What changed in this filing

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Item 9A. Controls and Procedures

2021-02-23 compared with 2020-02-21 · 1143 added, 1540 removed, 1671 unchanged (62% of the section changed)

3 unchanged sentences

As of December 31, 2020, the end of the period covered by this Annual Report on Form 10-K, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures.

Based upon that evaluation, our Chief Executive Officer and Interim Chief Financial Officer have concluded our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of December 31, 2019 were effective to provide reasonable assurance that the desired control objectives were achieved.

Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of December 31, 2020 were effective to provide reasonable assurance that the desired control objectives were achieved.

Changes in Internal Control Over Financial Reporting

3 unchanged sentences

consolidating the activities of acquired business units;

migrating certain processes to our shared services organizations;

migrating certain processes to our shared services organizations and/or managed third parties;

formalizing and refining policies, procedures and control documentation requirements;

2 unchanged sentences

There have been no changes in our internal control over financial reporting that occurred during the three months ended December 31, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Peabody Energy Corporation 2020 Form 10-K

Management’s Report on Internal Control Over Financial Reporting

Management is responsible for maintaining and establishing adequate internal control over financial reporting.

An evaluation of the effectiveness of the design and operation of our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, as of the end of the period covered by this report was performed under the supervision and with the participation of management, including our Chief Executive Officer and Interim Chief Financial Officer.

This evaluation is performed to determine if our internal controls over financial reporting provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

4 unchanged sentences

Our Independent Registered Public Accounting Firm, Ernst & Young LLP, has audited our internal control over financial reporting, as stated in their unqualified opinion report included herein.

Kellow /s/ Mark A.

President and Chief Executive Officer

Interim Chief Financial Officer

Executive Vice President and Chief Financial Officer

February 23, 2021

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

3 unchanged sentences

In our opinion, Peabody Energy Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Peabody Energy Corporation as of December 31, 2019 and 2018 (Successor), the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity and cash flows for the year ended December 31, 2019 and 2018 (Successor), the period from April 2, 2017 through December 31, 2017 (Successor), the period from January 1, 2017 through April 1, 2017 (Predecessor), and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”) of the Company, and our report dated February 21, 2020 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Peabody Energy Corporation as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive (loss) income, changes in stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2020, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”) of the Company, and our report dated February 23, 2021 expressed an unqualified opinion thereon.

Basis for Opinion

17 unchanged sentences

February 23, 2021

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

Other Information.

12 unchanged sentences

Outstanding Options,

Warrants and Rights

Weighted-Average

Warrants and Rights Weighted-Average

Exercise Price of

Outstanding Options,

Warrants and Rights

Number of Securities

Warrants and Rights Number of Securities

Remaining Available

4 unchanged sentences

Equity compensation plans approved by security holders

1,026,326 (1)

Equity compensation plans not approved by security holders

Total 1,026,326 $ — 7,297,347

(1) Shares issuable pursuant to outstanding performance units and vested but not issued deferred stock units.

5 unchanged sentences

The information required by Items 404 and 407(a) of Regulation S-K is included under the captions “Review of Related Person Transactions” and “Additional Information Concerning the Board of Directors - Board Independence” in our 2021 Proxy Statement and is incorporated herein by reference.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

Principal Accountant Fees and Services.

5 unchanged sentences

Report of Independent Registered Public Accounting Firm

Consolidated Statements of Operations — For the Years Ended December 31, 2019 and 2018, the Period April 2 through December 31, 2017 (Successor);

and January 1 through April 1, 2017 (Predecessor)

Consolidated Statements of Comprehensive (Loss) Income — For the Years Ended December 31, 2019 and 2018, the Period April 2 through December 31, 2017 (Successor);

and January 1 through April 1, 2017 (Predecessor)

Consolidated Statements of Operations — For the Years Ended December 31, 2020, 2019 and 2018

Consolidated Statements of Comprehensive (Loss) Income — For the Years Ended December 31, 2020, 2019 and 2018

Consolidated Balance Sheets — December 31, 2020 and 2019

Consolidated Statements of Cash Flows — For the Years Ended December 31, 2019 and 2018, the Period April 2 through December 31, 2017 (Successor);

and January 1 through April 1, 2017 (Predecessor)

Consolidated Statements of Changes in Stockholders’ Equity — For the Years Ended December 31, 2019 and 2018, the Period April 2 through December 31, 2017 (Successor);

and January 1 through April 1, 2017 (Predecessor)

Consolidated Statements of Cash Flows — For the Years Ended December 31, 2020, 2019 and 2018

Consolidated Statements of Changes in Stockholders’ Equity — For the Years Ended December 31, 2020, 2019 and 2018

Notes to Consolidated Financial Statements

4 unchanged sentences

(3) Exhibits.

See Exhibit Index hereto.

The exhibits below are numbered in accordance with the Exhibit Table of Item 601 of Regulation S-K.

Description of Exhibit

2.1 Debtors’ Second Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code as revised March 15, 2017 (Incorporated by reference to Exhibit 2.2 of the Registrant’s Current Report on Form 8-K, filed March 20, 2017).

2.2 Order Confirming Debtors’ Second Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code on March 17, 2017 (Incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K, filed March 20, 2017).

2.3 Asset Purchase Agreement, dated as of September 20, 2018, by and between Drummond Company, Inc.

and Peabody Southeast Mining, LLC, and, for certain limited purposes, Peabody Energy Corporation (Incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K, filed September 24, 2018).

2.4 Implementation Agreement, dated as of June 18, 2019, between Peabody Energy Corporation and Arch Coal, Inc.

(Incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K/A filed on June 19, 2019).

Peabody Energy Corporation 2020 Form 10-K

3.1 Fourth Amended and Restated Certificate of Incorporation of the Registrant (Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed April 3, 2017).

3.2 Amended and Restated By-Laws of the Registrant (Incorporated by reference to Exhibit 3.3 of the Registrant’s Current Report on Form 8-K filed April 3, 2017).

4.1 Specimen of stock certificate representing the Registrant’s common stock, $.01 par value (Incorporated by reference to Exhibit 4.13 to Amendment No.

4 to the Registrant’s Form S-1 Registration Statement No.

333-55412, filed May 1, 2001).

4.2 Indenture, dated as of February 15, 2017, between Peabody Securities Finance Corporation and Wilmington Trust, National Association, as Trustee, governing 6.000% Senior Secured Notes due 2022 and 6.375% Senior Secured Notes due 2025 (Incorporated by reference to Exhibit 4.1 of the Registrant’s Current Report on Form 8-K, filed February 15, 2017).

4.3 First Supplemental Indenture, dated as of April 3, 2017, among the Registrant, Peabody Securities Finance Corporation, the subsidiary guarantors party thereto and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.3 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

4.4 Second Supplemental Indenture, dated as of May 7, 2018, among the Registrant, NGS Acquisition Corp., LLC, and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.4 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

4.5 Third Supplemental Indenture, dated as of August 9, 2018, between the Registrant and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2018).

4.6 Fourth Supplemental Indenture, dated as of December 7, 2018, among the Registrant, Peabody Southeast Mining, LLC, and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.6 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

4.7 Description of Securities (Incorporated by reference to Exhibit 4.7 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2019).

4.8 Indenture dated as of January 29, 2021, by and among the Co-Issuers, Wilmington Trust, National Association, as trustee, and the Company (on a limited basis, to the extent of its obligations specifically set forth therein) (Incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on February 1, 2021).

4.9 Indenture dated as of January 29, 2021, by and among Peabody, the guarantors party thereto, and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed on February 1, 2021).

4.10 Seventh Supplemental Indenture, dated as of January 8, 2021, by and among the Company and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed on February 1, 2021).

4.11 Eighth Supplemental Indenture, dated as of January 29, 2021, by and among the Company and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.4 to the Registrant’s Current Report on Form 8-K filed on February 1, 2021).

4.12 First Supplemental Indenture, dated as of February 3, 2021, by and among the Co-Issuers, Wilmington Trust, National Association, as trustee, and Peabody (on a limited basis, to the extent of its obligations specifically set forth therein) (Incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on February 5, 2021).

4.13 First Supplemental Indenture, dated as of February 3, 2021, by and among Peabody, the guarantors party thereto, and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed on February 5, 2021).

10.1 Federal Coal Lease WYW0321779:

North Antelope/Rochelle Mine (Incorporated by reference to Exhibit 10.3 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

10.2 Federal Coal Lease WYW119554:

North Antelope/Rochelle Mine (Incorporated by reference to Exhibit 10.4 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

10.3 Federal Coal Lease WYW5036:

Rawhide Mine (Incorporated by reference to Exhibit 10.5 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

10.4 Federal Coal Lease WYW3397:

Caballo Mine (Incorporated by reference to Exhibit 10.6 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

10.5 Federal Coal Lease WYW83394:

Caballo Mine (Incorporated by reference to Exhibit 10.7 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

10.6 Federal Coal Lease WYW136142 (Incorporated by reference to Exhibit 10.8 of Amendment No.

1 to the Registrant’s Form S-4 Registration Statement No.

333-59073, filed September 8, 1998).

10.7 Royalty Prepayment Agreement by and among Peabody Natural Resources Company, Gallo Finance Company and Chaco Energy Company, dated September 30, 1998 (incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1998).

10.8 Federal Coal Lease WYW154001:

North Antelope Rochelle South (Incorporated by reference to Exhibit 10.68 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004).

Peabody Energy Corporation 2020 Form 10-K

10.9 Federal Coal Lease WYW150210:

North Antelope Rochelle Mine (Incorporated by reference to Exhibit 10.8 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2005).

10.10 Federal Coal Lease WYW151134 effective May 1, 2005:

West Roundup (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2005).

10.11 Federal Coal Lease Readjustment WYW78633:

Caballo (Incorporated by reference to Exhibit 10.24 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

10.12 Transfer by Assignment and Assumption of Federal Coal Lease WYW172657:

Caballo West (Incorporated by reference to Exhibit 10.25 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

10.13 Federal Coal Lease WYW176095:

Porcupine South (Incorporated by reference to Exhibit 10.26 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

10.14 Federal Coal Lease WYW173408:

North Porcupine (Incorporated by reference to Exhibit 10.27 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

10.15 Federal Coal Lease WYW172413:

School Creek (Incorporated by reference to Exhibit 10.28 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

10.16 Separation Agreement, Plan of Reorganization and Distribution, dated October 22, 2007, between the Registrant and Patriot Coal Corporation (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

10.17 Tax Separation Agreement, dated October 22, 2007, between the Registrant and Patriot Coal Corporation (Incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

10.18 Coal Act Liabilities Assumption Agreement, dated October 22, 2007, among Patriot Coal Corporation, Peabody Holding Company, LLC and the Registrant (Incorporated by reference to Exhibit 10.3 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

10.19 Salaried Employee Liabilities Assumption Agreement, dated October 22, 2007, among Patriot Coal Corporation, Peabody Holding Company, LLC, Peabody Coal Company, LLC and the Registrant (Incorporated by reference to Exhibit 10.5 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

10.20 Coal Supply Agreement, dated October 22, 2007, between Patriot Coal Sales LLC and COALSALES II, LLC (Incorporated by reference to Exhibit 10.6 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

10.21 Settlement Agreement entered into as of October 24, 2013, by and among Patriot Coal Corporation, on behalf of itself and its affiliates, the Registrant, on behalf of itself and its affiliates, and the United Mine Workers of America, on behalf of itself and the UMWA Employees and UMWA Retirees (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed October 30, 2013).

10.22 Purchase and Sale Agreement, dated as of November 20, 2015, by and between Four Star Holdings, LLC and Western Megawatt Resources, LLC (Incorporated by reference to Exhibit 10.28 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2015).

10.23* Employment Agreement entered into as of August 21, 2013, by and between Peabody Energy Corporation and Glenn L.

Kellow (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on August 27, 2013).

10.24* Restrictive Covenant Agreement entered into as of August 21, 2013, by and between Peabody Energy Corporation and Glenn L.

Kellow (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on August 27, 2013).

10.25* Letter dated January 27, 2015 to Glenn L.

Kellow from the Chairman of the Compensation Committee of the Peabody Energy Corporation Board of Directors (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 28, 2015).

10.26* Letter Agreement entered into as of January 27, 2015, by and between Peabody Energy Corporation and Glenn L.

Kellow (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on January 28, 2015).

10.27* Letter Agreement entered into as of April 20, 2015, by and between Peabody Energy Corporation and Glenn L.

Kellow (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on April 21, 2015).

10.28* Form of Addendum to Participation Agreement executed by Glenn L.

Kellow and Charles F.

Meintjes (2020) (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020).

10.29* Contract of Employment, dated October 22, 2020, between Peabody Energy Australia Coal Pty Ltd and Darren R.

Yeates (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed October 26, 2020).

Peabody Energy Corporation 2020 Form 10-K

10.30* Restated Employment Agreement entered into as of January 7, 2013 by and between the Registrant and Charles F.

Meintjes (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed January 10, 2013).

10.31* Separation and Release Agreement, dated as of September 28, 2020, between Peabody Energy Corporation and Charles Meintjes (Incorporated by reference to Exhibit 10.4 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020).

10.32* Restated Employment Agreement entered into as of December 20, 2012 by and between the Registrant and Kemal Williamson (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on December 26, 2012).

10.33* Peabody Energy Corporation 2019 Executive Severance Plan.

(Incorporated by reference to Exhibit 10.32 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

10.34 Termination Agreement, dated as of October 5, 2020, between Peabody Energy Corporation and Arch Resources, Inc.

(Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed on October 6, 2020).

10.35 Limited Waiver to Purchase and Sale Agreement by and between Four Star Holdings, LLC and Western Megawatt Resources, LLC dated March 30, 2016 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed March 31, 2016).

10.36 Fifth Amended and Restated Receivables Purchase Agreement, dated as of March 25, 2016, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various Sub-Servicers listed on the signature pages thereto, all Conduit Purchasers listed on the signature pages thereto, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed March 31, 2016).

10.37 First Amendment to the Fifth Amended and Restated Receivables Purchase Agreement, dated as of April 12, 2016, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various Sub-Servicers listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as the Sole Purchaser, Committed Purchaser, LC Bank and LC Participant (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 13, 2016).

10.38 Second Amendment to the Fifth Amended and Restated Receivables Purchase Agreement, dated as of April 18, 2016, by and among Peabody Energy Corporation, P&L Receivables Company, LLC, the various Sub-Servicers listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as the Sole Purchaser, Committed Purchaser, LC Bank and LC Participant (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 22, 2016).

10.39 Sixth Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of June 30, 2020, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.2 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020).

10.40 Superpriority Secured Debtor-In-Possession Credit Agreement, dated as of April 18, 2016, by and among Peabody Energy Corporation, the guarantors party thereto, the lenders party thereto and Citibank, N.A.

as Administrative Agent and L/C Issuer (Incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed April 22, 2016).

10.41 Amendment No.

1 to Superpriority Secured Debtor-in-Possession Credit Agreement, dated as of May 9, 2016, by and among Peabody Energy Corporation, the guarantors party thereto, the lenders party thereto and Citibank, N.A.

as Administrative Agent (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed May 24, 2016).

10.42 Amendment No.

2 to Superpriority Secured Debtor-in-Possession Credit Agreement, dated as of May 18, 2016, by and among Peabody Energy Corporation, the guarantors party thereto, the lenders party thereto, the issuing bank party thereto, and Citibank, N.A.

as Administrative Agent (Incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed May 24, 2016).

10.43 Amendment No.

4 to the Superpriority Secured Debtor-In-Possession Credit Agreement, dated as of October 11, 2016, by and among Peabody Energy Corporation, Peabody Global Funding, LLC (f/k/a Global Center for Energy and Human Development, LLC) and certain Debtors parties thereto as guarantors, the lenders party thereto and Citibank, N.A., as administrative agent (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed on October 14, 2016).

10.44 Amendment No.

5 to Superpriority Secured Debtor-In-Possession Credit Agreement, by and among Peabody Energy Corporation, Peabody Global Funding, LLC (f/k/a Global Center for Energy and Human Development, LLC) and certain Debtors parties thereto as guarantors, the lenders party thereto and Citibank, N.A., as administrative agent (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed November 23, 2016).

Peabody Energy Corporation 2020 Form 10-K

10.45 Amendment No.

6 to Superpriority Secured Debtor-In-Possession Credit Agreement, by and among Peabody Energy Corporation, Peabody Global Funding, LLC and certain Debtors parties thereto as guarantors, the lenders party thereto and Citibank, N.A., as administrative agent (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed December 14, 2016).

10.46 Plan Support Agreement entered into as of December 22, 2016 by and among the Registrant and certain other parties thereto (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed December 23, 2016).

10.47 Private Placement Agreement entered into as of December 22, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed December 23, 2016).

10.48 Amendment to Private Placement Agreement entered into as of December 28, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed December 30, 2016).

10.49 Second Amendment to Private Placement Agreement entered into as of February 8, 2017 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.127 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016).

10.50 Backstop Commitment Agreement entered into as of December 22, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed December 23, 2016).

10.51 Amendment to Backstop Commitment Agreement entered into as of December 28, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed December 30, 2016).

10.52 Share Sale and Purchase Agreement entered into as of November 3, 2016 by and among Peabody Australia Mining Pty Ltd, Peabody Energy Australia Pty Ltd, South32 Aluminium (Holdings) Pty Ltd, and South32 Treasury Limited (Incorporated by reference to Exhibit 10.124 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016).

10.53 Exit Facility Commitment Letter entered into as of January 11, 2017, by and among the Registrant, Goldman Sachs Bank USA, JPMorgan Chase Bank, N.A., Credit Suisse AG, Credit Suisse Securities (USA) LLC, Macquarie Capital Funding LLC and Macquarie Capital (USA) Inc.

(Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 12, 2017).

10.54 Receivables Purchase Facility Commitment Letter entered into as of January 27, 2017, by and among the Registrant, P&L Receivables Company, LLC and PNC Bank, National Association (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 27, 2017).

10.55 Notice Letter and Term Sheet dated as of February 15, 2017, for Amendments to the Receivables Purchase Facility Commitment Letter entered into as of January 27, 2017, by and among the Registrant, P&L Receivables Company, LLC and PNC Bank, National Association (Incorporated by reference to Exhibit 10.128 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016).

10.56 Settlement Agreement dated as of March 13, 2017 by and among the Registrant, certain subsidiaries of the Registrant, and the United Mine Workers of America 1974 Pension Plan and Trust (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on March 17, 2017).

10.57 Sixth Amended and Restated Receivables Purchase Agreement, dated as of April 3, 2017, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various Sub-Servicers listed on the signature pages thereto, all Conduit Purchasers listed on the signature pages thereto, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.4 of the Registrant’s Current Report on Form 8-K filed April 3, 2017).

10.58 First Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of June 30, 2017, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various parties identified on the signature pages thereto as Sub-Servicers, Metropolitan Collieries Pty Ltd, and PNC Bank, National Association, as Administrator and as the sole Purchaser Agent, Committed Purchaser, LC Bank and LC Participant on the date thereof (Incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q, filed August 14, 2017).

10.59 Second Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of December 13, 2017, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, Regions Bank, and PNC Bank, National Association, as Administrator and as the sole Purchaser Agent, Committed Purchaser, LC Bank and LC Participant on the date thereof (Incorporated by reference to Exhibit 10.57 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017).

10.60 Fifth Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of April 3, 2019, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 4, 2019).

Peabody Energy Corporation 2020 Form 10-K

10.61 Credit Agreement dated as of April 3, 2017, among the Registrant, as Borrower, Goldman Sachs Bank USA, as Administrative Agent, and the other lenders party thereto (Incorporated by reference to Exhibit 10.3 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

10.62 Amendment No.

1 to Credit Agreement, by and among Peabody Energy Corporation, the subsidiaries of the Peabody Energy Corporation party thereto as reaffirming parties, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, dated as of September 18, 2017 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed September 18, 2017).

10.63 Amendment No.

2 to Credit Agreement, by and among Peabody Energy Corporation, the subsidiaries of Peabody Energy Corporation party thereto as reaffirming parties, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, dated as of November 17, 2017 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed November 20, 2017).

10.64 Amendment No.

3 to Credit Agreement, by and among Peabody Energy Corporation, the subsidiaries of Peabody Energy Corporation party thereto as reaffirming parties, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, dated as of December 18, 2017 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed December 19, 2017).

10.65 Amendment No.

4 to Credit Agreement, by and among Peabody Energy Corporation, the subsidiaries of Peabody Energy Corporation party thereto as reaffirming parties, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, dated as of April 11, 2018 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 11, 2018).

10.66 Amendment No.

5 to Credit Agreement, by and among Peabody Energy Corporation, the subsidiaries of Peabody Energy Corporation party thereto as reaffirming parties, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, dated as of June 27, 2018 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018).

10.67 Amendment No.

6 to Credit Agreement, by and among Peabody Energy Corporation, the subsidiaries of Peabody Energy Corporation party thereto as reaffirming parties, the incremental revolving lenders party thereto, Goldman Sachs Bank USA, as existing administrative agent, and JPMorgan Chase Bank, N.A., as successor administrative agent, dated as of September 17, 2019 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019).

10.68 Amendment No.

7 by and among Peabody Energy Corporation, the subsidiaries of the Peabody Energy Corporation party thereto as reaffirming parties, the lenders party thereto, and JPMorgan Chase Bank, N.A., as successor administrative agent, dated as of September 17, 2019 (Incorporated by reference to Exhibit 10.2 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019).

10.69* Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 4.6 of the Registrant’s Registration Statement on Form S-8, filed April 3, 2017).

10.70 Registration Rights Agreement, dated as of April 3.

2017, among the Registrant and the stockholders party thereto (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed, April 3, 2017).

10.71 Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017).

10.72* Form of Restricted Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.7 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

10.73* Form of Restrictive Covenant Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.8 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

10.74* Form of Deferred Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.12 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017).

10.75* Form of Performance Share Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan.

(Incorporated by reference to Exhibit 10.68 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017).

10.76 Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.73 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

10.77* Form of Deferred Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.74 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

10.78* Form of Restricted Stock Unit Agreement (ELT Level 2019 Special Award) under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.75 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019).

10.79* Form of Restricted Stock Unit Agreement (Director Level and Above 2019 Special Award) under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.76 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019).

10.80* Form of Deferred Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.2 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020).

Peabody Energy Corporation 2020 Form 10-K

10.81* Form of Restricted Stock Unit Agreement (Director Level and Above 2020 Off-Cycle Award) under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.3 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020).

10.82* Form of Performance Share Units Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.4 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020).

10.83* Form of Restricted Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.5 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020).

10.84 Agreement, dated as of February 4, 2020, by and among Peabody Energy Corporation, Elliott Investment Management L.P., Elliott Associates, L.P.

and Elliott International, L.P.

(Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed February 5, 2020).

10.85 Management Services Agreement, dated as of August 4, 2020, by and between Peabody Investments Corp.

and each of the Client Companies listed on the signature page thereto (Incorporated by reference to Exhibit 10.3 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020).

10.86 Management Services Agreement, dated as August 4, 2020, by and between Peabody Energy Australia Pty Ltd and each of the Client Companies listed on the signature page thereto (Incorporated by reference to Exhibit 10.4 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020).

10.87 Transaction Support Agreement, dated as of November 6, 2020, between Peabody Energy Corporation, certain subsidiaries of Peabody Energy Corporation and the Participating Sureties (Incorporated by reference to Exhibit 10.5 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020).

10.88 Transaction Support Agreement, dated as of December 24, 2020, between Peabody, certain subsidiaries of Peabody, the Revolving Lenders, the Administrative Agent, and the Consenting Noteholders (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed December 28, 2020).

10.89 Amended and Restated Transaction Support Agreement, dated as of December 31, 2020, between Peabody, certain subsidiaries of Peabody, the Revolving Lenders, the Administrative Agent, and the Consenting Noteholders (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed January 4, 2021).

10.90 First Amendment to Amended and Restated Transaction Support Agreement, dated as of January 29, 2021, between Peabody, certain subsidiaries of Peabody, the Revolving Lenders, the Administrative Agent, and the Consenting Noteholders (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on February 1, 2021).

21† List of Subsidiaries.

23.1† Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.

23.2† Consent of Weir International, Inc.

31.1† Certification of periodic financial report by the Registrant’s Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2† Certification of periodic financial report by the Registrant’s Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1† Certification of periodic financial report pursuant to 18 U.S.C.

Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Registrant’s Chief Executive Officer.

32.2† Certification of periodic financial report pursuant to 18 U.S.C.

Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Registrant’s Chief Financial Officer.

95† Mine Safety Disclosure required by Item 104 of Regulation S-K.

101.INS Inline XBRL Instance Document - the instance document does not appear in the interactive data file because XBRL tags are embedded within the Inline XBRL document

101.SCH Inline XBRL Taxonomy Extension Schema Document

101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document

104 Cover Page Interactive Data File (embedded within the Inline XBRL document).

* These exhibits constitute all management contracts, compensatory plans and arrangements required to be filed as an exhibit to this form pursuant to Item 15(a)(3) and 15(b) of this report.

Peabody Energy Corporation 2020 Form 10-K

† Filed herewith.

Pursuant to the Instructions to Exhibits, certain instruments defining the rights of holders of long-term debt securities of the Company and its consolidated subsidiaries are not filed because the total amount of securities authorized under any such instrument does not exceed 10% of the total assets of the Company and its subsidiaries on a consolidated basis.

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Form 10-K Summary.

Not applicable.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons, on behalf of the registrant and in the capacities and on the dates indicated.

President and Chief Executive Officer,

Director (principal executive officer)

February 21, 2020

Interim Chief Financial Officer (principal financial and accounting officer)

February 21, 2020

/s/ SAMANTHA ALGAZE

February 21, 2020

Signature Title Date

KELLOW President and Chief Executive Officer,

Director (principal executive officer) February 23, 2021

SPURBECK Executive Vice President and Chief Financial Officer (principal financial and accounting officer) February 23, 2021

/s/ SAMANTHA ALGAZE Director February 19, 2021

Samantha Algaze

/s/ ANDREA BERTONE

February 21, 2020

/s/ ANDREA BERTONE Director February 19, 2021

Andrea Bertone

/s/ NICHOLAS CHIREKOS

February 21, 2020

/s/ BILL CHAMPION Director February 19, 2021

Bill Champion

/s/ NICHOLAS CHIREKOS Director February 19, 2021

Nicholas Chirekos

/s/ STEPHEN GORMAN

February 21, 2020

/s/ STEPHEN GORMAN Director February 19, 2021

Stephen Gorman

/s/ JOE LAYMON

February 21, 2020

/s/ TERESA MADDEN

February 21, 2020

Teresa Madden

/s/ ROBERT MALONE

February 21, 2020

/s/ JOE LAYMON Director February 22, 2021

/s/ ROBERT MALONE Chairman February 20, 2021

Robert Malone

/s/ DAVID MILLER

February 21, 2020

/s/ KENNETH MOORE

February 21, 2020

Kenneth Moore

/s/ MICHAEL SUTHERLIN

February 21, 2020

/s/ DAVID MILLER Director February 19, 2021

/s/ MICHAEL SUTHERLIN Director February 19, 2021

Michael Sutherlin

/s/ DARREN YEATES

February 21, 2020

/s/ DARREN YEATES Director and Executive Vice President and Chief Operating Officer February 20, 2021

Darren Yeates

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Peabody Energy Corporation (the Company) as of December 31, 2019 and 2018 (Successor), the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity and cash flows for the year ended December 31, 2019 and 2018 (Successor), the period from April 2, 2017 through December 31, 2017 (Successor), and the period from January 1, 2017 through April 1, 2017 (Predecessor), and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2019 and 2018 (Successor), and the results of its operations and its cash flows for the year ended December 31, 2019 and 2018 (Successor), the period from April 2, 2017 through December 31, 2017 (Successor), and the period from January 1, 2017 through April 1, 2017 (Predecessor) in conformity with US generally accepted accounting principles.

We have audited the accompanying consolidated balance sheets of Peabody Energy Corporation (the Company) as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive (loss) income, changes in stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2020, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with US generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 23, 2021 expressed an unqualified opinion thereon.

Company Reorganization

As discussed in Notes 1 and 2 to the consolidated financial statements, on March 17, 2017, the Bankruptcy Court entered an order confirming the plan of reorganization, which became effective on April 3, 2017.

Accordingly, the accompanying consolidated financial statements have been prepared in conformity with Accounting Standards Codification 852-10, Reorganizations, for the Successor Company as a new entity with assets, liabilities and a capital structure having carrying amounts not comparable with prior periods (Predecessor) as described in Notes 1 and 2.

Basis for Opinion

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Our audits 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.

Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

Asset Retirement Obligation Liability

Description of the Matter

At December 31, 2019, the Company’s asset retirement obligation (ARO) liabilities totaled $752.3 million.

Description of the Matter At December 31, 2020, the Company’s asset retirement obligation (ARO) liabilities totaled $728.2 million.

As discussed in Note 1 and Note 14 of the consolidated financial statements, the Company estimates its ARO liabilities in the U.S.

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

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of the controls over the Company’s accounting for ARO liabilities, including controls over management’s review of the ARO calculation and the significant assumptions and data inputs described above.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of the controls over the Company’s accounting for ARO liabilities, including controls over management’s review of the ARO calculation and the significant assumptions and data inputs described above.

To audit the ARO liabilities, our procedures included evaluating the methodology used, and testing the significant assumptions discussed above and the underlying data used by the Company in its estimate.

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Additionally, we involved our specialists to assist in our assessment of the Company’s ARO liability.

As part of this effort, our specialists observed mine site operations, interviewed members of the Company’s engineering staff, assessed the completeness of the mine reclamation estimate with respect to meeting mine closure and post closure plan regulatory requirements, and evaluated the reasonableness of the engineering estimates and assumptions.

Acquisition of Shoal Creek Mine

Description of the Matter

On December 3, 2018, the Company completed the acquisition of the Shoal Creek metallurgical coal mine, preparation plant and supporting assets located in Alabama (Shoal Creek Mine) for a purchase price of $389.9 million, as disclosed in Note 3 to the consolidated financial statements.

The transaction was accounted for as a business combination.

Auditing the Company's accounting for its acquisition of the Shoal Creek Mine was complex due to the significant estimation uncertainty in the Company’s determination of the fair value of the identified assets which principally consisted of property, plant, equipment and mine development assets.

The significant estimation uncertainty was primarily due to the sensitivity of the respective fair values to underlying assumptions about the future performance of the acquired business and finalizing the life of mine estimates relative to the remaining life and value of specific acquired assets.

The Company measured the fair value of the property, plant, equipment and mine development assets using significant assumptions, including discount rates and certain assumptions that form the basis of the forecasted results (e.g., future coal prices and yield of salable tons from the acquired reserves).

These significant assumptions are forward looking and could be affected by future market and geological conditions.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company's acquisition processes.

This included controls over the estimates to support the measurement of property, plant, equipment;

mine development assets;

and consideration transferred in the acquisition.

We also tested controls over management’s review of assumptions used in the valuation models.

To test the estimated fair value of the assets acquired, we performed audit procedures that included, among others, evaluating the Company's selection of the valuation methodology, evaluating the methods and significant assumptions used in the valuation model, and evaluating the completeness and accuracy of the underlying data supporting the significant assumptions and estimates.

We involved our specialists to assist with our evaluation of the methodology used by the Company and significant assumptions included in the fair value estimates.

Specifically, when assessing the key assumptions, we evaluated the effect of future coal prices, the yield of salable tons from the acquired reserves, and the impact the life of mine has on the useful life and value of certain acquired assets including rationalization adjustments in order to reconcile the aggregate fair value of the assets acquired to the amount of consideration transferred.

In addition, we performed a sensitivity analysis of the significant assumptions to evaluate the change in the fair value estimate that would result from changes in the assumptions and recalculated management's estimate.

Peabody Energy Corporation

2019 Form 10-K

Asset Impairment

Description of the Matter

As discussed in Note 5 to the consolidated financial statements, during 2019, the Company recorded an impairment loss on certain long-lived assets related to its El Segundo/Lee Ranch Mine based upon the expectation of reduced sales volumes and uncertainty over remaining economic mine lives.

Accordingly, during the fourth quarter, the Company evaluated its long-lived assets for recoverability and determined that these assets were not recoverable and were impaired.

As part of this effort, our specialists interviewed members of the Company’s engineering staff, assessed the completeness of the mine reclamation estimate with respect to meeting mine closure and post closure plan regulatory requirements, and evaluated the reasonableness of the engineering estimates and assumptions.

Asset Impairment of North Antelope Rochelle Mine

Description of the Matter As discussed in Note 3 to the consolidated financial statements, during 2020, the Company recorded an impairment loss on certain long-lived assets related to its North Antelope Rochelle Mine based upon the expectation of reduced future sales volumes.

Accordingly, during the second quarter, the Company evaluated its long-lived assets for recoverability and determined that these assets were not recoverable and were impaired.

As a result, the Company recognized a $1,418.1 million impairment loss, which is the amount by which the carrying value exceeded the estimated fair value of these assets.

Auditing the Company's impairment measurement involved a high degree of subjectivity as estimates underlying the determination of fair value were based on assumptions about future market and economic conditions.

Significant assumptions used in the Company’s fair value estimate included coal price forecasts, future volume, future production costs, and the cost of capital.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company's processes to determine the fair value of the asset group and to measure the long-lived asset impairment.

Significant assumptions used in the Company’s fair value estimate included future tons sold, coal prices for unpriced coal, production costs, transportation costs, and the cost of capital.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company's processes to determine the fair value of the asset group and to measure the long-lived asset impairment.

This included controls over management's review of the significant assumptions underlying the fair value determination.

Our testing of the Company's impairment measurement included, among other procedures, evaluating the significant assumptions and operating data used to estimate fair value.

For example, we compared the significant assumptions used to estimate market participant cash flows to current industry and economic outlook, obtained support to evaluate projected operating data, performed a sensitivity analysis of the significant assumptions to evaluate the change in the fair value estimate that would result from changes in the assumptions and recalculated management's estimate.

We also involved our specialists to assist in our evaluation of the cost of capital used in the fair value estimate.

We also involved our specialists to assist in our evaluation of the methodologies utilized in developing the estimate of fair value, reviewing the significant assumptions utilized including the weighted average cost of capital, and to prepare comparative calculations of management’s fair value estimate.

/s/ Ernst & Young, LLP

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February 23, 2021

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

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Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions, except per share data)

Revenues $ 2,881.1 $ 4,623.4 $ 5,581.8

Costs and expenses

Operating costs and expenses (exclusive of items shown separately below)

2,524.9 3,536.6 4,071.4

Depreciation, depletion and amortization 346.0 601.0 679.0

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Transaction costs related to business combinations and joint ventures

23.1 21.6 7.4

Other operating (income) loss:

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North Goonyella insurance recovery — ( 125.0 ) —

Income from equity affiliates

Operating profit

Loss (income) from equity affiliates 60.1 ( 3.4 ) ( 68.1 )

Operating profit (loss) ( 1,728.3 ) 61.7 661.6

Interest expense 139.8 144.2 151.3

Loss on early debt extinguishment

Interest income ( 9.4 ) ( 27.0 ) ( 33.6 )

Net periodic benefit costs, excluding service cost

Net periodic benefit (credit) costs, excluding service cost ( 1.8 ) 19.4 18.1

Net mark-to-market adjustment on actuarially determined liabilities

( 5.1 ) 67.4 ( 125.5 )

Reorganization items, net — — ( 12.8 )

(Loss) income from continuing operations before income taxes ( 1,851.8 ) ( 142.3 ) 664.1

Income tax provision (benefit)

Income tax provision 8.0 46.0 18.4

(Loss) income from continuing operations, net of income taxes ( 1,859.8 ) ( 188.3 ) 645.7

Income (loss) from discontinued operations, net of income taxes

(Loss) income from discontinued operations, net of income taxes ( 14.0 ) 3.2 18.1

Net (loss) income ( 1,873.8 ) ( 185.1 ) 663.8

Series A Convertible Preferred Stock dividends — — 102.5

Net income attributable to noncontrolling interests

Net (loss) income attributable to noncontrolling interests ( 3.5 ) 26.2 16.9

Net (loss) income attributable to common stockholders $ ( 1,870.3 ) $ ( 211.3 ) $ 544.4

6 unchanged sentences

See accompanying notes to consolidated financial statements

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

1 unchanged sentence

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

Net (loss) income $ ( 1,873.8 ) $ ( 185.1 ) $ 663.8

Reclassification for realized losses on cash flow hedges (net of respective net tax provision of $0.0, $0.0, $0.0, and $9.1) included in net (loss) income

Postretirement plans and workers’ compensation obligations (net of respective net tax provision of $ 0.0 , $ 0.0 and $ 7.1 )

168.1 ( 8.7 ) 44.6

Foreign currency translation adjustment 6.1 0.2 ( 5.9 )

Other comprehensive (loss) income, net of income taxes

Other comprehensive income (loss), net of income taxes 174.2 ( 8.5 ) 38.7

Comprehensive (loss) income ( 1,699.6 ) ( 193.6 ) 702.5

Series A Convertible Preferred Stock dividends — — 102.5

Net income attributable to noncontrolling interests

Net (loss) income attributable to noncontrolling interests ( 3.5 ) 26.2 16.9

Comprehensive (loss) income attributable to common stockholders $ ( 1,696.1 ) $ ( 219.8 ) $ 583.1

See accompanying notes to consolidated financial statements

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

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Cash and cash equivalents $ 709.2 $ 732.2

Accounts receivable, net of allowance for doubtful accounts of $0.0 at December 31, 2019 and $4.4 at December 31, 2018

Accounts receivable, net of allowance for credit losses of $ 0.0 at December 31, 2020 and 2019

Inventories 261.6 331.5

Other current assets 204.7 220.7

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Deferred income taxes 4.9 28.3

Total assets $ 4,667.1 $ 6,542.8

LIABILITIES AND STOCKHOLDERS’ EQUITY

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Treasury stock, at cost — 42.7 and 42.3 common shares as of December 31, 2020 and December 31, 2019

Retained earnings

( 1,368.9 ) ( 1,367.3 )

(Accumulated deficit) retained earnings ( 1,273.3 ) 597.0

Accumulated other comprehensive income 205.8 31.6

4 unchanged sentences

See accompanying notes to consolidated financial statements

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

1 unchanged sentence

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

1 unchanged sentence

Net (loss) income $ ( 1,873.8 ) $ ( 185.1 ) $ 663.8

(Income) loss from discontinued operations, net of income taxes

Loss (income) from discontinued operations, net of income taxes 14.0 ( 3.2 ) ( 18.1 )

(Loss) income from continuing operations, net of income taxes ( 1,859.8 ) ( 188.3 ) 645.7

Adjustments to reconcile (loss) income from continuing operations, net of income taxes to net cash provided by (used in) operating activities:

Adjustments to reconcile (loss) income from continuing operations, net of income taxes to net cash (used in) provided by operating activities:

Depreciation, depletion and amortization 346.0 601.0 679.0

Fresh start noncash coal inventory revaluation

Noncash interest expense including loss on early extinguishment of debt

16.2 16.2 19.2

Noncash coal inventory revaluation ( 0.7 ) 8.3 —

Deferred income taxes 27.8 39.4 35.5

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Net gain on disposals ( 15.2 ) ( 2.1 ) ( 48.2 )

Income from equity affiliates

Loss (income) from equity affiliates 60.1 ( 3.4 ) ( 68.1 )

Provision for North Goonyella equipment loss — 83.2 66.4

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Foreign currency option contracts ( 13.0 ) 5.2 9.1

Reclassification from other comprehensive earnings for terminated hedge contracts

Noncash reorganization items, net — — ( 12.8 )

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Accounts receivable 84.6 82.9 171.8

Inventories 70.6 ( 61.6 ) 50.2

Other current assets 21.0 ( 35.6 ) ( 30.6 )

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Pension obligations ( 28.4 ) ( 32.5 ) ( 66.9 )

Take-or-pay obligation settlement

Net cash provided by (used in) continuing operations

Other, net 0.1 2.1 16.0

Net cash provided by continuing operations 15.0 705.4 1,516.9

Net cash used in discontinued operations ( 24.7 ) ( 28.0 ) ( 27.2 )

Net cash provided by (used in) operating activities

Net cash (used in) provided by operating activities ( 9.7 ) 677.4 1,489.7

See accompanying notes to consolidated financial statements

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

1 unchanged sentence

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

11 unchanged sentences

Investment in equity securities — ( 3.0 ) ( 10.0 )

Net cash (used in) provided by investing activities

Other, net ( 0.4 ) ( 0.9 ) 3.8

Net cash used in investing activities ( 206.7 ) ( 261.3 ) ( 517.3 )

Cash Flows From Financing Activities

4 unchanged sentences

Repurchase of employee common stock relinquished for tax withholding

( 1.6 ) ( 12.3 ) ( 14.5 )

Dividends paid — ( 258.1 ) ( 59.6 )

Distributions to noncontrolling interests ( 3.5 ) ( 23.5 ) ( 10.3 )

Net cash (used in) provided by financing activities

Other, net — — 0.1

Net cash provided by (used in) financing activities 193.4 ( 701.3 ) ( 1,025.2 )

Net change in cash, cash equivalents and restricted cash ( 23.0 ) ( 285.2 ) ( 52.8 )

1 unchanged sentence

Cash, cash equivalents and restricted cash at end of period $ 709.2 $ 732.2 $ 1,017.4

(1) The following table provides a reconciliation of “Cash, cash equivalents and restricted cash at beginning of period”:

Cash and cash equivalents

Restricted cash included in “Investments and other assets”

Cash, cash equivalents and restricted cash at beginning of period

(2) The following table provides a reconciliation of “Cash, cash equivalents and restricted cash at end of period”:

Cash and cash equivalents

Restricted cash included in “Investments and other assets”

Cash, cash equivalents and restricted cash at end of period

See accompanying notes to consolidated financial statements

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

1 unchanged sentence

Peabody Energy Corporation Stockholders’ Equity

Series A Convertible Preferred Stock

(Accumulated Deficit) Retained

Comprehensive (Loss) Income

Noncontrolling

Series A Convertible Preferred Stock Common

Stock Additional

Capital Treasury

Stock (Accumulated Deficit) Retained

Earnings Accumulated

Comprehensive (Loss) Income Noncontrolling

Interests Total

Stockholders’

(Dollars in millions)

December 31, 2016 - Predecessor

Net (loss) income

Net realized losses on cash flow hedges (net of $9.1 net tax provision)

December 31, 2017 $ 576.0 $ 1.0 $ 2,590.3 $ ( 175.9 ) $ 613.6 $ 1.4 $ 49.4 $ 3,655.8

Impact of adoption of Accounting Standards Update 2014-09 — — — — ( 22.5 ) — — ( 22.5 )

Net income — — — — 646.9 — 16.9 663.8

Dividends declared ($ 0.485 per share)

— — 1.4 — ( 61.0 ) — — ( 59.6 )

Postretirement plans and workers’ compensation obligations (net of $ 7.1 tax provision)

Foreign currency translation adjustment

Share-based compensation for equity-classified awards

Repurchase of employee common stock relinquished for tax withholding

Distributions to noncontrolling interests

Elimination of Predecessor equity

April 1, 2017 - Predecessor

Issuance of Successor equity

April 2, 2017 - Successor

— — — — — 44.6 — 44.6

Foreign currency translation adjustment — — — — — ( 5.9 ) — ( 5.9 )

Warrant conversions

Series A Convertible Preferred Stock conversions ( 576.0 ) 0.4 678.1 — ( 102.5 ) — — —

Series A Convertible Preferred Stock dividends

Share-based compensation for equity-classified awards — — 34.9 — — — — 34.9

2 unchanged sentences

Distributions to noncontrolling interests — — — — — — ( 10.3 ) ( 10.3 )

December 31, 2017 - Successor

Impact of adoption of Accounting Standards Update 2014-09

December 31, 2018 $ — $ 1.4 $ 3,304.7 $ ( 1,025.1 ) $ 1,074.5 $ 40.1 $ 56.0 $ 3,451.6

Net (loss) income — — — — ( 211.3 ) — 26.2 ( 185.1 )

Dividends declared ($ 2.410 per share)

— — 8.1 — ( 266.2 ) — — ( 258.1 )

Postretirement plans and workers’ compensation obligations (net of $ 0.0 tax provision)

— — — — — ( 8.7 ) — ( 8.7 )

Foreign currency translation adjustment — — — — — 0.2 — 0.2

Series A Convertible Preferred Stock conversions

Share-based compensation for equity-classified awards — — 38.3 — — — — 38.3

2 unchanged sentences

Distributions to noncontrolling interests — — — — — — ( 23.5 ) ( 23.5 )

December 31, 2018 - Successor

Net (loss) income

Dividends declared ($2.410 per share)

December 31, 2019 $ — $ 1.4 $ 3,351.1 $ ( 1,367.3 ) $ 597.0 $ 31.6 $ 58.7 $ 2,672.5

Net loss — — — — ( 1,870.3 ) — ( 3.5 ) ( 1,873.8 )

Postretirement plans and workers’ compensation obligations (net of $ 0.0 tax provision)

— — — — — 168.1 — 168.1

Foreign currency translation adjustment — — — — — 6.1 — 6.1

Share-based compensation for equity-classified awards — — 13.5 — — — — 13.5

Common stock repurchases

Repurchase of employee common stock relinquished for tax withholding — — — ( 1.6 ) — — — ( 1.6 )

Distributions to noncontrolling interests — — — — — — ( 3.5 ) ( 3.5 )

December 31, 2019 - Successor

December 31, 2020 $ — $ 1.4 $ 3,364.6 $ ( 1,368.9 ) $ ( 1,273.3 ) $ 205.8 $ 51.7 $ 981.3

See accompanying notes to consolidated financial statements

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

12 unchanged sentences

The Company’s other commercial activities include managing its coal reserve and real estate holdings, and supporting the development of clean coal technologies.

Refinancing Transactions

During the fourth quarter of 2020 and the first quarter of 2021, the Company entered into a series of interrelated agreements with its surety bond providers, the revolving lenders under its credit agreement and certain holders of its senior secured notes to extend a significant portion of its near-term debt maturities to December 2024 and to stabilize collateral requirements for its existing surety bond portfolio.

Such agreements and related activities are described below.

Organizational Realignment

In July and August 2020, the Company effected certain changes to its corporate structure in contemplation of a debt-for-debt exchange, which included, among other steps, the formation of certain wholly-owned subsidiaries (the Co-Issuers) to indirectly own and conduct the operations of the Company’s Wilpinjong Mine in Australia and the designation of such entities as unrestricted subsidiaries under the Credit Agreement and its senior notes’ indenture (the Existing Indenture).

In connection with these actions, the Company contributed $ 100.0 million to the Co-Issuers to provide the Wilpinjong Mine with operating liquidity and address its capital needs over the next twelve months .

Surety Agreement

In November 2020, the Company entered into a surety transaction support agreement (Surety Agreement) with the providers of 99 % of its surety bond portfolio (Participating Sureties) to resolve approximately $ 800 million in additional collateral demands made by the Participating Sureties.

In accordance with the Surety Agreement, the Company initially provided $ 75.0 million of collateral, in the form of letters of credit.

Upon completion of the Refinancing Transactions, as defined below, other provisions of the Surety Agreement became effective.

In particular, the Company granted second liens on $ 200.0 million of certain mining equipment and will post an additional $ 25.0 million of collateral per year from 2021 through 2024 for the benefit of the Participating Sureties.

The collateral postings may also further increase to the extent the Company generates more than $ 100.0 million of free cash flow (as defined in the Surety Agreement) in any twelve-month period or has asset sales in excess of $ 10.0 million.

Further, the Participating Sureties have agreed to a standstill through December 31, 2024, during which time, the Participating Sureties will not demand any additional collateral, draw on letters of credit posted for the benefit of themselves, or cancel, or attempt to cancel, any existing surety bond.

The Company will not pay dividends or make share repurchases during the standstill period, unless otherwise agreed between the parties.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Refinancing Transactions

On January 29, 2021 (the Settlement Date), the Company completed a series of transactions (collectively, the Refinancing Transactions) to, among other things, provide the Company with maturity extensions and covenant relief, while allowing it to maintain sufficient operating liquidity and financial flexibility.

The Refinancing Transactions included a senior notes exchange and related consent solicitation, a revolving credit facility exchange, and various amendments to the Company’s existing debt agreements, as summarized below.

Exchange Offer

On the Settlement Date, the Company settled an exchange offer (Exchange Offer) pursuant to which $ 398.7 million aggregate principal amount of the Company’s 6.000 % Senior Secured Notes due March 2022 (the 2022 Notes) were validly tendered, accepted by the Company and exchanged for aggregate consideration consisting of (a) $ 193.9 million aggregate principal amount of new 10.000 % Senior Secured Notes due 2024 issued by the Co-Issuers (New Co-Issuer Notes), (b) $ 195.1 million aggregate principal amount of new 8.500 % Senior Secured Notes due 2024 issued by the Company (New Peabody Notes), and (c) a cash payment of approximately $ 9.4 million.

In connection with the settlement of the Exchange Offer, the Company also paid early tender premiums totaling $ 4.0 million in cash.

Following the settlement of the Exchange Offer, approximately $ 60.3 million aggregate principal amount of the 2022 Notes remain outstanding and are governed by the Existing Indenture, as amended by the supplemental indenture described below.

In connection with the Exchange Offer, the Company must offer to purchase up to $ 22.5 million New Peabody Notes at 80 % of their accreted value, plus accrued and unpaid interest, subsequent to the Settlement Date.

The Company expects to complete this purchase during the first quarter of 2021.

Consent Solicitation

Concurrently with the Exchange Offer, the Company solicited consents from holders of the 2022 Notes to certain proposed amendments to the Existing Indenture to (i) eliminate substantially all of the restrictive covenants, certain events of default applicable to the 2022 Notes and certain other provisions contained in the Existing Indenture and (ii) release the collateral securing the 2022 Notes and eliminate certain other related provisions contained in the Existing Indenture.

The Company received the requisite consents from holders of the 2022 Notes and entered into a supplemental indenture to the Existing Indenture, which became operative on January 29, 2021.

Revolver Transactions

In connection with the Refinancing Transactions, the Company restructured the revolving loans under the Credit Agreement by (i) making a pay down of revolving loans thereunder in the aggregate amount of $ 10.0 million, (ii) the Co-Issuers incurring $ 206.0 million of term loans under a credit agreement, dated as of the Settlement Date (New Co-Issuer Term Loans, New Co-Issuer Term Loan Agreement), (iii) the Company entering into a letter of credit facility (the New Company LC Agreement), and (iv) amending the Credit Agreement (collectively, the Revolver Transactions).

The New Co-Issuer Term Loans mature on December 31, 2024 and bear interest at a rate of 10.00 % per annum.

On the Settlement Date, the Company entered into the New Company LC Agreement with the revolving lenders party to the Credit Agreement, pursuant to which the Company obtained a $ 324.0 million letter of credit facility under which the Company’s existing letters under the Credit Agreement were deemed to be issued.

The commitments under the New Company LC Agreement mature on December 31, 2024.

Undrawn letters of credit under the New Company LC Agreement bear interest at 6.00 % per annum and unused commitments are subject to a 0.50 % per annum commitment fee.

In connection with the Revolver Transactions, the Company amended its Credit Agreement to make certain changes in consideration of the New Company LC Agreement.

After giving effect to the Revolver Transactions, there remain no revolving commitments or revolving loans under the Credit Agreement and the first lien net leverage ratio covenant was eliminated, effectively negating the compliance requirement at December 31, 2020.

The New Company LC Agreement requires that the Company’s restricted subsidiaries maintain minimum aggregate liquidity of $ 125.0 million at the end of each quarter through December 31, 2024.

As such, liquidity attributable to the Co-Issuers will be excluded from the calculation.

The Company capitalized $ 7.0 million of debt issuance costs incurred in relation to the Refinancing Transactions during the year ended December 31, 2020.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Plan of Reorganization and Emergence from Chapter 11 Cases

9 unchanged sentences

On April 3, 2017, (the Effective Date), the Debtors satisfied the conditions to effectiveness set forth in the Plan, the Plan became effective in accordance with its terms and the Debtors emerged from the Chapter 11 Cases.

On the Effective Date, in accordance with ASC 852, the Company applied fresh start reporting which requires the Company to allocate its reorganization value to the fair value of assets and liabilities in conformity with the guidance for the acquisition method of accounting for business combinations.

The Company was permitted to use fresh start reporting because (i) the holders of existing voting shares of the Predecessor (as defined below) company received less than 50 % of the voting shares of the emerging entity upon reorganization and (ii) the reorganization value of the Company’s assets immediately prior to Plan confirmation was less than the total of all postpetition liabilities and allowed claims.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Upon adoption of fresh start reporting, the Company became a new entity for financial reporting purposes, reflecting the Successor (as defined below) capital structure.

As a result, a new accounting basis in the identifiable assets and liabilities assumed was established with no retained earnings or accumulated other comprehensive income (loss) for financial reporting purposes.

The Company selected an accounting convenience date of April 1, 2017 for purposes of applying fresh start reporting as the activity between the convenience date and the Effective Date did not result in a material difference in the results.

References to “Successor” in the financial statements and accompanying footnotes are in reference to reporting dates on or after April 2, 2017;

references to “Predecessor” in the financial statements and accompanying footnotes are in reference to reporting dates through April 1, 2017 which includes the impact of the Plan provisions and the application of fresh start reporting.

As such, the Company’s financial statements for the Successor will not be comparable in many respects to its financial statements for periods prior to the adoption of fresh start reporting and prior to the accounting for the effects of the Plan.

In connection with fresh start reporting, the Company made certain prospective accounting policy elections that impact the Successor periods presented herein.

The Company now classifies the amortization associated with its asset retirement obligation assets within “Depreciation, depletion and amortization” in its consolidated statements of operations, rather than within “Asset retirement obligation expenses,” as in Predecessor periods.

With respect to its accrued postretirement benefit and pension obligations, the Company now records amounts attributable to actuarial valuation changes currently in earnings rather than recording such amounts within accumulated other comprehensive income and amortizing to expense over the applicable time periods.

During the year ended December 31, 2018, the Company recorded an additional gain on the settlement of claims for $ 12.8 million related to certain unsecured claims.

Newly Adopted Accounting Standards

In February 2016, the FASB issued Accounting Standards Update (ASU) 2016-02, “Leases (Topic 842),” to increase transparency and comparability among organizations by requiring the recognition of right-of-use (ROU) assets and lease liabilities on the balance sheet for leases with lease terms of more than 12 months.

Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases.

The FASB continued to clarify this guidance through the issuance of additional updates to ASU 2016-02.

On January 1, 2019, the Company adopted ASU 2016-02 using the modified transition approach and elected the package of practical expedients offered under ASU 2016-02, as updated, that allows it to forgo reassessment of lease classification for leases that have already commenced.

The Company also elected the practical expedients to adopt ASU 2016-02 without restating comparative prior period financial information, to not recognize ROU assets and lease liabilities for operating leases with shorter than 12-month terms and to include both lease and non-lease components within lease payments.

The Company has implemented the systems functionality and internal control processes necessary to comply with the new reporting requirements of ASU 2016-02.

The Company recognized the cumulative effect of initially applying ASU 2016-02 as an adjustment on January 1, 2019 and comparative information presented herein has not been restated.

ASU 2016-02 had a material impact on the Company's consolidated balance sheet but did not have a material impact on its results of operations or its cash flows.

The most significant impact was the recognition of ROU assets and lease liabilities for operating leases upon adoption, as set forth in the table below.

The Company's accounting for finance leases remained unchanged.

Adoption of ASU 2016-02

January 1, 2019

(Dollars in millions)

Operating lease right-of-use assets

Accounts payable and accrued expenses

Total current liabilities

Operating lease liabilities, less current portion

Total liabilities

ASU 2016-02 also requires entities to disclose certain qualitative and quantitative information regarding the amount, timing and uncertainty of cash flows arising from leases.

Such disclosures are included in Note 15.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Leases to explore for or use minerals, oil, natural gas and similar non-regenerative resources, including the intangible rights to explore for those natural resources and rights to use the land in which those natural resources are contained are excluded from the scope of ASU 2016-02.

As such, the adoption of ASU 2016-02 did not impact the accounting for the coal reserve leases under which the Company mines a substantial amount of its coal production.

Such leases typically require royalties to be paid as the coal is mined and sometimes require minimum annual royalties to be paid regardless of the amount of coal mined during the year.

Leases - Land Easements.

In January 2018, the FASB issued ASU 2018-01 to provide an optional transition practical expedient to not evaluate under Topic 842 existing or expired land easements that were not previously accounted for as leases under prior leasing guidance.

On January 1, 2019, the Company adopted the expedient to evaluate new or modified land easements under Topic 842, and it did not have a material impact on the Company’s results of operations, financial condition, cash flows or financial statement presentation.

Accounting Standards Not Yet Implemented

Financial Instruments - Credit Losses.

In June 2016, the FASB issued ASU 2016-13 related to the measurement of credit losses on financial instruments.

In June 2016, the FASB issued Accounting Standards Update (ASU) 2016-13 (Topic 326) related to the measurement of credit losses on financial instruments.

The new standard replaces the incurred loss methodology to record credit losses with a methodology that reflects the expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.

The Company adopted the standard on January 1, 2020 using the modified retrospective approach.

The Company will be required to use a forward-looking expected loss model for accounts receivables, loans and other financial instruments to record an allowance for the estimated contractual cash flows not expected to be collected.

This standard is effective for fiscal years beginning after December 15, 2019 (January 1, 2020 for the Company) and interim periods therein, with early adoption permitted.

Adoption of the standard will be applied using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date to align the Company’s credit loss methodology with the new standard.

The Company adopted the standard on January 1, 2020 with no material impact to the Company’s results of operations, financial condition, cash flows or financial statement presentation.

The Company has not restated comparative information for 2019 and no adjustments to retained earnings were necessary as a result of adopting Topic 326.

Effective January 1, 2020, the Company recognizes an allowance for credit losses for financial assets carried at amortized cost to present the net amount expected to be collected as of the balance sheet date.

Such allowance is based on the credit losses expected to arise over the life of the asset (contractual term) which includes consideration of prepayments and is based on the Company’s expectations as of the balance sheet date.

Assets are written off when the Company determines that such financial assets are deemed uncollectible.

Write-offs are recognized as deductions from the allowance for credit losses.

Expected recoveries of amounts previously written off, not to exceed the aggregate of the amount previously written off, are included in determining the necessary reserve at the balance sheet date.

The Company pools its accounts receivable based on similar risk characteristics in estimating its expected credit losses.

The Company also continuously evaluates such pooling decisions and adjusts as needed from period to period as risk characteristics change.

Fair Value Measurement.

2 unchanged sentences

All other amendments should be applied retrospectively to all periods presented upon their effective date.

The amendments are effective for all companies for fiscal years, and interim periods within those years, beginning after December 15, 2019.

The Company plans to adopt all disclosure requirements effective January 1, 2020.

The Company adopted the disclosure requirements effective January 1, 2020.

Compensation - Retirement Benefits.

In August 2018, the FASB issued ASU 2018-14 to add, remove and clarify disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans.

ASU 2018-14 is effective for fiscal years ending after December 15, 2020 for public companies and early adoption is permitted.

The Company plans to adopt the disclosure requirements effective January 1, 2020.

The Company adopted the disclosure requirements effective January 1, 2020.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income Taxes.

2 unchanged sentences

ASU 2019-12 is effective on January 1, 2021 for calendar year-end public companies and early adoption is permitted.

The Company elected to early adopt ASU 2019-12 in the third quarter of 2020 and apply the guidance to the beginning of the annual period, effective January 1, 2020.

The singular current year impact of the adoption of this ASU is related to the intraperiod tax allocation exception.

Under this new guidance, the Company is no longer required to allocate income tax benefit to continuing operations to offset the tax effect of other comprehensive income in situations where there is a loss from continuing operations and income in all other sources of income.

Under the predecessor accounting guidance, the Company would have recorded approximately $ 38 million of incremental income tax benefit in continuing operations with an offsetting income tax expense in other comprehensive income.

Accounting Standards Not Yet Implemented

Equity Method Investments.

In January 2020, the FASB issued ASU 2020-01, which clarifies the interactions between ASC 321, ASC 323 and ASC 815.

The new guidance addresses accounting for the transition into and out of the equity method and measuring certain purchased options and forward contracts to acquire investments.

ASU 2020-01 is effective on January 1, 2021 for calendar year-end public companies and early adoption is permitted.

The Company plans to adopt the requirements effective January 1, 2021.

Effects of Reference Rate Reform.

In March 2020, ASU 2020-04 was issued, which provides optional guidance for a limited period of time to ease the potential burden on accounting for contract modifications caused by reference rate reform.

This guidance is effective for all entities as of March 12, 2020 through December 31, 2022.

The guidance may be adopted over time as reference rate reform activities occur and should be applied on a prospective basis.

The Company is still completing its evaluation of the impact of ASU 2020-04 and plans to elect optional expedients as reference rate reform activities occur.

While the Company is still evaluating, it does not expect the guidance to have a material impact on its consolidated financial statements or disclosures.

The majority of the Company’s revenue is derived from the sale of coal under long-term coal supply agreements (those with initial terms of one year or longer and which often include price reopener and/or extension provisions) and contracts with terms of less than one year, including sales made on a spot basis.

3 unchanged sentences

Reported coal sales include taxes and fees charged by various federal and state governmental bodies and the freight charged on destination customer contracts.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company’s seaborne operating platform is primarily export focused with customers spread across several countries, with a portion of the thermal and metallurgical coal sold within Australia.

5 unchanged sentences

The resulting make-whole settlements are recognized when reasonably estimable.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company’s U.S.

2 unchanged sentences

A significant portion of the coal production from the U.S.

thermal mining segments is sold under long-term supply agreements, and customers of those segments continue to pursue long-term sales agreements in recognition of the importance of reliability, service and predictable coal prices to their operations.

thermal mining segments is sold under existing long-term supply agreements.

Certain customers of those segments utilize long-term sales agreements in recognition of the importance of reliability, service and predictable coal prices to their operations.

The terms of coal supply agreements result from competitive bidding and extensive negotiations with customers.

23 unchanged sentences

and actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company initially measures a disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell.

2 unchanged sentences

The Company assesses the fair value of a disposal group, less any costs to sell, each reporting period it remains classified as held for sale and reports any subsequent changes as an adjustment to the carrying value of the disposal group, as long as the new carrying value does not exceed the carrying value of the disposal group at the time it was initially classified as held for sale.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Upon determining that a disposal group meets the criteria to be classified as held for sale, the Company reports the assets and liabilities of the disposal group, if material, in the line items assets held for sale and liabilities held for sale in the consolidated balance sheets.

26 unchanged sentences

Coal reserves are recorded at cost, or at fair value in the case of nonmonetary exchanges of reserves or business acquisitions.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Depletion of coal reserves and amortization of advance royalties are computed using the units-of-production method utilizing only proven and probable reserves (as adjusted for recoverability factors) in the depletion base.

2 unchanged sentences

The estimated useful lives by category of assets are as follows:

Building and improvements

Building and improvements up to 32

Machinery and equipment 1 - 15

Leasehold improvements

Shorter of Useful Life or Remaining Life of Lease

Leasehold improvements Shorter of Useful Life or Remaining Life of Lease

The Company leases coal reserves under agreements that require royalties to be paid as the coal is mined.

Certain agreements also require minimum annual royalties to be paid regardless of the amount of coal mined during the year.

Total royalty expense was $ 388.6 million , $ 474.3 million , $ 364.6 million and $ 115.2 million for the years ended December 31, 2019 and 2018 , and the periods April 2 through December 31, 2017 and January 1 through April 1, 2017 , respectively.

Total royalty expense was $ 214.7 million, $ 388.6 million and $ 474.3 million for the years ended December 31, 2020, 2019 and 2018, respectively.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A substantial amount of the coal mined by the Company is produced from mineral reserves leased from the owner.

18 unchanged sentences

The Company determines if an arrangement is a lease at inception.

ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease.

Right-of-use (ROU) assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease.

Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term.

1 unchanged sentence

As most of its leases do not contain a readily determinable implicit rate, the Company uses its incremental borrowing rate at commencement to determine the present value of lease payments.

The Company does not separate lease components (i.e., fixed payments including rent, real estate taxes and insurance costs) from non-lease components (i.e., common-area maintenance) and recognizes them as a single lease component for the majority of asset classes.

Variable lease payments not included within lease contracts are expensed as incurred.

2 unchanged sentences

For certain equipment leases, the Company applies a portfolio approach to effectively account for the operating lease ROU assets and liabilities.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Equity Investments

1 unchanged sentence

Investments accounted for under the equity method are initially recorded at cost and any difference between the cost of the Company’s investment and the underlying equity in the net assets of the joint venture at the investment date is amortized over the lives of the related assets that gave rise to the difference.

The Company’s pro-rata share of the operating results of joint ventures and basis difference amortization is reported in the consolidated statements of operations in “Income from equity affiliates.” Similarly, the Company’s pro-rata share of the cumulative foreign currency translation adjustment of its equity method investments whose functional currency is not the U.S.

The Company’s pro-rata share of the operating results of joint ventures and basis difference amortization is reported in the consolidated statements of operations in “Loss (income) from equity affiliates.” Similarly, the Company’s pro-rata share of the cumulative foreign currency translation adjustment of its equity method investments whose functional currency is not the U.S.

dollar is reported in the consolidated balance sheets as a component of “Accumulated other comprehensive income,” with periodic changes thereto reflected in the consolidated statements of comprehensive income.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company monitors its equity method investments for indicators that a decrease in investment value has occurred that is other than temporary.

7 unchanged sentences

“Asset Impairment” for details regarding an impairment loss of $ 9.0 million recorded during the year ended December 31, 2019 related to an investment in an equity security.

No such impairment losses were recorded during the year ended December 31, 2018 or the periods April 2 through December 31, 2017 and January 1 through April 1, 2017 .

No such impairment losses were recorded during the years ended December 31, 2020 or 2018.

Asset Retirement Obligations

16 unchanged sentences

Adjustments to contingent liabilities are made when additional information becomes available that affects the amount of estimated loss, which information may include changes in facts and circumstances, changes in interpretations of law in the relevant courts, the results of new or updated environmental remediation cost studies and the ongoing consideration of trends in environmental remediation costs.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accrued contingent liabilities exclude claims against third parties and are not discounted.

2 unchanged sentences

The Company includes the interest component of any litigation-related penalties within “Interest expense” in the consolidated statements of operations.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income taxes are accounted for using a balance sheet approach.

12 unchanged sentences

The Company accounts for changes in its postretirement benefit obligations as a settlement when an irrevocable action has been effected that relieves the Company of its actuarially-determined liability to individual plan participants and removes substantial risk surrounding the nature, amount and timing of the obligation’s funding and the assets used to effect the settlement.

The Company records amounts attributable to actuarial valuation changes currently in earnings rather than recording such amounts within accumulated other comprehensive income and amortizing to expense over applicable time periods.

“Postretirement Health Care and Life Insurance Benefits” for information related to postretirement benefits.

3 unchanged sentences

The Company’s consolidated balance sheets reflect the funded status of the defined benefit pension plans.

“Pension and Savings Plans” for information related to pension plans.

3 unchanged sentences

Costs associated with restructuring activities are recognized in the period incurred.

Included as a component of “Restructuring charges” in the Company’s consolidated statements of operations for the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 were aggregate restructuring charges of $ 24.3 million , $ 1.2 million and $ 7.6 million , respectively, primarily associated with voluntary and involuntary workforce reductions.

There were no restructuring charges during the period January 1 through April 1, 2017 .

Included as a component of “Restructuring charges” in the Company’s consolidated statements of operations for the years ended December 31, 2020, 2019 and 2018 were aggregate restructuring charges of $ 37.9 million, $ 24.3 million and $ 1.2 million, respectively, primarily associated with voluntary and involuntary workforce reductions.

As of December 31, 2020, a $ 2.4 million accrual for restructuring charges remained in “Accounts payable and accrued expenses,” which is expected to be paid in the first quarter of 2021.

The Company recognizes at fair value all contracts meeting the definition of a derivative as assets or liabilities in the consolidated balance sheets, with the exception of certain coal trading contracts for which the Company has elected to apply a normal purchases and normal sales exception.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

22 unchanged sentences

Such factors include geographic proximity to one another, the expectation of shared infrastructure upon development based on future mining plans and whether it would be most advantageous to bundle such assets in the event of sale to a third party.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

8 unchanged sentences

Refer to Note 3.

“Asset Impairment” for details regarding impairment charges related to long-lived assets of $ 261.2 million and $ 30.5 million recognized during the year ended December 31, 2019 and the period January 1 through April 1, 2017 , respectively.

There were no impairment charges related to long-lived assets during the year ended December 31, 2018 or the period April 2 through December 31, 2017 .

“Asset Impairment” for details regarding impairment charges related to long-lived assets of $ 1,487.4 million and $ 261.2 million recognized during the years ended December 31, 2020 and 2019, respectively.

There were no impairment charges related to long-lived assets during the year ended December 31, 2018.

For assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements, the Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

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Income and expense accounts are remeasured at the average rates in effect during the year, except for those expenses related to balance sheet amounts that are remeasured at historical exchange rates.

Gains and losses from foreign currency remeasurement related to tax balances are included as a component of “Income tax provision (benefit),” while all other remeasurement gains and losses are included in “Operating costs and expenses” in the consolidated statements of operations.

The total impact of foreign currency remeasurement on the consolidated statements of operations was a net loss of $ 2.7 million for the year ended December 31, 2019 and a net gain of $ 1.4 million , $ 0.7 million and $ 10.6 million for the year ended December 31, 2018 and the periods April 2 through December 31, 2017 and January 1 through April 1, 2017 , respectively.

Gains and losses from foreign currency remeasurement related to tax balances are included as a component of “Income tax provision,” while all other remeasurement gains and losses are included in “Operating costs and expenses” in the consolidated statements of operations.

The total impact of foreign currency remeasurement on the consolidated statements of operations was a net loss of $ 4.0 million and $ 2.7 million for the years ended December 31, 2020 and 2019, respectively, and a net gain of $ 1.4 million for the year ended December 31, 2018.

The Company owns a 50 % equity interest in Middlemount Coal Pty Ltd.

6 unchanged sentences

Accordingly, foreign currency gains or losses on those loans are recorded as a component of foreign currency translation adjustment.

The Company recorded foreign currency translation gains of $ 0.2 million , $ 1.4 million and $ 5.5 million for the year ended December 31, 2019 and the periods April 2 through December 31, 2017 and January 1 through April 1, 2017 , respectively, and a loss of $ 5.9 million for the year ended December 31, 2018 .

The Company recorded foreign currency translation gains of $ 6.1 million and $ 0.2 million for the years ended December 31, 2020 and 2019, respectively, and a loss of $ 5.9 million for the year ended December 31, 2018.

Share-Based Compensation

1 unchanged sentence

“Share-Based Compensation” for information related to share-based compensation.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

17 unchanged sentences

Significant estimates inherent in the preparation of these consolidated financial statements include, but are not limited to, accounting for sales and cost recognition, postretirement benefit plans, environmental receivables and liabilities, asset retirement obligations, evaluation of long-lived assets for impairment, income taxes including deferred tax assets, fair value measurements and contingencies.

Reorganization Items

The Company’s application of fresh start reporting resulted in recognition of the following reorganization items for the periods presented below:

Year Ended December 31, 2018

January 1 through

April 1, 2017

(Dollars in millions)

Gain on settlement of claims

Fresh start adjustments, net

Fresh start income tax adjustments, net

Professional fees

Accounts payable settlement gains

Interest income

Reorganization items, net

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Upon implementation of the Plan on the Effective Date, the Company recorded a gain on the settlement of liabilities subject to compromise through a combination of cash payments, the issuance of new common stock and warrants and the issuance of new debt.

The following is the calculation of the total pre-tax gain on the settlement of the liabilities subject to compromise.

(Dollars in millions)

Liabilities subject to compromise

Less amounts issued to settle claims:

Successor Common Stock (at par)

Successor Series A Convertible Preferred Stock

Successor Additional paid-in capital

Issuance of Successor Notes

Issuance of Successor Term Loan

Cash payments and accruals for claims and professional fees

Write-off of Predecessor debt issuance costs

Gain on settlement of claims

At the Effective Date, 70.9 million shares of Common Stock were issued and outstanding at a par value of $ 0.01 per share.

Convertible Preferred Stock was recorded at fair value and was based upon the $ 750.0 million cash raised upon emergence from bankruptcy through the Private Placement Agreement, plus a premium to account for the fair value of the Convertible Preferred Stocks’ conversion and dividend features.

Each share of Convertible Preferred Stock was convertible, at the holder’s election or upon the occurrence of certain triggering events, into shares of Common Stock at a 35 % discount relative to the initial per share purchase price of $ 25.00 and provided for three years of guaranteed paid-in-kind dividends, payable semiannually, at a rate of 8.5 % per annum.

The 46.2 million shares of Common Stock issuable upon conversion of the Convertible Preferred Stock issued under the Plan and an additional 13.1 million shares of Common Stock attributable to such Convertible Preferred Stocks’ guaranteed paid-in-kind dividend feature constituted approximately 42 % ownership of the Plan Equity Value (as defined in the Plan) of $ 3,105.0 million in the reorganized Company, and thus had a fair value of $ 1,305.4 million .

Successor Additional paid-in capital was recorded at the Plan Equity Value less the amounts recorded for par value of the Common Stock, the fair value of the Convertible Preferred Stock, and certain fees incurred associated with the Registration Rights Agreement.

During the year ended December 31, 2018, the Company recorded an additional gain on the settlement of claims for $ 12.8 million related to certain unsecured claims.

Upon implementation of the Plan on the Effective Date, the Company recorded fresh start adjustments, net, as follows:

(Dollars in millions)

Other current assets

Property, plant, equipment and mine development, net

Investments and other assets

Accounts payable and accrued expenses

Deferred income taxes

Asset retirement obligations

Accrued postretirement benefit costs

Other noncurrent liabilities

Total fresh start adjustments, net

Represents adjustment to increase the book value of coal inventories to their estimated fair value, less costs to sell the inventories.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Represents adjustments comprising $ 228.5 million related to assets classified as held-for-sale at March 31, 2017 which were reclassified as held-for-use and considered in connection with the valuations described in (c) below, $ 89.5 million to write off certain existing short-term mine development costs, and $ 15.0 million of various prepaid assets deemed to have no future utility subsequent to the Effective Date.

Represents a $ 3,461.4 million reduction in property, plant and equipment to estimated fair value as discussed below:

The fair value of land and coal interests, excluding the asset related to the Company’s asset retirement obligations described below, was established at $ 3,504.7 million utilizing a discounted cash flow (DCF) model and the market approach.

The market approach was used to provide a starting value of the coal mineral reserves without consideration for economic obsolescence.

The DCF model was based on assumptions market participants would use in the pricing of these assets as well as projections of revenues and expenditures that would be incurred to mine or maintain these coal reserves through the life of mine.

The basis of the DCF analysis was the Company’s prepared projections which included a variety of estimates and assumptions, such as pricing and demand for coal.

The Company’s pricing was based on its view of the market taking into account third-party forward pricing curves adjusted for the quality of products sold by the Company.

The fair value of land and coal interests also includes $ 281.2 million corresponding to the asset retirement obligation discussed in item (g) below.

The fair value of buildings and improvements and machinery and equipment were set at $ 466.1 million and $ 940.5 million , respectively, utilizing both market and cost approaches.

The market approach was used to estimate the value of assets where detailed information for the asset was available and an active market was identified with a sufficient number of sales of comparable property that could be independently verified through reliable sources.

The cost approach was utilized where there were limitations in the secondary equipment market to derive values from.

The first step in the cost approach is the estimation of the cost required to replace the asset via construction or purchasing a new asset with similar utility adjusting for depreciation due to physical deterioration, functional obsolescence due to technology changes and economic obsolescence due to external factors such as regulatory changes.

Useful lives were assigned to all assets based on remaining future economic benefit of each asset.

Primarily to recognize fair value of $ 314.9 million inherent in certain U.S.

coal supply agreements as a result of favorable differences between contract terms and estimated market terms for the same coal products, partially offset by a reduction in the fair value of certain equity method investments.

The intangible asset related to coal supply agreements will be amortized on a per ton shipped basis through 2025.

Represents $ 32.6 million to account for the short-term portion of the value of certain contract-based intangibles primarily consisting of unutilized capacity of certain port and rail take-or-pay contracts, partially offset by $ 15.7 million related to liabilities classified as held-for-sale at March 31, 2017 which were reclassified as held-for-use and considered in connection with the valuations described in (c) above, and various other fair value adjustments.

The intangible liabilities related to port and rail take-or-pay contracts will be amortized ratably over the terms of each contact, which vary in duration through 2043.

Represents the tax impact of fresh start reporting.

Represents the fair value adjustment related to the Company’s asset retirement obligations which was calculated using DCF models based on contemporary mine plans.

The credit-adjusted, risk-free interest rates utilized to estimate the Company’s asset retirement obligations were 9.36 % for its U.S.

reclamation obligations and 4.36 % for its Australia reclamation obligations.

Represents the remeasurement of liabilities associated with the Company’s postretirement benefits obligations as of the Effective Date as the reorganization of the Company pursuant to the Plan represented a remeasurement event under ASC 715 “Compensation - Retirement Benefits.” The relevant discount rate was adjusted to 4.10 % from 4.15 % used in the Company’s remeasurement process for the year ended December 31, 2016.

Represents $ 83.6 million to account for the long-term portion of the value of contract-based intangibles related to unutilized capacity of port and rail take-or-pay contracts as described in (e) above and $ 58.7 million to account for the fair value inherent in certain U.S.

coal supply agreements as a result of unfavorable differences between contract terms and estimated market terms for the same coal products as described in (d) above, partially offset by a remeasurement reduction of $ 9.2 million of the Company’s pension liabilities in accordance with ASC 715 as described in (h) above, as the relevant discount rate was adjusted to 4.10 % from 4.15 % used in the Company’s remeasurement process for the year ended December 31, 2016, and certain other valuation adjustments.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Acquisition of Shoal Creek Mine

for a purchase price of $ 389.8 million after customary purchase price adjustments, which was funded with available cash on hand.

The acquisition expanded the Company’s seaborne metallurgical mining platform.

The acquisition excluded all liabilities other than reclamation and the Company is not responsible for other liabilities relating to the operation of the Shoal Creek Mine prior to the acquisition date, including employee benefit plans and post-employment benefits.

In connection with completing the acquisition, a new collective bargaining agreement was reached with the union-represented workforce that eliminates participation in the multi-employer pension plan and replaces it with a 401(k) retirement plan.

The purchase accounting allocations were recorded in the accompanying consolidated financial statements as of, and for the period subsequent to the acquisition date.

The following table summarizes the fair values of assets acquired and liabilities assumed that were recognized at the acquisition and control date as well as fair value adjustments made through December 31, 2019 :

Preliminary Allocations

Final Allocations

(Dollars in millions)

Property, plant, equipment and mine development

Current liabilities

Asset retirement obligations

Total purchase price

Determining the fair value of assets acquired and liabilities assumed required judgment and the utilization of independent valuation experts, and included the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates and asset lives, among other items.

Due to the unobservable inputs to the valuation, the fair value would be considered Level 3 in the fair value hierarchy.

The adjustments to the provisional fair values resulted from additional information obtained about facts in existence at the acquisition and control date and included rationalization adjustments in order to reconcile the aggregated fair value of the assets acquired to the amount of consideration transferred.

Adjustments to provisional fair values were assumed to have been made as of the acquisition and control date.

As a result, "Depreciation, depletion and amortization" would have been lower by $ 0.4 million , $ 0.5 million and $ 0.4 million for the fourth quarter of 2018, first quarter of 2019 and second quarter of 2019, respectively, than was previously reported.

The accompanying consolidated statements of operations reflect these adjustments in the year ended December 31, 2019 .

The Company has finalized the valuation of the net assets acquired and related purchase price allocation.

The results of Shoal Creek Mine for the year ended December 31, 2019 and the period December 4, 2018 through December 31, 2018 are included in the consolidated statements of operations and are reported in the Seaborne Metallurgical Mining segment.

The Shoal Creek Mine contributed revenues of $ 12.8 million and less than $ 0.1 million of net income from December 4, 2018 through December 31, 2018.

This excludes acquisition costs recorded during the year ended December 31, 2018 of $ 7.4 million , which primarily consisted of professional fees.

These acquisition costs are recorded in the “Transaction costs related to business combinations and joint ventures” line item in the consolidated statements of operations.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As a result of Peabody's reorganization and change in reporting entity as described in Note 1.

“Summary of Significant Accounting Policies,” the following unaudited pro forma financial information presents the estimated combined results of operations of the Company and Shoal Creek Mine, on a pro forma basis, as though the operations of the Shoal Creek Mine had been combined with the Company’s operations as of April 2, 2017.

Pro forma information is not presented for the year ended December 31, 2019 because the operations of the Shoal Creek Mine are reflected in the Company’s actual consolidated results for the entire year.

The unaudited pro forma financial information does not necessarily reflect the results of operations that would have occurred had the operations of the Company and Shoal Creek Mine been combined during those periods or that may be attained in the future.

Year Ended December 31, 2018

April 2 through December 31, 2017

(Dollars in millions, except per share data)

Income from continuing operations, net of income taxes

Basic earnings per share from continuing operations

Diluted earnings per share from continuing operations

The pro forma income from continuing operations, net of income taxes includes adjustments to operating costs to reflect the additional expense for the estimated impact of the fair value adjustment for coal inventory, a reduction in postretirement benefit costs resulting from the new collective bargaining agreement described above, and the estimated impact on depreciation, depletion and amortization for the fair value adjustment for property, plant and equipment (including coal reserve assets).

On a pro forma basis, the acquisition would have had no impact on taxable income due to the Company’s federal net operating losses (NOLs), as further described in Note 12.

“Income Taxes.”

(2) Revenue Recognition

The Company accounts for revenue in accordance with ASC Topic 606, “Revenue from Contracts with Customers” (ASC 606), which the Company adopted on January 1, 2018, using the modified retrospective approach.

Disaggregation of Revenues

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Year Ended December 31, 2020

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate and Other (1)

(Dollars in millions)

Domestic $ 145.5 $ — $ 993.9 $ 675.2 $ — $ 1,814.6

Export 564.8 — — — — 564.8

Total thermal 710.3 — 993.9 675.2 — 2,379.4

Metallurgical coal

Export — 484.3 — — — 484.3

Total metallurgical — 484.3 — — — 484.3

Peabody Energy Corporation

2019 Form 10-K

Other 1.5 2.2 ( 2.8 ) 32.1 ( 15.6 ) 17.4

Revenues $ 711.8 $ 486.5 $ 991.1 $ 707.3 $ ( 15.6 ) $ 2,881.1

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

1 unchanged sentence

Year Ended December 31, 2019

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

(Dollars in millions)

Total thermal

Metallurgical coal

Total metallurgical

April 2 through December 31, 2017

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate and Other (1)

(Dollars in millions)

Domestic $ 147.9 $ — $ 1,208.9 $ 1,274.2 $ — $ 2,631.0

Export 822.4 — — 11.3 — 833.7

Total thermal 970.3 — 1,208.9 1,285.5 — 3,464.7

Metallurgical coal

Export — 1,030.0 — — — 1,030.0

Total metallurgical — 1,030.0 — — — 1,030.0

January 1 through April 1, 2017

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

Other 1.4 3.1 19.8 23.9 80.5 128.7

Revenues $ 971.7 $ 1,033.1 $ 1,228.7 $ 1,309.4 $ 80.5 $ 4,623.4

Year Ended December 31, 2018

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate and Other (1)

(Dollars in millions)

Domestic $ 153.0 $ — $ 1,424.8 $ 1,342.5 $ — $ 2,920.3

Export 945.0 — — 23.4 — 968.4

Total thermal 1,098.0 — 1,424.8 1,365.9 — 3,888.7

Metallurgical coal

Export — 1,548.6 — — — 1,548.6

Total metallurgical — 1,548.6 — — — 1,548.6

Peabody Energy Corporation

2019 Form 10-K

Other 1.2 4.4 — 27.1 111.8 144.5

Revenues $ 1,099.2 $ 1,553.0 $ 1,424.8 $ 1,393.0 $ 111.8 $ 5,581.8

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

2 unchanged sentences

Year Ended December 31, 2020

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate and Other (1)

(Dollars in millions)

1 unchanged sentence

Less than one year 361.1 113.3 48.9 3.8 — 527.1

1.5 2.2 ( 2.8 ) 32.1 ( 15.6 ) 17.4

Revenues $ 711.8 $ 486.5 $ 991.1 $ 707.3 $ ( 15.6 ) $ 2,881.1

Year Ended December 31, 2019

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

(Dollars in millions)

One year or longer

Less than one year

April 2 through December 31, 2017

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate and Other (1)

(Dollars in millions)

1 unchanged sentence

Less than one year 381.1 201.4 121.3 31.3 — 735.1

January 1 through April 1, 2017

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Midwestern U.S.

Corporate and Other (1)

1.4 3.1 19.8 23.9 80.5 128.7

Revenues $ 971.7 $ 1,033.1 $ 1,228.7 $ 1,309.4 $ 80.5 $ 4,623.4

Year Ended December 31, 2018

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate and Other (1)

(Dollars in millions)

1 unchanged sentence

Less than one year 298.5 511.9 140.9 58.7 — 1,010.0

1.2 4.4 — 27.1 111.8 144.5

Revenues $ 1,099.2 $ 1,553.0 $ 1,424.8 $ 1,393.0 $ 111.8 $ 5,581.8

(1) Corporate and Other revenue includes gains and losses related to mark-to-market adjustments from economic hedge activities intended to hedge future coal sales.

1 unchanged sentence

“Derivatives and Fair Value Measurements” for additional information regarding the economic hedge activities.

Other includes revenues from arrangements such as customer contract-related payments, royalties related to coal lease agreements, sales agency commissions, farm income and property and facility rentals, for which contract duration is not meaningful.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(2) Other includes revenues from arrangements such as customer contract-related payments associated with volume shortfalls, royalties related to coal lease agreements, sales agency commissions, farm income and property and facility rentals, for which contract duration is not meaningful.

Committed Revenue from Contracts with Customers

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Accounts receivable, net $ 244.8 $ 329.5

Trade receivables, net presented above have been shown net of reserves of $ 0.1 million as of December 31, 2018 .

Trade receivables, net included no reserves as of December 31, 2019 .

Miscellaneous receivables, net presented above have been shown net of reserves of $ 4.3 million as of December 31, 2018 .

Miscellaneous receivables, net included no reserves as of December 31, 2019 .

Included in “Operating costs and expenses” in the consolidated statements of operations were credits of $ 4.4 million and $ 0.2 million for the years ended December 31, 2019 and 2018 , respectively, and a charge of $ 4.3 million for the period ended April 2 through December 31, 2017 .

No charges for doubtful accounts were recognized during the period January 1 through April 1, 2017.

The Company also records long-term customer receivables related to the reimbursement of certain post-mining costs which are included within “Investments and other assets” in the accompanying consolidated balance sheets.

The balance of such receivables was $ 11.1 million as of December 31, 2018 .

There were no such outstanding receivables as of December 31, 2019 .

Since the adoption of ASC 606, the Company records a portion of the consideration received as “Interest income” rather than “Revenues” in the accompanying consolidated statements of operations, due to the embedded financing element within the related contract.

Interest income related to these arrangements amounted to $ 8.2 million and $ 8.4 million during the years ended December 31, 2019 and 2018 , respectively.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Trade receivables, net included no allowance for credit losses as of both December 31, 2020 and 2019.

Miscellaneous receivables, net included no allowance for credit losses as of both December 31, 2020 and 2019.

No charges for credit losses were recognized during the year ended December 31, 2020.

Included in “Operating costs and expenses” in the consolidated statements of operations were reductions of previously recorded credit losses of $ 4.4 million and $ 0.2 million for the years ended December 31, 2019 and 2018, respectively.

(3) Asset Impairment

During the year ended December 31, 2019 , the Company recognized impairment charges of $ 172.0 million related to its El Segundo/Lee Ranch Mine of the Western U.S.

Mining segment and $ 20.0 million related to its Wildcat Hills Underground Mine of the Midwestern U.S.

Mining segment based upon the expectation of reduced sales volumes and uncertainty over remaining economic mine lives.

During the year ended December 31, 2020, the Company recognized impairment charges of $ 1,418.1 million related to its North Antelope Rochelle Mine of the Powder River Basin Mining segment.

Of this amount, $ 1,393.7 million related to the property, plant, equipment and mine development assets;

$ 19.9 million related to operating lease right-of-use assets;

and $ 4.5 million related to contract-based intangible assets.

The outlook for the North Antelope Rochelle Mine has been negatively impacted by the accelerated decline of coal-fired electricity generation in the U.S., driven by the reduced utilization of plants and plant retirements, sustained low natural gas pricing and the increased use of renewable energy sources.

These factors have led to the expectation of reduced future sales volumes.

The impairment charge was based upon the remaining estimated discounted cash flows of the mine.

Such cash flows were based upon estimates which generally constitute unobservable Level 3 inputs under the fair value hierarchy, including, but not limited to, future tons sold, coal prices for unpriced coal, production costs (including costs for labor, commodity supplies and contractors), transportation costs and a risk-adjusted cost of capital.

During the year ended December 31, 2020, the Company also recognized impairment charges of $ 69.3 million related to certain unassigned coal reserves in the Midwest due to their low probability of development.

During the year ended December 31, 2019, the Company recognized impairment charges of $ 192.0 million related to the El Segundo/Lee Ranch and Wildcat Hills Underground Mines of the Other U.S.

Thermal Mining segment based upon the expectation of reduced sales volumes and uncertainty over remaining economic mine lives.

The related impairment charges were based upon the remaining probability-weighted discounted cash flows of those mines.

The Company also recognized impairment charges of $ 69.2 million related to certain unallocated coal reserves in the Midwest and Colorado due to their low probability of development, and $ 9.0 million related to the fair value of an investment in equity securities during the year ended December 31, 2019 .

During the year ended December 31, 2018 and the period April 2 through December 31, 2017 , the Company recognized no impairment charges.

During the period January 1 through April 1, 2017 , the Company recognized impairment charges of $ 30.5 million related to terminated coal lease contracts in the Midwest.

In addition to the impairment charges described above, the Company also recorded provisions related to its North Goonyella Mine during the year ended December 31, 2019 , as further described at Note 22.

The Company also recognized impairment charges of $ 69.2 million related to certain unassigned coal reserves in the Midwest and Colorado due to their low probability of development, and $ 9.0 million related to the fair value of an investment in equity securities during the year ended December 31, 2019.

No impairment charges were recognized during the year ended December 31, 2018.

In addition to the impairment charges described above, the Company also recorded provisions related to its North Goonyella Mine during the years ended December 31, 2019 and 2018, as further described in Note 20.

“Other Events.”

In connection with its impairment assessments, the Company identified long-lived assets included in its Midwestern U.S.

Mining and Corporate and Other segments whose recoverability and carrying values were most sensitive to coal pricing, cost pressures and customer concentration risk at December 31, 2019 .

Such assets had an aggregate carrying value of $ 89.0 million as of December 31, 2019 .

The Company conducted a review of those assets for recoverability and determined that no further impairment charge was necessary as of that date.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company also identified certain assets with an aggregate carrying value of approximately $ 1.2 billion at December 31, 2020 in its Seaborne Metallurgical Mining, Powder River Basin Mining, Other U.S.

Thermal Mining and Corporate and Other segments whose recoverability is most sensitive to coal pricing, cost pressures, customer demand, customer concentration risk and future economic viability.

The Company conducted a review of those assets for recoverability as of December 31, 2020 and determined that no further impairment charges were necessary as of that date.

(4) Discontinued Operations

Discontinued operations include certain former Seaborne Thermal Mining and Midwestern U.S.

Mining segment assets that have ceased production and other previously divested legacy operations, including Patriot Coal Corporation and certain of its wholly-owned subsidiaries (Patriot).

Discontinued operations include certain former Seaborne Thermal Mining and Other U.S.

Thermal Mining segment assets that have ceased production and other previously divested legacy operations, including Patriot Coal Corporation and certain of its wholly-owned subsidiaries (Patriot).

Summarized Results of Discontinued Operations

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Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

Income (loss) from discontinued operations, net of income taxes

(Loss) income from discontinued operations, net of income taxes $ ( 14.0 ) $ 3.2 $ 18.1

There were no significant revenues from discontinued operations during the years ended December 31, 2020, 2019 and 2018.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Liabilities of Discontinued Operations

8 unchanged sentences

In 2013, the Company entered into a definitive settlement agreement (2013 Agreement) with Patriot and the United Mine Workers of America (UMWA), on behalf of itself, its represented Patriot employees and its represented Patriot retirees, to resolve all then-disputed issues related to Patriot’s bankruptcy.

In May 2015, Patriot again filed voluntary petitions for relief under the Bankruptcy Code in the Eastern District of Virginia and subsequently initiated a process to sell some or all of its assets to qualified bidders.

In May 2015, Patriot again filed voluntary petitions for relief under the Bankruptcy Code in the U.S.

District Court for the Eastern District of Virginia and subsequently initiated a process to sell substantially all of its assets to qualified bidders.

On October 9, 2015, Patriot’s bankruptcy court entered an order confirming Patriot’s plan of reorganization, which provided, among other things, for the sale of substantially all of Patriot’s assets to two different buyers.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Black Lung Occupational Disease Liabilities.

9 unchanged sentences

The Company has sought clarification from the DOL regarding these inconsistencies.

The accounting for these liabilities could be reduced in the future.

The amount of these liabilities could be reduced in the future.

Whether the Company will ultimately be required to fund certain of those obligations in the future as a result of Patriot’s May 2015 bankruptcy remains uncertain.

The amount of the liability, which was determined on an actuarial basis based on the best information available to the Company was $ 90.1 million and $ 85.7 million at December 31, 2020 and 2019, respectively.

In connection with the actuarial valuation, the Company recorded a mark-to-market adjustment of $ 18.3 million and $ 33.7 million to decrease the liability during the years ended December 31, 2019 and 2018 , respectively and $ 7.9 million to increase the liability during the period April 2 through December 31, 2017.

In connection with the actuarial valuation, the Company recorded a mark-to-market adjustment of $ 4.2 million to increase the liability during the year ended December 31, 2020 and adjustments of $ 18.3 million and $ 33.7 million to decrease the liability during the years ended December 31, 2019 and 2018, respectively.

While the Company has recorded a liability, it intends to review each claim on a case-by-case basis and contest liability estimates as appropriate.

5 unchanged sentences

Former employers are required to contribute to the Combined Fund according to a formula.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Under the terms of the Patriot spin-off, Patriot was primarily liable to the Combined Fund for the approximately $ 40 million of its subsidiaries’ obligations at that time.

Once Patriot ceased meeting its obligations, the Company was held responsible for these costs and, as a result, recorded “Income (loss) from discontinued operations, net of income taxes” charges of $ 0.7 million , $ 0.7 million , $ 0.6 million and $ 0.2 million during the years ended December 31, 2019 and 2018 , the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017 , respectively.

The Company made payments into the fund of $ 1.9 million , $ 2.2 million , $ 1.7 million and $ 0.6 million during the years ended December 31, 2019 and 2018 , the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017 , respectively, and estimates that the annual cash cost to fund these potential Combined Fund liabilities will range between $ 1 million and $ 2 million in the near-term, with those premiums expected to decline over time because the fund is closed to new participants.

Once Patriot ceased meeting its obligations, the Company was held responsible for these costs and, as a result, recorded “(Loss) income from discontinued operations, net of income taxes” charges of $ 0.5 million, $ 0.7 million and $ 0.7 million during the years ended December 31, 2020, 2019 and 2018, respectively.

In connection with the actuarial valuation, the Company recorded mark-to-market adjustments of $ 0.9 million and $ 2.4 million to decrease the liability during the years ended December 31, 2020 and 2018, respectively, and an adjustment of $ 0.1 million to increase the liability during the year ended December 31, 2019.

The Company made payments into the fund of $ 1.6 million, $ 1.9 million and $ 2.2 million during the years ended December 31, 2020, 2019 and 2018, respectively, and estimates that the annual cash cost to fund these potential Combined Fund liabilities will range between $ 1 million and $ 1.5 million in the near-term, with those premiums expected to decline over time because the fund is closed to new participants.

The liability related to the fund was $ 13.2 million and $ 15.2 million at December 31, 2020 and 2019, respectively.

UMWA 1974 Pension Plan (UMWA Plan) Litigation.

On July 16, 2015, a lawsuit was filed by the UMWA Plan, the UMWA 1974 Pension Trust (Trust) and the Trustees of the UMWA Plan and Trust (Trustees) in the United States District Court for the District of Columbia, against the Company, Peabody Holding Company, LLC, a subsidiary of the Company, and Arch Coal, Inc.

The plaintiffs sought, pursuant to the Employee Retirement Income Security Act of 1974, as amended (ERISA) and the Multiemployer Pension Plan Amendments Act of 1980 (MPPAA), a declaratory judgment that the defendants were obligated to arbitrate any opposition to the Trustees’ determination that the defendants had statutory withdrawal liability as a result of the 2015 Patriot bankruptcy.

(Arch), known as Arch Coal, Inc.

prior to May 15, 2020.

The plaintiffs sought, pursuant to the Employee Retirement Income Security Act of 1974, as amended (ERISA), and the Multiemployer Pension Plan Amendments Act of 1980, a declaratory judgment that the defendants were obligated to arbitrate any opposition to the Trustees’ determination that the defendants had statutory withdrawal liability as a result of the 2015 Patriot bankruptcy.

After a legal and arbitration process and with the approval of the Bankruptcy Court, on January 25, 2017, the UMWA Plan and the Company agreed to a settlement of the claim which entitled the UMWA Plan to $ 75 million to be paid by the Company in increments through 2021.

The balance of the liability, on a discounted basis, was $ 13.9 million and $ 26.0 million at December 31, 2020 and 2019, respectively.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(5) Inventories

Inventories as of December 31, 2020 and December 31, 2019 consisted of the following:

1 unchanged sentence

Materials and supplies $ 102.6 $ 116.3

Raw coal 70.5 85.1

Saleable coal 88.5 130.1

Inventories $ 261.6 $ 331.5

Materials and supplies inventories presented above have been shown net of reserves of $ 10.4 million and $ 7.9 million as of December 31, 2020 and 2019, respectively.

The coal inventories presented above include net realizable value adjustments of $ 7.6 million and $ 8.3 million as of December 31, 2020 and 2019, respectively.

(6) Equity Method Investments

1 unchanged sentence

The Company’s equity method investments include its joint venture interest in Middlemount and certain other equity method investments.

The table below summarizes the book value of those investments and related financing receivables, which are reported in “Investments and other assets” in the consolidated balance sheets, and the related “Income from equity affiliates”:

Book Value at

(Income) Loss from Equity Affiliates

December 31, 2019

December 31, 2018

Year Ended December 31, 2019

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Book Value at Loss (Income) from Equity Affiliates

December 31, Year Ended December 31,

2020 2019 2020 2019 2018

(Dollars in millions)

Equity method investment and financing receivables related to Middlemount

$ 24.6 $ 56.3 $ 60.1 $ ( 9.0 ) $ ( 69.3 )

Other equity method investments — 0.6 — 5.6 1.2

Total equity method investments and financing receivables related to Middlemount

As of December 31, 2019 and 2018 , respectively, the financing receivables are accounted for as in-substance common stock due to the limited fair value attributed to Middlemount’s equity.

The Company received cash payments from Middlemount of $ 14.7 million , $ 106.7 million , $ 48.1 million and $ 32.7 million during the years ended December 31, 2019 and 2018 , the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017 , respectively.

$ 24.6 $ 56.9 $ 60.1 $ ( 3.4 ) $ ( 68.1 )

The Company received cash payments from Middlemount of $ 14.7 million and $ 106.7 million during the years ended December 31, 2019 and 2018, respectively, related to financing receivables.

No payments were received from Middlemount during the year ended December 31, 2020.

One of the Company’s Australian subsidiaries and the other shareholder of Middlemount are parties to an agreement, as amended from time to time, to provide a revolving loan (Revolving Loans) to Middlemount.

The Company’s participation in the Revolving Loans will not, at any time, exceed its 50 % equity interest of the revolving loan limit, which was $ 50 million Australian dollars and fully drawn upon by Middlemount at December 31, 2019.

Subsequent to December 31, 2019, the parties amended the agreement to temporarily increase the revolving loan limit to $ 70 million Australian dollars through August 2020, at which time the revolving loan limit will revert to $ 50 million Australian dollars.

The Company’s participation in the Revolving Loans will not, at any time, exceed its 50 % equity interest of the revolving loan limit.

At December 31, 2020, the revolving loan limit was $ 160 million Australian dollars, and Middlemount had not fully drawn upon the Revolving Loans.

The Revolving Loans bear interest at 10 % per annum and expire on December 31, 2021.

The carrying value of the Revolving Loans due to the Company’s Australian subsidiary was $ 17.1 million and zero as of December 31, 2019 and 2018 , respectively.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The carrying value of the portion of the Revolving Loans due to the Company’s Australian subsidiary, which is included in the total investment balance, was $ 46.2 million and $ 17.5 million as of December 31, 2020 and 2019, respectively, with the increase during the year ended December 31, 2020 attributable to the Company’s share of additional funding.

As of both December 31, 2020 and 2019, the financing receivables and Revolving Loans are accounted for as in-substance common stock due to the limited fair value attributed to Middlemount’s equity.

During the year ended December 31, 2018, the Company determined that a valuation allowance on Middlemount’s net deferred tax position was no longer necessary based on recent cumulative earnings and expectation of future earnings.

1 unchanged sentence

During the year ended December 31, 2019, Middlemount received notification that the Australian Taxation Office would no longer pursue its position, and the related tax reserve was released.

During the years ended December 31, 2019 and 2018 , the period April 2 through December 31, 2017 , and the period January 1 through April 1, 2017 , respectively, Middlemount generated revenues of approximately $ 160 million , $ 271 million , $ 193 million and $ 60 million (on a 50 % basis).

During the year ended December 31, 2020, the Company established a valuation allowance on Middlemount’s net deferred tax position of approximately $ 33 million primarily based upon recent cumulative losses.

During the years ended December 31, 2020, 2019 and 2018, respectively, Middlemount generated revenues of approximately $ 123 million, $ 160 million and $ 271 million (on a 50 % basis).

Middlemount had current assets, noncurrent assets, current liabilities and noncurrent liabilities of $ 31.0 million, $ 301.8 million, $ 273.8 million and $ 83.5 million, respectively, as of December 31, 2020 and $ 30.8 million, $ 209.7 million, $ 225.8 million and $ 40.1 million, respectively, as of December 31, 2019 (on a 50 % basis).

3 unchanged sentences

These risk management activities are actively monitored for compliance with the Company’s risk management policies.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of December 31, 2020, the Company had currency options outstanding with an aggregate notional amount of $ 575.0 million Australian dollars to hedge currency risk associated with anticipated Australian dollar expenditures over the first nine months of 2021.

3 unchanged sentences

Such financial contracts include futures, forwards and options.

Of the aggregate notional volume, 1.7 million tonnes will settle in 2020 and the remainder will settle in 2021.

All 0.8 million tonnes will settle in 2021.

The Company had no diesel fuel or interest rate derivatives in place as of December 31, 2020.

10 unchanged sentences

For classification purposes, the Company records the net fair value of all the positions with a given counterparty as a net asset or liability in the consolidated balance sheets.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company’s coal trading assets and liabilities include financial instruments cleared through various exchanges, which involve the daily net settlement of open positions.

4 unchanged sentences

The Company offsets its coal trading asset and liability derivative positions, and variation margin related to those positions, on a counterparty-by-counterparty basis in the consolidated balance sheets.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The fair value of derivatives reflected in the accompanying consolidated balance sheets are set forth in the table below.

December 31, 2019

December 31, 2018

Asset Derivative

Liability Derivative

Asset Derivative

Liability Derivative

December 31, 2020 December 31, 2019

Asset Derivative Liability Derivative Asset Derivative Liability Derivative

(Dollars in millions)

4 unchanged sentences

Effect of counterparty netting ( 30.2 ) 30.2 ( 74.3 ) 74.3

Variation margin (held) posted

Variation margin posted (held) 6.5 — ( 22.1 ) —

Net derivatives and margin as classified in the balance sheets $ 10.9 $ ( 1.7 ) $ 5.9 $ —

2 unchanged sentences

Currently, the Company does not seek cash flow hedge accounting treatment for its currency- or coal-related derivative financial instruments and thus changes in fair value are reflected in current earnings.

Prior to the Bankruptcy Petitions, as of December 31, 2015, the Company concluded that as a result of deterioration in its credit profile, it could no longer consider its then existing cash flow hedging relationships to be “highly effective” at offsetting the changes in the anticipated exposure of hedged items.

Therefore, the Company discontinued the application of cash flow hedge accounting subsequent to December 31, 2015 and changes in the fair value of derivative instruments have been reflected in current earnings after that date.

Previous fair value adjustments recorded in “Accumulated other comprehensive income” were frozen until the underlying transactions impacted the Company’s earnings.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The tables below show the amounts of pre-tax gains and losses related to the Company’s derivatives.

Year Ended December 31, 2020

Total (loss) gain recognized in income

(Loss) gain realized in income on derivatives

Unrealized gain recognized in income on derivatives

Total gain (loss) recognized in income Gain realized in income on derivatives Unrealized gain (loss) recognized in income on derivatives

Financial Instrument

1 unchanged sentence

Foreign currency option contracts

$ 12.9 $ 5.8 $ 7.1

Coal contracts related to forecasted sales

( 23.8 ) 5.8 ( 29.6 )

Coal trading contracts

( 0.7 ) 4.2 ( 4.9 )

Total $ ( 11.6 ) $ 15.8 $ ( 27.4 )

Year Ended December 31, 2019

Total (loss) gain recognized in income

(Loss) gain realized in income on derivatives

Unrealized (loss) gain recognized in income on derivatives

Total (loss) gain recognized in income (Loss) gain realized in income on derivatives Unrealized gain recognized in income on derivatives

Financial Instrument

1 unchanged sentence

Foreign currency option contracts

$ ( 3.7 ) $ ( 4.9 ) $ 1.2

Coal contracts related to forecasted sales

67.6 25.4 42.2

Coal trading contracts

April 2 through December 31, 2017

Total gain (loss) recognized in income

Gain (loss) realized in income on derivatives

Unrealized (loss) gain recognized in income on derivatives

( 0.3 ) ( 8.7 ) 8.4

Total $ 63.6 $ 11.8 $ 51.8

Year Ended December 31, 2018

Total (loss) gain recognized in income (Loss) gain realized in income on derivatives Unrealized (loss) gain recognized in income on derivatives

Financial Instrument

1 unchanged sentence

Foreign currency option contracts

$ ( 9.1 ) $ ( 8.4 ) $ ( 0.7 )

Coal contracts related to forecasted sales

Coal trading contracts

January 1 through April 1, 2017

Total (loss) gain recognized in income

Gain (loss) realized in income on derivatives

Unrealized gain recognized in income on derivatives

Loss reclassified from other comprehensive loss into income

Financial Instrument

(Dollars in millions)

Commodity swap contracts

Foreign currency forward contracts

Financial coal contracts - Company production

115.7 97.4 18.3

Coal trading contracts

During the years ended December 31, 2019 and 2018 , the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017 , gains and losses on foreign currency option contracts and commodity swap contracts were included in “Operating costs and expenses,” and gains and losses on coal contracts related to forecasted sales and those related to coal trading contracts were included in “Revenues” in the accompanying consolidated statements of operations.

Peabody Energy Corporation

2019 Form 10-K

( 2.9 ) ( 5.3 ) 2.4

Total $ 103.7 $ 83.7 $ 20.0

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the years ended December 31, 2020, 2019 and 2018, gains and losses on foreign currency option contracts were included in “Operating costs and expenses,” and gains and losses on coal contracts related to forecasted sales and those related to coal trading contracts were included in “Revenues” in the accompanying consolidated statements of operations.

The Company classifies the cash effects of its derivatives within the “Cash Flows From Operating Activities” section of the consolidated statements of cash flows.

5 unchanged sentences

and Level 3 - inputs are unobservable, or observable but cannot be market-corroborated, requiring the Company to make assumptions about pricing by market participants.

The following tables set forth the hierarchy of the Company’s net financial asset (liability) positions for which fair value is measured on a recurring basis:

The following tables set forth the hierarchy of the Company’s net financial asset positions for which fair value is measured on a recurring basis:

December 31, 2020

Level 1 Level 2 Level 3 Total

(Dollars in millions)

5 unchanged sentences

December 31, 2019

Level 1 Level 2 Level 3 Total

(Dollars in millions)

11 unchanged sentences

generally valued based on unadjusted quoted prices in active markets (Level 1) or a valuation that is corroborated by the use of market-based pricing (Level 2) except when credit and non-performance risk is considered to be a significant input (greater than 10% of fair value), then the Company classifies as Level 3.

Investments in equity securities are based on observed prices in an inactive market (Level 3).

Other Financial Instruments .

The following methods and assumptions were used by the Company in estimating fair values for other financial instruments as of December 31, 2019 and 2018 :

Cash and cash equivalents, restricted cash, accounts receivable, including those within the Company’s accounts receivable securitization program, notes receivable and accounts payable have carrying values which approximate fair value due to the short maturity or the liquid nature of these instruments.

Long-term debt fair value estimates are based on observed prices for securities with an active trading market when available (Level 2), and otherwise on estimated borrowing rates to discount the cash flows to their present value (Level 3).

Peabody Energy Corporation

2019 Form 10-K

• Investments in equity securities:

based on observed prices in an inactive market (Level 3).

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Other Financial Instruments .

The following methods and assumptions were used by the Company in estimating fair values for other financial instruments as of December 31, 2020 and 2019:

• Cash and cash equivalents, accounts receivable, including those within the Company’s accounts receivable securitization program, notes receivable and accounts payable have carrying values which approximate fair value due to the short maturity or the liquid nature of these instruments.

• Long-term debt fair value estimates are based on observed prices for securities when available (Level 2), and otherwise on estimated borrowing rates to discount the cash flows to their present value (Level 3).

Market risk associated with the Company’s fixed- and variable-rate long-term debt relates to the potential reduction in the fair value and negative impact to future earnings, respectively, from an increase in interest rates.

The fair value of debt, shown below, is principally based on reported market values, recently completed market transactions and estimates based on interest rates, maturities, credit risk and underlying collateral.

The fair value of debt, shown below, is principally based on reported market values and estimates based on interest rates, maturities, credit risk, underlying collateral and completed market transactions.

(Dollars in millions)

14 unchanged sentences

therefore, a change in one unobservable input would not necessarily correspond with a change in another unobservable input.

The following table summarizes the changes in the Company’s recurring Level 3 net financial assets (liabilities):

Year Ended December 31, 2019

The following table summarizes the changes in the Company’s recurring Level 3 net financial assets:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

Beginning of period $ 4.0 $ 10.0 $ —

Transfers into Level 3

Transfers out of Level 3

Total (losses) gains realized/unrealized:

Included in earnings — ( 9.0 ) ( 1.7 )

Purchases — 3.0 10.0

Settlements — — 1.7

End of period $ 4.0 $ 4.0 $ 10.0

The Company had no transfers between Levels 1, 2 and 3 during any of the periods presented in the table above.

Transfers of liabilities into/out of Level 3 from/to Level 2 during the periods presented were due to the relative value of unobservable inputs to the total fair value measurement of certain derivative contracts falling below, or in the case of transfers in, rising above, the 10% threshold.

The Company’s policy is to value all transfers between levels using the beginning of period valuation.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table summarizes the changes in net unrealized gains relating to Level 3 net financial liabilities held both as of the beginning and the end of the period:

Year Ended December 31, 2019

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

(Dollars in millions)

Changes in unrealized gains (1)

Within the consolidated statements of operations and consolidated statements of comprehensive income for the periods presented, unrealized gains from Level 3 items are combined with unrealized gains and losses on positions classified in Level 1 or 2, as well as other positions that have been realized during the applicable periods.

Credit and Nonperformance Risk.

7 unchanged sentences

The Company also continually monitors counterparty and contract non-performance risk, if present, on a case-by-case basis.

As of December 31, 2019 , 91 % of the Company’s credit exposure related to coal trading activities was with investment grade counterparties and 9 % was with counterparties that are not rated.

Performance Assurances and Collateral

The Company is required by the exchanges upon which it transacts to post certain additional collateral, known as initial margin, which represents an estimate of potential future adverse price movements across the Company’s portfolio under normal market conditions.

The Company is required by the exchanges upon which it transacts to post collateral, known as initial margin, which represents an estimate of potential future adverse price movements across the Company’s portfolio under normal market conditions.

The Company posted initial margin of $ 3.0 million and $ 7.9 million as of December 31, 2020 and 2019, respectively, which is reflected in “Other current assets” in the consolidated balance sheets.

As of December 31, 2019 and 2018 , respectively, the Company had posted $ 1.3 million and $ 2.2 million in excess of margin requirements.

As of December 31, 2020 and 2019, respectively, the Company had posted $ 0.9 million and $ 1.3 million in excess of initial margin requirements.

The Company is required to post variation margin on positions that are in a net liability position and is entitled to receive and hold variation margin on positions that are in a net asset position with an exchange and certain of its OTC derivative contract counterparties.

As of December 31, 2019 , the Company was in receipt of $ 22.1 million in variation margin, while it had posted $ 21.8 million of net variation margin at December 31, 2018 .

As of December 31, 2020 the Company had posted $ 6.5 million of variation margin, while it was in receipt of $ 22.1 million in variation margin at December 31, 2019.

Certain of the Company’s derivative trading instruments require the parties to provide additional performance assurances whenever a material adverse event jeopardizes one party’s ability to perform under the instrument.

If the Company was to sustain a material adverse event (using commercially reasonable standards), its counterparties could request collateralization on derivative trading instruments in which the Company holds a net liability position.

Based on the aggregate fair values of such net liability positions at December 31, 2019 and 2018 , the Company would have been required to post additional collateral of approximately $ 0.0 million and $ 1.3 million , respectively.

Based on the aggregate fair values of such net liability positions at December 31, 2020 and 2019, the Company would have been required to post additional collateral of approximately $ 1.6 million and less than $ 0.1 million, respectively.

As of December 31, 2020 and 2019, the Company was not required to post collateral to counterparties for such positions.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

5 unchanged sentences

December 31, 2020

Assets Liabilities Net Total

(Dollars in millions)

1 unchanged sentence

Take-or-pay contracts — ( 34.7 ) ( 34.7 )

Total $ 7.9 $ ( 52.0 ) $ ( 44.1 )

Balance sheet classification:

2 unchanged sentences

Other noncurrent liabilities — ( 47.6 ) ( 47.6 )

Total $ 7.9 $ ( 52.0 ) $ ( 44.1 )

December 31, 2019

Assets Liabilities Net Total

(Dollars in millions)

1 unchanged sentence

Take-or-pay contracts — ( 40.0 ) ( 40.0 )

Total $ 20.7 $ ( 61.4 ) $ ( 40.7 )

Balance sheet classification:

2 unchanged sentences

Other noncurrent liabilities — ( 53.0 ) ( 53.0 )

Total $ 20.7 $ ( 61.4 ) $ ( 40.7 )

Amortization of the intangible assets and liabilities related to coal supply agreements occurs ratably based upon coal volumes shipped per contract and is recorded as a component of “Depreciation, depletion and amortization” in the accompanying consolidated statements of operations.

Such amortization amounted to $ 23.2 million , $ 93.0 million and $ 121.3 million during the years ended December 31, 2019 and 2018 and the period April 2 through December 31 , 2017 respectively.

Such amortization amounted to $ 4.2 million, $ 23.2 million and $ 93.0 million during the years ended December 31, 2020, 2019 and 2018, respectively.

During the year ended December 31, 2020, the Company also charged to expense intangible assets of $ 4.5 million related to a coal supply agreement deemed to have been impaired, as further described in Note 3.

“Asset Impairment.” The Company anticipates net amortization of sales contracts, based upon expected shipments, to be an expense of approximately $ 7 million and $ 1 million for the years 2020 and 2021, respectively, and credits of $ 2 million per year for the years 2022 through 2024, and $ 3 million in total thereafter.

“Asset Impairment.” The Company anticipates net amortization of sales contracts, based upon expected shipments, to be a credit of less than $ 1 million for the year 2021, credits of approximately $ 2 million per year for the years 2022 through 2024, and a credit of $ 3 million for the year 2025.

Future unutilized capacity and the amortization periods related to the take-or-pay contract intangible liabilities are based upon estimates of forecasted usage.

Such amortization, which is classified as a reduction to “Operating costs and expenses” in the accompanying consolidated statements of operations, amounted to $ 16.6 million , $ 26.6 million and $ 22.5 million during the years ended December 31, 2019 and 2018 and the period April 2 through December 31 , 2017 respectively.

Such amortization, which is classified as a reduction to “Operating costs and expenses” in the accompanying consolidated statements of operations, amounted to $ 8.2 million, $ 16.6 million and $ 26.6 million during the years ended December 31, 2020, 2019 and 2018, respectively.

The Company anticipates net amortization of take-or-pay contract intangible liabilities for the years 2021 through 2025 to be approximately $ 4 million, $ 3 million, $ 3 million, $ 4 million and $ 1 million, respectively, and $ 20 million in total thereafter.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

10 unchanged sentences

Such coal reserves were comprised of mineral rights for leased coal interests and advance royalties that had a net book value of $ 0.8 billion and $ 2.0 billion as of December 31, 2020 and 2019, respectively, and coal reserves held by fee ownership of $ 0.7 billion and $ 0.8 billion at December 31, 2020 and 2019, respectively.

The amount of coal reserves not subject to current depletion at properties where the Company was not currently engaged in mining operations or leasing to third parties was $ 0.1 billion and $ 0.2 billion as of December 31, 2019 and 2018 , respectively.

Land and coal interests also include acquired interests in mineral rights at certain Australian exploration properties that had a net book value of $ 0.1 billion as of December 31, 2019 and 2018 .

The amount of coal reserves unassigned to active mining operations, and thus not subject to current depletion, including certain exploratory properties, was $ 0.1 billion as of both December 31, 2020 and 2019.

(10) Income Taxes

(Loss) income from continuing operations before income taxes for the periods presented below consisted of the following:

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Total income tax provision (benefit) for the periods presented below consisted of the following:

Year Ended December 31, 2019

$ ( 1,771.5 ) $ ( 374.2 ) $ ( 43.4 )

( 80.3 ) 231.9 707.5

Total $ ( 1,851.8 ) $ ( 142.3 ) $ 664.1

Total income tax provision for the periods presented below consisted of the following:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

federal $ ( 23.9 ) $ ( 21.5 ) $ ( 46.8 )

2.4 28.4 29.8

State 1.7 ( 0.3 ) ( 0.1 )

Total current ( 19.8 ) 6.6 ( 17.1 )

federal 23.4 20.3 30.4

State — ( 0.2 ) ( 0.6 )

Total deferred 27.8 39.4 35.5

Total income tax provision (benefit)

The following is a reconciliation of the expected statutory federal income tax (benefit) expense to the Company’s income tax provision (benefit) for the periods presented below:

Year Ended December 31, 2019

Total income tax provision $ 8.0 $ 46.0 $ 18.4

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following is a reconciliation of the expected statutory federal income tax (benefit) expense to the Company’s income tax provision for the periods presented below:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

3 unchanged sentences

Remeasurement due to the Tax Cuts and Jobs Act — — 9.5

Reorganization costs

Bad debt deduction

Changes in tax reserves ( 7.7 ) 3.0 2.1

5 unchanged sentences

State income taxes, net of federal tax benefit ( 6.8 ) ( 13.2 ) 3.2

Total income tax provision (benefit)

Other, net ( 3.5 ) 9.7 12.1

Total income tax provision $ 8.0 $ 46.0 $ 18.4

Certain reconciliation items included in the above table exclude the remeasurement of foreign income tax accounts as these foreign currency effects are separately presented.

The Plan provided that the Company’s pre-petition equity and certain obligations were canceled and extinguished and a significant portion of its long-term debt was discharged in exchange for new Common Stock and other consideration.

The Company excluded cancellation of debt income (CODI) with respect to the Plan from its taxable income in accordance with U.S.

Internal Revenue Code (IRC) Section 108 and reduced certain income tax attributes by the amount of such CODI.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

On December 22, 2017, the Tax Cuts and Jobs Act (the Act) was signed into law making significant changes to the IRC.

On December 22, 2017, the Tax Cuts and Jobs Act (the Act) was signed into law making significant changes to the U.S.

Internal Revenue Code.

Key provisions of the Act that impacted the Company include:

1 unchanged sentence

federal corporate tax rate from 35% to 21% and (iii) the new global intangible low-taxed income (GILTI).

Due to the repeal of the corporate AMT system, the Company’s existing AMT credits as of December 31, 2017 are anticipated to be refunded through the 2021 federal tax return.

During 2019 , the Company received a refund of $ 45.7 million and is expecting an additional refund of $ 23.4 million in 2020.

Deferred tax assets and liabilities attributable to the U.S.

were remeasured from 35% to the reduced tax rate of 21%.

The Company recorded a provision of $ 473.5 million and an offsetting valuation allowance adjustment for the remeasurement for the period April 2 through December 31, 2017.

The Company recorded an additional provision of $ 9.5 million during the year ended December 31, 2018 upon completion of the filing of both U.S.

and foreign tax returns for the 2017 tax year and an offsetting valuation allowance.

The Company elected to recognize the tax on GILTI as a period expense in the period the tax is incurred and recorded a provision of $ 6.1 million and $ 68.2 million for the years ended December 31, 2019 and 2018 , which was fully offset by the release of valuation allowance associated with the NOLs that absorbed the GILTI inclusion.

Upon completion of the filing of both U.S.

and foreign tax returns for the 2017 tax year, the Company recorded an additional provision of $ 9.5 million related to the remeasurement and an offsetting valuation allowance during the year ended December 31, 2018.

The Company elected to recognize the tax on GILTI as a period expense in the period the tax is incurred and due to foreign tested losses, the Company did no t record a provision for the year ended December 31, 2020.

The Company recorded a provision of $ 6.1 million and $ 68.2 million for the years ended December 31, 2019 and 2018, which was fully offset by the release of valuation allowance associated with the net operating losses (NOLs) that absorbed the GILTI inclusion.

Due to the repeal of the corporate AMT system, the Company’s existing AMT credits as of December 31, 2017 were anticipated to be refunded through the 2021 federal tax return.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act was signed into law and contains numerous tax provisions including the acceleration of refunds of previously generated AMT credits.

In 2020, the Company received AMT credit refunds of $ 46.9 million and is expecting an additional refund of $ 1.2 million in 2021.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and liabilities as of December 31, 2020 and 2019 consisted of the following:

9 unchanged sentences

Workers’ compensation obligations 7.8 7.6

Operating lease right-of-use assets

Operating lease liabilities 17.5 20.8

Other 24.1 16.7

Total gross deferred tax assets 2,311.6 2,208.1

3 unchanged sentences

Property, plant, equipment and mine development, principally due to differences in depreciation, depletion and asset impairments

Operating lease liabilities

Operating lease right-of-use assets 13.5 20.8

Coal supply agreements 3.1 3.1

1 unchanged sentence

Total deferred tax liabilities 54.4 140.2

Net deferred tax (liability) asset

Net deferred tax liability $ ( 30.1 ) $ ( 0.5 )

Deferred taxes are classified as follows:

1 unchanged sentence

Noncurrent deferred income tax liability ( 35.0 ) ( 28.8 )

Net deferred tax (liability) asset

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Net deferred tax liability $ ( 30.1 ) $ ( 0.5 )

As of December 31, 2020, the Company had gross Australia NOLs of $ 2.1 billion in Australian dollars and gross U.S.

federal NOLs of $ 2.8 billion.

The Company’s tax loss carryforwards and credits of $ 1.5 billion as of December 31, 2019 were comprised primarily of net Australia NOLs and capital tax loss carryforwards of $ 766.4 million , net federal NOLs of $ 530.6 million , state NOLs of $ 81.5 million , AMT credits of $ 23.4 million , tax general business credits (GBCs) of $ 112.6 million and other foreign NOLs of $ 14.5 million .

The AMT credits will be fully refunded by 2022.

During 2020 the Company reduced its gross Australia NOLs by $ 1.3 billion in Australian dollars due to a cancellation of intercompany debt in accordance with Australia tax law.

The Company’s tax loss carryforwards and credits of $ 1.4 billion as of December 31, 2020 were comprised primarily of net Australia NOLs and capital tax loss carryforwards of $ 590.8 million, net federal NOLs of $ 580.3 million, state NOLs of $ 76.3 million, tax general business credits (GBCs) of $ 112.6 million and other foreign NOLs of $ 15.0 million.

The foreign tax loss carryforwards have no expiration date.

5 unchanged sentences

Recognition of those valuation allowances was driven by recent cumulative book losses, as determined by considering all sources of available income (including items classified as discontinued operations or recorded directly to “Accumulated other comprehensive income”), which limited the Company’s ability to look to future taxable income in assessing the realizability of the related assets.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Unrecognized Tax Benefits

5 unchanged sentences

Gross unrecognized tax benefits $ 9.1 $ 16.5

The amount of the Company’s gross unrecognized tax benefits increased by $ 2.5 million since December 31, 2018 due to adjustments to existing positions and additions for current positions.

The amount of the Company’s gross unrecognized tax benefits decreased by $ 7.4 million since December 31, 2019 due primarily to adjustments for effectively settled positions, partially offset by additions for current positions.

The amount of the net unrecognized tax benefits that, if recognized, would directly affect the effective tax rate was $ 9.1 million and $ 16.5 million at December 31, 2020 and 2019, respectively.

1 unchanged sentence

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

1 unchanged sentence

Additions for current year tax positions 1.9 2.2 1.8

Additions (reductions) for prior year tax positions

(Reductions) additions for prior year tax positions ( 9.3 ) 0.3 —

Reductions for settlements with tax authorities — — ( 0.5 )

1 unchanged sentence

The Company recognizes interest and penalties related to unrecognized tax benefits in its income tax provision.

The Company recorded $ 0.4 million , $ 0.4 million and $ 4.8 million of gross interest and penalties for the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 , respectively, and reversed gross interest and penalties of $ 2.1 million for the period January 1 through April 1, 2017 .

The Company recorded $ 0.4 million of gross interest and penalties for both of the years ended December 31, 2019 and 2018, and reversed gross interest and penalties of $ 0.4 million for the year ended December 31, 2020.

The Company had $ 5.4 million and $ 5.8 million of accrued gross interest and penalties related to unrecognized tax benefits at December 31, 2020 and 2019, respectively.

The Company expects a decrease of $ 5.3 million in its net unrecognized tax benefits during the next twelve months.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company expects a decrease of $ 2.2 million in its net unrecognized tax benefits during the next twelve months is reasonably possible.

Tax Returns Subject to Examination

7 unchanged sentences

However, when appropriate, the Company has the ability to access foreign cash without incurring residual cash taxes due to the existence of NOLs.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Tax Payments and Refunds

The following table summarizes the Company’s income tax (refunds) payments, net for the periods presented below:

Year Ended December 31, 2019

The following table summarizes the Company’s income tax refunds, net for the periods presented below:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

— federal $ ( 44.6 ) $ ( 45.7 ) $ ( 103.1 )

— state and local 1.6 0.3 ( 1.6 )

Total income tax (refunds) payments, net

3.1 36.3 40.7

Total income tax refunds, net $ ( 39.9 ) $ ( 9.1 ) $ ( 64.0 )

(11) Accounts Payable and Accrued Expenses

1 unchanged sentence

(Dollars in millions)

Trade accounts payable

Accrued payroll and related benefits $ 163.9 $ 186.2

Trade accounts payable 146.3 254.8

Other accrued expenses 116.2 118.5

11 unchanged sentences

Accounts payable and accrued expenses $ 745.7 $ 957.0

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(12) Long-term Debt

In accordance with the Plan, the Company was recapitalized with new debt and equity instruments, including the 6.000 % Senior Secured Notes due March 2022, the 6.375 % Senior Secured Notes due March 2025 and the Senior Secured Term Loan due 2025 in the table below.

The Company’s total indebtedness as of December 31, 2019 and December 31, 2018 consisted of the following:

The Company’s total funded indebtedness (Indebtedness) as of December 31, 2020 and 2019 consisted of the following:

(Dollars in millions)

6.000 % Senior Secured Notes due March 2022

$ 459.0 $ 459.0

6.375 % Senior Secured Notes due March 2025

Senior Secured Term Loan due 2025, net of original issue discount 388.2 392.1

Revolving credit facility 216.0 —

Finance lease obligations 27.3 15.2

Debt issuance costs ( 42.7 ) ( 55.5 )

1,547.8 1,310.8

Current portion of long-term debt 44.9 18.3

Long-term debt $ 1,502.9 $ 1,292.5

In connection with the Chapter 11 Cases, the Company was required to pay adequate protection payments of $ 29.8 million to certain first lien creditors of the Predecessor company during the period January 1 through April 1, 2017.

The adequate protection payments were recorded as “Interest expense” in the consolidated statements of operations and ceased upon the Effective Date.

The Company did not record interest expense subsequent to the filing of the Bankruptcy Petitions for the majority of non-first lien Predecessor indebtedness, which was automatically stayed in accordance with Section 502(b)(2) of the Bankruptcy Code.

The amount of contractual interest stayed was $ 92.9 million for the period January 1, 2017 through the Effective Date.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Refinancing Transactions

As previously described in Note 1.

“Summary of Significant Accounting Policies,” the Company completed the Exchange Offer and Revolver Transactions on January 29, 2021.

Pursuant to the Exchange Offer, $ 398.7 million aggregate principal amount of the 2022 Notes were exchanged for aggregate consideration consisting of $ 193.9 million aggregate principal amount of New Co-Issuer Notes, $ 195.1 million aggregate principal amount of New Peabody Notes, and a cash payment of approximately $ 9.4 million.

In connection with the Revolver Transactions, the Company paid down $ 10.0 million of its existing revolving loans and exchanged the remaining balance for $ 206.0 million of New Co-Issuer Term Loans.

6.000 % and 6.375 % Senior Secured Notes

On February 15, 2017, one of PEC’s subsidiaries entered into an indenture (the Indenture) with Wilmington Trust, National Association, as trustee, relating to its issuance of $ 500.0 million aggregate principal amount of 6.000 % senior secured notes due 2022 (the 2022 Notes) and $ 500.0 million aggregate principal amount of 6.375 % senior secured notes due 2025 (the 2025 Notes and, together with the 2022 Notes, the Senior Notes).

The Senior Notes were sold on February 15, 2017 in a private transaction exempt from the registration requirements of the Securities Act of 1933.

Upon emergence from the Chapter 11 Cases, the Company entered into the Existing Indenture with Wilmington Trust, National Association, as trustee, relating to its issuance of $ 500.0 million aggregate principal amount of the 2022 Notes and $ 500.0 million aggregate principal amount of 6.375 % senior secured notes due 2025 (the 2025 Notes and, together with the 2022 Notes, the Senior Notes).

The Senior Notes were issued on February 15, 2017 in a private transaction exempt from the registration requirements of the Securities Act of 1933.

The Senior Notes were issued at par value.

The Company paid aggregate debt issuance costs of $ 49.5 million related to the offering, which will be amortized over the respective terms of the Senior Notes.

Interest payments on the Senior Notes are scheduled to occur each year on March 31st and September 30th until maturity.

During the years ended December 31, 2019 and 2018 , the Company recorded interest expense of $ 72.0 million and $ 71.9 million , respectively, related to the Senior Notes.

The Company may redeem the 2022 Notes beginning March 31, 2019, in whole or in part, at 103.0 % of par, beginning March 31, 2020 at 101.5 % of par and beginning March 31, 2021 and thereafter at par.

The 2025 Notes may be redeemed, in whole or in part, beginning March 31, 2020 at 104.8 % of par, beginning March 31, 2021 at 103.2 % of par, beginning March 31, 2022 at 101.6 % of par and beginning March 31, 2023 and thereafter at par.

In addition, prior to the first date on which the Senior Notes are redeemable at the redemption prices noted above, the Company may also redeem some or all of the Senior Notes at a calculated make-whole premium, plus accrued and unpaid interest.

On August 9, 2018, the Company executed an amendment to the Indenture following the solicitation of consents from the requisite majorities of holders of each series of Senior Notes.

