What changed in this filing

/stocks — the workspaceLOADING

Item 5. Market for Registrant’s Common Equity

2022-03-07 compared with 2021-03-15 · 322 added, 401 removed, 435 unchanged (62% of the section changed)

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Price range of our common stock

Upon the consummation of the transactions contemplated by the Merger Agreement, we began trading on the New York Stock Exchange under the ticker “CTRA” on November 9, 2018.

Following the effectiveness of our name change on February 1, 2021, our ticker symbol on the New York Stock Exchange changed from “CTRA” to “AMR” effective on February 4, 2021.

The following table sets forth, for the periods indicated, the high and low sales prices per share of our common stock reported on the New York Stock Exchange.

2020 High Low

First Quarter $9.15 $1.93

Second Quarter $6.57 $2.25

Third Quarter $10.26 $3.02

Fourth Quarter $14.32 $6.37

2019 High Low

First Quarter $66.00 $54.21

Second Quarter $61.87 $49.62

Third Quarter $52.71 $25.37

Fourth Quarter $28.12 $5.70

As of December 31, 2021, there were 115 registered holders of record of our common stock.

7 unchanged sentences

Repurchase of Common Stock

The following table summarizes information about shares of common stock that were repurchased during the fourth quarter of 2020.

Purchased (1)

Average Price

Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Share Repurchase Programs (2)

Approximate Dollar

Value of Shares

that May Yet Be

Purchased Under

the Programs (2),(3)

October 1, 2020 through October 31, 2020

— $ — — $ 67,552

November 1, 2020 through November 30, 2020

— $ — — $ 67,552

December 1, 2020 through December 31, 2020

3,138 $ 12.15 — $ 67,552

3,138 — $ 67,552

(1) We are authorized to repurchase common shares from employees (upon the election by the employee) to satisfy the employees’ statutory tax withholdings upon the vesting of stock grants.

Shares that are repurchased to satisfy the employees’ statutory tax withholdings are recorded in treasury stock at cost.

(2) Refer to Note 13 for information on our capital return program.

As of October 1, 2019, we suspended the Company Repurchase Plan.

(3) We cannot estimate the number of shares that will be repurchased because decisions to purchase are subject to market and business conditions, levels of available liquidity, our cash needs, restrictions under agreements or obligations, legal or

regulatory requirements or restrictions, and other relevant factors.

This amount does not include $16 thousand of stock repurchase related fees.

There were no repurchases related to warrants during the current quarter.

Refer to Note 2 for information on warrants.

Selected Financial Data

Not applicable.

Refer to Note 25 for subsequent event disclosures related to our share repurchase program.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

2 unchanged sentences

COVID-19 Pandemic

In the first quarter of 2020, the COVID-19 virus was declared a pandemic by the World Health Organization.

The COVID-19 pandemic has had negative impacts on our business, results of operations, financial condition and cash flows.

A continued period of reduced demand for our products could have additional significant adverse consequences for us.

The full extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on certain developments, including the duration and spread of the outbreak, its impact on our customers and suppliers and the range of governmental and community reactions to the pandemic, which are still uncertain and cannot be fully predicted at this time.

Refer to “Item 1.

Business—Human Capital Resources—Employee Health and Welfare” for further COVID-19 related impacts.

The full extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on certain developments, including the continued duration and spread of the outbreak, its impact on our customers and suppliers and the range of governmental and community reactions to the pandemic, which are still uncertain and still cannot be fully predicted.

Our current view of the impacts of COVID-19 to our customers and suppliers is discussed below in the Market Overview section.

Additionally, refer to Note 1 for further discussion of the COVID-19 pandemic impacts to our business and Note 8 for discussion of certain strategic actions announced during the second quarter of 2020 with respect to two of our thermal coal mining complexes in an effort to strengthen our financial performance.

All of our coal mining operations have been classified as essential in the states in which we operate.

We have not experienced significant supply chain disruptions due to the COVID-19 pandemic.

We continue to monitor developments closely.

All of our coal mining operations have been classified as essential in the states in which we operate enabling them to continue operations throughout the COVID-19 pandemic.

Health and safety are core values of our company and are the foundation for how we manage every aspect of our business and we have therefore implemented policies, procedures and prevention measures to protect our employees during the COVID-19 pandemic.

These policies, procedures and prevention measures include, but are not limited to, employee communications on COVID-19 monitoring and precautionary measures, enhanced cleaning and sterilization practices, limiting contractor access to our properties, limiting business travel, implementing social distancing measures by staggering shift times, limiting in-person meetings and meeting sizes, and remote work arrangements.

We will continue to evaluate these policies, procedures and precautionary measures for further enhancements as necessary.

We have not experienced significant supply chain disruptions due the COVID-19 pandemic.

We will continue to monitor these developments closely.

These include, but are not limited to, employee communications on COVID-19 monitoring and precautionary measures, enhanced cleaning and sterilization practices, and remote work arrangements.

We will continue to evaluate these policies, procedures, and precautionary measures in light of further developments as necessary or appropriate.

Market Overview

After a challenging COVID-19-afflicted 2020, the Australian metallurgical coal market, despite the recent pullback, has shown meaningful improvement in 2021, with the Australian premium hard coking coal index increasing 22% to $125 per metric ton in February since the end of 2020 and up nearly 30% since the lows of mid-November.

The Atlantic High-Vol A indices have also performed well after reaching a low of $105 in mid-August.

The current February High-Vol A index of $153 per metric ton represents a 46% improvement over that period.

Global manufacturing and industrial production are continuing to show growth in all regions with the manufacturing Purchasing Managers’ Indices (“PMI”) above 50.0 in the U.S., Europe, Brazil, India, and China, which is showing the most moderate growth among the major producers at 50.9 in January.

According to the World Steel Association (“WSA”), December 2020 crude steel production increased compared to the same prior year period in most producing regions.

The overall global growth of 5.8% was driven mainly by China and Europe, which grew 7.7% and 10.2% in December, respectively.

For the full year 2020, the global crude steel production declined less than 1%, led by declines in North America and Europe.

South America, driven by Brazil, exhibited the strongest growth of any

major region, growing 16.3% in December.

Turkey posted one of the most impressive growth rates in December and for the full year 2020, with crude steel production growing 17.7% and 6.0%, respectively.

We concluded our 2021 domestic metallurgical contracts during the fourth quarter.

In total, we expect to sell approximately 14 million tons from our Met reportable segment in 2021.

Coking coal prices have risen from their recent multi-year lows.

Trade tensions between Australia and China forced Australian coal producers to sell at weaker prices and encouraged them to divert and re-sell cargoes away from China into other markets.

These actions have opened the door for some North American coking coal producers to ship coal to China at higher netbacks than could be achieved in Atlantic Basin markets.

In addition, we see demand improving in other Atlantic Basin and global markets.

At this time, we are also seeing increasing spot interest from both domestic and seaborne customers and prospective customers which has resulted in an increase in shipments.

In connection with the company’s strategic focus on optimizing metallurgical coal production, we continue striving to match our available products and production with customer demand.

On the thermal side, as of the end of December, natural gas prices had not achieved the previously forecasted levels.

Since that time, severe weather has resulted in high consumer electricity demand and lower production, causing stress to the energy system in parts of the U.S.

Natural gas inventories are poised to drop to the five-year average for the first time since the end of 2019.

Central Appalachian thermal coal burns for our customers have not yet been significantly impacted by the fluctuations in natural gas prices, but we have seen increased demand associated with the recent severe weather.

Internationally, Europe and Asia have also experienced severe weather, supply disruptions, reductions in coal capacity, and high carbon prices limiting opportunities for US coal.

Increased ESG pressures are forcing expedited closure of coal units, domestically and abroad.

US thermal coal producers are continuing to reduce investment in thermal coal.

At our thermal coal operations, we have significantly reduced inventories at all locations, and are matching our sales and production to make for an orderly transition to lower thermal coal production.

As Alpha enters 2021, we continue to evaluate market conditions for our metallurgical coal products amid residual uncertainty attributable to the continued concern around the COVID-19 pandemic.

The impact the pandemic may have on demand continues to make customer demand forecasts challenging.

Depending on the extent and timing of global and national economic stabilization and recovery, our ability to estimate future customer coal demand remains limited.

Metallurgical coal markets exhibited volatility and strength in the final months of 2021, with the U.S.

East Coast indices rising to new calendar-year highs in the fourth quarter.

Each of the U.S.

East Coast indices finished the year more than double where it started at the beginning of January 2021, and the Australian Premium Low Volatile index more than tripled over the same twelve-month period.

Looking specifically at movement within the fourth quarter, the U.S.

East Coast High Volatile A index was at $377 per metric ton on October 1, 2021 and ended the quarter at $340 per metric ton on December 31, 2021.

East Coast Low

Volatile index began at $412 per metric ton at the start of the quarter and moved to $320 per metric ton at quarter close.

The Australian Premium Low Volatile index also ended lower, going from $390 per metric ton on October 1, 2021 down to $357 per metric ton on December 31, 2021.

Supply conditions remain tight in the metallurgical coal markets, with demand in Alpha’s key markets continuing to be strong.

Across the globe, economic indicators reflect an inconsistent growth landscape as the uneven recovery continues from COVID-19 pandemic-related labor and supply-chain challenges.

While still representing positive, yet slowing, economic growth, the world manufacturing Purchasing Managers’ Index (“PMI”) of 53.2 in January 2022 represented a 15-month low for the metric.

In December and January, the United States PMI indices of 57.7 and 55.5, respectively, continued to come off their mid-year highs.

Brazil and India, two of Alpha’s important foreign markets, also posted lower January PMI levels as compared to their December indices.

India’s PMI slipped from 55.5 in December to 54.0 in January, and Brazil dipped further into economic contraction from 49.8 in December to 47.8 in January.

China’s PMI also slid from 50.9 to 49.1.

Alpha’s key market of Europe was the exception to the general pattern of slowing growth for the time period, with its PMI indices improving modestly from 58.0 in December to 58.7 in January.

The World Steel Association’s (“WSA”) global crude steel production was 158.7 million metric tons in December 2021, a 3.0% decrease as compared to the year-ago period of December 2020.

Steel production in the European Union held roughly flat year over year, with December 2021 levels just 1.4% lower than in December 2020.

North American crude steel production of 9.7 million metric tons for the month represented a 7.5% increase over the year-ago period.

China’s production level of 86.2 million metric tons was down 6.8% as compared to December of 2020.

The capacity utilization rate for U.S.

steel mills, which is measured by the American Iron and Steel Institute, was 79.8% for the week ending February 12, 2022.

While this level is lower than the recent high in the mid-80s, it still represents sustained steel demand in North America.

In the thermal coal market, strong demand and tight supply conditions remain, alongside volatility in the indices.

Alpha’s last remaining thermal operation, the Slabcamp mine, is on schedule to mine out and cease operation in summer of 2022.

Alpha continues to ship coal in accordance with existing contracts.

We are monitoring developments in Ukraine as well as the related export controls and financial and economic sanctions imposed on certain industry sectors and parties in Russia by the U.S., the U.K., the European Union and others.

Although we do not presently foresee direct material adverse effects upon our business, financial condition or results of operations as a result of developments in Ukraine and the consequent controls and sanctions, these factors may affect companies in many sectors and could lead to increased market volatility and uncertainty, which could affect us in turn.

Business Overview

We are a Tennessee-based mining company with operations across Virginia and West Virginia.

With customers across the globe, high-quality reserves and significant port capacity, we are a leading U.S.

supplier of metallurgical products for the steel industry.

With customers across the globe, high-quality reserves and significant port capacity, we reliably supply metallurgical coal products to the steel industry.

We operate high-quality, cost-competitive coal mines across the CAPP coal basin.

As of December 31, 2020, our operations consisted of twenty-three active mines and eight coal preparation and load-out facilities, with approximately 3,250 employees.

We produce, process, and sell met coal and thermal coal from operations located in Virginia and West Virginia.

As of December 31, 2021, our operations consisted of twenty active mines and eight coal preparation and load-out facilities, with approximately 3,500 employees.

We produce, process, and sell met coal and thermal coal.

We also sell coal produced by others, some of which is processed and/or blended with coal produced from our mines prior to resale, with the remainder purchased for resale.

As of December 31, 2020, we had 623.5 million tons of reserves, including 445.0 million tons of proven reserves and 178.5 million tons of probable reserves.

As of December 31, 2021, we had 351.1 million tons of reserves, 335.8 million tons of proven and probable metallurgical reserves, and 15.3 million tons of proven and probable thermal reserves.

Additionally, we had approximately 381.7 million tons of in situ bituminous coal resources.

We began operations on July 26, 2016, with mining operations in NAPP, CAPP, and the PRB.

Through the Acquisition, we acquired a significant reserve base.

We also acquired Alpha Natural Resources Inc.’s 40.6% interest in the DTA coal export terminal in eastern Virginia, and on March 31, 2017, we acquired a portion of another partner’s ownership stake and increased our interest to 65.0%.

We also acquired Alpha Natural Resources Inc.’s 40.6% interest in the DTA coal export terminal in Newport News, Virginia, and on March 31, 2017, we acquired a portion of another partner’s ownership stake and increased our interest to 65.0%.

We merged with Alpha Natural Resources Holdings, Inc.

1 unchanged sentence

on November 9, 2018.

On December 8, 2017, the Company closed a transaction to sell the Eagle Butte and Belle Ayr mines located in the PRB, Wyoming, along with related coal reserves, equipment, infrastructure and other real properties.

Refer to Note 3 for information related to Blackjewel’s subsequent bankruptcy filing and the related ESM Transaction.

On December 8, 2017, we closed a transaction with Blackjewel L.L.C.

(“Blackjewel”) to sell our Eagle Butte and Belle Ayr mines (the “Western Mines”) located in the PRB, Wyoming, along with related coal reserves, equipment, infrastructure and other real properties (our former PRB operations).

On October 4, 2019, we closed on the ESM Transaction in connection with Blackjewel’s subsequent bankruptcy filing.

On May 29, 2020, certain of our subsidiaries (Contura Coal West, LLC and Contura Wyoming Land, LLC), one of which held the mining permits for the Western Mines, were merged with certain subsidiaries of

ESM to become wholly-owned subsidiaries of ESM and to complete the permit transfer process in connection with the ESM Transaction.

On December 10, 2020, we closed on a transaction with Iron Senergy Holdings, LLC, to sell our thermal coal mining operations located in Pennsylvania consisting primarily of our Cumberland mining complex and related property (our former NAPP operations).

This transaction accelerated our strategic exit from thermal coal production to shift our focus toward met coal production.

The former PRB and NAPP operations results of operations and financial position are reported as discontinued operations in the Consolidated Financial Statements.

The historical information in the accompanying Notes to the Consolidated Financial Statements has been restated to reflect the effects of these former operations being reported as discontinued operations in the Consolidated Financial Statements.

The disposition of our former NAPP operations accelerated our strategic exit from thermal coal production to shift our focus toward met coal production.

The former NAPP operations’ results of operations and financial position are reported as discontinued operations in the Consolidated Financial Statements.

Refer to Note 3 for further information on discontinued operations.

At our thermal coal operations, we have significantly reduced inventories at all locations and are matching our sales and production to make for an orderly transition to lower thermal coal production.

For the years ended December 31, 2021 and 2020, sales of met coal were 13.9 million tons and 12.3 million tons, respectively, and accounted for approximately 83% and 80%, respectively, of our coal sales volume.

Sales of thermal coal were

3.2 million tons and 4.5 million tons, respectively, and accounted for approximately 20% and 26%, respectively, of our coal sales volume.

Our sales of met coal were made primarily to steel companies in the northeastern and midwestern regions of the United States and in several countries in Europe, Asia and the Americas.

Sales of thermal coal were 2.9 million tons and 3.2 million tons, respectively, and accounted for approximately 17% and 20%, respectively, of our coal sales volume.

Our sales of met coal were made primarily to steel companies in the northeastern and midwestern regions of the United States and in several countries in Asia, Europe, and the Americas.

Our sales of thermal coal were made primarily to large utilities and industrial customers throughout the United States.

2 unchanged sentences

We also record freight and handling fulfillment revenue within coal revenues for freight and handling services provided in delivering coal to certain customers, which are a component of the contractual selling price.

As of December 31, 2020, we have two reportable segments:

Met and CAPP - Thermal.

To conform to the current period reportable segments presentation, the prior periods have been restated to reflect the change in reportable segments.

Refer to Note 25 for additional disclosures on reportable segments including export coal revenue information.

As of December 31, 2021, we have one reportable segment:

To conform to the current period reportable segment presentation, the prior periods have been restated to reflect the change in reportable segments.

Our Met segment operations consist of high-quality met coal mines, including Deep Mine 41, Road Fork 52, Black Eagle, and Lynn Branch.

The coal produced by our Met segment operations is predominantly met coal with some amounts of thermal coal being produced as a byproduct of mining.

In addition to the one reportable segment, our All Other category includes general corporate overhead and corporate assets and liabilities, our former CAPP - Thermal operations consisting of one active mine and one preparation plant in West Virginia, and the elimination of certain intercompany activity, as well as expenses associated with certain idled/closed mines.

Refer to Notes 23 and 24 for additional disclosures on our reportable segment, geographic areas, and export coal revenue information.

Other Business Development s

We announced on March 7, 2022 that our board of directors authorized a share repurchase program allowing for the expenditure of up to $150.0 million for the repurchase of our common stock.

Repurchases will be made from time to time in accordance with applicable securities laws in the open market, and may include repurchases pursuant to Rule 10b5-1 trading plans.

The share repurchase program is effective immediately and has no expiration date, and repurchases may begin as soon as March 9, 2022.

The repurchase program does not obligate us to acquire any particular amount of common stock or to acquire shares on any particular timetable, and the program may be suspended at any time at our discretion.

The timing and amount of share repurchases will be determined by our management based on our evaluation of market conditions, the trading price of the stock, applicable legal requirements, compliance with the provisions of our debt agreements, and other factors.

Effective February 1, 2021, we changed our corporate name from Contura Energy, Inc.

7 unchanged sentences

We manage our commodity price risk for coal sales through the use of coal supply agreements.

As of March 11, 2021, we have sales commitments as follows:

As of February 25, 2022, we had sales commitments for 2022 as follows:

Tons % Priced Average Realized Price per Ton

Met 14.0 million 56 % $80.68

CAPP - Thermal 1.5 million 100 % $57.57

Met - Domestic $189.31

Met - Export $236.99

Met Total 14.5 million 39 % $204.75

Thermal 1.0 million 100 % $52.46

Met Segment 15.5 million 44 % $180.36

All Other 0.7 million 82 % $57.24

Due to the significant uncertainty in the worldwide coal markets due to COVID-19, there is risk of reduction in future shipments due to deferrals and utilization of force majeure clauses in customer contracts.

19 unchanged sentences

Market pricing may vary according to region and lead to different discounts or premiums to the most directly comparable benchmark price for such coal product.

Our results of operations are dependent upon our ability to improve productivity and control costs.

Our primary expenses are for operating supply costs, repair and maintenance expenditures, cost of purchased coal, royalties, current wages and benefits, post-employment benefits, freight and handling costs and taxes incurred in selling our coal.

Our results of operations are dependent upon our ability to maximize productivity and control costs.

Our primary expenses are for operating supply costs, repair and maintenance expenditures, cost of purchased coal, royalties, wages and benefits, freight and handling costs and taxes incurred in selling our coal.

Principal goods and services we use in our operations include maintenance and repair parts and services, electricity, fuel, roof control and support items, explosives, tires, conveyance structure, ventilation supplies and lubricants.

4 unchanged sentences

We seek suppliers who identify and concentrate on implementing continuous improvement opportunities within their area of expertise.

To the extent upward pressure on costs exceeds our ability to realize sales increases, or if we experience unanticipated operating or transportation difficulties, our operating margins would be negatively impacted.

To the extent upward pressure on costs

exceeds our ability to realize sales increases, or if we experience unanticipated operating or transportation difficulties, our operating margins would be negatively impacted.

We may also experience difficult geologic conditions, delays in obtaining permits, labor shortages, unforeseen equipment problems, and unexpected shortages of critical materials such as tires, fuel and explosives that may result in adverse cost increases and limit our ability to produce at forecasted levels.

10 unchanged sentences

Coal revenues.

Coal revenues decreased $582.8 million, or 29.2%, for the year ended December 31, 2020 compared to the prior year period.

The decrease was primarily due to lower total overall coal sales volume and lower coal sales realization within our Met operations as a result of a weaker pricing environment impacted by the COVID-19 pandemic.

Refer to the Coal Operations section below for further detail on coal revenues for the year ended December 31, 2020 compared to the prior year period.

Coal revenues increased $839.5 million, or 59.4%, for the year ended December 31, 2021 compared to the prior year period.

The increase was primarily due to an increase in tons sold and higher coal sales realization within our Met segment operations as a result of an improved pricing environment during the second half of 2021.

Increasing coal demand, resulting from improved economic activity, coupled with a limited supply response contributed to a rise in coal prices.

Refer to the “Non-GAAP Coal revenues” section below for further detail on coal revenues for the year ended December 31, 2021 compared to the prior year period.

Cost and Expenses

6 unchanged sentences

Amortization of acquired intangibles, net 13,244 9,214 4,030 43.7 %

Selling, general and administrative expenses (exclusive of depreciation, depletion and amortization shown separately above) 57,356 78,953 (21,597) (27.4) %

Merger-related costs — 1,090 (1,090) (100.0) %

Asset impairment and restructuring (561) 83,878 (84,439) (100.7) %

Goodwill impairment — 124,353 (124,353) (100.0) %

Total other operating income:

Selling, general and administrative expenses (exclusive of depreciation, depletion and amortization shown separately above) 63,901 57,356 6,545 11.4 %

Total other operating (income) loss:

Mark-to-market adjustment for acquisition-related obligations 19,525 (8,750) 28,275 323.1 %

2 unchanged sentences

Cost of coal sales.

Cost of coal sales decreased $386.8 million, or 23.2%, for the year ended December 31, 2020 compared to the prior year period.

The decrease was primarily driven by a decrease in tons sold in the current period relative to the prior year period and decreased costs of purchased coal, salaries and wages expense, and supplies and maintenance expense as we continue to improve our cost management to achieve operational efficiencies, partially offset by inventory change during the current period.

Cost of coal sales increased $398.7 million, or 31.1%, for the year ended December 31, 2021 compared to the prior year period.

The increase was primarily driven by an increase in tons sold in the current period relative to the prior

year period and increased supplies and maintenance expense, royalties and taxes, and salaries and wages expense, partially offset by inventory change during the current period.

Depreciation, depletion and amortization.

Depreciation, depletion and amortization decreased $29.8 million, or 21.3%, for the year ended December 31, 2021 compared to the prior year period.

The decrease in depreciation, depletion and amortization primarily related to asset impairments and revisions to asset retirement obligations during the current period.

Accretion on asset retirement obligations.

Accretion on asset retirement obligations increased $2.6 million, or 11.1%, for the year ended December 31, 2020 compared to the prior year period.

This increase was primarily driven by an increase in our credit-adjusted risk-free rate used to discount the obligations relative to the prior period.

The decrease in depreciation, depletion and amortization was primarily a result of asset disposals and asset impairments throughout the prior year.

Amortization of acquired intangibles, net.

1 unchanged sentence

The increase was primarily driven by the lower current period amortization related to below-market acquired coal supply agreements.

