above.

Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and to have consented to the provisions of our bylaws described above.

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or stockholders which may discourage lawsuits with respect to such claims.

Alternatively, if a court were to find the choice of forum provision that is contained in our amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations.

Alternatively, if a court were to find the choice of forum provision that is contained in our bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations.

Unresolved Staff Comments

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors