What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-02-26 compared with 2023-02-23 · 491 added, 794 removed, 1247 unchanged (51% of the section changed)

1 unchanged sentence

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of

Alpha Metallurgical Resources, Inc.

To the Stockholders and the Board of Directors of Alpha Metallurgical Resources, Inc.

Opinions on the Financial Statements and Internal Control Over Financial Reporting

1 unchanged sentence

and subsidiaries (the Company) as of December 31, 2023 and 2022, and the related consolidated statements of operations, comprehensive income, stockholders' equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively, the financial statements).

We also have audited the Company’s internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in 2013.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control — Integrated Framework issued by COSO.

We also have audited the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.

Basis for Opinions

The Company's management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting.

Our responsibility is to express an opinion on the Company's financial statements and an opinion on the Company's internal control over financial reporting based on our audits.

2 unchanged sentences

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

12 unchanged sentences

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Asset Retirement Obligations

3 unchanged sentences

Changes to the liability at operations that are currently being reclaimed are recorded to depreciation, depletion, and amortization.

On at least an annual basis the Company reviews its estimated future cash flows for its asset retirement obligations.

We identified the valuation of the asset retirement obligation as a critical audit matter because the estimate involves a high degree of subjectivity and auditing the significant assumptions utilized by management in estimating the amount of the liability requires judgment.

In particular, the obligation is determined using a discounted cash flow technique and is based upon mining permit requirements and various assumptions including discount rates, inflation rate, estimates of disturbed acreage, timing of reclamation activities, and third-party reclamation costs.

On at least an annual basis the Company reviews its estimated future cash flows for its asset retirement obligation liability.

We identified the valuation of the asset retirement obligation liability as a critical audit matter because the estimate involves a high degree of subjectivity and auditing the significant assumptions utilized by management in estimating the amount of the liability requires judgment.

In particular, the obligation liability is determined using a discounted cash flow technique and is based upon mining permit requirements and various assumptions including discount rates, inflation rate, estimates of disturbed acreage, timing of reclamation activities, and third-party reclamation costs.

Our audit procedures related to the Company’s asset retirement obligation liability included the following, among others:

1 unchanged sentence

– We compared significant valuation assumptions including the discount rates and inflation rate to market data and utilized a valuation specialist to assist in testing the Company’s discounted cash flow model.

– We compared the estimates of disturbed acreage, timing of reclamation activities, and third-party reclamation costs to the prior year estimates, assessing consistency between timing of reclamation activities and projected mine lives, evaluated the appropriateness of the estimated costs based on mine type, and compared anticipated costs to recent operating data.

– We compared the estimates of disturbed acreage, timing of reclamation activities, and third-party reclamation costs to the prior year estimates, assessed consistency between timing of reclamation activities and projected mine lives, evaluated the appropriateness of the estimated costs based on mine type, and compared anticipated costs to recent operating data.

– We utilized an external specialist who performed observations of mine site operations, conducted interviews of engineering personnel, assessed compliance with mine closure and post closure plan regulatory requirements, and evaluated the reasonableness of the engineering estimates and assumptions.

21 unchanged sentences

Mark-to-market adjustment for acquisition-related obligations — 8,880 19,525

Other expense (income) 3,363 ( 10,972 ) ( 2,223 )

Other (income) expense ( 1,088 ) 3,363 ( 10,972 )

Total costs and expenses 2,608,332 2,520,713 1,899,486

Income (loss) from operations 1,580,879 359,200 ( 170,688 )

Income from operations 863,085 1,580,879 359,200

Other (expense) income:

1 unchanged sentence

Interest income 11,933 3,187 336

Loss on extinguishment of debt ( 2,753 ) — —

Equity loss in affiliates ( 18,263 ) ( 14,346 ) ( 4,149 )

Miscellaneous income (loss), net 6,832 6,465 ( 1,972 )

Miscellaneous (expense) income, net ( 1,620 ) 6,832 6,465

Total other expense, net ( 17,626 ) ( 26,129 ) ( 67,002 )

Income (loss) from continuing operations before income taxes 1,554,750 292,198 ( 243,634 )

Income tax (expense) benefit ( 106,205 ) ( 3,408 ) 2,164

Net income (loss) from continuing operations 1,448,545 288,790 ( 241,470 )

Discontinued operations:

Loss from discontinued operations — — ( 205,429 )

Net income (loss) $ 1,448,545 $ 288,790 $ ( 446,899 )

Basic income (loss) per common share:

Income (loss) from continuing operations $ 82.82 $ 15.66 $ ( 13.20 )

Loss from discontinued operations — — ( 11.22 )

Net income (loss) $ 82.82 $ 15.66 $ ( 24.42 )

Diluted income (loss) per common share:

Income (loss) from continuing operations $ 79.49 $ 15.30 $ ( 13.20 )

Loss from discontinued operations — — ( 11.22 )

Net income (loss) $ 79.49 $ 15.30 $ ( 24.42 )

Income before income taxes 845,459 1,554,750 292,198

Income tax expense ( 123,503 ) ( 106,205 ) ( 3,408 )

Net income 721,956 1,448,545 288,790

Basic income per common share $ 51.18 $ 82.82 $ 15.66

Diluted income per common share $ 49.30 $ 79.49 $ 15.30

Weighted average shares - basic 14,106,466 17,490,886 18,441,175

3 unchanged sentences

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands)

1 unchanged sentence

2023 2022 2021

Net income (loss) $ 1,448,545 $ 288,790 $ ( 446,899 )

Other comprehensive income (loss), net of tax:

Net income $ 721,956 $ 1,448,545 $ 288,790

Other comprehensive (loss) income, net of tax:

Employee benefit plans:

Current period actuarial gain (loss) $ 56,485 $ 47,461 $ ( 60,647 )

Income tax ( 12,888 ) — —

Current period actuarial (loss) gain $ ( 34,205 ) $ 56,485 $ 47,461

Income tax benefit (expense) 7,588 ( 12,888 ) —

$ ( 26,617 ) $ 43,597 $ 47,461

reclassification adjustments for amounts reclassified to earnings due to amortization of net actuarial loss and settlements 3,555 6,021 7,278

Income tax ( 811 ) — —

reclassification adjustments for amounts reclassified to earnings due to amortization of net actuarial (gain) loss and settlements ( 2,324 ) 3,555 6,021

Income tax benefit (expense) 516 ( 811 ) —

$ ( 1,808 ) $ 2,744 $ 6,021

Total other comprehensive income (loss), net of tax $ 46,341 $ 53,482 $ ( 53,369 )

Total comprehensive income (loss) $ 1,494,886 $ 342,272 $ ( 500,268 )

Total other comprehensive (loss) income, net of tax $ ( 28,425 ) $ 46,341 $ 53,482

Total comprehensive income $ 693,531 $ 1,494,886 $ 342,272

Refer to accompanying Notes to Consolidated Financial Statements.

7 unchanged sentences

Short-term investments — 46,052

Trade accounts receivable, net of allowance for doubtful accounts of $ 239 and $ 393 as of December 31, 2022 and 2021, respectively

Trade accounts receivable, net of allowance for credit losses of $ 234 and $ 239 as of December 31, 2023 and 2022, respectively

509,682 407,210

23 unchanged sentences

Long-term debt 6,792 7,897

Acquisition-related obligations - long-term — 19,000

Workers’ compensation and black lung obligations 189,226 188,247

6 unchanged sentences

Stockholders’ Equity

Preferred stock - par value $ 0.01 , 5.0 million shares authorized, none issued

Common stock - par value $ 0.01 , 50.0 million shares authorized, 21.7 million issued and 15.5 million outstanding at December 31, 2022 and 20.8 million issued and 18.4 million outstanding at December 31, 2021

Preferred stock - par value $ 0.01 , 5,000,000 shares authorized, none issued

Common stock - par value $ 0.01 , 50,000,000 shares authorized, 22,058,135 issued and 12,938,679 outstanding at December 31, 2023 and 21,703,163 issued and 15,552,676 outstanding at December 31, 2022

Additional paid-in capital 834,482 815,442

1 unchanged sentence

Treasury stock, at cost:

6.2 million shares at December 31, 2022 and 2.4 million shares at December 31, 2021

9,119,456 shares at December 31, 2023 and 6,150,487 shares at December 31, 2022

( 1,189,715 ) ( 649,061 )

Retained earnings (accumulated deficit) 1,275,319 ( 71,739 )

Retained earnings 1,969,527 1,275,319

Total stockholders’ equity 1,573,928 1,429,755

8 unchanged sentences

Operating activities:

Net income (loss) $ 1,448,545 $ 288,790 $ ( 446,899 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Net income $ 721,956 $ 1,448,545 $ 288,790

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation, depletion and amortization 136,869 107,620 110,047

Amortization of acquired intangibles, net 8,523 19,498 13,244

Accretion of acquisition-related obligations discount 233 1,258 3,342

Amortization of debt issuance costs and accretion of debt discount 1,947 8,282 12,338

Loss on extinguishment of debt 2,753 — —

Mark-to-market adjustment for acquisition-related obligations — 8,880 19,525

Loss on sale of business — — 36,113

Loss (gain) on disposal of assets, net 43 ( 9,911 ) ( 2,401 )

(Gain) loss on disposal of assets, net ( 6,817 ) 43 ( 9,911 )

Accretion on asset retirement obligations 25,500 23,765 26,520

1 unchanged sentence

Deferred income taxes 39,722 ( 14,521 ) ( 163 )

Asset impairment and restructuring — ( 561 ) 256,518

Stock-based compensation 19,017 7,484 5,315

17 unchanged sentences

Cash paid for business acquired ( 11,919 ) ( 24,878 ) —

Cash paid on sale of business — — ( 52,192 )

Capital contributions to equity affiliates ( 19,556 ) ( 6,677 ) ( 3,443 )

Purchases of investment securities ( 207,065 ) ( 269,420 ) ( 17,985 )

Maturity of investment securities 149,397 13,265 16,685

Sales and maturities of investment securities 320,961 149,397 13,265

Capital contributions to equity affiliates ( 30,812 ) ( 19,556 ) ( 6,677 )

Other, net 35 ( 4,214 ) ( 3,382 )

1 unchanged sentence

Financing activities:

Proceeds from borrowings on long-term debt — — 57,500

Repurchases of long-term debt — — ( 18,415 )

29 unchanged sentences

(Amounts in thousands)

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive (Loss) Income Treasury Stock at Cost Retained Earnings (Accumulated Deficit) Total Stockholders’ Equity

Balances, December 31, 2019 $ 205 $ 775,707 $ ( 58,616 ) $ ( 107,984 ) $ 86,810 $ 696,122

Net loss — — — — ( 446,899 ) ( 446,899 )

Credit losses cumulative-effect adjustment — — — — ( 440 ) ( 440 )

Other comprehensive loss, net — — ( 53,369 ) — — ( 53,369 )

Stock-based compensation, issuance of common stock for share vesting, and common stock reissuances 1 3,717 — 1,179 — 4,897

Common stock repurchases and related expenses — — — ( 209 ) — ( 209 )

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive (Loss) Income Treasury Stock at Cost (Accumulated Deficit) Retained Earnings Total Stockholders’ Equity

Balances, December 31, 2020 $ 206 $ 779,424 $ ( 111,985 ) $ ( 107,014 ) $ ( 360,529 ) $ 200,102

14 unchanged sentences

Balances, December 31, 2022 $ 217 $ 815,442 $ ( 12,162 ) $ ( 649,061 ) $ 1,275,319 $ 1,429,755

Net income — — — — 721,956 721,956

Other comprehensive loss, net — — ( 28,425 ) — — ( 28,425 )

Stock-based compensation, issuance of common stock for share vesting, and common stock reissuances 2 12,127 — 6,888 — 19,017

Exercise of stock options — 225 — — — 225

Common stock repurchases and related expenses — — — ( 547,542 ) — ( 547,542 )

Warrants exercises 2 6,688 — — — 6,690

Cash dividend and dividend equivalents declared ($ 1.940 per share)

— — — — ( 27,748 ) ( 27,748 )

Balances, December 31, 2023 $ 221 $ 834,482 $ ( 40,587 ) $ ( 1,189,715 ) $ 1,969,527 $ 1,573,928

Refer to accompanying Notes to Consolidated Financial Statements.

20 unchanged sentences

Basis of Presentation

Together, the consolidated balance sheets and consolidated statements of operations, comprehensive income (loss), cash flows and stockholders’ equity for the Company are referred to as the “Financial Statements.” The Financial Statements are also referred to as “Consolidated” and references across periods are generally labeled “Balance Sheets,” “Statements of Operations,” and “Statements of Cash Flows.” The Company’s former NAPP operations results of operations and financial position are reported as discontinued operations in the Consolidated Financial Statements for the year ended December 31, 2020.

Refer to Note 3 for further information on discontinued operations.

Together, the consolidated statements of operations, comprehensive income, balance sheets, cash flows and stockholders’ equity for the Company are referred to as the “Consolidated Financial Statements.” The Consolidated Financial Statements are also referenced across periods as “Consolidated Statements of Operations,” “Consolidated Statements of Comprehensive Income,” “Consolidated Balance Sheets,” “Consolidated Statements of Cash Flows,” and “Consolidated Statements of Stockholders’ Equity.”

The Consolidated Financial Statements include all wholly owned subsidiaries’ results of operations for the years ended December 31, 2023, 2022, and 2021.

1 unchanged sentence

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S.

Reclassifications

Certain immaterial amounts as of and for the years ended December 31, 2022 and 2021 in the Consolidated Financials Statements and notes to the Consolidated Financials Statements have been recast to reclassify discontinued operations and present the related amounts within continuing operations as part of the All Other category.

Additionally, certain amounts in the prior year Consolidated Statements of Stockholders’ Equity have been reclassified to conform to the current year presentation.

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 the Company’s business, results of operations, financial condition and cash flows.

In 2021, the Company experienced an increase in employee absences due to COVID-19, although COVID-related absences within the Company decreased in 2022.

Indirectly, through some of the Company’s third-party vendors, the Company and the Company’s customers have experienced some supply chain disruptions due to the COVID-19 pandemic.

The continued impact of the COVID-19 pandemic on the Company’s operational and financial performance will depend on certain developments, including the duration of the virus, the global economic impacts of the virus, its impact on the Company’s customers and suppliers, and the range of governmental and community reactions to the pandemic, which cannot be fully predicted.

Health and safety are core values of the Company and are the foundation for how the Company manages every

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

aspect of its business.

The Company continues to monitor developments closely and adjust as necessary, including with respect to the Company’s implemented policies, procedures, and prevention measures to protect the safety and health of its employees.

(2) Summary of Significant Accounting Policies

12 unchanged sentences

reserves for contingencies and litigation;

fair value of financial instruments;

and fair value adjustments for acquisition accounting.

and fair value of financial instruments.

Estimates are based on facts and circumstances believed to be reasonable at the time;

3 unchanged sentences

Cash and cash equivalents are stated at cost, which approximates fair value.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Restricted Cash

9 unchanged sentences

Refer to Note 21 for further information.

Trade Accounts Receivable and Allowance for Doubtful Accounts

Trade Accounts Receivable and Allowance for Credit Losses

Trade accounts receivable are recorded at their invoiced amounts and do not bear interest.

4 unchanged sentences

Credit limits are monitored and adjusted as considered necessary based on changes to a customer’s credit profile.

If a customer’s credit deteriorates, the Company may reduce credit risk exposure by reducing credit limits, obtaining letters of credit, obtaining credit insurance, or requiring pre-payment for shipments.

If a customer’s credit deteriorates, the Company may reduce credit risk exposure by reducing credit limits, obtaining letters of credit (“LCs”), obtaining credit insurance, or requiring pre-payment for shipments.

Credit losses have historically not been material.

1 unchanged sentence

Refer to Note 22 for further information.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Coal is reported as inventory at the point in time the coal is extracted from the mine.

6 unchanged sentences

Refer to Note 6 for further information.

Discontinued Operations

In accordance with Accounting Standards Codification (“ASC”) 205-20-45, the Company treats a disposal transaction as a discontinued operation when the disposal of a component or group of components represents a strategic shift that will have a major effect on the Company’s operations and financial results.

In the period in which the discontinued operations criteria are met, the assets and liabilities of the discontinued operations are separately presented on the Company's Consolidated Balance Sheets and the results of operations, including any gain or loss recognized, are reclassified to discontinued operations on the Company’s Consolidated Statement of Operations.

Refer to Note 3 for further information.

Advanced Mining Royalties

Lease rights to coal reserves are often acquired in exchange for royalty payments.

Advance mining royalties are advance payments made to lessors under terms of mineral lease agreements that are recoupable against future production royalties.

These advance payments are deferred and charged to operations as the coal reserves are mined.

The Company regularly reviews recoverability of advance mining royalties and establishes or adjusts the allowance for advance mining royalties as necessary using the specific identification method.

Advance royalty balances are generally charged off against the allowance when they are no longer recoupable.

Advanced mining royalties are advanced payments made to lessors under terms of mineral lease agreements that are recoupable against future production royalties.

These advanced payments are deferred and charged to operations as the coal reserves are mined.

The Company regularly reviews recoverability of advanced mining royalties and establishes or adjusts the allowance for advanced mining royalties as necessary using the specific identification method.

Advanced royalty balances are generally charged off against the allowance when they are no longer recoupable.

Advanced mining royalties are included within Other non-current assets on the Company’s Consolidated Balance Sheets.

Refer to Note 9 for further information.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Property, Plant, and Equipment, Net

5 unchanged sentences

Maintenance and repairs are expensed as incurred.

When equipment is retired or disposed, the related cost and accumulated depreciation are removed from the respective accounts and any profit or loss on disposal is recognized in Other expense (income) in the Company’s Consolidated Statements of Operations.

When equipment is retired or disposed, the related cost and accumulated depreciation are removed from the respective accounts and any profit or loss on disposal is recognized in Other (income) expense in the Company’s Consolidated Statements of Operations.

Refer to Note 8 for further information.

2 unchanged sentences

These amounts include $ 27,473 and $ 20,284 of asset retirement obligation assets, net of accumulated amortization, associated with active mining operations for the years ended December 31, 2023 and 2022, respectively.

During the year ended December 31, 2020, the Company recorded a long-lived asset impairment which reduced the carrying value of owned and leased mineral rights, net, by $ 41,579 .

Refer to Note 8 for further information on long-lived asset impairment.

Costs to obtain owned and leased mineral rights are capitalized and amortized to operations as depletion expense using the units-of-production method.

Only proven and probable reserves are included in the depletion base.

Depletion expense is

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

included in Depreciation, depletion and amortization in the accompanying Consolidated Statements of Operations and was $ 23,078 , $ 23,541 , and ($ 13,746 ) for the years ended December 31, 2022, 2021, and 2020 respectively.

Depletion expense for the years ended December 31, 2022, 2021, and 2020 includes a credit of ($ 3,016 ), an expense of $ 5,782 , and a credit of ($ 34,377 ), respectively, related to revisions to asset retirement obligations.

Depletion expense is included in Depreciation, depletion and amortization in the accompanying Consolidated Statements of Operations and was $ 23,944 , $ 23,078 , and $ 23,541 for the years ended December 31, 2023, 2022, and 2021 respectively.

Depletion expense for the years ended December 31, 2023, 2022, and 2021 includes a credit of ($ 34 ), a credit of ($ 3,016 ), and an expense of $ 5,782 , respectively, related to revisions to asset retirement obligations.

Refer to Note 15 for further disclosures related to asset retirement obligations.

11 unchanged sentences

The balances of such assets as of December 31, 2023 and 2022, net of accumulated amortization, were $ 46,579 and $ 55,102 , respectively, and are included within Other acquired intangibles, net of accumulated amortization, on the Company’s Consolidated Balance Sheets.

During the year ended December 31, 2020, the Company recorded long-lived asset impairments which reduced the carrying value of acquired mine permits, net, by $ 21,144 .

Refer to Note 8 for further information.

The acquired mine permits are amortized over the estimated life of the associated mine.

Amortization expense is included in Amortization of acquired intangibles, net in the accompanying Consolidated Statements of Operations and was $ 8,523 , $ 19,498 , and $ 13,571 for the years ended December 31, 2023, 2022, and 2021, respectively.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Additionally, the Company previously recognized assets for acquired above market-priced coal supply agreements and liabilities for acquired below market-priced coal supply agreements.

3 unchanged sentences

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

In December 2022, primarily to secure the supply of certain underground mining equipment parts needed for its operations, the Company purchased substantially all of the assets of a mining equipment component manufacturing and rebuilding business for $ 24,878 , which included $ 7,787 of working capital, $ 6,355 of property, plant, and equipment, and $ 10,736 of goodwill.

Goodwill for the years ended December 31, 2023 and 2022 was $ 11,124 and $ 10,736 , respectively, and is included within Other non-current assets on the Company’s Consolidated Balance Sheets.

In January 2023, primarily to secure additional coal trucks and related equipment and facilities, the Company purchased substantially all the assets of a freight, hauling and transportation services business for $ 11,919 , resulting in $ 388 of goodwill.

The acquired goodwill, related primarily to the acquired workforce and expected cost synergies, was allocated to the Company's Met reportable segment.

In December 2022, the Company purchased substantially all of the assets of a mining equipment component manufacturing and rebuild business to help secure the supply of certain underground mining equipment parts needed for the Company’s operations for $ 24,878 , which included $ 7,787 of working capital, $ 6,355 of property, plant, and equipment, and $ 10,736 of goodwill.

The acquired goodwill, related primarily to the acquired workforce and expected cost synergies, was allocated to the Company’s Met reportable segment.

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.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The Company assesses goodwill for impairment on a qualitative basis.

11 unchanged sentences

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

Refer to Note 8 for further information.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Asset Retirement Obligations

6 unchanged sentences

To settle the liability, the obligation is paid, and any difference between the liability and the amount of cash paid is recorded within Depreciation, depletion and amortization within the Consolidated Statements of Operations at the time the reclamation work is completed.

The Company annually reviews its estimated future cash flows for its asset retirement obligations.

On at least an annual basis, the Company reviews its estimated future cash flows for its asset retirement obligations.

Refer to Note 15 for further information.

7 unchanged sentences

Deferred Financing Costs

The costs to obtain new debt financing or amend existing financing agreements are generally deferred and amortized to

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

interest expense over the life of the related indebtedness or credit facility using the effective interest method.

The costs to obtain new debt financing or amend existing financing agreements are generally deferred and amortized to interest expense over the life of the related indebtedness or credit facility using the effective interest method.

Unamortized deferred financing costs are presented in the Consolidated Balance Sheets as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts or premiums.

14 unchanged sentences

Adjustments to the probable ultimate liabilities are made annually based on an actuarial study and adjustments to the liability are recorded based on the results of this study.

These short-term and long-term obligations are included in the Consolidated Balance Sheets within Accrued expenses and other current liabilities and Workers’ compensation and black lung obligations, respectively, with the related expected insurance receivables within Prepaid expenses and other current assets and Other non-current assets.

These short-term and long-term obligations are included in the Consolidated Balance Sheets within

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Accrued expenses and other current liabilities and Workers’ compensation and black lung obligations, respectively, with the related expected insurance receivables within Prepaid expenses and other current assets and Other non-current assets.

As of December 31, 2023 and 2022, the workers’ compensation liability was net of a discount of $ 22,205 and $ 22,824 , respectively, related to fair value adjustments associated with acquisition accounting.

13 unchanged sentences

Refer to Note 18 for information.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Postretirement Life Insurance Benefits

5 unchanged sentences

Refer to Note 18 for further information.

Net Income (Loss) per Share

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of outstanding common shares for the period.

Diluted (loss) earnings per share reflects the potential dilution that could occur if instruments that may require the issuance of common shares in the future were settled and the underlying common shares were issued.

Diluted (loss) earnings per share is computed by increasing the weighted-average number of outstanding common shares computed in basic earnings (loss) per share to include the additional common shares that would be outstanding after issuance and adjusting net income (loss) for changes that would result from the issuance.

Net Income per Share

Basic net income per share is computed by dividing net income by the weighted-average number of outstanding common shares for the period.

Diluted earnings per share reflects the potential dilution that could occur if instruments that may require the issuance of common shares in the future were settled and the underlying common shares were issued.

Diluted earnings per share is computed by increasing the weighted-average number of outstanding common shares computed in basic earnings per share to include the additional common shares that would be outstanding after issuance and adjusting net income for changes that would result from the issuance.

Only those securities that are dilutive are included in the calculation.

7 unchanged sentences

Refer to Note 19 for further information.

On July 26, 2016 (the “Initial Issue Date”), the Company issued warrants, which are classified as equity instruments, and are exercisable for cash or on a cashless basis at any time from the Initial Issue Date until July 26, 2023, and no fractional shares will be issued upon warrant exercises.

The exercise price and the warrant share number will be adjusted in respect of certain dilutive events with respect to common stock (namely, dividends or distributions on the common stock, share splits and combinations, above-market tender offers for common stock by the Company or a subsidiary thereof, and discounted issuances of common stock or rights or options to purchase common stock or securities convertible or exchangeable into common stock).

Additionally, in the case of any reorganization (i.e., a consolidation, merger, or sale of all or substantially all of the consolidated assets of Alpha) pursuant to which the common stock is converted into cash, securities or other property, the warrants would become exercisable for such property.

Refer to Note 9 for additional information.

Equity Method Investments

Investments in unconsolidated affiliates that the Company has the ability to exercise significant influence over, but not control, are accounted for under the equity method of accounting.

Under the equity method of accounting, the Company records its proportionate share of the entity’s net income or loss at each reporting period in the Consolidated Statements of Operations in other (expense) income, with a corresponding entry to increase or decrease the carrying value of the investment.

The carrying value of the Company’s equity method investments was $ 23,070 and $ 20,460 as of December 31, 2022 and 2021, respectively.

Recently Adopted Accounting Guidance

Reference Rate Reform:

In December 2022, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2022-06, Deferral of the Sunset Date of Topic 848 (“ASU 2022-06”).

This update defers the sunset date of ASC 848 to December 31, 2024.

The amendments are effective immediately for all entities and are applied prospectively.

As the Company previously adopted ASU 2020-04, Reference Rate Reform (Topic 848):

Facilitation of Effects of Reference Rate Reform on Financial Reporting during the first quarter of 2020, ASU 2022-06 did not have an impact on the Company’s Consolidated Financial Statements and related disclosures.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

Government Assistance :

In November 2021, the FASB issued ASU 2021-10 , Disclosures by Business Entities about Government Assistance (“ASU 2021-10”).

This update requires business entities to make annual disclosures about transactions with a government accounted for by analogizing to a grant or contribution accounting model.

The required annual disclosures include the nature of the transaction, the related accounting policy, the financial statement line items affected and the amounts reflected in the current period financial statements, and any significant terms and conditions.

The amendments are effective for fiscal years beginning after December 15, 2021, for all entities, with early application permitted.

The Company adopted ASU 2021-10 during the fourth quarter of 2022.

The adoption of this ASU did not have a material impact on the Company’s Consolidated Financial Statements and related disclosures.

In September 2022, the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations (“ASU 2022-04”).

This update enhances transparency about an entity’s use of supplier finance programs.

The ASU requires entities to disclose information about the key terms of the program, outstanding confirmed amounts as of the end of the period, a rollforward of such amounts during each annual period, and a description of where in the financial statements outstanding amounts are presented.

The amendments are effective for fiscal years beginning after December 15, 2022, with early application permitted.

The Company adopted ASU 2022-04 during the third quarter of 2022.

The adoption of this ASU did not have a material impact on the Company’s Consolidated Financial Statements and related disclosures.

Fair Value Measurement:

In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”).

This update clarifies how the fair value of equity securities subject to contractual sale restrictions is determined.

Per the update, a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and is not considered in measuring fair value.

Additionally, the update requires entities with investments in equity securities subject to contractual sale restrictions to disclose certain qualitative and quantitative information about such securities.

The amendments are effective for fiscal years beginning after December 15, 2023, with early application permitted.

The Company adopted ASU 2022-03 during the second quarter of 2022.

The adoption of this ASU did not have a material impact on the Company’s Consolidated Financial Statements and related disclosures.

Financial Instruments:

In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”).

This update eliminates the troubled debt restructuring model for creditors that have adopted Topic 326.

All loan modifications will now be accounted for under general loan modification guidance and, on a prospective basis, entities will be subject to new disclosure requirements covering modifications of receivables to borrowers experiencing financial difficulty.

In addition, entities will be required to prospectively disclose current-period gross write-off information by year of origination.

The amendments are effective for fiscal years beginning after December 15, 2022, with early application permitted.

The Company adopted ASU 2022-02 during the first quarter of 2022.

The adoption of this ASU did not have a material impact on the Company’s Consolidated Financial Statements and related disclosures.

(3) Discontinued Operations

The Company has no discontinued operations as of or for the years ended December 31, 2022 and 2021.

Discontinued operations consisted of activity related to the Company’s former NAPP operations for the year ended December 31, 2020.

Former NAPP Operations

On November 11, 2020, the Company entered into a unit purchase agreement (the “UPA”) to sell its thermal coal mining operations located in Pennsylvania consisting primarily of its Cumberland mining complex and related property (“Cumberland Transaction”) to a third-party purchaser Iron Senergy Holdings, LLC (“Iron Senergy”).

The Cumberland Transaction closed on December 10, 2020.

In accordance with terms of the UPA, the Company transferred its equity interests in certain subsidiaries (Cumberland Contura, LLC, Contura Coal Resources, LLC, Contura Pennsylvania Land, LLC, Emerald Contura, LLC, and Contura Pennsylvania Terminal, LLC) along with total consideration of $ 49,987 to Iron Senergy.

Pursuant to the terms of the UPA, the Company also retained certain assets and liabilities associated with its former NAPP operations.

The mining permits associated with the Cumberland mining operations were obtained by Iron Senergy at closing.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The following table presents the details of the Cumberland Transaction:

Year Ended December 31, 2020

Cash $ 19,987

Surety bonding collateral 30,000

Total consideration $ 49,987

Transaction costs 2,205

Carrying value of assets and liabilities (1)

Loss on sale $ 36,113

(1) Assets and liabilities were primarily comprised of property, plant and equipment, net of $ 32,872 , deferred longwall move expenses of $ 15,173 , and coal and supplies inventory of $ 5,112 and asset retirement obligations of $ 39,573 , severance of $ 17,143 , black lung obligations of $ 8,290 , and subsidence liability of $ 3,559 .

In connection with the UPA, the Company entered into certain agreements with Iron Senergy under which Iron Senergy will sell to the Company all of the coal that the Company is obligated to sell to customers under Cumberland coal supply agreements (“Cumberland CSAs”) which existed as of the transaction closing date but did not transfer to Iron Senergy at closing (each, a “Cumberland Back-to-Back Coal Supply Agreement”).

Each Cumberland Back-to-Back Coal Supply Agreement has economic terms identical to, but offsetting, the related Cumberland CSA.

If a Cumberland customer subsequently consents to assign a Cumberland CSA to Iron Senergy after closing, the related Cumberland CSA will immediately and automatically transfer to Iron Senergy and the related Cumberland Back-to-Back Coal Supply Agreements executed by the parties shall thereupon terminate as set forth therein.

As the Company does not control the purchased coal prior to customer delivery, the Company will record coal purchases and sales under the related agreements on a net basis.

Per terms of the Cumberland Back-to-Back Coal Supply Agreements, the Company is required to purchase and sell 401 tons of coal in 2023 totaling $ 15,478 .

For the years ended December 31, 2022, 2021, and 2020 the Company purchased and sold 1,617 , 2,591 , and 104 tons, respectively, totaling $ 62,171 , $ 100,338 , and $ 3,997 , respectively, under the Cumberland Back-to-Back Coal Supply Agreements.

During the fourth quarter of 2022, one Cumberland Back-to-Back Coal Supply Agreement initially scheduled to be fully performed by December 31, 2022 was extended into 2023 and is expected to be fully performed by the end of the second quarter of 2023.

Major Financial Statement Components of Discontinued Operations

The major components of net loss from discontinued operations before income taxes in the Consolidated Statements of Operations for the year ended December 31, 2020 are as follows:

Year Ended December 31, 2020 (1)

Total revenues $ 235,509

Costs and expenses:

Cost of coal sales (exclusive of items shown separately below) 215,390

Depreciation, depletion and amortization 11,570

Accretion on asset retirement obligations 4,154

Asset impairment and restructuring (2)

Selling, general and administrative expenses (3)

Other income ( 926 )

Other non-major expense items, net 374

Loss on sale 36,113

Loss from discontinued operations before income taxes $ ( 205,429 )

(1) Includes minor residual activity related to the Company’s former PRB operations.

(2) Refer to Note 8.

(3) Represents professional and legal fees.

On July 26, 2016 (the “Initial Issue Date”), the Company issued warrants, which were classified as equity instruments, and were exercisable for cash or on a cashless basis at any time from the Initial Issue Date until July 26, 2023, and no fractional shares were issued upon warrant exercises.

The exercise price and the warrant share number were adjusted in respect of certain dilutive events with respect to common stock.

At 5:00 pm Eastern time on July 26, 2023 the Company’s Series A Warrants expired pursuant to their terms.

Refer to Note 7 for additional information.

Equity Method Investments

Investments and membership interests in joint ventures are accounted for under the equity method of accounting if the Company has the ability to exercise significant influence, but not control, over the entity.

Under the equity method of accounting, the Company’s proportionate share of the entity’s comprehensive income or loss each reporting period is reflected in Equity loss in affiliates in the Consolidated Statements of Operations.

Equity method investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable.

The carrying values of the Company’s equity method investments are included within Other non-current assets on the Company’s Consolidated Balance Sheets.

Refer to Notes 9 and 10 for additional information.

Recent Accounting Guidance

Segment Disclosures :

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

This update requires public entities to disclose significant segment expenses that are regularly provided to its chief operating decision maker and other segment items and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually.

The additional disclosures are required to be provided on a retrospective basis.

The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company will provide the additional required disclosures upon adoption.

Income Tax Disclosures :

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”).

This update requires public business entities to disclose in their income tax rate reconciliation table additional categories of information about federal, state, and foreign income taxes and to provide additional details about the reconciling items in categories meeting a quantitative threshold.

The guidance will also require entities to disclose income taxes paid, net of refunds, disaggregated by federal, state, and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold.

The additional disclosures are required to be provided on a prospective basis with the option to provide retrospectively.

The amendments are effective for fiscal years beginning after December 15, 2024.

The Company will provide the additional required disclosures upon adoption.

Disaggregation of Revenue from Contracts with Customers

ASC 606 requires that entities disclose disaggregated revenue information in categories (such as type of good or service, geography, market, type of contract, etc.) that depict how the nature, amount, timing, and uncertainty of revenue and cash flow are affected by economic factors.

ASC 606 explains that the extent to which an entity’s revenue is disaggregated depends on the facts and circumstances that pertain to the entity’s contracts with customers and that some entities may need to use more than one type of category to meet the objective for disaggregating revenue.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

Refer to the Consolidated Statements of Operations and Note 6 for net loss per share information related to discontinued operations.

The major components of cash flows related to discontinued operations were as follows:

Year Ended December 31,

Depreciation, depletion and amortization $ 11,570

Capital expenditures $ 34,411

Other significant operating non-cash items related to discontinued operations:

Accretion on asset retirement obligations $ 4,154

Asset impairment and restructuring $ 172,640

Disaggregation of Revenue from Contracts with Customers

The Company earns revenues primarily through the sale of coal produced at Company operations and coal purchased from third parties.

6 unchanged sentences

Export revenue generally is derived by spot or short term contracts with pricing determined at the time of shipment or based on a market index;

whereas domestic revenue is characterized by contracts that typically have a term of one year or longer and typically the pricing is fixed.

whereas domestic revenue is characterized by contracts that typically have a term of one year or longer and with fixed pricing terms.

The following tables disaggregate the Company’s coal revenues by product category and by market to depict how the nature, amount, timing, and uncertainty of the Company’s coal revenues and cash flows are affected by economic factors:

Year Ended December 31,

Met Coal Thermal Coal Total

Export coal revenues $ 3,195,516 $ 107,961 $ 3,303,477

Domestic coal revenues 687,795 101,715 789,510

Total coal revenues $ 3,883,311 $ 209,676 $ 4,092,987

Year Ended December 31, 2021

Met Coal Thermal Coal Total

Export coal revenues $ 1,675,147 $ 30,879 $ 1,706,026

Domestic coal revenues 396,160 150,438 546,598

Total coal revenues $ 2,071,307 $ 181,317 $ 2,252,624

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31, 2020

Met Coal Thermal Coal Total

Export coal revenues $ 870,121 $ 27,904 $ 898,025

Domestic coal revenues 362,654 152,445 515,099

2023 2022 2021

Export met coal revenues $ 2,412,960 $ 3,195,516 $ 1,675,147

Export thermal coal revenues 126,108 107,961 30,879

Total export coal revenues $ 2,539,068 $ 3,303,477 $ 1,706,026

Domestic met coal revenues $ 865,667 $ 687,795 $ 396,160

Domestic thermal coal revenues 51,895 101,715 150,438

Total domestic coal revenues $ 917,562 $ 789,510 $ 546,598

Total met coal revenues $ 3,278,627 $ 3,883,311 $ 2,071,307

Total thermal coal revenues 178,003 209,676 181,317

Total coal revenues $ 3,456,630 $ 4,092,987 $ 2,252,624

13 unchanged sentences

The following tables summarize the changes to accumulated other comprehensive loss during the years ended December 31, 2023, 2022, and 2021:

Balance January 1, 2022 Other comprehensive income before reclassifications Amounts reclassified from accumulated other comprehensive loss Balance December 31, 2022

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Balance January 1, 2023 Other comprehensive loss before reclassifications Amounts reclassified from accumulated other comprehensive loss Balance December 31, 2023

Employee benefit costs $ ( 12,162 ) $ ( 26,617 ) $ ( 1,808 ) $ ( 40,587 )

3 unchanged sentences

Balance January 1, 2021

Other comprehensive loss before reclassifications Amounts reclassified from accumulated other comprehensive loss Balance December 31, 2020

Other comprehensive income before reclassifications Amounts reclassified from accumulated other comprehensive loss Balance December 31, 2021

Employee benefit costs $ ( 111,985 ) $ 47,461 $ 6,021 $ ( 58,503 )

The following table summarizes the amounts reclassified from accumulated other comprehensive loss and the Consolidated Statements of Operations line items affected by the reclassification during the years ended December 31, 2023, 2022, and 2021:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Details about accumulated other comprehensive loss components Amounts reclassified from accumulated other comprehensive loss Affected line item in the Consolidated Statements of Operations

2 unchanged sentences

Employee benefit costs:

Amortization of actuarial loss (1)

$ 3,311 $ 5,653 $ 3,929 Miscellaneous income (loss), net

Amortization of actuarial (gain) loss (1)

$ ( 2,324 ) $ 3,311 $ 5,653 Miscellaneous (expense) income, net

Settlement (1)

244 368 3,349 Miscellaneous income (loss), net

— 244 368 Miscellaneous (expense) income, net

Total before income tax $ ( 2,324 ) $ 3,555 $ 6,021

Income tax ( 811 ) — — Income tax (expense) benefit

Income tax benefit (expense) 516 ( 811 ) — Income tax expense

Total, net of income tax $ ( 1,808 ) $ 2,744 $ 6,021

(1) These accumulated other comprehensive loss components are included in the computation of net periodic benefit costs for certain employee benefit plans.

(1) These accumulated other comprehensive loss components are included in the computation of net periodic benefit costs (credits) for certain employee benefit plans.

Refer to Note 18.

(6) Net Income (Loss) per Share

The number of shares used to calculate basic net income (loss) per common share is based on the weighted average number of the Company’s outstanding common shares during the respective period.

The number of shares used to calculate diluted net income (loss) per common share is based on the number of common shares used to calculate basic net income (loss) per common share plus the dilutive effect of stock options and other stock-based instruments held by the Company’s employees and directors during the period, and the Company’s outstanding warrants.

(5) Net Income per Share

The number of shares used to calculate basic net income per common share is based on the weighted average number of the Company’s outstanding common shares during the respective period.

The number of shares used to calculate diluted net income per common share is based on the number of common shares used to calculate basic net income per common share plus the dilutive effect of stock options and other stock-based instruments held by the Company’s employees and directors during the period, and the Company’s outstanding warrants.

The dilutive effect of outstanding stock-based instruments is determined by application of the treasury stock method.

The stock options and warrants become dilutive for diluted net income (loss) per common share calculations when the market price of the Company’s common stock exceeds the exercise price.

As discussed below, dilutive securities are not included in the computation of diluted net loss per common share for the year ended December 31, 2020 as the impact would be anti-dilutive.

For the years ended December 31, 2022, 2021, and 2020, respectively, 0 , 717,992 , and 1,317,351 warrants, stock options, and other stock-based instruments were excluded from the computation of dilutive net income (loss) per common share because they would have been anti-dilutive.

The stock options and warrants become dilutive for diluted net income per common share calculations when the market price of the Company’s common stock exceeds the exercise price.

Anti-dilution also occurs in periods of a net loss, and the dilutive impact of all warrants and share-based compensation awards are excluded.

For the years ended December 31, 2023, 2022, and 2021, respectively, 1,240 , 0 , and 717,992 warrants, stock options, and other stock-based instruments were excluded from the computation of dilutive net income per common share because they would have been anti-dilutive.

When applying the treasury stock method, anti-dilution generally occurs when the exercise prices or unrecognized compensation cost per share are higher than the Company’s average stock price during an applicable period.

Anti-dilution also occurs in periods of a net loss, and the dilutive impact of all share-based compensation awards are excluded.

For the year ended December 31, 2020, the weighted average share impact of stock options and other stock-based instruments that were excluded from the calculation of diluted shares due to the Company incurring a net loss for the period was 142,250 .

The following table presents the net income (loss) per common share for the years ended December 31, 2022, 2021, and 2020:

The following table presents the net income per common share for the years ended December 31, 2023, 2022, and 2021:

ALPHA METALLURGICAL RESOURCES, INC.

4 unchanged sentences

2023 2022 2021

Net income (loss)

Income (loss) from continuing operations $ 1,448,545 $ 288,790 $ ( 241,470 )

Loss from discontinued operations — — ( 205,429 )

Net income (loss) $ 1,448,545 $ 288,790 $ ( 446,899 )

Net income $ 721,956 $ 1,448,545 $ 288,790

Weighted average common shares outstanding - basic 14,106,466 17,490,886 18,441,175

Basic income (loss) per common share:

Income (loss) from continuing operations $ 82.82 $ 15.66 $ ( 13.20 )

Loss from discontinued operations — — ( 11.22 )

Net income (loss) $ 82.82 $ 15.66 $ ( 24.42 )

Net income per common share - basic $ 51.18 $ 82.82 $ 15.66

Weighted average common shares outstanding - basic 14,106,466 17,490,886 18,441,175

3 unchanged sentences

Weighted average common shares outstanding - diluted 14,642,856 18,222,397 18,871,682

Diluted income (loss) per common share:

Income (loss) from continuing operations $ 79.49 $ 15.30 $ ( 13.20 )

Loss from discontinued operations — — ( 11.22 )

Net income (loss) $ 79.49 $ 15.30 $ ( 24.42 )

Net income per common share - diluted $ 49.30 $ 79.49 $ 15.30

(6) Inventories, net

4 unchanged sentences

Total inventories, net $ 231,344 $ 200,574

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

(8) Asset Impairment and Restructuring

Long-lived Asset Impairment for the Year Ended December 31, 2021

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.

Long-lived Asset Impairment for the Year Ended December 31, 2020

During the year ended December 31, 2020, weakening coal market conditions due in part to the impact of the global COVID-19 Pandemic, as well as the following events resulted in quarterly impairment testing:

• During the second quarter of 2020, the Company announced that it would take certain strategic actions with respect to two of its thermal coal mining complexes in an effort to strengthen its financial performance and improve forecasted liquidity.

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

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

As a result, the Cumberland mine was expected to cease production by the end of 2022.

On December 10, 2020, the Company sold its Cumberland mining operations.

Refer to Note 3 for further details.

• During the fourth quarter of 2020, changes in mine plans and the determination that certain mineral reserves previously forecasted to be mined were no longer considered economic due to poor geologic conditions reduced forecasted cash flows for one Met and one All Other asset group to amounts below those required for full recoverability.

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

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

The following tables present the details of the long-lived asset impairments during the year ended December 31, 2020:

Year Ended December 31, 2020

First Quarter Second Quarter Third Quarter Fourth Quarter Year Ended

Continuing operations:

$ 32,951 $ — $ — $ 13,366 $ 46,317

All Other 758 17,390 219 16,270 34,637

Total from continuing operations $ 33,709 $ 17,390 $ 219 $ 29,636 $ 80,954

Discontinued operations:

$ — $ 144,348 $ 3,297 $ — $ 147,645

Total long-lived asset impairment:

$ 33,709 $ 161,738 $ 3,516 $ 29,636 $ 228,599

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31, 2020

First Quarter Second Quarter Third Quarter Fourth Quarter Year Ended

Continuing operations:

Mineral rights, net

$ 21,825 $ 2,241 $ — $ 17,513 $ 41,579

Property, plant, and equipment, net

6,066 6,496 219 5,450 18,231

Acquired mine permits, net 5,818 8,653 — 6,673 21,144

Total from continuing operations $ 33,709 $ 17,390 $ 219 $ 29,636 $ 80,954

Discontinued operations:

Mineral rights, net

$ — $ 16,364 $ — $ — $ 16,364

Property, plant, and equipment, net

— 127,984 3,297 — 131,281

Total from discontinued operations $ — $ 144,348 $ 3,297 $ — $ 147,645

Total long-lived asset impairment:

Mineral rights, net

$ 21,825 $ 18,605 $ — $ 17,513 $ 57,943

Property, plant, and equipment, net

6,066 134,480 3,516 5,450 149,512

Acquired mine permits, net 5,818 8,653 — 6,673 21,144

Total long-lived asset impairment $ 33,709 $ 161,738 $ 3,516 $ 29,636 $ 228,599

Restructuring

As a result of the strategic actions announced in the second quarter of 2020 and subsequent changes to severance and employee-related benefits, the Company recorded restructuring expense of ($ 621 ) in the All Other category during the year ended December 31, 2021.

As a result of the strategic actions discussed above, the Company recorded restructuring expense during the year ended December 31, 2020 as follows:

Year Ended December 31, 2020

Total Restructuring Continuing Operations (3)

Discontinued Operations

Severance and employee-related benefits (1)

$ 26,037 $ 2,117 $ 23,920

Other costs (2)

1,882 807 1,075

Total restructuring expense $ 27,919 $ 2,924 $ 24,995

(1) Severance and employee-related benefits were considered probable and estimable based on provisions of contractual agreements and existing employee benefit plans.

(2) Includes accelerated amortization of deferred longwall move expenses of $ 668 , allowance for advanced mining royalties of $ 407 , and allowance for obsolete materials and supplies inventory of $ 807 .

(3) Total restructuring expense from continuing operations of $ 2,924 was recorded within the All Other category and affected Accrued expenses and other current liabilities, Other non-current liabilities, Inventories, net, and Other non-current assets.

(7) Capital Stock

Share Repurchase Program

On March 4, 2022, the Company’s Board of Directors (the “Board”) adopted a share repurchase program that permitted the Company to repurchase up to an aggregate amount of $ 150,000 of the Company's common stock.

On May 3, 2022, the Board amended the share repurchase program to increase the aggregate amount the Company is permitted to repurchase to $ 600,000 of the Company's common stock.

On November 4, 2022, the Board amended the share repurchase program to increase the aggregate amount the Company is permitted to repurchase to $ 1,000,000 of the Company’s common stock.

Share repurchases

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

may be made from time to time through open market transactions, block trades, tender offers, or otherwise, and the program has no expiration date.

On February 21, 2023, the Company’s Board of Directors (the “Board”) approved a $ 200,000 increase to the existing common share repurchase program that the Board adopted on March 4, 2022, bringing the total authorization to repurchase the Company’s stock to $ 1,200,000 .

On October 31, 2023, the Board approved an additional $ 300,000 increase to the share repurchase program, bringing the total authorization to repurchase the Company’s stock to $ 1,500,000 .

Share repurchases may be made from time to time through open market transactions, block trades, tender offers, or otherwise, and the program has no expiration date.

The share repurchase program does not obligate the Company 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 the Company’s discretion.

1 unchanged sentence

As of December 31, 2023, the Company had repurchased an aggregate of 6,475,271 shares under the program for an aggregate purchase price of approximately $ 1,040,128 (comprised of $ 1,039,934 of share repurchases and $ 194 of related fees).

Refer to Note 25 for subsequent event disclosures related to an increase in the aggregate amount permitted to be repurchased under the share repurchase program.

The Company has also accrued a stock repurchase excise tax of $ 4,665 related to the share repurchase program as of December 31, 2023, which is recorded in treasury stock at cost.

Dividend Program

1 unchanged sentence

Pursuant to this policy, the Board initially intended to pay aggregate cash dividends of $ 1.50 per share of common stock per year, with $ 0.375 per share paid each quarter.

Subsequently, during the year ended December 31, 2022, the Board increased the quarterly dividend amounts and also declared a one-time, special dividend.

In addition, pursuant to the terms of certain stock-based compensation awards under the Company’s Management Incentive Plan (the “MIP”) and Long-Term Incentive Plan (the “LTIP”), dividend equivalent amounts for each quarterly dividend will become payable at various vesting dates with respect to each underlying outstanding award.

Subsequently, during the years ended December 31, 2022 and 2023 the Board increased the quarterly dividend amounts.

In addition, pursuant to the terms of certain stock-based compensation awards under the Company’s Management Incentive Plan (the “MIP”) and Long-

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Term Incentive Plan (the “LTIP”), dividend equivalent amounts for each quarterly dividend will become payable at various vesting dates with respect to each underlying outstanding award.

The Board declared the following dividends on the Company’s common stock during the year ended December 31, 2023:

Total Dividend per Share (1)

Total Dividends Paid (2)

Total Dividend per Share Total Dividends Paid (1)

Declaration Date Holders of Record Date Payable Date

$ 0.44 $ 6,602 February 21, 2023 March 15, 2023 April 3, 2023

$ 0.50 $ 7,001 May 3, 2023 June 15, 2023 July 5, 2023

$ 0.50 $ 6,736 August 2, 2023 September 15, 2023 October 3, 2023

5.418 84,748 November 4, 2022 December 15, 2022 January 3, 2023

$ 0.50 $ 6,510 October 31, 2023 December 1, 2023 December 15, 2023

$ 1.94 $ 26,849

(1) The fourth quarter dividend declared on November 4, 2022 includes the quarterly cash dividend of $ 0.418 per share and the one-time, special dividend of $ 5.00 per share.

(1) Excludes dividend equivalents paid or accrued of $ 899 as of December 31, 2023.

As of December 31, 2022, a related $ 84,748 balance was held on deposit to facilitate the dividend payment on January 3, 2023.

The Company expects any future dividend payments will be targeted to be paid in the first month of each calendar quarter.

Any decisions as to whether and when to pay future cash dividends will, however, be made by the Board and depend on the Company’s future earnings and financial condition and other relevant factors.

Refer to Note 25 for subsequent event disclosures related to the Company’s dividend program.

On July 26, 2016, the Company issued 810,811 warrants.

Pursuant to the terms in the underlying warrants agreement (refer to Note 2), the exercise price was adjusted from $ 46.911 per share to $ 46.804 per share as of the June 15, 2022 dividend record date while the warrant share number remained unchanged, at 1.15 .

Subsequently, as of the September 15, 2022 and December 15, 2022 dividend record dates, the exercise price was adjusted to $ 46.679 per share and $ 45.086 per share, respectively, and the warrant share number was adjusted to 1.16 and 1.20 , respectively.

Refer to Note 25 for subsequent event disclosures related to the Company’s dividend program which could result in an additional adjustment to the warrants exercise price and warrants share number.

As of December 31, 2022, 190,838 warrants remained outstanding, with a total of 229,006 shares underlying the un-exercised warrants.

For the year ended December 31, 2022, the Company issued 702,182 shares of common stock resulting from exercises of its warrants and, pursuant to the terms of the underlying warrants agreement, withheld 187,857 of the issued shares, in satisfaction of the warrant exercise price and in lieu of fractional shares, which were subsequently reclassified as treasury stock in the amount of $ 18,509 .

The decision to declare and pay cash dividends will be made by the Board and will depend on the Company’s earnings, financial condition and other relevant factors.

On August 2, 2023, the Board determined to end the Company’s fixed dividend program following the quarterly dividend declared and paid in the fourth quarter of 2023 and to focus instead on the Company’s share repurchase program.

On July 26, 2016, the Company issued 810,811 warrants, which were classified as equity instruments.

Pursuant to the underlying warrant agreement, the warrants were exercisable for cash or on a cashless basis at any time until their expiration, and no fractional shares were to be issued upon warrant exercise.

Pursuant to the underlying warrant agreement (refer to Note 2), the exercise price was adjusted from $ 45.086 per share to $ 44.972 per share as of the March 15, 2023 dividend record date and to $ 44.820 per share as of the June 15, 2023 dividend record date, while the warrant share number remained unchanged at 1.20 .

At 5:00 pm Eastern time on July 26, 2023 the Company’s Series A Warrants expired pursuant to their terms.

As of December 31, 2023, no warrants remained outstanding as the warrants expired during the third quarter of 2023.

For the year ended December 31, 2023, the Company issued 169,028 shares of common stock resulting from exercises of its warrants and, pursuant to the terms of the underlying warrant agreement, withheld 20,139 of the issued shares in satisfaction of the warrant exercise price and in lieu of fractional shares, which were subsequently reclassified as treasury stock in the amount of $ 2,368 .

As of December 31, 2022, 190,838 warrants were outstanding, with a total of 229,006 shares underlying the un-exercised warrants.

For the year ended December 31, 2021, the Company issued 143 shares of common stock resulting from exercises of

For the year ended December 31, 2022, the Company issued 702,182 shares of common stock resulting from exercises of its warrants and, pursuant to the terms of the underlying warrant agreement, withheld 187,857 of the issued shares in satisfaction of the warrant exercise price and in lieu of fractional shares, which were subsequently reclassified as treasury stock in the amount of $ 18,509 .

As of December 31, 2021, 801,246 warrants were outstanding, with a total of 921,433 shares underlying the un-exercised warrants.

For the year ended December 31, 2021, the Company issued 143 shares of common stock resulting from exercises of its warrants and, pursuant to the terms of the underlying warrant agreement, withheld 17 of the issued shares in satisfaction of the warrant exercise price and in lieu of fractional shares, which were subsequently reclassified as treasury stock.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

its warrants and, pursuant to the terms of the underlying warrants agreement, withheld 17 of the issued shares in satisfaction of the warrant exercise price and in lieu of fractional shares, which were subsequently reclassified as treasury stock.

As of December 31, 2020, 801,370 warrants were outstanding, with a total of 921,576 shares underlying the un-exercised warrants.

For the year ended December 31, 2020, there were no warrant exercises.

(8) Property, Plant, and Equipment, net

8 unchanged sentences

Total property, plant, and equipment, net $ 588,992 $ 442,645

Included in plant and mining equipment are assets under financing leases totaling $ 13,139 and $ 8,611 with accumulated depreciation of $ 7,710 and $ 5,624 as of December 31, 2022 and December 31, 2021, respectively.

Included in plant and mining equipment are assets under financing leases totaling $ 10,964 and $ 13,139 with accumulated depreciation of $ 5,015 and $ 7,710 as of December 31, 2023 and 2022, respectively.

Depreciation and amortization expense associated with property, plant, equipment and non-mineral asset retirement obligation assets, net, was $ 112,925 , $ 84,542 , and $ 86,506 for the years ended December 31, 2023, 2022, and 2021 respectively.

Depreciation expense for the years ended December 31, 2022, 2021, and 2020 includes a credit of ($ 1,344 ), ($ 307 ), and ($ 3,689 ), respectively, related to revisions to asset retirement obligations.

Depreciation expense for the years ended December 31, 2023, 2022, and 2021 includes an expense of $ 7,343 , and credits of ($ 1,344 ) and ($ 307 ), respectively, related to revisions to asset retirement obligations.

Refer to Note 15 for further disclosures related to asset retirement obligations.

During the years ended December 31, 2021 and 2020, the Company recorded long-lived asset impairments which reduced the carrying value of property, plant, and equipment, net, by $ 60 and $ 18,231 , respectively.

Refer to Note 8 for further information.

As of December 31, 2022, the Company had unconditional purchase obligations for approximately $ 40,015 , $ 0 , and $ 4,887 of new equipment purchase commitments expected to be acquired at various dates in 2023, 2024, and 2025, respectively.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

As of December 31, 2023, the Company had unconditional purchase obligations for approximately $ 48,557 of new equipment purchase commitments expected to be acquired at various dates in 2024.

(9) Other Non-Current Assets

7 unchanged sentences

Total other non-current assets $ 106,486 $ 103,195

(10) Equity Method Investments

The Company holds a 65 % partnership interest in Dominion Terminal Associates LLP (“DTA”) which operates a ground storage-to-vessel coal transloading facility in Newport News, Virginia for use by its partners.

As the Company shares power with its minority partner through equal management committee representation, the Company does not control DTA.

Under the terms of operating and throughput and handling agreements, each partner is charged its share of cash operating costs in exchange for the right to use the facility’s loading capacity and is required to make periodic cash advances to fund such costs.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The Company’s equity method investees do not have long-term debt obligations and the Company is not contingently obligated to make any future financing-related payments with respect to its equity method investees.

The Company’s lease population consists primarily of vehicle and heavy equipment leases and leases for office equipment.

19 unchanged sentences

Total lease costs and other lease information for the years ended December 31, 2023, 2022, and 2021 included the following:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31,

8 unchanged sentences

(1) The Company had no variable lease costs or sublease income for the years ended December 31, 2023, 2022, and 2021.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31,

34 unchanged sentences

Asset retirement obligations 38,915 36,963

Accrued interest and fees 1,062 14,489

Dividend payable 2,342 86,118

4 unchanged sentences

Long-term debt consisted of the following:

Term Loan Credit Facility - due June 2024 $ — $ 449,435

Debt discount and issuance costs — ( 6,195 )

Notes payable and other $ 5,097 $ 6,179

Financing leases 5,277 4,796

Total long-term debt $ 10,374 $ 10,975

1 unchanged sentence

Long-term debt, net of current portion $ 6,792 $ 7,897

(1) Includes financing leases, refer to Note 12 for additional information.

Term Loan Credit Facility - due June 2024

On June 14, 2019, the Company entered into a credit agreement with Cantor Fitzgerald Securities, as administrative agent and collateral agent, and the other lenders party thereto (as defined therein) (the “Term Loan Credit Agreement”) that provided for a senior secured term loan facility in the aggregate principal amount of $ 561,800 with a maturity date of June 14, 2024 (the “Term Loan Credit Facility”).

Principal repayments equal to approximately $ 1,405 were due each March, June, September and December (commencing with September 30, 2019) with the final principal repayment installment to be paid on the maturity date and in an amount equal to the aggregate principal amount outstanding on such date.

The Term Loan Credit Facility bore an interest rate per annum based on the character of the loan (defined as either “Base Rate Loan” or “Eurocurrency Rate Loan”).

Each loan type bore interest at a rate per annum comprised of a base rate (as defined) plus an applicable percentage ( 6.00 % for Base Rate Loans and 7.00 % for Eurocurrency Rate Loans on or prior to the second anniversary of the Closing Date and 7.00 % or 8.00 % thereafter (the “Applicable Rate”)).

The Eurocurrency base rate was subject to a 2.00 % floor.

Interest accrued on each Base Rate Loan was payable in arrears on the last business day of each March, June, September and December and the maturity date.

Interest accrued on each Eurocurrency Rate Loan was payable in arrears on the last day of each interest period as defined therein.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

During the three months ending September 30, 2021, the Company repurchased and permanently retired, through privately negotiated transactions, $ 18,724 of outstanding principal borrowings under the Term Loan Credit Facility.

These borrowings were repurchased at a discount resulting in an aggregate purchase price of $ 18,415 .

As the participating lenders were existing shareholders (related parties) of the Company as of the repurchase date, the Company analyzed various factors regarding each of the transactions and concluded such repurchases were at a reasonable market rate and reflected the terms of an arm’s length transaction per the requirements of the Term Loan Credit Facility.

Additionally, during the third and fourth quarters of 2021, the Company made voluntary prepayments of $ 81,000 of outstanding principal borrowings under the Term Loan Credit Facility.

As of December 31, 2021, the carrying value of the Term Loan Credit Facility was $ 443,241 , all of which was classified as long-term within the Consolidated Balance Sheets.

As of December 31, 2022, there were no outstanding borrowings under the Term Loan Credit Facility as a result of the Company’s voluntary prepayments of $ 449,435 of outstanding principal borrowings during the first and second quarters of 2022.

Effective with the final voluntary prepayment on June 3, 2022, the Credit Agreement was terminated, and the Company was released of all underlying obligations including the Credit Agreement covenants.

Second Amended and Restated Asset-Based Revolving Credit Agreement

On December 6, 2021, the Company entered into the Second Amended and Restated Asset-Based Revolving Credit Agreement with Citibank N.A as administrative agent, collateral agent, swingline lender, and L/C issuer and the other lenders party thereto (the “Lenders”), and BMO Harris Bank N.A and Eclipse Business Capital LLC as co-collateral agents.

The Second Amended and Restated Asset-Based Revolving Credit Agreement (“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 “ABL Facility”).

Under the ABL Facility, the Company 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 $ 155,000 , of which no more than $ 150,000 may represent outstanding letters of credit ($ 125,000 on a committed basis and another $ 25,000 on an uncommitted cash collateralized basis) with the facility having a maturity date of December 6, 2024.

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

Under the terms of the ABL Agreement, letters of credit fees will be calculated at 5.25 %, while any future borrowings will bear interest based on the character of the loan (defined as either secured overnight financing rate “SOFR” Loan (“SOFR Loan”) or “Base Rate Loan”) plus an applicable rate of 4.50 % for SOFR Loans and 3.50 % for Base Rate Loans.

Pursuant to terms of the ABL Agreement at each notice period, the Company elects the character of the loan, the interest period, and may provide notice of continuation or conversion of the borrowed principal amount with the ability to repay the borrowed principal amount in advance of the maturity date without penalty.

As of December 31, 2022 and 2021, no borrowings were outstanding under the ABL Facility.

The ABL Agreement provides that a specified percentage of billed and unbilled receivables and raw and clean inventory meeting certain criteria are eligible to be counted for purposes of collateralizing the amount of financing available, subject to certain terms and conditions.

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 the Fixed Charge Coverage Ratio (as defined therein).

In accordance with the terms of the ABL Facility, the Company may be required to 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.

Any letter of credit issued under the ABL Facility will bear a commitment fee rate of 0.50 %, and a fronting fee of 0.25 % of the face amount under each letter of credit.

As of December 31, 2022 and 2021, the Company had $ 61,877 and $ 121,037 letters of credit outstanding under the ABL Facility, respectively.

The ABL Facility is guaranteed by substantially all of Alpha’s direct and indirect subsidiaries (together with Alpha, the “Loan Parties”) and secured by all or substantially all assets of the Loan Parties, including equity in Alpha’s direct domestic subsidiaries, as collateral for the obligations under the ABL Facility.

The ABL Facility has a first lien on ABL priority collateral and previously had a second lien on Term Loan priority collateral.

As noted above, the Term Loan Credit Facility was voluntarily prepaid in full on June 3, 2022, and in connection therewith, the Term Loan priority collateral was released in connection therewith, and the ABL Facility’s lien on the Term Loan priority collateral is no longer second.

The ABL Agreement, as amended, and related documents contain negative and affirmative covenants including certain financial covenants.

The Company is in compliance with all covenants under these agreements as of December 31, 2022.

On December 6, 2021, the Company entered into the Second Amended and Restated Asset-Based Revolving Credit Agreement (“ABL Agreement”) with Citibank N.A as administrative agent, collateral agent, swingline lender, and letter of credit (“LC”) issuer and the other lenders party thereto (the “Lenders”), and BMO Harris Bank N.A and Eclipse Business Capital LLC as co-collateral agents.

The ABL Agreement included a senior secured asset-based revolving credit facility (the “ABL Facility”) under which the Company could borrow cash or obtain LCs, on a revolving basis, in an aggregate amount of up to $ 155,000 , of which no more than $ 150,000 could represent outstanding LCs ($ 125,000 on a committed basis and another $ 25,000 on an uncommitted cash collateralized basis).

The facility’s maturity date was December 6, 2024.

Under the terms of the ABL Agreement, LCs fees were calculated at 5.25 %, while borrowings bore interest based on the character of the loan (defined as either secured overnight financing rate “SOFR” Loan (“SOFR Loan”) or “Base Rate Loan”) plus an applicable rate of 4.50 % for SOFR Loans and 3.50 % for Base Rate Loans.

Pursuant to terms of the ABL Agreement, the Company elected the character of the loan, the interest period, and could provide notice of continuation or conversion of the borrowed principal amount with the ability to repay the borrowed principal amount in advance of the maturity date without penalty.

As of December 31, 2022, no borrowings were outstanding under the ABL Facility.

Any LC issued under the ABL Facility bore a commitment fee rate of 0.50 %, and a fronting fee of 0.25 % of the face amount under each LC.

As of December 31, 2022, the Company had $ 61,877 LCs outstanding under the ABL Facility.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

New ABL Agreement

On October 27, 2023, the Company terminated its existing ABL Agreement and along with certain of its directly and indirectly owned subsidiaries (the “Borrowers”) entered into a new Credit Agreement (the “New ABL Agreement”) with Regions Bank, as lender, swingline lender, LC issuer, administrative agent, collateral agent, and lead arranger, along with ServisFirst Bank and Texas Capital Bank, as joint lead arrangers and the other lenders party thereto.

In connection with the termination, the Company recorded a loss on extinguishment of debt of $ 2,753 related to the write-off of unamortized debt issuance costs for and fees paid to exiting lenders.

The New ABL Agreement continues to include an asset-based revolving credit facility (the “New ABL Facility”) which allows the Company to borrow cash or obtain LCs, on a revolving basis, in an aggregate amount of up to $ 155,000 .

The Company may request an increase to the capacity of the facility of up to $ 75,000 provided that $ 25,000 may be solely for the purpose of providing additional availability to obtain cash collateralized LCs.

Availability under the New ABL Facility is calculated monthly and fluctuates based on qualifying amounts of coal inventory, trade accounts receivable and in certain circumstances specified amounts of cash.

The Company must maintain minimum Liquidity, as defined in the New ABL Agreement, of $ 75,000 .

The New ABL Facility matures on October 27, 2027.

As part of the transition from the previous ABL Facility to the New ABL Facility, the Company temporarily cash collateralized outstanding LCs until replacement LCs could be issued under the New ABL Facility.

As of December 31, 2023, the Company had $ 31 of cash collateralized LCs remaining to be replaced.

During the first quarter of 2024, the remaining cash collateralized LCs from the previous ABL Facility were cancelled with no replacement required and the cash collateral was returned.

Under the terms of the New ABL Facility, LC fees will be calculated at 3.25 % (including a fronting fee of 0.25 %) while future borrowings will bear interest based on the character of the loan (defined as either a “Term Secured Overnight Financing Rate Loan” (or “Term SOFR Loan”) or a “Base Rate Loan”) plus an applicable rate of 3.10 % for a Term SOFR Loan and 2.00 % for a Base Rate Loan.

The Company may elect the character and interest period for each loan.

All amounts borrowed may be repaid prior to maturity without penalty.

A commitment fee of 0.375 % will be charged on any unused capacity.

As of December 31, 2023, the Company had no amount borrowed and $ 60,896 LCs outstanding under the New ABL Facility.

The New ABL Facility is guaranteed by substantially all of Alpha’s directly and indirectly owned subsidiaries that are not Borrowers (the “Guarantors”) and is secured by all or substantially all assets of the Borrowers and Guarantors.

The New ABL Agreement and related documents contain negative and affirmative covenants including certain financial covenants.

The Company is in compliance with all covenants under these agreements as of December 31, 2023.

Future Maturities

4 unchanged sentences

Acquisition-related obligations consisted of the following:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Contingent Revenue Obligation $ — $ 27,719

Environmental Settlement Obligations — 535

Discount — ( 233 )

Total acquisition-related obligations $ — $ 28,254

1 unchanged sentence

Acquisition-related obligations, net of current portion $ — $ —

The Company entered into various settlement agreements with Alpha Natural Resources, Inc.

and/or the Alpha Natural Resources, Inc.

bankruptcy successor ANR, Inc.

and third parties as part of the Alpha Natural Resources, Inc.

bankruptcy reorganization process.

The Company assumed acquisition-related obligations through those settlement agreements which became effective on July 26, 2016, the effective date of Alpha Natural Resources, Inc.’s plan of reorganization.

Additionally, as a result of the Merger, the Company assumed certain acquisition-related obligations pursuant to the terms stipulated within the bankruptcy settlement previously entered into by the Merger Companies.

Contingent Revenue Obligation

As a result of the Merger, the Company assumed a contingent revenue payment obligation (the “Contingent Revenue Obligation”) to certain of the Merger Companies’ creditors pursuant to the terms stipulated within the bankruptcy settlement previously entered into by the Merger Companies.

Pursuant to terms of the obligation, the annual obligation will be limited to revenues derived from legacy operations for the Merger Companies and will not include revenues related to legacy Alpha Metallurgical Resources, Inc.

The Contingent Revenue Obligation consists of a contingent revenue payment of 1.5 % of annual gross revenues of the legacy operations for the Merger Companies up to $ 500,000 and 1.0 % of annual gross revenue of the legacy operations for the Merger Companies in excess of $ 500,000 through the period ended December 31, 2022.

The corresponding final payment is expected to be paid from a short-term restricted cash escrow account during the second quarter of 2023.

As of December 31, 2022 and 2021, the carrying value of the Contingent Revenue Obligation was $ 27,719 and $ 35,005 , with $ 27,719 and $ 16,005 classified as current, respectively, and classified as an acquisition-related obligation in the Consolidated Balance Sheets.

Pursuant to terms of the obligation, the annual obligation was limited to revenues derived from legacy operations for the Merger Companies and did not include revenues related to legacy Alpha Metallurgical Resources, Inc.

The Contingent Revenue Obligation consisted of a contingent revenue payment of 1.5 % of annual gross revenues of the legacy operations for the Merger Companies up to $ 500,000 and 1.0 % of annual gross revenue of the legacy operations for the Merger Companies in excess of $ 500,000 through the period ended December 31, 2022.

During the first quarter of 2023, the Company paid the final calculated payment pursuant to terms of the Contingent Revenue Obligation.

Refer to Note 16 for further disclosures related to the fair value assignment and methods used.

During the second quarter of 2022, the Company paid $ 16,166 pursuant to terms of the Contingent Revenue Obligation.

Refer to Note 20 for disclosures related to a Contingent Revenue Obligation repurchase transaction with a related party during the fourth quarter of 2021.

Additionally, during the second quarter of 2021, the Company paid $ 11,396 pursuant to terms of the Contingent Revenue Obligation.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Environmental Settlement Obligations

As a result of the Merger, the Company assumed certain environmental settlement obligations (the “Environmental Settlement Obligations”) pursuant to the terms stipulated within the bankruptcy settlement previously entered into by the Merger Companies.

These obligations include payments to a third-party environmental agency and the funding of certain reclamation related projects through 2023.

As of December 31, 2022 and 2021, the carrying value of the Environmental Settlement Obligations was $ 535 and $ 6,400 , net of discounts of $ 0 and $ 233 , all of which was classified as a current acquisition-related obligation in the Consolidated Balance Sheets.

(15) Asset Retirement Obligations

13 unchanged sentences

Long-term portion $ 166,509

(1) The revisions in estimated cash flows resulted primarily from discount rate adjustments and changes in mine plans.

(1) The revisions in estimated cash flows resulted primarily from a decrease in the discount rate and changes in mine plans.

(2) Included within Accrued expenses and other current liabilities on the Company’s Consolidated Balance Sheets.

3 unchanged sentences

These estimates involve uncertainty and cannot be determined with precision.

The carrying amounts for cash and cash equivalents, trade accounts receivable, net, prepaid expenses and other current assets, restricted cash, deposits, trade accounts payable, accrued expenses and other current liabilities, and environmental settlement obligations approximate fair value as of December 31, 2022 and 2021 due to the short maturity of these instruments.

The following table sets forth by level, within the fair value hierarchy, the Company’s long-term debt at fair value as of December 31, 2021:

December 31, 2021

Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

Term Loan Credit Facility - due June 2024 $ 443,241 $ 447,561 $ — $ 447,561 $ —

(1) Net of debt discounts and debt issuance costs.

The following table sets forth by level, within the fair value hierarchy, the Company’s financial and non-financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2022 and 2021.

Financial and non-financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

The carrying amounts for cash and cash equivalents, trade accounts receivable, net, prepaid expenses and other current assets, restricted cash, deposits, trade accounts payable, notes payable and other, financing leases, accrued expenses and other current liabilities, and environmental settlement obligations approximate fair value as of December 31, 2023 and 2022 due to the short maturity of these instruments.

Financial and non-financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the determination of fair value for assets and liabilities and their placement within the fair value hierarchy levels.

1 unchanged sentence

Total Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

Contingent Revenue Obligation $ 27,719 $ — $ — $ 27,719

Trading securities (1)

$ 40,597 $ — $ 40,597 $ —

(1) Includes $ 46,052 classified as Short-term investments and $ 105,735 classified as Long-term restricted investments on the Company’s Consolidated Balance Sheets.

(1) Classified as Long-term restricted investments on the Company’s Consolidated Balance Sheets.

December 31, 2022

3 unchanged sentences

$ 151,787 $ — $ 151,787 $ —

(1) Classified as Long-term restricted investments on the Company’s Consolidated Balance Sheets.

(1) Includes $ 46,052 classified as Short-term investments and $ 105,735 classified as Long-term restricted investments on the Company’s Consolidated Balance Sheets.

The following tables are reconciliations of the financial and non-financial assets and liabilities that were accounted for at fair value on a recurring basis and that were categorized within Level 3 of the fair value hierarchy:

1 unchanged sentence

Contingent Revenue Obligation $ 27,719 $ ( 27,719 ) $ — $ — $ —

(1) The loss recognized in earnings resulted primarily from an increase in forecasted future revenue as of December 31, 2022.

December 31, 2021 Payments Loss Recognized in Earnings Transfer In (Out) of Level 3 Fair Value Hierarchy December 31, 2022

3 unchanged sentences

Level 2 Fair Value Measurements

Trading Securities - Typically includes money market funds.

The fair value is based on observable market data.

Level 2 Fair Value Measurements

Term Loan Credit Facility - due June 2024 - The fair value was based on the average between bid and ask prices provided by a third-party.

As the fair value is based on observable market inputs and due to limited trading volume in the Term Loan Credit Facility, the Company has classified the fair value within Level 2 of the fair value hierarchy.

Effective June 3, 2022, the Term Loan Credit Facility was terminated.

Refer to Note 14 for additional information.

Trading Securities - Typically includes certificates of deposit, corporate fixed income, and U.S.

1 unchanged sentence

The fair values are obtained from a third-party pricing service provider.

The fair values provided by the pricing service provider are

The fair values provided by the pricing service provider are based on observable market inputs including credit spreads and broker-dealer quotes, among other inputs.

The Company classifies the prices obtained from the pricing services within Level 2 of the fair value hierarchy because the underlying inputs are directly observable from active markets.

However, the pricing models used entail a certain amount of subjectivity and therefore differing judgments in how the underlying inputs are modeled could result in different estimates of fair value.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

based on observable market inputs including credit spreads and broker-dealer quotes, among other inputs.

The Company classifies the prices obtained from the pricing services within Level 2 of the fair value hierarchy because the underlying inputs are directly observable from active markets.

However, the pricing models used entail a certain amount of subjectivity and therefore differing judgments in how the underlying inputs are modeled could result in different estimates of fair value.

Level 3 Fair Value Measurements

3 unchanged sentences

The annualized volatility was calculated by observing volatilities for comparable companies with adjustments for the Company's size and leverage.

As the royalty period ended on December 31, 2022, the fair value of the remaining obligation represents the actual final calculated payment to be made during the second quarter of 2023.

As the royalty period ended on December 31, 2022, the fair value of the remaining obligation as of that date represents the actual final calculated payment made during the first quarter of 2023.

Refer to Note 14 for additional information.

The range of significant unobservable inputs used to value the Contingent Revenue Obligation as of December 31, 2021 are set forth in the following table:

December 31, 2021

Forecasted future revenue $ 1.5 - $ 2.0 billion

Stated royalty rate 1.0 % - 1.5 %

Annualized volatility 18.4 % - 39.3 % ( 29.9 %)

(17) Income Taxes

Significant components of income tax expense (benefit) from continuing operations were as follows:

Significant components of income tax expense (benefit) were as follows:

Year Ended December 31,

2023 2022 2021

Current tax expense (benefit):

Current tax expense:

Federal $ 80,254 $ 114,106 $ 2,422

1 unchanged sentence

Total current $ 83,781 $ 120,726 $ 3,571

Deferred tax (benefit) expense:

Deferred tax expense (benefit):

Federal $ 35,824 $ ( 1,726 ) $ ( 3 )

5 unchanged sentences

Total $ 123,503 $ 106,205 $ 3,408

A reconciliation of statutory federal income tax expense (benefit) on income (loss) from continuing operations to the actual income tax expense (benefit) is as follows:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

A reconciliation of statutory federal income tax expense on income to the actual income tax expense is as follows:

Year Ended December 31,

2023 2022 2021

Federal statutory income tax expense (benefit) $ 326,497 $ 61,362 $ ( 51,163 )

Increase (reductions) in taxes due to:

Federal statutory income tax expense $ 177,547 $ 326,497 $ 61,362

Increase (decrease) in taxes due to:

Percentage depletion allowance ( 36,685 ) ( 50,277 ) ( 11,864 )

4 unchanged sentences

Capital loss carryforward expiration — 140 10,552

Non-deductible compensation 9,934 5,573 1,429

Stock-based compensation ( 6,968 ) ( 3,588 ) 405

Other, net 829 1,961 ( 171 )

Income tax expense (benefit) $ 106,205 $ 3,408 $ ( 2,164 )

Income tax expense $ 123,503 $ 106,205 $ 3,408

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Deferred income taxes result from temporary differences between the reporting of amounts for financial statement purposes and income tax purposes.

4 unchanged sentences

Reserves and accruals not currently deductible 8,141 10,572

Workers’ compensation benefit obligations 38,099 47,105

Workers’ compensation and black lung obligations 39,432 38,099

Pension obligations 18,409 23,826

14 unchanged sentences

Total deferred tax liabilities ( 185,646 ) ( 164,968 )

Net deferred tax assets (liabilities) $ 504 $ ( 317 )

Net deferred tax (liabilities) assets $ ( 31,114 ) $ 504

Changes in the valuation allowance were as follows:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31,

1 unchanged sentence

Valuation allowance beginning of period $ 53,801 $ 172,883 $ 263,387

(Decrease) increase in valuation allowance recorded to income tax expense (benefit) ( 119,082 ) ( 78,043 ) 117,829

(Decrease) increase in valuation allowance not affecting income tax expense (benefit) — ( 12,461 ) 12,538

Decrease in valuation allowance recorded to income tax expense ( 5,658 ) ( 119,082 ) ( 78,043 )

Decrease in valuation allowance not affecting income tax expense — — ( 12,461 )

Valuation allowance end of period $ 48,143 $ 53,801 $ 172,883

At December 31, 2022, the Company has regular tax net operating loss carryforwards for federal income tax purposes of approximately $ 1,139,000 .

This includes approximately $ 1,007,000 that are available to offset regular federal taxable income subject to an annual Internal Revenue Code Section 382 limitation of approximately $ 1,000 and $ 132,000 that are subject to an annual Section 382 limitation of approximately $ 17,500 .

At December 31, 2023, the Company has recorded a deferred tax asset of $ 26,494 for federal net operating loss carryforwards, which represents the tax-effected amount of net operating loss carryforwards mathematically available for utilization prior to statutory expiration.

Underlying this deferred tax asset are approximately $ 12,000 of gross federal net operating loss carryforwards that are subject to an annual Internal Revenue Code Section 382 limitation of approximately $ 1,000 and approximately $ 114,000 of gross federal net operating loss carryforwards that are subject to an annual Internal Revenue Code Section 382 limitation of approximately $ 17,500 .

These federal net operating loss carryforwards were generated before 2018 and will expire between years 2035 and 2037.

The Company has capital loss carryforwards of approximately $ 223,000 .

The capital loss carryforwards will expire between years 2024 and 2025.

A valuation allowance is recorded against the capital loss carryforwards and certain state net operating loss carryforwards.

During the third quarter of the year ended December 31, 2020, the Company recorded a decrease in unrecognized tax benefits of approximately $ 20,788 as a result of the issuance of final regulatory guidance from the Internal Revenue Service (“IRS”).

The decrease in unrecognized tax benefits did not impact the Company’s effective tax rate for the year ended December 31, 2020.

The Company has a gross federal capital loss carryforward of approximately $ 208,000 .

The capital loss carryforward will expire in 2025.

A valuation allowance is recorded against the federal and state capital loss carryforwards and certain state net operating loss carryforwards.

The Company has no liability for uncertain tax positions for the years ended December 31, 2023, 2022, and 2021.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The Company’s policy is to classify interest and penalties related to uncertain tax positions as part of income tax expense.

As of December 31, 2023 and 2022, the Company had no accrued interest and penalties.

The following reconciliation illustrates the Company’s liability for uncertain tax positions:

Year Ended December 31,

2022 2021 2020

Unrecognized tax benefits - beginning of period $ — $ — $ 20,788

Reductions for tax positions of prior years — — ( 20,788 )

Unrecognized tax benefits - end of period $ — $ — $ —

As of December 31, 2023, tax years 2020 – 2023 remain open to federal and state examination.

4 unchanged sentences

Among other provisions, the IRA enacted a 15% corporate alternative minimum tax and a 1% excise tax on repurchases of corporate stock for tax years beginning after December 31, 2022.

The Company is currently assessing the impact of the IRA but does not expect it to have a material impact on our results of operations.

The Company determined that it is not subject to the corporate alternative minimum tax for the year ended December 31, 2023.

Refer to Note 7 for information on the excise tax on repurchases of the Company’s corporate stock.

(18) Employee Benefit Plans

The Company provides several types of benefits for its employees, including defined benefit and defined contribution pension plans, workers’ compensation and black lung benefits, and postretirement life insurance.

The Company provides several types of benefits for its employees, including a defined benefit and defined contribution pension plan, workers’ compensation and black lung benefits, and postretirement life insurance.

The Company does not participate in any multi-employer plans.

The components of net periodic benefit (credit) cost other than the service cost component for black lung are included in the line item Miscellaneous income (loss), net, in the Consolidated Statements of Operations.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Company Administered Defined Benefit Pension Plans

In connection with the Merger, the Company assumed three qualified non-contributory defined benefit pension plans, which cover certain salaried and non-union hourly employees.

The qualified non-contributory defined benefit pension plans are collectively referred to as the “Pension Plans.” Benefits are frozen under these plans.

The components of net periodic benefit cost (credit) other than the service cost component for black lung are included in the line item Miscellaneous (expense) income, net, in the Consolidated Statements of Operations.

Company Administered Defined Benefit Pension Plan

In connection with the Merger, the Company assumed three qualified non-contributory defined benefit pension plans, which covered certain salaried and non-union hourly employees.

The qualified non-contributory defined benefit pension plans were collectively referred to as the “Pension Plans.” Effective as of December 31, 2023, the assets and liabilities of the Pension Plans were merged into one qualified non-contributory defined benefit pension plan (“Pension Plan”).

Benefits are frozen under the Pension Plan.

Participants accrued benefits either based on certain formulas, the participant’s compensation prior to retirement, or plan specified amounts for each year of service with the Company.

One of the Company’s frozen qualified non-contributory defined benefit pension plans utilizes a cash balance formula for certain of its participants.

The Pension Plan utilizes a cash balance formula for certain of its participants.

The cash balance formula provides guaranteed rates of interest on accumulated balances of 6 % for balances accumulated prior to 2004 and 4 % on balances accumulated thereafter.

Annual funding contributions to the Pension Plans are made as recommended by consulting actuaries based upon the ERISA funding standards.

Annual funding contributions to the Pension Plan are made as recommended by consulting actuaries based upon the ERISA funding standards.

Projected contributions are based on the latest available data and include the impact of the funding relief granted by the American Rescue Plan Act (“ARPA”) and the application of the interest rate stabilization guidance under ARPA.

Plan assets consist of equity securities, fixed income funds, commingled short-term funds, private equity funds, and a guaranteed insurance contract.

Effective in 2019, two of the qualified non-contributory defined benefit pension plans were amended to offer certain eligible participants the option to elect to receive lump sum benefits, which resulted in a partial plan settlement and the accelerated recognition of a portion of the accumulated other comprehensive loss during the years ended December 31, 2022, 2021, and 2020.

The Pension Plan offers certain eligible participants the option to elect to receive lump sum benefits, which resulted in a partial plan settlement and the accelerated recognition of a portion of the accumulated other comprehensive loss during the years ended December 31, 2022 and 2021.

Refer to the disclosures below for further information on the partial plan settlements.

The following tables set forth the Pension Plans’ accumulated benefit obligations, fair value of plan assets and funded status for the years ended December 31, 2022 and 2021.

The following tables set forth the Pension Plan’s accumulated benefit obligation, fair value of plan assets and funded status for the years ended December 31, 2023 and 2022.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31,

3 unchanged sentences

Interest cost 23,973 15,981

Actuarial gain (1)

( 182,441 ) ( 34,922 )

Actuarial loss (gain) 18,239 ( 182,441 )

Benefits paid ( 32,288 ) ( 30,378 )

11 unchanged sentences

$ ( 101,908 ) $ ( 110,836 )

(1) For the year ended December 31, 2022, the actuarial gain was primarily attributable to the loss on plan assets and the change in the weighted-average discount rate actuarial assumption used in determining the benefit obligations.

For the year ended December 31, 2021, the actuarial gain was primarily attributable to the change in the weighted-average discount rate actuarial assumption used in determining the benefit obligations.

(1) Amounts are classified as long-term on the Consolidated Balance Sheets as there are sufficient plan assets to make expected benefit payments to plan participants in the succeeding twelve months.

Gross amounts related to benefit obligations recognized in accumulated other comprehensive loss consisted of the following as of December 31, 2023 and 2022:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Net actuarial loss $ 26,059 $ 12,683

The following table details the components of net periodic benefit credit:

The following table details the components of net periodic benefit cost (credit):

Year Ended December 31,

4 unchanged sentences

Settlement — 244 412

Net periodic benefit credit $ ( 10,397 ) $ ( 11,537 ) $ ( 4,686 )

Other changes in plan assets and benefit obligations recognized in other comprehensive (loss) income are as follows:

Net periodic benefit cost (credit) $ 2,707 $ ( 10,397 ) $ ( 11,537 )

Other changes in plan assets and benefit obligation recognized in other comprehensive income (loss) are as follows:

Year Ended December 31,

2023 2022 2021

Actuarial (gain) loss $ ( 32,912 ) $ ( 37,004 ) $ 45,663

Actuarial loss (gain) (1)

$ 14,106 $ ( 32,912 ) $ ( 37,004 )

Amortization of net actuarial loss ( 730 ) ( 2,111 ) ( 3,217 )

Settlement — ( 244 ) ( 412 )

Total recognized in other comprehensive (loss) income $ ( 35,267 ) $ ( 40,633 ) $ 42,015

Total recognized in other comprehensive income (loss) $ 13,376 $ ( 35,267 ) $ ( 40,633 )

(1) For the year ended December 31, 2023, the actuarial loss was primarily attributable to a decrease in the weighted-average discount rate actuarial assumption used in determining the benefit obligation.

For the year ended December 31, 2022, the

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

actuarial gain was primarily attributable to an increase in the weighted-average discount rate actuarial assumption used in determining the benefit obligation partially offset by the loss on plan assets.

The following table presents information applicable to plans with accumulated benefit obligations in excess of plan assets:

3 unchanged sentences

Fair value of plan assets $ 376,458 $ 357,606

The weighted-average actuarial assumption used in determining the benefit obligations as of December 31, 2022 and 2021 was as follows:

The weighted-average actuarial assumption used in determining the benefit obligation as of December 31, 2023 and 2022 was as follows:

Discount rate 5.10 % 5.42 %

The weighted-average actuarial assumptions used to determine net periodic benefit credit for the years ended December 31, 2022, 2021, and 2020 were as follows:

The weighted-average actuarial assumptions used to determine net periodic benefit cost (credit) for the years ended December 31, 2023, 2022, and 2021 were as follows:

Year Ended December 31,

4 unchanged sentences

The discount rate assumptions were determined from a high-quality corporate bond yield-curve timing of the Company’s projected cash out flows.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The expected long-term rate of return on assets of the Pension Plans is established each year in consultation with the plans’ actuaries and outside investment advisors.

This rate is determined by taking into consideration the Pension Plans’ target asset allocation, expected long-term rates of return on each major asset class by reference to long-term historic ranges, inflation assumptions, and the expected additional value from active management of the Pension Plans’ assets.

The expected long-term rate of return on assets of the Pension Plan is established each year in consultation with the plan’s actuaries and outside investment advisors.

This rate is determined by taking into consideration the Pension Plan’s target asset allocation, expected long-term rates of return on each major asset class by reference to long-term historic ranges, inflation assumptions, and the expected additional value from active management of the Pension Plan’s assets.

For the determination of net periodic benefit cost in 2024, the Company will utilize an expected long-term rate of return on plan assets of 6.20 %.

Assets of the Pension Plans are held in trusts and are invested in accordance with investment guidelines that have been established by the Company’s Benefits Committee in consultation with outside investment advisors.

Assets of the Pension Plan are held in trusts and are invested in accordance with investment guidelines that have been established by the Company’s Benefits Committee in consultation with outside investment advisors.

The target allocation for 2024 and the actual asset allocation as reported at December 31, 2023 are as follows:

4 unchanged sentences

Total 100.0 % 100.0 %

The asset allocation targets have been set with the expectation that the Pension Plans’ assets will fund the expected liabilities within an appropriate level of risk.

In determining the appropriate target asset allocations, the Benefits Committee considers the demographics of the Pension Plans’ participants, the funded status of each plan, the Company’s contribution philosophy, the Company’s business and financial profile, and other associated risk factors.

The Pension Plans’ assets are periodically rebalanced among the major asset categories to maintain the asset allocation within a specified range of the target allocation percentage.

The target allocation between equity securities and fixed income funds is determined by reference to the funded status percentage for each of the Pension Plans.

The plan administrator uses a one-way de-risking glide path whereby the fixed income funds allocation increases as the funded status improves.

The asset allocation targets have been set with the expectation that the Pension Plan’s assets will fund the expected liability within an appropriate level of risk.

In determining the appropriate target asset allocations, the Benefits Committee considers the demographics of the Pension Plan’s participants, the funded status of the plan, the Company’s contribution philosophy, the Company’s business and financial profile, and other associated risk factors.

The Pension Plan’s assets are periodically rebalanced among the major asset categories to maintain the asset allocation within a specified range of the target allocation percentage.

The target allocation between equity securities and fixed income funds is determined by reference to the funded status percentage for the Pension Plan.

The plan administrator uses a one-way de-risking glide path whereby the fixed income

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

funds allocation increases as the funded status improves.

At a 90.0 % funded status level, the glide path calls for a 50 / 50 equity securities and fixed income funds mix.

During the year ended December 31, 2021, one of the Pension Plans’ funded status levels reached 90.0 % and the related plan assets were adjusted accordingly to the new allocation.

The Company contributed $ 3,430 to the pension plans during the year ended December 31, 2022.

The Company expects to contribute $ 25,011 to the Pension Plans in 2023, which includes amounts above the estimated minimum required contributions for the 2023 plan year.

The Company contributed $ 25,011 to the Pension Plan during the year ended December 31, 2023.

The Company expects to contribute $ 25,000 to the Pension Plan in 2024, which includes amounts above the estimated minimum required contributions for the 2024 plan year.

The following represents expected future pension benefit payments for the next ten years:

1 unchanged sentence

2029-2033 152,086

The fair values of the Company’s Pension Plans’ assets as of December 31, 2022, by asset category are as follows:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The fair values of the Company’s Pension Plan’s assets as of December 31, 2023, by asset category are as follows:

Asset Category Total Quoted Market Prices in Active Market for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

22 unchanged sentences

Changes in Level 3 plan assets for the period ended December 31, 2023 were as follows:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

5 unchanged sentences

Ending balance, December 31, 2023 $ 12,230

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The fair values of the Company’s Pension Plans’ assets as of December 31, 2021, by asset category are as follows:

The fair values of the Company’s Pension Plan’s assets as of December 31, 2022, by asset category are as follows:

Asset Category Total Quoted Market Prices in Active Market for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

30 unchanged sentences

The following is a description of the valuation methodologies used for assets measured at fair value:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Level 1 Plan Assets:

7 unchanged sentences

The Market Value provided typically reflects the fair value of each underlying fund investment, including unrealized gains and losses.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Workers’ Compensation and Pneumoconiosis (Black Lung)

26 unchanged sentences

(Amounts in thousands except share and per share data)

The divestiture of the Company’s former NAPP operations during the fourth quarter of 2020 (refer to Note 3) resulted in a partial plan settlement of $ 8,290 and the accelerated recognition of a portion of the accumulated other comprehensive loss of $ 1,563 during the three months ended December 31, 2020.

Refer to the disclosures below for further information on the partial plan settlement.

As a result of the strategic actions impacting certain mines during the three months ended June 30, 2020 (refer to Note 8), black lung obligations were revalued for curtailment and remeasured with an updated discount rate as of May 31, 2020, which resulted in an increase in the liability for black lung obligations of approximately $ 7,400 with the offset to accumulated other comprehensive loss and a slight increase in net periodic expense to be recognized subsequent to the remeasurement date.

Refer to the disclosures below for further information.

The following tables set forth the accumulated black lung benefit obligations, fair value of plan assets and funded status for the years ended December 31, 2023 and 2022:

4 unchanged sentences

Interest cost 4,660 2,722

Actuarial gain (1)

( 21,060 ) ( 9,759 )

Actuarial loss (gain) 20,019 ( 21,060 )

Benefits paid ( 10,280 ) ( 8,025 )

8 unchanged sentences

Accrued benefit cost at end of period $ ( 107,258 ) $ ( 90,883 )

(1) For the years ended December 31, 2022 and 2021, the actuarial gain was primarily attributable to the change in the weighted-average discount rate actuarial assumption used in determining the benefit obligations.

(1) Assets of the plan are held in a Section 501(c)(21) tax-exempt trust fund and consist primarily of government debt securities.

5 unchanged sentences

Gross amounts related to the black lung benefit obligations recognized in accumulated other comprehensive loss consisted of the following as of December 31, 2023 and 2022:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Net actuarial (gain) loss $ ( 10,198 ) $ 11,940

Net actuarial loss (gain) $ 12,630 $ ( 10,198 )

The following table details the components of the net periodic benefit cost for the black lung benefit obligations:

4 unchanged sentences

Expected return on plan assets ( 50 ) ( 53 ) ( 54 )

Amortization of net actuarial loss 1,257 2,453 1,942

Settlement — — 1,563

Amortization of net actuarial (gain) loss ( 2,833 ) 1,257 2,453

Net periodic benefit cost $ 3,828 $ 6,568 $ 7,834

Summary net periodic benefit cost:

Continuing operations $ 6,568 $ 7,834 $ 7,670

Discontinued operations (1)

Total net periodic benefit cost $ 6,568 $ 7,834 $ 9,052

(1) The discontinued operations consisted of activity related to the Company’s former NAPP operations.

Refer to Note 3.

Other changes in the black lung plan assets and benefit obligations recognized in other comprehensive (loss) income are as follows:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Other changes in the black lung plan assets and benefit obligations recognized in other comprehensive income (loss) are as follows:

Year Ended December 31,

2023 2022 2021

Actuarial (gain) loss $ ( 20,881 ) $ ( 9,649 ) $ 14,567

Amortization of net actuarial loss ( 1,257 ) ( 2,453 ) ( 1,942 )

Settlement — — ( 1,563 )

Total recognized in other comprehensive (loss) income $ ( 22,138 ) $ ( 12,102 ) $ 11,062

Actuarial loss (gain) (1)

$ 19,995 $ ( 20,881 ) $ ( 9,649 )

Amortization of net actuarial gain (loss) 2,833 ( 1,257 ) ( 2,453 )

Total recognized in other comprehensive income (loss) $ 22,828 $ ( 22,138 ) $ ( 12,102 )

For the year ended December 31, 2022, the actuarial gain was primarily attributable to an increase in the weighted-average discount rate actuarial assumption used in determining the benefit obligations.

The weighted-average assumptions related to black lung obligations used to determine the benefit obligation as of December 31, 2023 and 2022 were as follows:

3 unchanged sentences

The weighted-average assumptions related to black lung benefit obligations used to determine net periodic benefit cost were as follows:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Year Ended December 31,

5 unchanged sentences

Federal black lung medical benefit trend rate 5.00 % 5.00 % 5.00 %

Black lung benefit expense inflation rate (1)

— % — % 2.00 %

Expected return on plan assets 2.00 % 2.00 % 2.00 %

(1) Effective in 2021, the annual claim administration expenses are incorporated into the annual service cost component of the net periodic benefit cost for the black lung benefit obligations.

Estimated future cash payments related to black lung benefit obligations for the next 10 years ending after December 31, 2023 are as follows:

1 unchanged sentence

2024 $ 10,687

2029-2033 24,037

Postretirement Life Insurance Benefits

As part of the Alpha Natural Resources, Inc.

bankruptcy reorganization process and the Retiree Committee Settlement Agreement, the Company assumed the unfunded liability for life insurance benefits for certain disabled and non-union retired employees.

bankruptcy reorganization process and the Retiree Committee Settlement Agreement, the Company assumed the unfunded liability for life insurance benefits for certain disabled and non-union retired

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Provisions are made for estimated benefits and adjustments to the probable ultimate liabilities are made annually based on an actuarial study prepared by independent actuaries.

As of December 31, 2022 and 2021, the postretirement life insurance benefit obligation was $ 8,761 , including a current portion $ 648 , and $ 11,610 , including a current portion $ 602 , respectively, which are included in the Consolidated Balance Sheets as Other non-current liabilities and Accrued expenses and other current liabilities.

As of December 31, 2023 and 2022, the postretirement life insurance benefit obligation was $ 8,857 , including a current portion of $ 613 , and $ 8,761 , including a current portion of $ 648 , respectively, which are included in the Consolidated Balance Sheets as Other non-current liabilities and Accrued expenses and other current liabilities.

Defined Contribution and Profit-Sharing Plans

8 unchanged sentences

During the years ended December 31, 2023, 2022, and 2021, the Company incurred total expenses of $ 86,745 , $ 68,706 , and $ 62,351 , respectively, which primarily include claims processed and an estimate for claims incurred but not paid.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

( 19) Stock-Based Compensation Awards

4 unchanged sentences

The ANR EIP is no t authorized for additional issuance of awards of shares of common stock, and as of December 31, 2023, there were no shares of common stock available for grant under the ANR EIP.

As of December 31, 2022, the Company had four types of stock-based awards outstanding:

time-based restricted stock units, performance-based restricted stock units, stock options, and performance-based cash awards.

As of December 31, 2023, the Company had three types of stock-based awards outstanding:

time-based restricted stock units, performance-based restricted stock units, and performance-based cash awards.

Upon vesting and settlement or exercise of the stock-based awards outstanding, the Company issues authorized and unissued shares of the Company’s common stock to the recipient.

5 unchanged sentences

During the year ended December 31, 2022, the Company repurchased 94,460 shares of its common stock issued pursuant to awards under the MIP and LTIP for a total purchase amount of $ 7,867 , or $ 83.28 average price paid per share.

During the year ended December 31, 2020, the Company repurchased 43,559 shares of its common stock issued pursuant to awards under the MIP, LTIP and ANR EIP for a total purchase amount of $ 209 , or $ 4.79 average price paid per share.

During the year ended December 31, 2021, the Company repurchased 50,363 shares of its common stock issued pursuant to awards under the MIP and LTIP for a total purchase amount of $ 785 , or $ 15.60 average price paid per share.

On November 8, 2023, the Company modified the terms of certain outstanding stock-based compensation awards previously granted to Mr.

Stetson, the executive chair of the Board.

Pursuant to the terms of the modification, upon the completion of his service as executive chair as of the end of the day on December 31, 2023, and his appointment by the Board

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

as non-executive chair of the Board effective as of January 1, 2024, the pro-rata vesting of his outstanding incentive awards was to be calculated as if his separation date were instead December 31, 2024.

The modification resulted in total incremental compensation cost of $ 6,717 for the year ended December 31, 2023 and impacted the time-based restricted stock units and performance-based restricted stock units granted to him under the LTIP during the years ended December 31, 2023 and 2022.

Awards held by other employees were not affected by the modification.

As all modified awards are fully vested, there is no remaining compensation cost to be recognized as of December 31, 2023.

2023 Awards Granted

During the year ended December 31, 2022, the Company granted certain key employees and non-employee directors 95,111 time-based restricted stock units under the MIP and LTIP with a weighted average grant date fair value of $ 96.60 based on the Company’s closing stock price at the trading day before the date of the grant.

The awards granted to key employees on January 25, 2022 will vest ratably over a three-year period from the date of the grant in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

The restricted stock units granted to non-employee directors on May 3, 2022 will vest on the first to occur of (i) May 2, 2023, (ii) the director’s service as a member of the Board is terminated, for any reason other than removal for cause, as of a date that is more than six months after the date of grant, and (iii) a change in control.

The award granted to the Chief Executive Officer (“CEO”) on November 18, 2022, in advance of his transition to Executive Chairman on January 1, 2023, will vest over the course of 2023 in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

All unvested restricted stock units will immediately vest upon involuntary departure from the Board.

During the year ended December 31, 2023, the Company granted certain key employees and non-employee directors 35,018 time-based restricted stock units under the LTIP with a weighted average grant date fair value of $ 165.43 based on the Company’s closing stock price at the trading day before the date of the grant.

Awards granted to key employees on January 25, 2023 will vest ratably over a three-year period from the date of the grant in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

Per the terms of the transition agreement between Mr.

Stetson and the Company, dated November 18, 2022, relating to his service as the Company’s executive chair of the Board, and then as its non-executive chair, awards granted to Mr.

Stetson were to vest pro-rata as of December 31, 2023, the last day of his service as the Company’s executive chair, reflecting his service through that date.

The transition agreement was later amended as discussed above.

Restricted stock units were also granted to a non-employee director on February 2, 2023, which vested on May 2, 2023, and to multiple non-employee directors on May 3, 2023, which will vest on the first to occur of (i) May 2, 2024, (ii) the director’s separation of service due to the director’s death or physical or mental incapacity to perform his or her usual duties, (iii) the director’s service as a member of the Board is terminated, for any reason other than removal for cause, as of a date that is more than six months after the date of grant, and (iv) a change in control.

Additionally, during the year ended December 31, 2023, the Company granted certain key employees 49,701 performance-based restricted stock units under the LTIP, which represent the number of shares of common stock that may be issued based on the achievement of targeted performance levels related to pre-established relative total shareholder return goals and annually determined operational goals over a three year period.

These awards are scheduled to cliff vest on the third anniversary of the date of the grant, subject to the participant’s continuous service with the Company through the applicable vesting date and the satisfaction of the performance criteria.

Per the terms of the transition agreement between Mr.

Stetson and the Company, dated November 18, 2022, relating to his service as the Company’s executive chair of the Board, and then as its non-executive chair, the awards granted to Mr.

Stetson were to vest pro-rata as of December 31, 2023, the last day of his service as the Company’s executive chair, reflecting his service through that date.

The transition agreement was later amended as discussed above.

The performance-based restricted stock units have the potential to be earned from 0 % to 200 % of the targeted performance level, depending on actual results.

Upon vesting and settlement of these awards, the Company will issue authorized and previously unissued shares of the Company’s common stock to the recipient.

The 29,816 operational performance-based restricted stock units were valued based on the Company’s closing stock price on the trading day before the date of the grant and had a weighted average grant date fair value of $ 171.07 .

For the awards with operational performance conditions, the Company reassesses at each reporting date whether achievement of each of the performance conditions was probable and adjusts the accrual of stock-based compensation expense as needed.

Of the 19,885 relative total shareholder return performance-based restricted stock units, 2,093 were valued based on the Company’s closing stock price on the trading day before the date of the grant and had a weighted average grant date fair value of $ 171.07 , and 17,792 were valued relative to the stock price performance of a comparator group and had a weighted average grant date fair value of $ 267.18 based on a Monte Carlo simulation.

The Monte Carlo simulation incorporated the assumptions as presented in the following table:

Relative performance-based restricted stock units

Start price (1)

Valuation date stock price (2)

Expected volatility (3)

Risk-free interest rate (4)

Expected dividend yield (5)

(1) The start price for the Company represented the average closing stock price over the twenty trading days ending on December 31, 2022, assuming dividends distributed during this period were reinvested in additional shares of the Company’s stock on the ex-dividend date.

(2) The valuation date stock price represented the closing value on the grant date.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

(3) The expected volatility assumption was based on the historical volatility of the price of the Company’s stock.

(4) The annual risk-free interest rate equaled the yield on the semi-annual zero coupon U.S.

Treasury rates converted to continuously compounded rates that had a term equal to the length of the remaining performance measurement period as of the valuation date.

(5) The expected dividend yield represented the investments return to a share of the Company’s stock that is not available to the holder of the performance-based restricted stock unit.

2022 Awards Granted

Awards granted to key employees on January 25, 2022 will vest ratably over a three-year period from the date of the grant in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

Restricted stock units were also granted to non-employee directors on May 3, 2022, which vested on May 2, 2023.

An award granted to Mr.

Stetson, the Chief Executive Officer (“CEO”), on November 18, 2022, in advance of his transition to executive chair of the Board on January 1, 2023, vested over the course of 2023 in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

Additionally, during the year ended December 31, 2022, the Company granted certain key employees 60,857 performance-based restricted stock units under the LTIP, which represent the number of shares of common stock that may be issued based on the achievement of targeted performance levels related to pre-established relative total shareholder return goals and annually determined operational goals over a three year period.

19 unchanged sentences

Additionally, during the year ended December 31, 2022, the Company granted certain key employees performance-based cash incentive awards under the LTIP with a target award amount of $ 1,105 .

The cash to be awarded is based on the achievement of pre-established relative total shareholder return goals over a three-year period.

These awards have the potential to be distributed from 0 % to 200 % of the targeted performance level, depending on actual results.

Upon vesting of these awards, the Company issues cash to the recipient.

These awards are classified as a liability, and the Company reassesses at each reporting date the fair value of the award and adjusts the accruals of stock-based compensation expense as appropriate based on a Monte Carlo simulation.

As of December 31, 2022, the liability for these awards totaled $ 374 .

The performance-based cash incentive awards were valued relative to the stock price performance of a comparator group and had a weighted average grant date fair

The cash to be awarded is based on the

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

value as a percent of target dollar value of 61.97 % based on a Monte Carlo simulation.

achievement of pre-established relative total shareholder return goals over a three-year period.

These awards have the potential to be distributed from 0 % to 200 % of the targeted performance level, depending on actual results.

Upon vesting of these awards, the Company issues cash to the recipient.

As of December 31, 2023 and 2022, the liability for these awards totaled $ 1,233 and $ 374 , respectively.

The performance-based cash incentive awards were valued relative to the stock price performance of a comparator group and had a weighted average grant date fair value as a percent of target dollar value of 61.97 % based on a Monte Carlo simulation.

The Monte Carlo simulation incorporates the assumptions as presented in the following table:

5 unchanged sentences

Expected dividend yield (5)

(1) The start price for the Company represents the average closing stock price over the twenty trading days ending on December 31, 2021, assuming dividends distributed during this period were reinvested in additional shares of the Company’s stock on the ex-dividend date.

(2) The valuation date stock price represents the closing price at each reporting date.

(3) The expected volatility assumption is based on the historical volatility of the price of the Company’s stock.

(4) The annual risk-free interest rate equals the yield on the semi-annual zero coupon U.S.

Treasury rates converted to continuously compounded rates that have a term equal to the length of the remaining performance measurement period as of the valuation date.

(5) The expected dividend yield represents the investments return to a share of the Company’s stock that is not available to the holder of the performance-based restricted stock unit.

(1) The start price for the Company represented the average closing stock price over the twenty trading days ending on December 31, 2021, assuming dividends distributed during this period were reinvested in additional shares of the Company’s stock on the ex-dividend date.

(2) The valuation date stock price represented the closing price on the grant date.

(3) The expected volatility assumption was based on the historical volatility of the price of the Company’s stock.

(4) The annual risk-free interest rate equaled the yield on the semi-annual zero coupon U.S.

Treasury rates converted to continuously compounded rates that had a term equal to the length of the remaining performance measurement period as of the valuation date.

(5) The expected dividend yield represented the investments return to a share of the Company’s stock that is not available to the holder of the performance-based restricted stock unit.

2021 Awards Granted

During the year ended December 31, 2021, the Company granted certain key employees and non-employee directors 223,496 time-based restricted stock units under the MIP and LTIP with a weighted average grant date fair value of $ 12.03 based on the Company’s closing stock price at the trading day before the date of the grant.

The awards granted to key employees will vest ratably over a three-year period from the date of the grant in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

The restricted stock units granted to non-employee directors on February 10, 2021 will vest on the first to occur of (i) April 30, 2021, (ii) the director’s separation from service due to the director’s death or physical or mental incapacity to perform his or her usual duties, such condition likely to remain continuously and permanently, as determined by the Company, and (iii) a change in control.

The restricted stock units granted to non-employee directors on May 1, 2021 will vest on the first to occur of (i) April 30, 2022, (ii) the director’s service as a member of the Board is terminated, for any reason other than removal for cause, as of a date that is more than six months after the date of grant, and (iii) a change in control.

Awards granted to key employees will vest ratably over a three-year period from the date of the grant in accordance with the vesting schedule, subject to the participant’s continuous service with the Company through each applicable vesting date.

Restricted stock units were also granted to non-employee directors on February 10, 2021, which vested on April 30, 2021, and on May 1, 2021, which vested on April 30, 2022.

Additionally, during the year ended December 31, 2021, the Company granted certain key employees 167,587 performance-based restricted stock units under the LTIP, which represent the number of shares of common stock that may be issued based on the achievement of targeted performance levels related to pre-established relative total shareholder return goals and annually determined operational goals over a three year period.

38 unchanged sentences

Expected dividend yield (5)

(1) The start price for the Company represents the average closing stock price over the twenty trading days ending on December 31, 2020, assuming dividends distributed during this period were reinvested in additional shares of the Company’s stock on the ex-dividend date.

(2) The valuation date stock price represents the closing price at each reporting date.

(3) The expected volatility assumption is based on the historical volatility of the price of the Company’s stock.

(4) The annual risk-free interest rate equals the yield on the semi-annual zero coupon U.S.

Treasury rates converted to continuously compounded rates that have a term equal to the length of the remaining performance measurement period as of the valuation date.

(5) The expected dividend yield represents the investments return to a share of the Company’s stock that is not available to the holder of the performance-based restricted stock unit.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

2020 Awards Granted

During the year ended December 31, 2020, the Company granted certain key employees and non-employee directors 402,620 time-based restricted stock units under the MIP and LTIP with a weighted average grant date fair value of $ 6.17 based on the Company’s closing stock price at the trading day before the date of the grant.

The awards granted to non-employee directors will vest on the first to occur of (i) April 30, 2021, (ii) the director’s separation from service due to the director’s death or physical or mental incapacity to perform his or her usual duties, such condition likely to remain continuously and permanently, as determined by the Company, (iii) a change in control, and (iv) the director's service as a member of the Board is terminated as of a date that is after October 31, 2021 but prior to May 1, 2022 for any reason other than removal for cause.

Additionally, during the year ended December 31, 2020, the Company granted the CEO 302,795 performance-based restricted stock units under the LTIP which represent the number of shares of common stock that may be issued based on the achievement of targeted performance levels related to pre-established relative total shareholder return goals and annually determined operational goals over a three year period.

This award was scheduled to cliff vest on the third anniversary of the date of the grant, subject to the participant’s continuous service with the Company through the applicable vesting date and the satisfaction of the performance criteria.

These performance-based restricted stock units had the potential to be earned from 0 % to 200 % of the targeted performance level, depending on actual results.

Upon vesting of this award, the Company would issue authorized and previously unissued shares of the Company’s common stock to the recipient.

The 151,398 operational performance-based restricted stock units were valued based on the Company’s closing stock price on the trading day before the date of the grant and had a weighted average grant date fair value of $ 6.36 .

For the awards with operational performance conditions, the Company reassessed at each reporting date whether achievement of each of the performance conditions was probable and adjusted the accrual of stock-based compensation expense as needed.

The 151,397 relative total shareholder return performance-based restricted stock units were valued relative to the stock price performance of a comparator group and had a weighted average grant date fair value of $ 8.53 based on a Monte Carlo simulation.

The Monte Carlo simulation incorporated the assumptions as presented in the following table:

Relative performance-based restricted stock units

Start price (1)

Valuation date stock price (2)

Expected volatility (3)

Risk-free interest rate (4)

Expected dividend yield (5)

(1) The start price for the Company represented the average closing stock price over the twenty trading days ending on December 31, 2020, assuming dividends distributed during this period were reinvested in additional shares of the Company’s stock on the ex-dividend date.

4 unchanged sentences

(5) The expected dividend yield represented the investments return to a share of the Company’s stock that is not available to the holder of the performance-based restricted stock unit.

During the first quarter of 2021, the 302,795 performance-based restricted stock units granted under the LTIP were voluntarily forfeited by the CEO in conjunction with an amendment to his employment agreement and the shares were canceled and allocated back to the LTIP for future issuance.

The amendment also included an amendment to the participant’s time-based restricted stock granted under the MIP, such that the ratable vesting initially scheduled to occur on the second and third anniversaries of the award shall instead both occur on the second anniversary of the award.

Additionally, during the year ended December 31, 2020, the Company granted certain key employees performance-based cash incentive awards under the LTIP with a target award amount of $ 2,755 .

The cash to be awarded is based on the achievement of pre-established relative total shareholder return goals over a three-year period.

These awards are scheduled to cliff vest on the third anniversary of the date of the grant, subject to the participant’s continuous service with the Company

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

through the applicable vesting date and the satisfaction of the performance criteria.

These awards have the potential to be distributed from 0 % to 200 % of the targeted performance level, depending on actual results.

Upon vesting of these awards, the Company issues cash to the recipient.

As of December 31, 2022 and 2021, the liability for these awards totaled $ 3,968 and $ 2,542 , respectively.

The Monte Carlo simulation incorporates the assumptions as presented in the following table:

Performance-based cash incentive awards

Start price (1)

Valuation date stock price (2)

Expected volatility (3)

Risk-free interest rate (4)

Expected dividend yield (5)

(1) The start price for the Company represents the average closing stock price over the twenty trading days ending on December 31, 2019, assuming dividends distributed during this period were reinvested in additional shares of the Company’s stock on the ex-dividend date.

(2) The valuation date stock price represents the closing price at each reporting date.

(3) The expected volatility assumption is based on the historical volatility of the price of the Company’s stock.

(4) The annual risk-free interest rate equals the yield on the semi-annual zero coupon U.S.

Treasury rates converted to continuously compounded rates that have a term equal to the length of the remaining performance measurement period as of the valuation date.

(5) The expected dividend yield represents the investments return to a share of the Company’s stock that is not available to the holder of the performance-based restricted stock unit.

Restricted Stock Units

13 unchanged sentences

Relative performance-based restricted stock unit activity for the year ended December 31, 2023 based on target achievement of the performance criteria is summarized in the following table:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

Relative performance-based restricted stock unit activity:

2 unchanged sentences

Granted 19,885 $ 257.06

( 46,551 ) $ 65.70

Vested ( 10,502 ) $ 106.82

Forfeited ( 1,045 ) $ 167.08

Non-vested shares outstanding at December 31, 2023 99,715 $ 72.90

(1) Shares were canceled and allocated back to the LTIP for future issuance as the 2019 award’s performance metric was not achieved, including 25,364 shares for employees that had previously only met the continued employment vesting criteria.

As of December 31, 2023, there was $ 3,809 of unrecognized compensation cost related to non-vested relative performance-based restricted stock units which is expected to be recognized as expense over a weighted-average period of 1.92 years.

Absolute performance-based restricted stock unit activity for the year ended December 31, 2022 based on target achievement of the performance criteria is summarized in the following table:

Absolute performance-based restricted stock unit activity:

Number of Shares Weighted-Average Grant Date Fair Value

Non-vested shares outstanding at December 31, 2021 15,532 $ 50.60

Granted — $ —

( 15,532 ) $ 50.60

Non-vested shares outstanding at December 31, 2022 — $ —

(1) Shares were canceled and allocated back to the LTIP for future issuance as the 2019 award’s performance metric was not achieved, including 8,459 shares for employees that had previously only met the continued employment vesting criteria.

As of December 31, 2022, there was no unrecognized compensation cost related to non-vested absolute performance-based restricted stock units.

The total fair value of shares vested during the year ended December 31, 2023 was $ 3,559 .

Operational performance-based restricted stock unit activity for the year ended December 31, 2023 based on target achievement of the performance criteria is summarized in the following table:

3 unchanged sentences

Granted 29,816 $ 171.07

Forfeited or Canceled — $ —

Vested ( 15,753 ) $ 74.61

Forfeited ( 1,568 ) $ 150.24

Non-vested shares outstanding at December 31, 2023 149,562 $ 47.48

As of December 31, 2022, there was $ 1,011 of unrecognized compensation cost related to non-vested operational performance-based restricted stock units, based on the probability of achievement as of December 31, 2022, which is expected to be recognized as expense over a weighted-average period of 1.63 years.

Stock Options

30-Day Volume-Weighted Average Price (“VWAP”) Stock Options

30-day VWAP stock option activity for the year ended December 31, 2022 is summarized in the following table:

As of December 31, 2023, there was $ 1,446 of unrecognized compensation cost related to non-vested operational performance-based restricted stock units, based on the probability of achievement as of December 31, 2023, which is expected

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

to be recognized as expense over a weighted-average period of 1.70 years.The total fair value of shares vested during the year ended December 31, 2023 was $ 5,339 .

Stock Options

30-Day Volume-Weighted Average Price (“VWAP”) Stock Options

30-day VWAP stock option activity for the year ended December 31, 2023 is summarized in the following table:

Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (1)

15 unchanged sentences

Granted — — %

Vested ( 2,054 ) 200.00 %

Forfeited ( 28 ) 130.43 %

2 unchanged sentences

(20) Related Party Transactions

On December 7, 2022, the Company’s subsidiary, Maxxim Rebuild Co., LLC (“Maxxim”) acquired certain assets of Industrial Plating & Machine, Inc.

(“IPM”), as well as its Bluefield, West Virginia manufacturing facility.

As part of the transaction, the Company entered into an employment agreement with Joseph Shannon Remines, IPM’s president, pursuant to which Mr.

Remines would be employed by Maxxim as Vice-President, and pursuant to which he would continue to be employed at the Bluefield facility.

The initial term of the agreement is three years , with automatic one-year renewals thereafter unless either party gives 90 days’ prior notice.

The agreement provides Mr.

Remines with a base salary, an opportunity for sales bonuses if gross revenues at the facility exceed certain thresholds, as well as participation in the Company’s other benefits programs, including the Annual Incentive Bonus Plan and the LTIP.

Remines also is an owner of the company that leases the real property for the Bluefield facility under a lease with an initial term of five years , with an option in favor of Maxxim to extend the term for an additional five years and for one-year extensions thereafter.

The initial base rental under the lease is $ 360,000 per year.

Additionally, Mr.

Remines continues to own IPM, which also operates a chroming business at a separate facility, which Maxxim did not acquire.

The Company will continue to do business with IPM related to the chroming business, which is not material.

There were no material related party transactions for the year ended December 31, 2023.

During the year ended December 31, 2021, the Company, through a privately negotiated transaction with an underlying Contingent Revenue Obligation creditor, repurchased 7.75 % of the outstanding rights of the Contingent Revenue Obligation at an aggregate purchase price of $ 2,091 .

The underlying Contingent Revenue Obligation creditor was an existing shareholder (related party) as of the repurchase date.

Refer to Note 14 for additional disclosures on this acquisition-related obligation.

Additionally, during the year ended December 31, 2021, the Company repurchased at a discount certain outstanding principal

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

Under his employment agreement, Mr.

Remines is subject to numerous restrictions and conditions to avoid a conflict of interest or the ability to engage in self-dealing.

Remines and his companies have also entered into a non-competition agreement with the Company in connection with the transaction.

The Board reviewed and approved the transaction in advance, and, although Mr.

Remines does not meet the definition of a "related person," the Board also approved the nature of the arrangements with Mr.

Remines described above.

The underlying Contingent Revenue Obligation creditor was an existing shareholder (related party) as of the repurchase date.

Refer to Note 15 for additional disclosures on this acquisition-related obligation.

Additionally, during the year ended December 31, 2021, the Company repurchased at a discount certain outstanding principal borrowings made under the Term Loan Credit Facility from existing shareholders through privately negotiated transactions.

borrowings made under the Term Loan Credit Facility from existing shareholders through privately negotiated transactions.

Refer to Note 13 for additional disclosures on long-term debt.

There were no material related party transactions for the year ended December 31, 2020.

(21) Commitments and Contingencies

9 unchanged sentences

As of December 31, 2023, the Company has obligations under certain coal purchase agreements that contain minimum quantities to be purchased in 2024 totaling an estimated $ 236,848 .

The Company also has obligations under certain unconditional purchase obligations totaling $ 109,358 , $ 98,602 , and $ 4,887 in 2023, 2024, and 2025, respectively, including transportation commitments, minimum equipment purchase commitments, diesel fuel purchase commitments, and electricity purchase commitments.

The Company also has outstanding unconditional purchase obligations for 2024 and 2025 totaling $ 251,038 and $ 66,675 , respectively, related to the purchase of equipment, diesel fuel, and electricity, as well as for rail freight and export terminal costs (including $ 48,405 in 2024 for DTA funding.)

Under the terms of its partnership related agreements with respect to its investment in DTA, the Company is required to fund its proportionate share of DTA’s ongoing operating and capital costs.

In November 2023, the Company, together with DTA management announced that DTA needed additional capital investment to maximize functionality and minimize downtime due to mechanical issues.

Beyond the Company’s share of routine operating costs, it expects to invest up to an incremental $ 25,000 per year for infrastructure and equipment upgrades at DTA over the next 6 years.

The Company’s 2024 funding of DTA includes routine operating and capital costs and infrastructure and equipment upgrades.

Contingencies

1 unchanged sentence

Further regulations, legislation or litigation in these areas may also cause the Company’s sales or profitability to decline by increasing costs or by hindering the Company’s ability to continue mining at existing operations or to permit new operations.

During the normal course of business, contract-related matters arise between the Company and its customers.

When a loss related to such matters is considered probable and can reasonably be estimated, the Company records a liability.

During the first half of 2023, the Company purchased and sold 399 tons, totaling $ 15,170 , under the Cumberland Back-to-Back Coal Supply Agreements.

For the year ended December 31, 2022, the Company purchased and sold 1,617 tons, totaling $ 62,171 , under the Cumberland Back-to-Back Coal Supply Agreements.

As of June 30, 2023, the Cumberland Back-to-Back Coal Supply Agreements had been fully performed.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

During the normal course of business, contract-related matters arise between the Company and its customers.

When a loss related to such matters is considered probable and can reasonably be estimated, the Company records a liability.

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

In the normal course of business, the Company is a party to certain guarantees and financial instruments with off-balance sheet risk, such as bank letters of credit, performance or surety bonds, and other guarantees and indemnities related to the obligations of affiliated entities which are not reflected in the Company’s Consolidated Balance Sheets.

In the normal course of business, the Company is a party to certain guarantees and financial instruments with off-balance sheet risk, such as bank LCs, performance or surety bonds, and other guarantees and indemnities related to the obligations of affiliated entities which are not reflected in the Company’s Consolidated Balance Sheets.

However, the underlying liabilities that they secure, such as asset retirement obligations, workers’ compensation liabilities, and royalty obligations, are reflected in the Company’s Consolidated Balance Sheets.

1 unchanged sentence

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

The Company can also use bank letters of credit to collateralize certain obligations.

As of December 31, 2022, the Company had $ 61,877 in letters of credit outstanding under the Second Amended and Restated Asset-Based Revolving Credit Agreement.

Additionally, as of December 31, 2022, the Company had $ 50 in letters of credit outstanding under the Credit and Security Agreement dated June 30, 2017, and related amendments, between ANR, Inc.

and First Tennessee Bank National Association.

The Company can also use bank LCs to collateralize certain obligations.

As of December 31, 2023, the Company had $ 31 of cash collateralized LCs remaining to be replaced as part of the transition from the previous ABL Facility to the New ABL Facility and $ 60,896 in LCs outstanding under the New ABL Facility.

During the first quarter of 2024, the remaining cash collateralized LCs from the previous ABL Facility were cancelled with no replacement required and the cash collateral was returned.

As of December 31, 2023, the Company had outstanding surety bonds with a total face amount of $ 177,109 to secure various obligations and commitments.

To secure the Company’s reclamation-related obligations, the Company has $ 35,040 of collateral in the form of restricted cash, restricted investments, and deposits supporting these obligations as of December 31, 2022.

To secure the Company’s reclamation-related obligations, the Company has $ 33,858 of collateral in the form of restricted cash and restricted investments supporting these obligations as of December 31, 2023.

The Company meets frequently with its surety providers and has discussions with certain providers regarding the extent of and the terms of their participation in the program.

These discussions may cause the Company to shift surety bonds between providers or to alter the terms of their participation in our program.

To the extent that surety bonds become unavailable or the Company’s surety bond providers require additional collateral, the Company would seek to secure its obligations with letters of credit, cash deposits or other suitable forms of collateral.

To the extent that surety bonds become unavailable or the Company’s surety bond providers require additional collateral, the Company would seek to secure its obligations with LCs, cash deposits or other suitable forms of collateral.

The Company’s failure to maintain, or inability to acquire, surety bonds or to provide a suitable alternative would have a material adverse effect on its liquidity.

18 unchanged sentences

$ 40,597 $ 105,735

(1) Classified as trading securities as of December 31, 2022 and 2021.

(1) Classified as long-term trading securities as of December 31, 2023 and 2022.

Amounts included in deposits provide collateral to secure the following obligations:

Workers’ compensation obligations $ 4,500 $ —

Reclamation-related obligations — 102

2 unchanged sentences

Total deposits $ 5,382 $ 86,111

Less current portion ( 32 ) ( 84,748 )

Total deposits, net of current portion (1)

$ 5,350 $ 1,363

(1) Includes $ 84,748 related to the Company’s dividend payable.

Refer to Note 9 for additional information.

(2) Included within Short-term deposits and Other non-current assets on the Company’s Consolidated Balance Sheets.

(1) Included within Other non-current assets on the Company’s Consolidated Balance Sheets.

DCMWC Reauthorization Process

3 unchanged sentences

As a result of this application, the DCMWC notified the Company in a letter dated February 21, 2020 that the Company was reauthorized to self-insure certain of its black lung obligations for a period of one-year from February 21, 2020.

The DCMWC reauthorization is contingent, however, upon the Company’s providing collateral of $ 65,700 to secure certain of its black lung obligations.

This proposed collateral requirement is an increase from the approximate $ 2,600 in collateral that the Company currently provides to secure these self-insured black lung obligations.

The DCMWC reauthorization was contingent, however, upon the Company’s providing collateral of $ 65,700 to secure certain of its black lung obligations.

This proposed collateral requirement would have been an increase from the approximate $ 2,600 in collateral that the Company currently provides to secure these self-insured black lung obligations.

The reauthorization process provided the Company 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.

2 unchanged sentences

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.

The DOL 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 the Company presented facts and arguments in support of its appeal.

No ruling has been made on the appeal, but during the call the Company indicated that it would be willing to allocate an additional $ 10,000 in collateral.

If the Company’s appeal is unsuccessful, the Company may be required to provide additional letters of credit to receive the self-insurance reauthorization from the DCMWC or alternatively insure these black lung obligations through a third-party provider that would likely also require the Company to provide additional collateral.

If the Company’s appeal is unsuccessful, the Company may be required to provide additional LCs to receive the self-insurance reauthorization from the DCMWC or alternatively insure these black lung obligations through a third-party provider that would likely also require the Company to provide additional collateral.

In January 2023, the DOL proposed for public comment new regulations which, if adopted, would substantially increase the collateral required to secure self-insured federal black lung obligations.

Under the proposed 120% minimum collateral requirement, the Company estimates it could be required to provide approximately $ 80,000 to $ 100,000 of collateral to secure certain of its black lung obligations.

A significant increase in these collateral obligations would have a materially adverse effect on the Company’s liquidity.

The DOL has indicated that it expects that some form of these new regulations could go into effect in the first quarter or early second quarter of 2024.

A significant increase in these collateral obligations could have a materially adverse effect on the Company’s liquidity.

(d) Legal Proceedings

The Company is party to legal proceedings from time to time.

These proceedings, as well as governmental examinations, could involve various business units and a variety of claims including, but not limited to, contract disputes, personal injury claims, property damage claims (including those resulting from blasting, trucking and flooding), environmental and safety issues, securities-related matters and employment matters.

While some legal matters may specify the damages claimed by the plaintiffs, many seek an unquantified amount of damages.

Even when the amount of damages claimed against the Company or its subsidiaries is stated, (i) the claimed amount may be exaggerated or unsupported;

(ii) the claim may be based on a novel legal theory or involve a large number of parties;

(iii) there may be uncertainty as to the likelihood of a class being certified or

Litigation has been initiated against certain of our subsidiaries in which the plaintiffs allege violations of the Fair Labor Standards Act due to alleged failure to compensate for time “donning” and “doffing” equipment and to account for the effects in the calculation of overtime rates and pay.

The plaintiffs seek collective action certification.

We cannot reasonably estimate a

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

the ultimate size of the class;

range of potential exposure at this time.

We believe the plaintiffs’ claims are without merit, but if we were ultimately unsuccessful in defending against this litigation, it could have a material, adverse effect upon our liquidity and results of operations.

In addition, the Company is party to other legal proceedings from time to time.

While some legal matters may specify the damages claimed by the plaintiffs, many seek an unquantified amount of damages.

Even when the amount of damages claimed against the Company or its subsidiaries is stated, (i) the claimed amount may be exaggerated or unsupported;

(ii) the claim may be based on a novel legal theory or involve a large number of parties;

(iii) there may be uncertainty as to the likelihood of a class being certified or the ultimate size of the class;

(iv) there may be uncertainty as to the outcome of pending appeals or motions;

9 unchanged sentences

Total revenues 3,471,417 4,101,592 2,258,686

Export coal revenues 2,539,068 3,303,477 1,706,026

Top customer as % of total revenues 13 % 25 % 13 %

2 unchanged sentences

Number of customers exceeding 10% of total trade accounts receivable, net 3 2 3

Domestic revenue as % of coal revenues 19 % 24 % 36 %

Export revenue as % of coal revenues 81 % 76 % 64 %

Countries with export revenue exceeding 10% of total revenues India India, China, Brazil India, Brazil

Domestic coal revenue as % of total coal revenues 26 % 19 % 24 %

Export coal revenue as % of total coal revenues 74 % 81 % 76 %

Countries with export coal revenue exceeding 10% of total revenues India India India, China, Brazil

Met coal as % of coal sales volume 90 % 87 % 83 %

4 unchanged sentences

The Company has one reportable segment:

Met, which consists of six active mines and two preparation plants in Virginia, seventeen active mines and five preparation plants in West Virginia, as well as expenses associated with certain idled/closed mines.

In addition to the one reportable segment, the All Other category includes general corporate overhead and corporate assets and liabilities, the 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.

Reportable segment operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is the Chief Executive Officer of the Company.

Segment operating results and capital expenditures for the year ended December 31, 2022 were as follows:

Met, which consists of five active mines and two preparation plants in Virginia, seventeen active mines and six preparation plants in West Virginia, as well as expenses associated with certain idled/closed mines.

ALPHA METALLURGICAL RESOURCES, INC.

2 unchanged sentences

(Amounts in thousands except share and per share data)

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

Reportable segment operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is the Chief Executive Officer of the Company.

Segment operating results and capital expenditures for the year ended December 31, 2023 were as follows:

Year Ended December 31, 2023

13 unchanged sentences

Capital expenditures $ 160,679 $ 3,630 $ 164,309

Segment operating results and capital expenditures from continuing operations for the year ended December 31, 2020 were as follows:

Segment operating results and capital expenditures for the year ended December 31, 2021 were as follows:

Year Ended December 31, 2021

5 unchanged sentences

Capital expenditures $ 79,185 $ 4,115 $ 83,300

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for the year ended December 31, 2023:

7 unchanged sentences

Non-cash stock compensation expense 96 18,921 19,017

Mark-to-market adjustment - acquisition-related obligations — 8,880 8,880

Loss on extinguishment of debt — 2,753 2,753

Accretion on asset retirement obligations 14,886 10,614 25,500

1 unchanged sentence

Adjusted EBITDA $ 1,087,803 $ ( 54,692 ) $ 1,033,111

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for the year ended December 31, 2022:

8 unchanged sentences

Mark-to-market adjustment - acquisition-related obligations — 8,880 8,880

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

Accretion on asset retirement obligations 13,590 10,175 23,765

Asset impairment and restructuring — ( 561 ) ( 561 )

Amortization of acquired intangibles, net 15,699 3,799 19,498

Adjusted EBITDA $ 1,776,642 $ ( 36,030 ) $ 1,740,612

The following table presents a reconciliation of net loss from continuing operations to Adjusted EBITDA for the year ended December 31, 2020:

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for the year ended December 31, 2021:

Year Ended December 31, 2021

Met All Other Consolidated

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

Net income (loss) $ 439,859 $ ( 151,069 ) $ 288,790

Interest expense 184 69,470 69,654

Interest income ( 6 ) ( 330 ) ( 336 )

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

Income tax expense — 3,408 3,408

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 )

Management restructuring costs (1)

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

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

Adjusted EBITDA $ 567,270 $ ( 32,789 ) $ 534,481

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

No asset information has been disclosed as the CODM does not regularly review asset information by reportable segment.

(25) Subsequent Events

On February 21, 2023, the Board declared a quarterly cash dividend of $ 0.44 per share which will be payable on April 3, 2023 for holders of record as of March 15, 2023.

The quarterly cash dividend was increased to $ 0.44 from the previous quarterly cash dividend of $ 0.418 per share.

ALPHA METALLURGICAL RESOURCES, INC.

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Amounts in thousands except share and per share data)

On February 21, 2023, the Board also approved a $ 200,000 increase to the existing common share repurchase program, bringing the total authorization to repurchase the Company’s stock to $ 1,200,000 .

Refer to Note 9 for information regarding the Company’s dividend program and share repurchase program.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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 8. Financial Statements and Supplementary Data