Selling, general and administrative.

Selling, general and administrative expenses decreased $21.6 million, or 27.4%, for the year ended December 31, 2020 compared to the prior year period.

This decrease in expense was primarily related to decreases of $6.5 million in severance expense, $5.8 million in wages and benefits expense, $4.8 million in stock compensation expense, and $4.4 million in professional fees, partially offset by an increase of $2.8 million in incentive pay.

Asset impairment and restructuring.

Asset impairment and restructuring increased $17.6 million, or 26.5%, for the year ended December 31, 2020 compared to the prior year period.

Asset impairment and restructuring for the year ended December 31, 2020 includes long-lived asset impairments of $81.0 million related to asset groups recorded within the Met and CAPP - Thermal reporting segments and restructuring expense of $2.9 million recorded in CAPP - Thermal and All Other reporting segments.

Asset impairment and restructuring for the year ended December 31, 2019 includes a long-lived asset impairment of $60.2 million related to asset groups recorded within the Met and CAPP - Thermal reporting segments and an asset impairment of $6.2 million primarily related to the write-off of prepaid purchased coal as a result of Blackjewel’s Chapter 11 bankruptcy filing on July 1, 2019.

Asset impairment and restructuring decreased $84.4 million, or 100.7%, for the year ended December 31, 2021 compared to the prior year period.

For the year ended December 31, 2021, asset impairment and restructuring included long-lived asset impairment of $60 thousand and restructuring expense of ($621) thousand.

For the year ended December 31, 2020, asset impairment and restructuring included long-lived asset impairment of $81.0 million and restructuring expense of $2.9 million.

Refer to Note 8 for further information.

Selling, general and administrative.

Selling, general and administrative expenses increased $6.5 million, or 11.4%, for the year ended December 31, 2021 compared to the prior year period.

This increase in expense was primarily related to increases of $4.3 million in incentive pay, $2.1 million in stock compensation expense, and $1.2 million in wages and benefits expense, partially offset by decreases of $1.6 million in professional fees and $0.7 million in severance expense.

Mark-to-market adjustment for acquisition-related obligations.

The mark-to-market adjustment for acquisition-related obligations resulted in an increase to income of $5.2 million for the year ended December 31, 2020 compared to the adjustment in the prior year period.

This increase was related to changes in underlying fair value assumptions during the current period.

The mark-to-market adjustment for acquisition-related obligations resulted in an increase in expense of $28.3 million for the year ended December 31, 2021 compared to the prior year period.

This decrease was related to the $19.5 million Contingent Revenue Obligation mark-to-market adjustment recorded during the year ended December 31, 2021 due to changes in underlying fair value assumptions during the current period.

Refer to Note 17 for Contingent Revenue Obligation fair value input assumptions.

Other income .

Other income increased $8.7 million, or 393.6%, for the year ended December 31, 2021 compared to the prior year period, primarily due to a gain on sale of assets, net, of $9.9 million and a gain on settlement of acquisition-related obligations of $1.1 million in the current period.

Other (Expense) Income

5 unchanged sentences

Interest income 334 7,027 (6,693) (95.2) %

Loss on modification and extinguishment of debt — (26,459) 26,459 100.0 %

Equity loss in affiliates (4,149) (3,473) (676) (19.5) %

Miscellaneous loss, net (1,972) (10,195) 8,223 80.7 %

Miscellaneous income (loss), net 6,867 (1,972) 8,839 448.2 %

Total other expense, net $ (66,602) $ (72,946) $ 6,344 8.7 %

Interest expense.

Interest expense increased $7.0 million, or 10.4%, for the year ended December 31, 2020 compared to the prior year period, primarily due to an increase in debt outstanding and higher interest rates related to the debt facilities in place during the current period.

Additionally, there were higher letters of credit fees due to higher letters of credit outstanding under the Amended and Restated Asset-Based Revolving Credit Agreement during the current period.

Refer to Note 15 for additional information.

Loss on modification and extinguishment of debt.

During the year ended December 31, 2019, we recorded a loss on modification of debt of $0.3 million, primarily related to modification fees paid under the refinance, and a loss on extinguishment of debt of $26.2 million, primarily related to the write-off of outstanding debt discounts and unamortized debt issuance costs under the Amended and Restated Credit Agreement dated November 9, 2018.

Interest expense decreased $4.9 million, or 6.5%, for the year ended December 31, 2021 compared to the prior year period, primarily due to a decrease in debt outstanding.

Refer to Note 14 for additional information.

Miscellaneous loss, net.

Miscellaneous loss, net decreased $8.2 million, or 80.7%, for the year ended December 31, 2020 compared to the prior year period, primarily due to the decrease in pension obligation net periodic benefit costs due to lower settlement charges and interest costs during the current period.

Interest income.

Interest income decreased $6.7 million, or 95.2%, for the year ended December 31, 2021 compared to the prior year period.

The decrease was primarily due to the interest income recorded during the three months ended June 30, 2020 associated with the federal income tax interest receivable related to the net operating loss carryback claim.

Miscellaneous income (loss), net.

Miscellaneous income (loss), net increased $8.8 million, or 448.2%, for the year ended December 31, 2021 compared to the prior year period.

The increase was primarily due to the increase in the net periodic benefit credit for pension obligations.

Refer to Note 19 for additional information.

Income Tax Benefit

The following table summarizes information about our income tax benefit during the years ended December 31, 2020 and 2019:

Income Tax (Expense) Benefit

The following table summarizes information about our income tax (expense) benefit during the years ended December 31, 2021 and 2020:

Year Ended December 31, Increase (Decrease)

(In thousands) 2021 2020 $ %

Income tax benefit $ 2,164 $ 53,287 $ (51,123) (95.9) %

Income tax (expense) benefit $ (3,609) $ 2,164 $ (5,773) (266.8) %

Income taxes.

Income tax expense of $3.6 million was recorded for the year ended December 31, 2021 on income from continuing operations before income taxes of $290.5 million.

The effective tax rate differs from the federal statutory rate of 21% primarily due to the decrease in the valuation allowance.

Income tax benefit of $2.2 million was recorded for the year ended December 31, 2020 on a loss from continuing operations before income taxes of $243.6 million.

The effective tax rate differs from the federal statutory rate of 21% primarily due to the increase in the valuation allowance, partially offset by the permanent impact of percentage depletion deductions, the impact of state income taxes, net of federal tax impact, and a refund of previously sequestered AMT Credits.

Income tax benefit of $53.3 million was recorded for the year ended December 31, 2019 on a loss from continuing operations before income taxes of $272.9 million.

The effective tax rate differs from the federal statutory rate of 21% primarily due to the impact of state income taxes, net of federal impact, the net operating loss carryback benefit, and the permanent impact of the percentage depletion deduction, mostly offset by the impact of the non-deductible goodwill impairment and the increase in the valuation allowance.

Refer to Note 18 for additional information.

Coal Operations

Our Met operations consist of high-quality met coal mines, including Deep Mine 41, Road Fork 52, Black Eagle, and Lynn Branch.

The coal produced by Met operations is predominantly met coal with some amounts of thermal coal being produced as a byproduct of mining.

Our CAPP - Thermal operations consist of one underground thermal coal mine.

The coal produced by CAPP - Thermal operations is predominantly thermal coal with some met coal byproduct.

Our All Other category is not included in our Coal Operations results of operations as it includes general corporate overhead and corporate assets and liabilities and the elimination of certain intercompany activity.

Refer to Item 1.

Business and Notes 24 and 25 for additional financial information about reportable segments and geographic areas.

Non-GAAP Financial Measures

1 unchanged sentence

GAAP” or “GAAP”).

Specifically, we make use of the non-GAAP financial measures “Adjusted EBITDA,” “non-GAAP coal revenues,” “non-GAAP cost of coal sales,” and “Adjusted cost of produced coal sold.” We use Adjusted EBITDA to measure the operating performance of our segments and allocate resources to the segments.

Adjusted EBITDA does not purport to be an alternative to net income (loss) as a measure of operating performance.

Specifically, we make use of the non-GAAP financial measures “Adjusted EBITDA,” “non-GAAP coal revenues,” “non-GAAP cost of coal sales,” “non-GAAP coal margin,” and “Adjusted cost of produced coal sold.” We use Adjusted EBITDA to measure the operating performance of our segments and allocate resources to the segments.

Adjusted EBITDA does not purport to be an alternative to net income (loss) as a measure of operating performance or any other measure of operating results or liquidity presented in accordance with GAAP.

We use non-GAAP coal revenues to present coal revenues generated, excluding freight and handling fulfillment revenues.

Non-GAAP coal sales realization per ton for our operations is calculated as non-GAAP coal revenues divided by tons sold.

We use non-GAAP cost of coal sales to adjust cost of coal sales to remove freight and handling costs, depreciation, depletion and amortization - production (excluding the depreciation, depletion and amortization related to selling, general and administrative functions), accretion on asset retirement obligations, amortization of acquired intangibles, net, idled and closed mine costs and coal inventory acquisition accounting impacts.

Non-GAAP cost of coal sales per ton for our operations is calculated as non-GAAP cost of coal sales divided by tons sold.

9 unchanged sentences

Year Ended December 31, 2021

(In thousands, except for per ton data) Met CAPP - Thermal All Other Consolidated

(In thousands, except for per ton data) Met All Other Consolidated

Coal revenues $ 2,173,647 $ 78,950 $ 2,252,597

20 unchanged sentences

Year Ended December 31, 2021

(In thousands, except for per ton data) Met CAPP - Thermal All Other Consolidated

(In thousands, except for per ton data) Met All Other Consolidated

Coal revenues $ 2,173,647 $ 78,950 $ 2,252,597

14 unchanged sentences

Year Ended December 31, 2020

(In thousands, except for per ton data) Met CAPP - Thermal All Other Consolidated

(In thousands, except for per ton data) Met All Other Consolidated

Coal revenues $ 1,263,855 $ 149,269 $ 1,413,124

15 unchanged sentences

Idled and closed mine costs (16,640) (12,240) (28,880)

Cost impact of coal inventory fair value adjustment (2)

(4,751) (3,458) — (8,209)

Non-GAAP Cost of coal sales $ 917,407 $ 115,275 $ 1,032,682

2 unchanged sentences

(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.

(2) The cost impact of the coal inventory fair value adjustment as a result of the Merger was completed during the three months ended June 30, 2019.

Year Ended December 31, 2020

(In thousands, except for per ton data) Met CAPP - Thermal All Other Consolidated

(In thousands, except for per ton data) Met All Other Consolidated

Coal revenues $ 1,263,855 $ 149,269 $ 1,413,124

9 unchanged sentences

Idled and closed mine costs 16,640 12,240 28,880

Cost impact of coal inventory fair value adjustment (2)

4,751 3,458 — 8,209

Non-GAAP Coal margin $ 139,939 $ 21,054 $ 160,993

2 unchanged sentences

(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.

(2) The cost impact of the coal inventory fair value adjustment as a result of the Merger was completed during the three months ended June 30, 2019.

Year Ended December 31, Increase (Decrease)

(In thousands, except for per ton data) 2020 2019 $ %

Met operations 13,070 12,926 144 1.1 %

CAPP - Thermal operations 2,437 4,218 (1,781) (42.2) %

(In thousands, except for per ton data) 2021 2020 $ or Tons %

Met segment operations:

Tons sold 15,569 13,070 2,499 19.1 %

Non-GAAP Coal revenues $ 1,793,190 $ 1,057,346 $ 735,844 69.6 %

Met operations $ 1,057,346 $ 1,467,814 $ (410,468) (28.0) %

CAPP - Thermal operations $ 135,940 $ 251,257 $ (115,317) (45.9) %

Non-GAAP Coal sales realization per ton $ 115.18 $ 80.90 $ 34.28 42.4 %

Met operations $ 80.90 $ 113.56 $ (32.66) (28.8) %

CAPP - Thermal operations $ 55.78 $ 59.57 $ (3.79) (6.4) %

Average $ 76.95 $ 100.27 $ (23.32) (23.3) %

Non-GAAP segment coal revenues.

Met operations non-GAAP coal revenues decreased $410.5 million, or 28.0%, for the year ended December 31, 2020 compared to the prior year period.

The decrease in Met operations non-GAAP coal revenues was primarily due to lower non-GAAP coal sales realization of $32.66 per ton as a result of a weaker pricing environment resulting from the impacts of the COVID-19 pandemic.

CAPP - Thermal operations non-GAAP coal revenues decreased $115.3 million, or 45.9%, for the year ended December 31, 2020 compared to the prior year period.

The decrease in CAPP - Thermal operations non-GAAP coal revenues was due to lower coal sales volumes of 1.8 million tons and lower non-GAAP coal sales realization of $3.79 per ton as a result of a weaker pricing environment resulting from the impacts of the COVID-19 pandemic.

All Other category:

Tons sold 1,270 2,443 (1,173) (48.0) %

Non-GAAP Coal revenues $ 78,430 $ 136,329 $ (57,899) (42.5) %

Non-GAAP Coal sales realization per ton $ 61.76 $ 55.80 $ 5.96 10.7 %

Non-GAAP Coal revenues.

Met segment operations non-GAAP coal revenues increased $735.8 million, or 69.6%, for the year ended December 31, 2021 compared to the prior year period.

The increase was primarily due to an increase in tons sold and higher average non-GAAP coal sales realization of 42.4% per ton resulting from an improved pricing environment compared to the prior year period.

All Other category non-GAAP coal revenues decreased $57.9 million, or 42.5%, for the year ended December 31, 2021 compared to the prior year period primarily due to a decrease in thermal tons sold as we continued our strategic shift to focus on met coal production.

Year Ended December 31, Increase (Decrease)

(In thousands, except for per ton data) 2021 2020 $ %

Met segment operations:

Non-GAAP Cost of coal sales $ 1,209,842 $ 917,407 $ 292,435 31.9 %

Met operations $ 917,407 $ 1,134,120 $ (216,713) (19.1) %

CAPP - Thermal operations $ 115,031 $ 234,027 $ (118,996) (50.8) %

Non-GAAP Cost of coal sales per ton $ 77.71 $ 70.19 $ 7.52 10.7 %

Met operations $ 70.19 $ 87.74 $ (17.55) (20.0) %

CAPP - Thermal operations $ 47.20 $ 55.48 $ (8.28) (14.9) %

Non-GAAP Coal margin per ton $ 37.47 $ 10.71 $ 26.76 249.9 %

Met operations $ 10.71 $ 25.82 $ (15.11) (58.5) %

CAPP - Thermal operations $ 8.58 $ 4.08 $ 4.50 110.3 %

All Other category:

Non-GAAP Cost of coal sales $ 60,385 $ 115,275 $ (54,890) (47.6) %

Met operations non-GAAP cost of coal sales decreased $216.7 million, or 19.1%, for the year ended December 31, 2020 compared to the prior year period.

The decrease in Met operations non-GAAP cost of coal sales was primarily driven by decreased costs of purchased coal, salaries and wages expense, supplies and maintenance expense, and royalties and taxes, partially offset by inventory change during the current period.

CAPP - Thermal operations non-GAAP cost of coal sales decreased $119.0 million, or 50.8%, for the year ended December 31, 2020 compared to the prior year period.

The decrease in CAPP - Thermal operations non-GAAP cost of coal sales was primarily due to a decrease in tons sold in the current period relative to the prior year period and decreased supplies and maintenance expense and salaries and wages expense, partially offset by inventory change during the current period.

Non-GAAP Cost of coal sales per ton $ 47.55 $ 47.19 $ 0.36 0.8 %

Non-GAAP Coal margin per ton $ 14.21 $ 8.62 $ 5.59 64.8 %

Non-GAAP cost of coal sales.

Met segment operations non-GAAP cost of coal sales increased $292.4 million, or 31.9%, for the year ended December 31, 2021 compared to the prior year period.

The increase was primarily driven by an increase in tons sold in the current period relative to the prior year period and increased supplies and maintenance expense, royalties and taxes, and salaries and wages expense, partially offset by inventory change during the current period.

All Other category non-GAAP cost of coal sales decreased $54.9 million, or 47.6%, for the year ended December 31, 2021 compared to the prior year period.

The decrease was primarily driven by a decrease in thermal tons sold and decreased supplies and maintenance expense and royalties and taxes, partially offset by increased salaries and wages expense and inventory change during the current period.

Our non-GAAP cost of coal sales includes purchased coal costs.

1 unchanged sentence

Year Ended December 31, 2021

(In thousands, except for per ton data) Met CAPP - Thermal All Other Consolidated

(In thousands, except for per ton data) Met All Other Consolidated

Non-GAAP Cost of coal sales $ 1,209,842 $ 60,385 $ 1,270,227

6 unchanged sentences

Year Ended December 31, 2020

(In thousands, except for per ton data) Met CAPP - Thermal All Other Consolidated

(In thousands, except for per ton data) Met All Other Consolidated

Non-GAAP Cost of coal sales $ 917,407 $ 115,275 $ 1,032,682

5 unchanged sentences

(1) Cost of produced coal sold per ton for our operations is calculated as non-GAAP cost of produced coal sold divided by produced tons sold.

Segment Adjusted EBITDA

Segment Adjusted EBITDA for our reportable segments is a financial measure.

This non-GAAP financial measure is presented as a supplemental measure and is not intended to replace financial performance measures determined in accordance with GAAP.

Adjusted EBITDA

Adjusted EBITDA is a non-GAAP financial measure that is presented as a supplemental measure and is not intended to replace financial performance or liquidity measures determined in accordance with GAAP.

Moreover, this measure is not calculated identically by all companies and therefore may not be comparable to similarly titled measures used by other companies.

Segment Adjusted EBITDA is presented because management believes it is

a useful indicator of the financial performance of our coal operations.

Adjusted EBITDA is presented because management believes it is a useful indicator of the financial performance of our coal operations.

The following tables present a reconciliation of net income (loss) to Adjusted EBITDA for the years ended December 31, 2021 and 2020:

Year Ended December 31, 2021

(In thousands) Met CAPP - Thermal All Other Consolidated

Net loss from continuing operations $ (77,519) $ (52,520) $ (111,431) $ (241,470)

(In thousands) Met All Other Consolidated

Net income (loss) from continuing operations $ 439,859 $ (152,930) $ 286,929

Interest expense 184 69,470 69,654

Interest income (6) (328) (334)

Income tax benefit — — (2,164) (2,164)

Income tax expense — 3,609 3,609

Depreciation, depletion and amortization 99,963 10,084 110,047

1 unchanged sentence

Mark-to-market adjustment - acquisition-related obligations — 19,525 19,525

Gain on settlement of acquisition-related obligations — (1,125) (1,125)

Accretion on asset retirement obligations 13,571 12,949 26,520

Asset impairment and restructuring — (561) (561)

46,317 36,719 842 83,878

Management restructuring costs (2)

501 5 435 941

Loss on partial settlement of benefit obligations 1,607 (328) 1,687 2,966

Amortization of acquired intangibles, net 13,671 (427) 13,244

Adjusted EBITDA $ 567,270 $ (34,447) $ 532,823

(1) Asset impairment and restructuring for the year ended December 31, 2020 includes long-lived asset impairments of $81.0 million related to asset groups recorded within the Met and CAPP - Thermal reporting segments and restructuring expense of $2.9 million recorded in CAPP - Thermal and All Other reporting segments.

Refer to Note 8 for further information.

(2) Management restructuring costs are related to severance expense associated with senior management changes during the three months ended March 31, 2020.

Year Ended December 31, 2020

(In thousands) Met CAPP - Thermal All Other Consolidated

Net income (loss) from continuing operations $ 7,944 $ (97,398) $ (130,164) $ (219,618)

(In thousands) Met All Other Consolidated

Net loss from continuing operations $ (77,519) $ (163,951) $ (241,470)

Interest expense (2,014) 76,542 74,528

2 unchanged sentences

Depreciation, depletion and amortization 124,060 15,825 139,885

Merger-related costs — — 1,090 1,090

Non-cash stock compensation expense 289 4,607 4,896

1 unchanged sentence

Accretion on asset retirement obligations 14,214 12,290 26,504

Loss on modification and extinguishment of debt — — 26,459 26,459

Asset impairment (1)

15,034 50,993 297 66,324

Goodwill impairment (2)

124,353 — — 124,353

Cost impact of coal inventory fair value adjustment (3)

4,751 3,458 — 8,209

Gain on assets acquired in an exchange transaction (4)

(9,083) — — (9,083)

Asset impairment and restructuring 46,317 37,561 83,878

Management restructuring costs (1)

— — 7,720 7,720

Loss on partial settlement of benefit obligations 1,607 1,359 2,966

1 unchanged sentence

Adjusted EBITDA $ 120,281 $ (36,880) $ 83,401

(1) Asset impairment for the year ended December 31, 2019 includes a long-lived asset impairment of $60.2 million related to asset groups recorded within the Met and CAPP - Thermal reporting segments and an asset impairment of $6.2 million primarily related to the write-off of prepaid purchased coal as a result of Blackjewel’s Chapter 11 bankruptcy filing on July 1, 2019.

Refer to Note 8 for further information.

(2) The goodwill impairment testing as of December 31, 2019 resulted in a goodwill impairment of $124.4 million to write down the full carrying value of goodwill.

Refer to Note 2 for further information.

(3) The cost impact of the coal inventory fair value adjustment as a result of the Merger was completed during the three months ended June 30, 2019.

(4) During the year ended December 31, 2019, the Company entered into an exchange transaction which primarily included the release of the PRB overriding royalty interest owed to the Company in exchange for met coal reserves which resulted in a gain of $9.1 million.

(5) Management restructuring costs are related to severance expense associated with senior management changes in the year ended December 31, 2019.

The following table summarizes Adjusted EBITDA for our two reportable segments and All Other category:

(1) Management restructuring costs are related to severance expense associated with senior management changes during the three months ended March 31, 2020.

The following table summarizes Adjusted EBITDA for our Met segment operations and All Other category:

Year Ended December 31, Increase (Decrease)

2 unchanged sentences

Met operations $ 567,270 $ 120,281 $ 446,989 371.6 %

CAPP - Thermal operations 9,853 11,981 (2,128) (17.8) %

All Other (34,447) (36,880) 2,433 6.6 %

Total $ 532,823 $ 83,401 $ 449,422 538.9 %

Met operations.

Adjusted EBITDA decreased $195.7 million, or 61.9%, for the year ended December 31, 2020 compared to the prior year period.

The decrease in Adjusted EBITDA was primarily driven by decreased non-GAAP coal sales realization per ton of $32.66, or 28.8%, due to a weaker pricing environment resulting from the impact of the COVID-19 pandemic.

CAPP - Thermal operations.

Adjusted EBITDA decreased $2.1 million, or 17.8%, for the year ended December 31, 2020.

The decrease in Adjusted EBITDA was primarily driven by decreased coal sales volumes of 1.8 million tons, or 42.2%, and decreased non-GAAP coal sales realization per ton of $3.79, or 6.4%, due to a weaker pricing and demand environment resulting from the COVID-19 pandemic.

Met segment operations.

Adjusted EBITDA increased $447.0 million, or 371.6%, for the year ended December 31, 2021 compared to the prior year period.

The increase in Adjusted EBITDA was primarily driven by increased coal margin and coal sales volumes.

All Other category.

Adjusted EBITDA increased $2.4 million, or 6.6%, for the year ended December 31, 2021 compared to the prior year period.

The increase in Adjusted EBITDA was primarily driven by decreases in selling, general and administrative expenses and increased gain on sale of assets.

The increase in Adjusted EBITDA was primarily driven by decreases in cost of coal sales and increases in sales realization per ton, partially offset by a decrease in thermal tons sold.

Discontinued Operations

The former PRB and NAPP operations results of operations and financial position are reported as discontinued operations in the Consolidated Financial Statements.

The former NAPP operations’ results of operations and financial position are reported as discontinued operations in the Consolidated Financial Statements.

Refer to Note 3 for further information on discontinued operations.

The following tables summarize certain financial information relating to the PRB and NAPP discontinued operating results which are reported within the All Other reporting segment that have been derived from our consolidated financial statements for the years ended December 31, 2020 and 2019.

Year Ended December 31,

(In thousands, except for per ton data) 2020 2019

The following tables summarize certain financial information relating to the discontinued operating results which are reported within the All Other category that have been derived from our Consolidated Financial Statements for the year ended December 31, 2020.

(In thousands, except for per ton data) Year Ended December 31, 2020 (2)

Coal revenues $ 233,083

5 unchanged sentences

Depreciation, depletion and amortization - production (1)

11,570 99,405

Accretion on asset retirement obligations 4,154

3 unchanged sentences

Depreciation, depletion and amortization - production (1)

(11,570) (99,405)

Accretion on asset retirement obligations (4,154)

5 unchanged sentences

(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.

Year Ended December 31,

(In thousands, except for per ton data) 2020 2019

(2) Includes minor residual activity related to our former PRB operations.

(In thousands, except for per ton data) Year Ended December 31, 2020 (2)

Coal revenues $ 233,083

5 unchanged sentences

Depreciation, depletion and amortization - production (1)

11,570 99,405

Accretion on asset retirement obligations 4,154

5 unchanged sentences

(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.

Refer to Note 3 for disclosures on the Cumberland and PRB Back-to-Back Coal Supply Agreements.

(2) Includes minor residual activity related to our former PRB operations.

Refer to Note 3 for disclosures on the Cumberland Back-to-Back Coal Supply Agreements.

Liquidity and Capital Resources

1 unchanged sentence

Our primary sources of liquidity are derived from sales of coal, our debt financing, and miscellaneous revenues.

We believe that cash on hand, cash generated from our operations, and expected tax refunds will be sufficient to meet our working capital requirements, anticipated capital expenditures, debt service requirements, acquisition-related obligations, and reclamation obligations for the next 12 months.

We believe that cash on hand and cash generated from our operations will be sufficient to meet our working capital requirements, anticipated capital expenditures, debt service requirements, acquisition-related obligations, and reclamation obligations for the next 12 months and the reasonably foreseeable future.

We rely on a number of assumptions in budgeting for our future activities.

These include the costs for mine development to sustain capacity of our operating mines, our cash flows from operations, effects of regulation and taxes by governmental agencies, mining technology improvements and reclamation costs.

These assumptions are inherently subject to significant business, political, economic, regulatory, environmental and competitive uncertainties, contingencies and risks, all of which are difficult to predict and many of which are beyond our control.

These assumptions are inherently subject to significant business, political, economic, regulatory, environmental and competitive uncertainties, pending and existing climate-related initiatives, contingencies and risks, all of which are difficult to predict and many of which are beyond our control.

Increased scrutiny of ESG matters specific to the coal sector could negatively influence our ability to raise capital in the future and result in a reduced number of surety and insurance providers.

We may need to raise additional funds more quickly if market conditions deteriorate, and we may not be able to do so in a timely fashion, or at all;

We may need to raise additional funds if market conditions deteriorate, and we may not be able to do so in a timely fashion, on terms acceptable to us, or at all;

or one or more of our assumptions prove to be incorrect or if we choose to expand our acquisition, exploration, appraisal, or development efforts or any other activity more rapidly than we presently anticipate.

We may decide to raise additional funds before we need them if the conditions for raising capital are favorable.

Additionally, we may elect to raise additional funds before we need them if the conditions for raising capital are favorable.

We may seek to sell equity or debt securities or obtain additional bank credit facilities.

1 unchanged sentence

The incurrence of additional indebtedness could result in increased fixed obligations and additional covenants that could restrict our operations.

Liquidity and Cash Collateral

At December 31, 2020, we had cash and cash equivalents of $139.2 million and no remaining unused capacity under the Amended and Restated Asset-Based Revolving Credit Agreement (the “ABL Facility”).

Availability under the ABL Facility is calculated on a monthly basis and fluctuates based on qualifying amounts of coal inventory and trade accounts receivable (the “Borrowing Base”) and the facility's covenant limitations related to our Fixed Charge Coverage Ratio (refer to Analysis of Material Debt Covenants below).

In accordance with terms of the ABL Facility, we may be required to cash collateralize the ABL Facility to the extent outstanding borrowings and letters of credit under the ABL Facility exceed the Borrowing Base after considering covenant limitations.

Due to fluctuations of the Borrowing Base, we were required to post $25.0 million of cash collateral in January 2021 to remain in compliance with the terms of the ABL Facility as of December 31, 2020.

In February 2021, a portion of the posted cash collateral was used to repay the remaining $3.4 million in borrowings under the ABL Facility.

In March 2021, the remaining posted cash collateral was returned to unrestricted cash.

To secure our obligations under certain worker’s compensation, black lung, and reclamation obligations and financial guarantees, we are required to provide cash collateral.

At December 31, 2020, we had cash collateral in the amounts of $96.0 million, $23.8 million, and $27.2 million classified as long-term restricted cash, long-term restricted investments, and long-term deposits, respectively, on our Consolidated Balance Sheets.

The following table summarizes our total liquidity as of December 31, 2021:

(in thousands )

December 31, 2021

Cash and cash equivalents $ 81,211

Credit facility availability (1)

Total liquidity $ 115,174

(1) Comprised of our unused commitments available under the Second Amended and Restated Asset-Based Revolving Credit Agreement, subject to limitations described therein.

Cash Collateral

We are required to provide cash collateral to secure our obligations under certain worker’s compensation, black lung, reclamation-related obligations, financial payments and other performance obligations, and other operating agreements.

Additionally, we have short-term restricted cash held in escrow related to our Contingent Revenue Obligation (refer to Note 15).

Future regulatory changes relating to these obligations could result in increased obligations, additional costs, or additional collateral requirements which could require greater use of alternative sources of funding for this purpose, which would reduce our liquidity.

Refer below for information related to the new authorization process for self-insured coal mine operators being implemented by the U.S.

Refer to the DCMWC Reauthorization Process section below for information related to the new authorization process for self-insured coal mine operators being implemented by the U.S.

Department of Labor (Division of Coal Mine Workers’ Compensation).

Additionally, as December 31, 2020, we had $9.3 million of short-term restricted cash held in escrow related to our contingent revenue obligation.

Refer to Note 16 for further information regarding the contingent revenue obligation.

As of December 31, 2021, we had the following cash collateral on our Consolidated Balance Sheets:

(in thousands )

December 31, 2021

Short-term and long-term restricted cash $ 101,403

Long-term restricted investments 28,443

Short-term and long-term deposits 1,394

Total cash collateral $ 131,240

Off-Balance Sheet Arrangements

We are required to provide financial assurance in order to perform the post-mining reclamation required by our mining permits, pay workers’ compensation claims under workers’ compensation laws in various states, pay federal black lung benefits, and perform certain other obligations.

In order to provide the required financial assurance, we generally use surety bonds for post-mining reclamation and workers’ compensation obligations.

We also use bank letters of credit to collateralize certain obligations.

As of December 31, 2021, we had the following outstanding surety bonds and letters of credit:

(in thousands )

December 31, 2021

Surety bonds (1)

Letters of credit (2)

(1) Total face amount includes $30 thousand attributable to discontinued operations.

(2) The letters of credit outstanding are under the Second Amended and Restated Asset-Based Revolving Credit Agreement dated December 6, 2021 and the Credit and Security Agreement dated June 30, 2017, and related amendments, between ANR, Inc.

and First Tennessee Bank National Association.

Refer to Note 22, part (c) for further disclosures on off-balance sheet arrangements.

Debt Financing and Related Transactions

At December 31, 2021, we had $454.7 million of indebtedness outstanding before debt discount and issuance costs.

Our indebtedness is primarily comprised of our Credit Agreement entered into on June 14, 2019 that provides for a senior secured term loan facility in the aggregate principal amount of $561.8 million with a maturity date of June 14, 2024 (the “Term Loan Credit Facility”).

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 $50.0 million subject to certain conditions in the Credit Agreement, in increments not less than $25.0 million or the remaining availability.

In a continued strategic effort to reduce our outstanding debt and strengthen our balance sheet, we repurchased at a discount certain outstanding principal borrowings of $18.7 million and made voluntary prepayments of $81.0 million of outstanding principal borrowings under the Term Loan Credit Facility during the third and fourth quarters of 2021.

During the first quarter of 2022, we made additional voluntary prepayments of $150.0 million of outstanding principal borrowings under the Term Loan Credit Facility.

Subject to continued coal market strength and available liquidity, we are planning to continue our efforts to substantially deleverage the balance sheet in coming quarters.

On December 6, 2021, we entered into the Second Amended and Restated Asset-Based Revolving Credit Agreement (“New ABL Agreement”).

The New ABL Agreement amended and restated the Amended and Restated Asset-Based Revolving Credit Agreement dated November 9, 2018, in its entirety, and includes a senior secured asset-based revolving credit facility (“the New ABL Facility”).

Under the New ABL Facility, we may borrow cash from the Lenders (as defined therein) or cause the L/C Issuers (as defined therein) to issue letters of credit, on a revolving basis, in an aggregate amount of up to $155.0 million, of which no more than $150.0 million may represent outstanding letters of credit ($125.0 million on a committed basis and another $25.0 million on an uncommitted cash collateralized basis) with a maturity date of December 6, 2024.

The New ABL Agreement extended the maturity date of the facility from the previous maturity of April 3, 2022.

Availability under the New ABL Facility is calculated on a monthly basis and fluctuates based on qualifying amounts of coal inventory and trade accounts receivable (the “Borrowing Base”) and the facility's covenant limitations related to our Fixed Charge Coverage Ratio (refer to “Analysis of Material Debt Covenants” below).

In accordance with terms of the New ABL Facility, we may be required to cash collateralize the New ABL Facility to the extent outstanding borrowings and letters of credit under the New ABL Facility exceed the Borrowing Base after considering covenant limitations.

On July 26, 2021, we repaid in full the West Virginia allocation of the Lexington Coal Company (“LCC”) note payable (“LCC Note Payable”) in the amount of $21.2 million.

The final $7.7 million payment was originally due in July of 2022, but we negotiated the return of $14.0 million of surety collateral in exchange for early repayment, which allowed us to eliminate that portion of the debt a year early and at a lower net cash outflow than was previously expected in 2021.

In October 2021, we elected to repay in full the remaining LCC Note Payable in the amount of $2.3 million and the remaining obligation to contribute into the LCC’s water treatment restricted accounts (the “LCC Water Treatment Stipulation”) in the amount of $5.0 million.

Refer to Note 14 for additional disclosures on long-term debt.

Acquisition-Related Obligations

At December 31, 2021, we had $41.6 million of acquisition-related obligations outstanding before discount.

Our acquisition-related obligations are primarily comprised of the Contingent Revenue Obligation which has an offsetting $17.6 million of short-term restricted cash held in escrow as of the first quarter of 2022 (refer to Note 15).

Capital Requirements

We expect to spend between $160.0 million and $190.0 million on capital expenditures during 2022.

Our expected capital expenditures include an increase from our estimates in the prior year due to inflationary pressure on labor and supplies and plans for several important projects that will help modernize and strategically improve our operations and preparation plant infrastructure.

Contractual Obligations

The following is a summary of our significant contractual obligations as of December 31, 2021:

(in thousands )

2022 2023 2024 2025 2026 After 2026 Total

Term Loan Credit Facility (1)

$ 44,944 $ 44,944 $ 470,158 $ — $ — $ — $ 560,046

Contingent Revenue Obligation 17,524 22,988 — — — — 40,512

Minimum royalties 14,665 14,418 13,620 12,525 12,396 56,771 124,395

Coal purchase commitments 37,335 — — — — — 37,335

Unconditional purchase obligations (2)

46,514 105,750 87,825 — — — 240,089

Total $ 160,982 $ 188,100 $ 571,603 $ 12,525 $ 12,396 $ 56,771 $ 1,002,377

(1) Includes cash interest payable on this obligation, with an interest rate of 10.00% as of December 31, 2021.

(2) Includes transportation commitments, minimum equipment purchase commitments, and diesel fuel purchase commitments.

Refer to Note 22 for further information.

Additionally, we have long-term liabilities relating to asset retirement obligations, pension benefits, black lung benefits, postretirement life insurance benefits, and workers’ compensation benefits.

The table below reflects the estimated undiscounted cash flows for these obligations:

(in thousands) 2022 2023 2024 2025 2026 After 2026 Total

Asset retirement obligation $ 32,802 $ 35,495 $ 35,663 $ 24,079 $ 35,865 $ 256,029 $ 419,933

Pension benefit obligation (1)

30,949 30,944 31,161 31,497 31,657 940,537 1,096,745

Black lung benefit obligation 7,295 7,208 7,254 7,329 7,497 158,467 195,050

Postretirement life insurance benefit obligation 602 568 569 571 570 14,237 17,117

Workers’ compensation benefit obligation 10,612 7,757 6,277 5,497 5,076 72,759 107,978

Total $ 82,260 $ 81,972 $ 80,924 $ 68,973 $ 80,665 $ 1,442,029 $ 1,836,823

(1) The estimated undiscounted cash flows will be paid from the defined benefit pension plan assets held within the defined benefit pension plan trust.

Refer to Note 19 for further disclosures related to this obligation.

Business Updates

With respect to global economic events, there continues to be uncertainty and weakness in the coal industry.

On December 14, 2020, S&P Global Ratings affirmed their June 2, 2020 downgrades on their issuer credit ratings on the Company and their issue-level rating on our senior secured debt.

On June 2, 2020, S&P Global Ratings downgraded their issuer credit rating on the Company from “B-” to “CCC+” and their issue-level rating on our senior secured debt from “B” to “CCC+” amid weak market indicators.

The rating outlook was noted as negative.

On April 13, 2020, Moody’s Investors Service downgraded the Company’s Corporate Family Rating to Caa1 from B3, Senior Secured Bank Credit Facility to Caa2 from Caa1, and Probability of Default Rating to Caa1 from B3.

The rating outlook was changed from stable to negative.

These issues bring potential liquidity risks for us, including the risks of declines in our stock value, declines in our cash and cash equivalents, less availability and higher costs of additional credit, and requests for additional collateral by surety providers.

During the second quarter of 2020, as a result of the weakening coal market conditions due in part to the impact of the global COVID-19 pandemic, we announced that we would take certain strategic actions with respect to two of our thermal coal

mining complexes in an effort to strengthen our financial performance and improve forecasted liquidity.

We announced that an underground mine and preparation plant located in West Virginia would be idled during the third quarter of 2020.

In addition, we decided not to move forward with the construction of a new refuse impoundment at our Cumberland mine in Pennsylvania and would therefore no longer spend the significant capital required in connection with the project.

On December 10, 2020, we announced the closing of our previously announced agreement to divest our Cumberland mining operations and related property to a third-party purchaser for total consideration of $50.0 million, comprised of approximately $20.0 million in cash and $30.0 million in surety bonding collateral, resulting in a loss on sale of $36.1 million.

Refer to Note 3 for additional disclosure information on this transaction, the divestiture of our former PRB operations and the related ESM Transaction, and the related discontinued operations.

Weak market conditions and depressed coal prices have resulted in operating losses in recent quarters.

If market conditions do not improve, we expect to continue to experience operating losses and cash outflows in the coming quarters, which would adversely affect our liquidity.

In particular, we expect a decrease in cash and cash equivalents to the extent that capital expenditures and other cash obligations, including our debt service obligations, exceed cash generated from our operations.

On December 14, 2021, S&P Global Ratings upgraded its issuer credit rating on the Company to B- from CCC+ and its issuer-level rating on our senior secured debt to B- from CCC+ amid favorable market indicators.

The rating outlook was noted as stable.

On September 14, 2021, Moody’s Investors Service ("Moody's") upgraded our Corporate Family Rating to B3 from Caa1, Probability of Default Rating to B3-PD from Caa1-PD, Senior Secured First Lien Bank Credit Facility Rating to B3 (LGD4) from Caa2 (LGD4), and Speculative Grade Liquidity Rating to SGL-2 from SGL-3 which were upgraded from Moody’s previous ratings which were released on April 16, 2021.

The rating outlook was noted as stable.

Should we receive any negative outlook ratings in the future, such negative outlook ratings would result in potential liquidity risks for us, including the risks of declines in our stock value, declines in our cash and cash equivalents, less availability and higher costs of additional credit, and requests for additional collateral by surety providers.

The COVID-19 pandemic has had negative impacts on our business, results of operations, financial condition, and cash flows.

A continued period of reduced demand for our products could have significant adverse consequences on our business.

The full extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on various developments, including the duration and spread of the outbreak, its impact on our customers and suppliers and the range of governmental and community reactions to the pandemic, which are still uncertain and cannot be fully predicted at this time.

We have continued to take steps to enhance our capital structure and financial flexibility and reduce cash outflows from operations in the near term, including reductions in our operating, SG&A, and overhead costs, reductions in production volumes, and the amendment of our credit facility.

We expect to engage in similar efforts in the future as opportunities arise through refinancing, repayment or repurchase of outstanding debt, amendment of our credit facilities, and other methods, and may consider the sale of other assets or businesses, and such other measures as circumstances warrant.

The full extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on

various developments, including the duration and spread of the outbreak, its impact on our customers and suppliers and the range of governmental and community reactions to the pandemic, which are still uncertain and still cannot be fully predicted.

We continually strive to enhance our capital structure and financial flexibility and reduce cash outflows from operations.

As future opportunities arise, we will consider the possibility of refinancing, repayment or repurchase of outstanding debt and amendment of our credit facilities, and may consider the sale of other assets or businesses, and such other measures as we believe circumstances warrant.

We may decide to pursue or not pursue these opportunities at any time.

Access to additional funds from liquidity-generating transactions or other sources of external financing is subject to market conditions and certain limitations, including our credit rating and covenant restrictions in our credit facility and indentures.

On March 27, 2020, the CARES Act was enacted into law.

As a result of the CARES Act, AMT Credits of $66.1 million were received in the fourth quarter of 2020.

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 an NOL carryback claim.

Refer to Note 19.

As a regular part of our business, we review opportunities for, and engage in discussions and negotiations concerning, the acquisition or disposition of coal mining and related infrastructure assets and interests in coal mining companies, and acquisitions or dispositions of, or combinations or other strategic transactions involving companies with coal mining or other energy assets.

When we believe that these opportunities are consistent with our strategic plans and our acquisition or disposition criteria, we will make bids or proposals and/or enter into letters of intent and other similar agreements.

These bids or proposals, which may be binding or non-binding, are customarily subject to a variety of conditions and usually permit us to terminate the discussions and any related agreement if, among other things, we are not satisfied with the results of due diligence.

Any acquisition opportunities we pursue could materially affect our liquidity and capital resources and may require us to incur indebtedness, seek equity capital or both.

There can be no assurance that additional financing will be available on terms acceptable to us, or at all.

In August 2021, we received an expected $64.2 million federal income tax refund and a $5.4 million associated interest payment related to a net operating loss (“NOL”) carryback claim.

Refer to Note 18 for further income tax disclosures.

Pension Plans

4 unchanged sentences

Funding decisions also consider certain funded status thresholds defined by the Pension Protection Act of 2006.

We expected to contribute $25.5 million to the Pension Plans in 2021 based on our estimates prior to the recent funding relief granted under the American Rescue Plan Act.

We now expect these amounts may be reduced, as a result of the relief, and are in the process of quantifying the impact.

As a result of the recent funding relief granted under the American Rescue Plan Act, contributions requirements to the pension plans were reduced relative to our previous estimates, and we contributed $6.6 million to the Pension Plans in 2021.

We expect our minimum required contributions to be $4.4 million to the pension plans in 2022.

Refer to Note 19 for further disclosures related to this obligation.

Discontinued Operations

Refer to Note 3 for disclosure on discontinued operations.

DCMWC Reauthorization Process

5 unchanged sentences

This collateral requirement, which the DCMWC advises represents 70% of our estimated future liability according to the DCMWC’s estimation methodology, is an increase of approximately 2,400% from the approximately $2.6 million in collateral which we (previously by Alpha Natural Resources Inc.

prior to the Merger) have provided since 2016 to secure these self-insured black

lung obligations.

prior to the Merger) have provided since 2016 to secure these self-insured black lung obligations.

Future liability has not previously been estimated by the DCMWC in connection with the reauthorization process but is now being considered as part of its new collateral-setting methodology.

The reauthorization process provided us with the right to appeal the security determination in writing within 30 days of the date of the notification, which appeal period the DCMWC agreed to extend to May 22, 2020, and we exercised this right of appeal.

We strongly disagree with the DCMWC’s substantially higher collateral determination and the methodology through which the calculation was derived.

If our appeal is unsuccessful, we may be required to provide additional letters of credit in order to receive self-insurance reauthorization from the DCMWC or insure these black lung obligations through a third party provider, which would likely also require us to provide collateral.

We strongly disagree with the DCMWC’s substantially higher collateral determination and the methodology through

which the calculation was derived.

In February 2021, the U.S.

Department of Labor (“DOL”) withdrew its Federal Register notice seeking comments on its bulletin describing its new method of calculating collateral requirements.

The Department removed the bulletin from its website in May 2021.

On February 10, 2022, a telephone conference was held with DCMWC and DOL decision makers wherein we presented facts and arguments in support of our appeal.

No ruling has been made on the appeal, but during the call we indicated that we would be willing to allocate an additional $10.0 million in collateral.

Either of these outcomes would significantly reduce our liquidity.

Share Repurchase Program

On March 4, 2022, our board of directors adopted a share repurchase program that permits us to repurchase up to an aggregate amount of $150.0 million of our common stock.

Share repurchases may be made from time to time through open market transactions, block trades, tender offers, or otherwise.

Repurchases under the program are subject to market and business conditions, levels of available liquidity, our cash needs, restrictions under agreements or obligations, legal or regulatory requirements or restrictions and other relevant factors.

Cash, cash equivalents, and restricted cash decreased by $62.0 million and $103.1 million over the years ended December 31, 2021 and 2020, respectively.

7 unchanged sentences

Operating Activities.

Net cash flows from operating activities consist of a net loss adjusted for non-cash items.

Net cash provided by operating activities for the year ended December 31, 2020 was $129.2 million and was primarily attributable to net loss of $446.9 million adjusted for asset impairment and restructuring of $256.5 million, depreciation, depletion and amortization of $151.5 million, deferred income taxes of $33.1 million, loss on sale of business of $36.1 million, accretion on asset retirement obligations of $30.7 million, amortization of debt issuance costs and accretion of debt discount of $14.8 million.

The change in our operating assets and liabilities of $34.4 million was primarily attributable to decreases in trade accounts receivable, net, of $91.2 million, decreases in inventories, net, of $48.7 million, and decreases in prepaid expenses and other current assets of $28.2 million, partially offset by decreases in other non-current liabilities of $43.8 million, decreases in acquisition-related obligations of $32.6 million, decreases in trade accounts payable of $28.6 million, and decreases in asset retirement obligations of $19.4 million.

Net cash provided by operating activities for the year ended December 31, 2019 was $131.9 million and was primarily attributable to net loss of $316.3 million adjusted for depreciation, depletion and amortization of $315.2 million, goodwill impairment of $124.4 million, asset impairment of $83.5 million, accretion on asset retirement obligations of $33.8 million, loss on modification and extinguishment of debt of $26.5 million, employee benefit plans, net, of $20.8 million.

The change in our operating assets and liabilities of ($172.8) million was primarily attributable to decreases in asset retirement obligations of $111.6 million, increases in inventories, net, of $40.7 million, decreases in other non-current liabilities of $33.6 million, decreases in trade accounts payable of $28.1 million, decreases in acquisition-related obligations of $28.1 million, decreases in accrued expenses and other current liabilities of $25.5 million, and increases in other non-current assets of $24.5 million, partially offset by decreases in prepaid expenses and other current assets of $56.7 million, resulting primarily from income tax refunds of $72.2 million, and decreases in trade accounts receivable, net, of $47.4 million.

The increase in net cash provided by operating activities for the year ended December 31, 2021 compared to the prior year period was primarily attributable to the improvement in our results from operations as discussed above in “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations,” partially offset by changes in operating assets and liabilities, primarily attributable to an increase in our working capital.

Our working capital increase was primarily driven by an increase in our trade accounts receivable, net, partially offset by the receipt of the federal tax refund in the current year as discussed above.

Investing Activities.

Net cash used in investing activities for the year ended December 31, 2020 was $210.0 million, primarily driven by capital expenditures of $154.0 million, cash paid on sale of business of $52.2 million, and purchases of investment securities of $21.1 million, partially offset by maturity of investment securities of $16.7 million.

Net cash used in investing activities for the year ended December 31, 2019 was $191.8 million, primarily driven by capital expenditures of $192.4 million, purchases of investment securities of $92.9 million, partially offset by maturity of investment securities of $100.3 million.

The decrease in net cash used in investing activities for the year ended December 31, 2021 compared to the prior year period was primarily driven by the decrease in our capital expenditures which were near the maintenance capital level in the current year period and the cash paid on the sale of our former NAPP operations in the prior year period (refer to Note 3 for further information).

Financing Activities.

Net cash used in financing activities for the year ended December 31, 2020 was $22.4 million, primarily attributable to principal repayments of debt of $59.8 million and principal repayments of notes payable of $16.7 million, partially offset by proceeds from borrowings on debt of $57.5 million.

Net cash used in financing activities for the year ended December 31, 2019 was $69.7 million, primarily attributable to principal repayments of debt of $552.8 million, common stock repurchases and related expenses of $37.6 million, and principal repayments of notes payable of $14.8 million, partially offset by proceeds from borrowings on debt of $544.9 million.

Long-Term Debt

On November 9, 2018, we entered into a $225.0 million ABL Facility under the Amended and Restated Asset-Based Revolving Credit Agreement expiring on April 3, 2022.

On June 14, 2019, we entered into a $561.8 million Term Loan Credit Facility under the Credit Agreement.

Refer to Note 15 for additional disclosures on long-term debt.

The increase in net cash used in financing activities for the year ended December 31, 2021 compared to the prior year period was primarily driven by the repurchase and voluntary prepayments of our outstanding principal borrowings under the Term Loan Credit Facility during the second half of the current year period (refer to Note 14 for further information).

Analysis of Material Debt Covenants

We are in compliance with all covenants under the Credit Agreement and the Amended and Restated Asset-Based Revolving Credit Agreement, as of December 31, 2020.

A breach of the covenants in the Credit Agreement and the Amended and Restated Asset-Based Revolving Credit Agreement could result in a default under the terms of the agreement and the respective lenders could elect to declare all amounts borrowed due and payable.

Pursuant to the Amended and Restated Asset-Based Revolving Credit Agreement, during any Liquidity Period (capitalized terms as defined in the Amended and Restated Asset-Based Revolving Credit Agreement), our Fixed Charge Coverage Ratio cannot be less than 1.0 as of the last day of any Test Period, commencing with the Test Period ended immediately preceding the commencement of such Liquidity Period.

The Fixed Charge Coverage Ratio is calculated as (a) Consolidated EBITDA of the Company and its Restricted Subsidiaries for such period, minus non-financed Capital Expenditures (including Capital Expenditures financed with the proceeds of any Loans) paid or payable currently in cash by the Company or any of its Subsidiaries for such period to (b) the Fixed Charges of the Company and its Restricted Subsidiaries during such period.

We are in compliance with all covenants under the Credit Agreement’s Term Loan Credit Facility and the New ABL Agreement, as of December 31, 2021.

A breach of the covenants in the Credit Agreement’s Term Loan Credit Facility or the Amended and Restated Asset-Based Revolving Credit Agreement could result in a default under the terms of such agreement, and the respective lenders could then elect to declare all amounts borrowed due and payable.

Pursuant to the New ABL Agreement, during any Liquidity Period (capitalized terms as defined in the New ABL Agreement), our Fixed Charge Coverage Ratio cannot be less than 1.0 as of the last day of any Test Period, commencing with the Test Period ended immediately preceding the commencement of such Liquidity Period.

The Fixed Charge Coverage Ratio is

calculated as (a) Consolidated EBITDA of the Company and its Restricted Subsidiaries for such period, minus non-financed Capital Expenditures (including Capital Expenditures financed with the proceeds of any Loans) paid or payable currently in cash by the Company or any of its Subsidiaries for such period to (b) the Fixed Charges of the Company and its Restricted Subsidiaries during such period.

As of December 31, 2021, we were not in a Liquidity Period.

Acquisition-Related Obligations

Refer to Note 16 for additional details and disclosures on acquisition-related obligations.

Off-Balance Sheet Arrangements

Refer to Note 23, part (c) for disclosures on off-balance sheet arrangements.

Any acquisition opportunities we pursue could materially affect our liquidity and capital resources and may require us to incur indebtedness, seek equity capital or both.

There can be no assurance that additional financing will be available on terms acceptable to us, or at all.

Contractual Obligations

The following is a summary of our significant contractual obligations as of December 31, 2020:

(in thousands )

2021 2022 2023 2024 2025 After 2025 Total

Long-term debt (1)

$ 24,993 $ 21,468 $ 8,118 $ 536,519 $ — $ — $ 591,098

Other debt (2)

3,837 3,347 1,182 109 — — 8,475

Acquisition-related obligations 8,144 4,247 — — — — 12,391

Contingent revenue obligation (3)

11,395 13,209 13,702 — — — 38,306

Minimum equipment purchase commitments 5,008 — 170 — — — 5,178

Transportation commitments 29 338 — — — — 367

Operating leases 1,210 1,076 1,101 982 897 4,018 9,284

Minimum royalties 15,708 14,525 13,633 11,560 10,815 43,603 109,844

Coal purchase commitments 44,707 — — — — — 44,707

Total $ 115,031 $ 58,210 $ 37,906 $ 549,170 $ 11,712 $ 47,621 $ 819,650

(1) Includes Term Loan Credit Facility principal amounts of $5.6 million in 2021, $5.6 million in 2022, $5.6 million in 2023, and $536.5 million in 2024.

Cash interest payable on this obligation, with an interest rate of 9.00% as of December 31, 2020, would be approximately $53.4 million in 2021, $55.3 million in 2022, $54.8 million in 2023, and $24.7 million in 2024.

Also includes Lexington Coal Company (“LCC”) Note Payable principal amounts of $17.5 million in 2021 and $10.0 million in 2022, LCC Water Treatment Stipulation principal amounts of $1.9 million in 2021, $2.5 million in 2022, and $2.5 million in 2023, and the senior secured asset-based revolving credit facility (“ABL Facility”) principal amount of $3.4 million in 2022.

Refer to Note 15 for principal payment and interest rate terms.

(2) Includes financing lease obligation principal amounts of $2.0 million in 2021, $1.7 million in 2022, $0.3 million in 2023, and $6 thousand in 2024.

Cash interest payable on these obligations with interest rates ranging between 2.49% and 27.39%, would be approximately $0.2 million in 2021, $0.1 million in 2022, and $15 thousand in 2023.

Other debt includes principal amounts of $1.8 million in 2021, $1.6 million in 2022, $0.9 million in 2023, and $0.1 million in 2024.

(3) Refer to Note 16 for further disclosures related to this obligation.

Additionally, we have long-term liabilities relating to asset retirement obligations, pension, black lung benefits, life insurance benefits, and workers’ compensation benefits.

The table below reflects the estimated undiscounted cash flows for these obligations:

(in thousands) 2021 2022 2023 2024 2025 After 2025 Total

Asset retirement obligation $ 25,490 $ 34,180 $ 28,330 $ 35,725 $ 42,622 $ 330,075 $ 496,422

Pension benefit obligation (1)

31,178 31,267 31,628 32,149 32,426 981,075 1,139,723

Black lung benefit obligation 6,810 6,929 7,038 7,112 7,244 177,472 212,605

Life insurance benefit obligation 628 588 586 586 587 14,909 17,884

Workers’ compensation benefit obligation 13,155 9,351 7,185 6,106 5,633 80,382 121,812

Total $ 77,261 $ 82,315 $ 74,767 $ 81,678 $ 88,512 $ 1,583,913 $ 1,988,446

(1) The estimated undiscounted cash flows will be paid from the defined benefit pension plan assets held within the defined benefit pension plan trust.

Refer to Note 20 for further disclosures related to this obligation.

We expect to spend between $75 million and $95 million on capital expenditures during 2021.

Critical Accounting Policies and Estimates

2 unchanged sentences

We evaluate our estimates and assumptions on an ongoing basis and adjust such estimates and assumptions as facts and circumstances require.

Foreign currency and energy markets, and fluctuations in demand for steel products have combined to

increase the uncertainty inherent in such estimates and assumptions.

Foreign currency and energy markets, and fluctuations in demand for steel products have combined to increase the uncertainty inherent in such estimates and assumptions.

As future events and their effects cannot be determined with precision, actual results may differ significantly from these estimates.

Changes in these estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.

Business Combinations.

We account for our business combinations under the acquisition method of accounting.

The total cost of acquisitions is allocated to the underlying identifiable net tangible and intangible assets based on their respective estimated fair values.

Determining the fair value of assets acquired and liabilities assumed requires management’s judgment, the utilization of independent valuation experts, and often involves the use of significant estimates and assumptions with respect to the timing and amounts of future cash inflows and outflows, discount rates, market prices and asset lives, among other items.

Our asset retirement obligations arise from the federal Surface Mining Control and Reclamation Act of 1977 and similar state statutes, which require that mine property be restored in accordance with specified standards and an approved reclamation plan.

18 unchanged sentences

The inclusion of this margin will result in a recorded obligation that is greater than our estimates of our cost to perform the reclamation activities.

If our cost estimates are accurate, the excess of the recorded obligation over the cost incurred to perform the work will be recorded within depreciation, depletion and amortization within our Consolidated Statements of Operations at the time that reclamation work is completed.

If our cost estimates are accurate, the excess of the recorded obligation over the cost incurred to perform the work will be recorded as a reduction to depreciation, depletion and amortization within our Consolidated Statements of Operations at the time that reclamation work is completed.

On at least an annual basis, we review our reclamation liabilities and make necessary adjustments for permit changes as granted by state authorities, additional costs resulting from accelerated mine closures, and revisions to cost estimates and productivity assumptions to reflect current experience and updated plans.

1 unchanged sentence

While the precise amount of these future costs cannot be determined with certainty, as of December 31, 2021, we estimate that the aggregate undiscounted cost of final mine closures is approximately $419.9 million.

Refer to Note 16 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for reclamation disclosures including a table summarizing the changes in asset retirement obligations for the years ended December 31, 2021 and 2020.

Retirement Plans.

3 unchanged sentences

We contributed $6.6 million to our Pension Plans for the year ended December 31, 2021.

For the year ended December 31, 2020, we recorded a net periodic benefit credit of $4.7 million, which included a settlement of $1.6 million, for our Pension Plans and have recorded net obligations of $218.7 million.

For the year ended December 31, 2021,

we recorded a net periodic benefit credit of $11.5 million, which included a settlement of $0.4 million, for our Pension Plans and have recorded net obligations of $159.9 million.

Refer to Note 19 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for disclosures summarizing the changes in these projected benefit obligations for the years ended December 31, 2021 and 2020.

The calculation of the net periodic benefit expense (credit) and projected benefit obligation associated with our Pension Plans requires the use of a number of assumptions, which are used by our independent actuaries to make the underlying calculations.

Refer to Note 19 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for a summary of these assumptions and additional disclosures related to our Pension Plans.

Changes in these assumptions can result in different net periodic benefit expense and liability amounts, and actual experience can differ from the assumptions.

• The expected long-term rate of return on plan assets is an assumption of the rate of return on plan assets reflecting the average rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the

projected benefit obligation.

We establish the expected long-term rate of return at the beginning of each fiscal year based upon historical returns and projected returns on the underlying mix of invested assets.

The Pension Plans investment targets are 60% equity securities and 40% fixed income funds.

We establish the expected long-term rate of return on plan assets at the beginning of each fiscal year based upon historical returns and projected returns on the underlying mix of invested assets.

The Pension Plans investment targets are 60% equity securities and 40% fixed income funds, based on the assumption the Pension Plans have a funded status level less than 90% (refer to Note 19 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for additional disclosures on this assumption).

Investments are rebalanced on a periodic basis to stay within these targeted guidelines.

The long-term rate of return assumption used to determine net periodic benefit expense was 5.90% for the year ended December 31, 2020.

The long-term rate of return assumption to be used in 2021 is expected to be 5.80%.

The expected long-term rate of return on plan assets assumption used to determine net periodic benefit expense was 5.80% for the year ended December 31, 2021.

The expected long-term rate of return on plan assets assumption to be used in 2022 is expected to be 5.80%.

Any difference between the actual experience and the assumed experience is deferred as an unrecognized actuarial gain or loss and amortized into expense in future periods.

2 unchanged sentences

In estimating that rate, we use rates of return on high quality, fixed income investments.

The weighted average discount rate used to determine pension expense was 2.92% for the year ended December 31, 2020.

The differences resulting from actual versus assumed discount rates are amortized into pension expense (credit) over the remaining average life of the active plan participants.

The weighted average discount rate used to determine the pension benefit obligations was 2.92% for the year ended December 31, 2021.

The differences resulting from actual versus assumed discount rates are amortized into pension net periodic benefit expense (credit) over the remaining average life of the active plan participants.

A one percentage-point increase in the discount rate would increase the net periodic pension cost for the year ended December 31, 2021 by approximately $3.3 million and decrease the projected benefit obligation as of December 31, 2021 by approximately $83.5 million.

2 unchanged sentences

We are required by federal and state statues to provide benefits to employees for awards related to coal workers’ pneumoconiosis disease (black lung).

Certain of our subsidiaries are insured for black lung obligations by a third-party insurance provider and certain subsidiaries are self-insured for state black lung obligations.

Certain other subsidiaries are self-insured for federal black lung benefits and may fund benefit payments through Section 501(c)(21) tax-exempt trust fund.

Certain of our subsidiaries are insured for black lung benefit obligations by a third-party insurance provider and certain subsidiaries are self-insured for state black lung benefit obligations and may fund benefit payments through a Section 501(c)(21) tax-exempt trust fund.

Provisions are made for estimated benefits based on annual evaluations prepared by independent actuaries.

1 unchanged sentence

These actuarially determined liabilities use various actuarial assumptions, including the discount rate, future cost trends, demographic assumptions, and return on plan assets to estimate the costs and obligations for these items.

The discount rate represents our estimate of the interest rate at which black lung obligations could be effectively settled.

• The discount rate represents our estimate of the interest rate at which black lung benefit obligations could be effectively settled.

Assumed discount rates are used in the measurement of the black lung benefit obligations and the interest cost and service cost components of the net periodic benefit expense.

In estimating that rate, we use rates of return on high quality, fixed income investments.

Refer to Note 20 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for the weighted-average rate assumptions related to black lung obligations used to determine the benefit obligation.

The weighted average discount rate used to determine black lung benefit obligations was 2.96% for the year ended December 31, 2021.

The differences resulting from actual versus assumed discount rates are amortized into black lung net periodic benefit cost over the remaining average life of the active plan participants.

A one percentage-point increase in the discount rate would increase the net periodic black lung benefit cost for the year ended December 31, 2021 by approximately $0.6 million and decrease the projected benefit obligation as of December 31, 2021 by approximately $14.4 million.

The corresponding effects of a one percentage-point decrease in discount rate would decrease the net periodic black lung benefit cost for the year ended December 31, 2021 by approximately $0.8 million and increase the projected benefit obligation as of December 31, 2021 by approximately $18.4 million.

If our assumptions do not materialize as expected, actual cash expenditures and costs that we incur could differ materially from our current estimates.

Moreover, regulatory changes could affect our obligation to satisfy these or additional obligations.

As of December 31, 2020, we had estimated black lung obligations of approximately $124.8 million, including amounts reported as current and within discontinued operations, which are net of assets of $2.7 million that are held in a tax-exempt trust fund.

As of December 31, 2021, we had estimated black lung benefit obligations of approximately $114.5 million, including amounts reported as current and within discontinued operations, which are net of assets of $2.7 million that are held in a tax-exempt trust fund.

Refer to Note 19 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for disclosures summarizing these underlying assumptions and the changes in these projected benefit obligations for the years ended December 31, 2021 and 2020.

Income Taxes.

5 unchanged sentences

We believe the deferred tax liabilities relied upon as future taxable income in our assessment will reverse in the same period and jurisdiction and are of the same character as the temporary differences giving rise to the deferred tax assets that will be realized.

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

At December 31, 2021, a valuation allowance of $172.9 million has been provided on federal and state net operating losses and other deferred tax assets not currently expected to provide future tax benefits.

Refer to Note 18 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for additional disclosures on income taxes.

Asset Impairment.

4 unchanged sentences

The amount of any potential impairment is equal to the excess of an asset group’s carrying value over its estimated fair value.

The amount of

any potential impairment is allocated to the individual long-lived assets within the asset group on a pro-rata basis, except that the carrying value of individual long-lived assets are not reduced below their individual estimated fair values.

The amount of any potential impairment is allocated to the individual long-lived assets within the asset group on a pro-rata basis, except that the carrying value of individual long-lived assets are not reduced below their individual estimated fair values.

Long-lived assets located in a close geographic area are grouped together for purposes of impairment testing when, after considering revenue and cost interdependencies, circumstances indicate the assets are used together to produce future cash flows.

Our asset groups generally consist of the assets and applicable liabilities of one or more mines and preparation plants and associated coal reserves for which cash flows are largely independent of cash flows of other mines, preparation plants and associated reserves.

During the year ended December 31, 2021, long-lived asset impairment of $60 was recorded in the All Other category to reduce the carrying value of property, plant, and equipment, net, due to capital spending during the period at previously impaired locations requiring the impairment of certain additional assets not considered recoverable.

We performed long-lived asset impairment tests as of November 30, 2020, August 31, 2020, May 31, 2020, and February 29, 2020.

In total, we determined that indicators of impairment with respect to five long-lived asset groups within our Met reporting segment, three long-lived asset groups within its CAPP - Thermal reporting segment, and one long-lived asset group within discontinued operations existed during the year ended December 31, 2020.

In total, we determined that indicators of impairment with respect to five long-lived asset groups within our Met reporting segment, three long-lived asset groups within our All Other category, and one long-lived asset group within discontinued operations existed during the year ended December 31, 2020.

At December 31, 2020, we determined that the carrying amounts of the asset groups exceeded both their undiscounted cash flows and their estimated fair values.

3 unchanged sentences

Refer to Note 2 and Note 8 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Goodwill represents the excess of purchase price over the fair value of the identifiable net assets of acquired companies.

Goodwill is not amortized;

instead, it is tested for impairment annually as of October 31 of each year, or more frequently if indicators of impairment exist.

Refer to Note 2 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Prior to performing a quantitative goodwill impairment test, the Company first has the option of performing a qualitative assessment of goodwill.

If the Company determines based on its qualitative assessment that more likely than not that the fair value of a reporting unit containing goodwill exceeds its carrying amount, no further impairment testing is required.

If a quantitative impairment test is required, the Company compares the fair value of a reporting unit including goodwill to its carrying value.

If the fair value of the reporting unit is lower than its carrying amount, its goodwill is written down by the lesser of the amount by which the reporting units carrying amount exceeded its fair value or its carrying value of goodwill.

The valuation methodology utilized to estimate the fair value of the reporting units is based on both a market and income approach and is within the range of fair values yielded under each approach.

The income approach is based on a discounted cash flow methodology based on estimates of future sales volumes, coal prices, production costs, and a risk-adjusted cost of capital.

The market approach is based on a guideline company and similar transaction methodology.

Under the guideline company approach, certain metrics from a selected group of publicly traded guideline companies that have similar operations to the Company’s reporting units are used to estimate the fair value of the reporting units.

Under the similar transactions approach, recent merger and acquisition transactions for companies that have similar operations to the Company’s reporting units are used to estimate the fair value of the Company’s reporting units.

The income approach is dependent upon a number of significant management estimates about future performance.

Changes in any of these assumptions could materially impact the estimated fair value of our reporting units.

Our forecasts of coal prices generally reflect a long-term outlook of market prices expected to be received for our coal.

However, coal prices are influenced by global market conditions beyond our control.

If actual coal prices are less than our expectations, it could have a material impact on the fair value of our reporting units.

Our forecasts of costs to produce coal are based on our operating forecasts and an assumed inflation rate for materials and supplies such as steel, diesel fuel and explosives.

However, the costs of the materials and supplies used in our production process such as steel, diesel fuel and explosives are influenced by global market conditions beyond our control.

If actual costs are higher or if inflation increases above our expectations, it could have a material impact on the fair value of our reporting units.

We also are faced with increasingly stringent safety standards and governmental regulation, much of which is beyond our control, which could increase our costs and materially decrease the fair value of our reporting units.

For a further discussion of the factors that could result in a change in our assumptions, see “Risk Factors” in this Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission.

As of December 31, 2019, our goodwill balance was fully impaired.

Refer to Note 2 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.

Contingent Revenue Obligation.

Our Contingent Revenue Obligation was assumed in connection with the Merger.

Determining the fair value of this obligation requires management’s judgment and the utilization of independent valuation

experts, and involves the use of significant estimates and assumptions with respect to forecasts of future revenues and discount rates.

Determining the fair value of this obligation requires management’s judgment and the utilization of independent valuation experts, and involves the use of significant estimates and assumptions with respect to forecasts of future revenues and discount rates.

The Company forecasts future revenues for the duration of the obligation for the properties subject to the obligation.

1 unchanged sentence

If our assumptions do not materialize as expected, actual payments made under the obligation could differ materially from our current estimates.

For a further

discussion of the factors that could result in a change in our assumptions, see “Item 1A.

Risk Factors” in this Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission.

New Accounting Pronouncements.

Refer to Note 2 for disclosures related to new accounting policies adopted.

Refer to Note 2 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for disclosures related to new accounting policies adopted.

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 5. Market for Registrant’s Common Equity