The Company paid aggregate debt issuance costs of $ 49.5 million related to the offering, which are being amortized over the respective terms of the Senior Notes.

Interest payments on the Senior Notes are scheduled to occur each year on March 31 and September 30 until maturity.

During the years ended December 31, 2020, 2019 and 2018, the Company recorded interest expense of $ 72.2 million, $ 72.0 million and $ 71.9 million, respectively, related to the Senior Notes.

On August 9, 2018, the Company executed an amendment to the Existing Indenture following the solicitation of consents from the requisite majorities of holders of each series of Senior Notes.

The amendment permits a category of restricted payments at any time not to exceed the sum of $ 650.0 million, plus an additional $ 150.0 million per calendar year, commencing with calendar year 2019, with unused amounts in any calendar year carrying forward to and available for restricted payments in any subsequent calendar year.

The Company paid consenting Senior Note holders $ 10.00 in cash per $ 1,000 principal amount of 2022 Notes and $ 30.00 in cash per $ 1,000 principal amount of 2025 Notes, which amounted to $ 19.8 million .

Such consent payments were capitalized as additional debt issuance costs to be amortized over the respective terms of the Senior Notes.

The Company also expensed $ 1.5 million of other fees associated with the amendment to “Interest expense” in the accompanying consolidated statements of operations during 2018.

Peabody Energy Corporation

2019 Form 10-K

The Company paid consent fees to Senior Note holders which amounted to $ 19.8 million.

Such consent fees were capitalized as additional debt issuance costs to be amortized over the respective terms of the Senior Notes.

During the fourth quarter of 2019, the Company made open-market purchases of $ 41.0 million of the 2022 Notes for $ 39.9 million, plus accrued interest.

The notes were subsequently canceled.

As previously described in Note 1.

“Summary of Significant Accounting Policies,” the Existing Indenture was amended as it relates to the remaining 2022 Notes.

With respect to the 2025 Notes, the Existing Indenture contains customary conditions of default and imposes certain restrictions on the Company’s activities, including its ability to incur debt, incur liens, make investments, engage in fundamental changes such as mergers and dissolutions, dispose of assets, enter into transactions with affiliates and make certain restricted payments, such as cash dividends and share repurchases.

The 2025 Notes rank senior in right of payment to any subordinated Indebtedness and equally in right of payment with any senior Indebtedness to the extent of the collateral securing that Indebtedness.

The 2025 Notes are jointly and severally and fully and unconditionally guaranteed on a senior secured basis by substantially all of the Company’s domestic restricted subsidiaries (the Peabody Guarantors) and secured by (a) first priority liens over (1) substantially all of the assets of the Company and the Peabody Guarantors, except for certain excluded assets, (2) 100 % of the capital stock of each domestic restricted subsidiary of the Company, (3) 100 % of the capital stock of each first tier foreign subsidiary of the Company or a foreign subsidiary holding company and (4) all intercompany debt owed to the Company or any Peabody Guarantor, in each case, subject to certain exceptions (the Peabody Collateral), and (b) second priority liens over the Wilpinjong Collateral (as defined below).

The 2025 Notes are secured on a pari passu basis by the same collateral securing the Credit Agreement (as defined below), and the other priority lien debt of the Company, including the New Peabody Notes and the New Company LC Agreement described below.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the fourth quarter of 2019, the Company made open-market purchases of $ 41.0 million of the 2022 Notes for $ 39.9 million , plus accrued interest.

In connection with the purchases, the Company wrote off $ 1.3 million of debt issuance costs and charged $ 0.2 million to “Loss on early debt extinguishment.” The notes were subsequently canceled.

The Indenture contains customary conditions of default and imposes certain restrictions on the Company’s activities, including its ability to incur debt, incur liens, make investments, engage in fundamental changes such as mergers and dissolutions, dispose of assets, enter into transactions with affiliates and make certain restricted payments, such as cash dividends and share repurchases.

The Senior Notes rank senior in right of payment to any subordinated indebtedness and equally in right of payment with any senior indebtedness to the extent of the collateral securing that indebtedness.

The Senior Notes are jointly and severally and fully and unconditionally guaranteed on a senior secured basis by substantially all of the Company’s material domestic subsidiaries and secured by first priority liens over (1) substantially all of the assets of the Company and the guarantors, except for certain excluded assets, (2) 100 % of the capital stock of each domestic restricted subsidiary of the Company, (3) 100 % of the non-voting capital stock of each first tier foreign subsidiary of the Company or a foreign subsidiary holding company and no more than 65 % of the voting capital stock of each first tier foreign subsidiary of the Company or a foreign subsidiary holding company, (4) a legal charge of 65 % of the voting capital stock and 100 % of the non-voting capital stock of Peabody Investments (Gibraltar) Limited and (5) all intercompany debt owed to the Company or any guarantor, in each case, subject to certain exceptions.

The obligations under the Senior Notes are secured on a pari passu basis by the same collateral securing the Credit Agreement (as defined below), subject to certain exceptions.

Credit Agreement

1 unchanged sentence

The Credit Agreement originally provided for a $ 950.0 million senior secured term loan (the Senior Secured Term Loan), which was to mature in 2022 prior to the amendments described below.

Following the voluntary prepayments and amendments described below, the Credit Agreement provides for a $ 400.0 million first lien senior secured term loan, which bore interest at LIBOR plus 2.75 % per annum as of December 31, 2019 .

During the years ended December 31, 2019 and 2018 , the Company recorded interest expense of $ 22.2 million and $ 24.0 million , respectively, related to the Senior Secured Term Loan.

Proceeds from the Senior Secured Term Loan were received net of an original issue discount and deferred financing costs of $ 37.3 million that will be amortized over its term.

The loan principal is payable in quarterly installments plus accrued interest through December 2024 with the remaining balance due in March 2025.

The loan principal was voluntarily prepayable at 101 % of the principal amount repaid if voluntarily prepaid prior to October 2018 (subject to certain exceptions, including prepayments made with internally generated cash) and is voluntarily prepayable at any time thereafter without premium or penalty.

As previously described in Note 1.

“Summary of Significant Accounting Policies,” the Credit Agreement was amended in connection with the Refinancing Transactions.

Following the voluntary prepayments and amendments described below, the Credit Agreement provided for a $ 400.0 million first lien senior secured term loan, which bore interest at LIBOR plus 2.75 % per annum as of December 31, 2020.

During the years ended December 31, 2020, 2019 and 2018, the Company recorded interest expense of $ 15.6 million, $ 22.2 million and $ 24.0 million, respectively, related to the Senior Secured Term Loan.

Proceeds from the Senior Secured Term Loan were received net of an original issue discount and deferred financing costs of $ 37.3 million that are being amortized over its term.

The loan requires quarterly principal payments of $ 1.0 million and periodic interest payments through December 2024 with the remaining balance due in March 2025.

The loan principal was voluntarily prepayable at 101 % of the principal amount repaid if prepayment occurred prior to October 2018 (subject to certain exceptions, including prepayments made with internally generated cash) and is voluntarily prepayable at any time thereafter without premium or penalty.

The Senior Secured Term Loan may require mandatory principal prepayments of up to 75 % of Excess Cash Flow (as defined in the Credit Agreement) for any fiscal year if the Company’s Total Leverage Ratio (as defined in the Credit Agreement and calculated at December 31, net of any unrestricted cash) is greater than 2.00 :1.00.

The mandatory principal prepayment requirement is (i) 50 % of Excess Cash Flow if the Company’s Total Leverage Ratio is less than or equal to 2.00 :1.00 and greater than 1.50 :1.00, (ii) 25 % of Excess Cash Flow if the Company’s Total Leverage Ratio is less than or equal to 1.50 :1.00 and greater than 1.00 :1.00, or (iii) zero if the Company’s Total Leverage Ratio is less than or equal to 1.00 :1.00.

If required, mandatory prepayments resulting from Excess Cash Flows are payable within 100 days after the end of each fiscal year.The calculation of mandatory prepayments would be reduced commensurately by the amount of previous voluntary prepayments.

In certain circumstances, the Senior Secured Term Loan also requires that Excess Proceeds (as defined in the Credit Agreement) of $ 10.0 million or greater from sales of Company assets be applied against the loan principal, unless such proceeds are reinvested within one year.

The mandatory principal prepayment requirement changes to (i) 50 % of Excess Cash Flow if the Company’s Total Leverage Ratio is less than or equal to 2.00 :1.00 and greater than 1.50 :1.00, (ii) 25 % of Excess Cash Flow if the Company’s Total Leverage Ratio is less than or equal to 1.50 :1.00 and greater than 1.00 :1.00 or (iii) zero if the Company’s Total Leverage Ratio is less than or equal to 1.00 :1.00.

If required, mandatory prepayments resulting from Excess Cash Flows are payable within 100 days after the end of each fiscal year.

The calculation of mandatory prepayments would be reduced commensurately by the amount of previous voluntary prepayments.

In certain circumstances, the Senior Secured Term Loan requires that Excess Proceeds (as defined in the Credit Agreement) of $ 10.0 million or greater received from sales of Company assets be applied against the loan principal, unless such proceeds are reinvested within one year.

The Senior Secured Term Loan also requires that any net insurance proceeds be applied against the loan principal, unless such proceeds are reinvested within one year.

The Credit Agreement contains customary conditions of default and imposes certain restrictions on the Company’s activities, including its ability to incur liens, incur debt, make investments, engage in fundamental changes such as mergers and dissolutions, dispose of assets, enter into transactions with affiliates and make certain restricted payments, such as cash dividends and share repurchases.

Obligations under the Credit Agreement are secured on a pari passu basis by the same collateral securing the Senior Notes.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Obligations under the Credit Agreement are guaranteed by the Peabody Guarantors and are secured by first priority liens on the Peabody Collateral and second priority liens on the Wilpinjong Collateral (as defined below).

The obligations are secured on a pari passu basis by the same collateral securing the 2025 Notes and the other priority lien debt of the Company, including the New Peabody Notes and the New Company LC Agreement described below.

Since entering into the Credit Agreement, the Company has repaid $ 561.0 million of the original $ 950.0 million loan principal amount on the Senior Secured Term Loan in various installments, including $ 546.0 million which was voluntarily prepaid.

In September 2017, the Company entered into an amendment to the Credit Agreement which permitted the Company to add an incremental revolving credit facility in addition to the Company’s ability to add one or more incremental term loan facilities under the Credit Agreement.

The incremental revolving credit facility and/or incremental term loan facilities can be in an aggregate principal amount of up to $ 350.0 million plus additional amounts so long as the Company remains in compliance with Total Leverage Ratio requirements as set forth in the Credit Agreement.

The Amendment also made available an additional restricted payment basket that permits additional repurchases, dividends or other distributions with respect to the Company’s common and preferred Stock in an aggregate amount up to $ 450.0 million so long as the Company’s Fixed Charge Coverage Ratio (as defined in the Credit Agreement) is at least 2.00 :1.00 on a pro forma basis.

The incremental revolving credit facility and/or incremental term loan facilities can be in an aggregate principal amount of up to $ 350.0 million plus additional amounts so long as the Company remains in compliance with the Total Leverage Ratio covenant as set forth in the Credit Agreement.

In April 2018, the Company entered into another amendment to the Credit Agreement which lowered the interest rate on the Senior Secured Term Loan to its current level of LIBOR plus 2.75 % and eliminated an existing 1.0 % LIBOR floor.

1 unchanged sentence

In connection with this amendment, the Company voluntarily repaid $ 46.0 million of principal on the Senior Secured Term Loan.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the fourth quarter of 2017, the Company entered into the incremental revolving credit facility (the Revolver) for an aggregate commitment of $ 350.0 million for general corporate purposes and paid aggregate debt issuance costs of $ 4.7 million.

In September 2019, the Company entered into an amendment to the Credit Agreement which increased the aggregate commitment amount under the Revolver to $ 565.0 million and extended the maturity date on $ 540.0 million of the commitments from November 2020 to September 2023.

The maturity date for the remaining $ 25.0 million commitment is November 2020.

The remaining $ 25.0 million commitment matured in November 2020.

The Company incurred $ 5.7 million of additional debt issuance costs in connection with the amendment.

The Revolver currently permits loans which bear interest at LIBOR plus 3.25 % , as well as letters of credit which incur combined fees of 3.375 % per annum.

Unused capacity under the Revolver bears a commitment fee of 0.5 % per annum.

As a result of the amendment, such loans, letters of credit and unused capacity related to the $ 540.0 million of extended commitments will bear interest and incur fees at rates dependent upon the Company’s First Lien Leverage Ratio (as defined in the Credit Agreement) beginning in 2020.

The Revolver is also subject to a 2.00 :1.00 Total Leverage Ratio requirement (as defined by the Credit Agreement), modified to limit unrestricted cash netting to $ 800.0 million .

To date, the Revolver has only been utilized for letters of credit, including $ 66.4 million outstanding at December 31, 2019 .

Such letters of credit were primarily in support of the Company’s reclamation obligations, as further described in Note 25.

“Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees.” Availability under the Revolver was $ 498.6 million at December 31, 2019.

During the years ended December 31, 2019 and 2018 , the Company recorded interest expense and fees of $ 6.2 million and $ 7.2 million , respectively, related to the Revolver.

As a result of the amendment, such loans, letters of credit and unused capacity related to the $ 540.0 million of extended commitments bear interest and incur fees at rates dependent upon the Company’s First Lien Leverage Ratio (as defined in the Credit Agreement) beginning in 2020.

Specific to the Revolver, the Credit Agreement required that the Company maintain a 2.00 :1.00 First Lien Leverage Ratio, calculated on a trailing twelve-month basis and modified to limit unrestricted cash netting to $ 800.0 million.

This covenant was eliminated in connection with the Refinancing Transactions and was not applicable at December 31, 2020.

The Company borrowed $ 315.0 million under the Revolver and subsequently repaid $ 99.0 million of this amount during the year ended December 31, 2020.

At December 31, 2020, the Revolver was also utilized for letters of credit of $ 323.8 million, primarily in support of the Company’s reclamation obligations, as further described in Note 23.

“Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees.” At December 31, 2020, the remaining availability under the Revolver was $ 0.2 million.

At December 31, 2020, applicable Revolver rates were LIBOR plus 3.25 % for revolving loans, 0.50 % per annum for unused capacity and 3.375 % per annum for letters of credit fees.

During the years ended December 31, 2020, 2019 and 2018, the Company recorded interest expense and fees of $ 15.9 million, $ 6.2 million and $ 7.2 million, respectively, related to the Revolver.

The Company’s voluntary prepayments of $ 546.0 million of Senior Secured Term Loan principal and related amendments have been accounted for as a combination of partial debt extinguishments and debt modifications, depending upon the circumstances in each instance.

During 2018, the Company charged a pro rata portion of debt issuance costs and original issue discount of $ 2.0 million to “Loss on early debt extinguishment” and expensed $ 0.9 million of financing costs and fees to “Interest expense” in the accompanying consolidated statements of operations, and capitalized an additional $ 1.0 million of deferred financing costs.

During the period April 2 through December 31, 2017, the Company charged a pro rata portion of debt issuance costs and original issue discount of $ 20.9 million to “Loss on early debt extinguishment” and expensed $ 2.0 million of financing costs and fees to “Interest expense” in the accompanying consolidated statements of operations, and capitalized an additional $ 6.1 million of deferred financing costs.

Restricted Payments Under the Senior Notes and Credit Agreement

In addition to the $ 450.0 million restricted payment basket provided for under the September 2017 amendment, the Credit Amendment provides a builder basket for additional restricted payments subject to a maximum Total Leverage Ratio of 2.00 :1.00 (as defined in the Credit Agreement).

In addition to the $ 650.0 million restricted payment basket, plus an additional $ 150.0 million per calendar year, provided under the August 2018 amendment, the Indenture provides a builder basket for restricted payments that is calculated based upon the Company’s Consolidated Net Income, and is subject to a Fixed Charge Coverage Ratio of at least 2.25 :1.00 (as defined in the Indenture).

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Further, under both the Indenture and Credit Agreement, additional restricted payments are permitted through a $ 50.0 million general basket and an annual aggregate $ 25.0 million basket which allows dividends and common stock repurchases.

The payment of dividends and purchases of common stock under this annual aggregate $ 25.0 million basket are permitted so long as the Company’s Total Leverage Ratio would not exceed 1.25 :1.00 on a pro forma basis (as defined in the Credit Agreement and Indenture).

In connection with the Revolver Transactions, the Company amended its Credit Agreement to make certain changes in consideration of the New Company LC Agreement.

After giving effect to the Revolver Transactions, there remain no revolving commitments or revolving loans under the Credit Agreement.

Secured Borrowing under Receivables Securitization Program

As further described in Note 23.

“Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees,” the Company’s receivables securitization program provides for up to $ 250.0 million in funding accounted for as a secured borrowing, limited to the availability of eligible receivables.

During September 2020, the Company borrowed $ 60.0 million under the receivables securitization program, all of which was subsequently repaid during the fourth quarter of 2020.

Any borrowings under the receivables securitization program have a maturity date of April 2022, bear an interest rate of LIBOR plus 1.50 % and may be secured by a combination of collateral and the trade receivables underlying the receivables securitization program, from time to time.

Finance Lease Obligations

1 unchanged sentence

“Leases” for additional information associated with the Company’s finance leases, which pertain to the financing of mining equipment used in operations.

Refinancing Transactions and New Debt Agreements

As previously described in Note 1.

“Summary of Significant Accounting Policies,” the Company entered into several new debt agreements and amended existing debt agreements in connection with the Refinancing Transactions.

The following provides additional information regarding the terms and conditions of such new agreements.

New Co-Issuer Notes

The terms of the New Co-Issuer Notes are governed by an indenture, as amended and restated as of February 3, 2021, by and among the Co-Issuers, Wilmington Trust, National Association, as trustee, and, on a limited basis, the Company (New Co-Issuer Notes Indenture).

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The New Co-Issuer Notes bear interest at an annual rate of 10.000 %, which is payable on March 31, June 30, September 30 and December 31 of each year, commencing on March 31, 2021.

The New Co-Issuer Notes will mature on December 31, 2024.

The New Co-Issuer Notes will be subject to amortization at the end of each six-month period, beginning with June 30, 2021, whereby the Excess Cash Flow (as defined in the New Co-Issuer Notes Indenture) generated by the Wilpinjong Mine during each such period will be applied to the principal of the New Co-Issuer Notes and the New Co-Issuer Term Loans on a pro rata basis, provided that the liquidity attributable to the Co-Issuers would not fall below $ 60.0 million.

The New Co-Issuer Notes Indenture contains customary covenants that, among other things, limit the Co-Issuers’ and their subsidiaries’ ability to incur additional Indebtedness, pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments, enter into agreements that restrict distributions from subsidiaries, sell or otherwise dispose of assets, enter into transactions with affiliates, create or incur liens, and merge, consolidate or sell all or substantially all of their assets, and place restrictions on the ability of subsidiaries to pay dividends or make other payments to the Co-Issuers.

The New Co-Issuer Notes are not guaranteed by any of the Co-Issuers’ subsidiaries and thus are structurally subordinated to any existing or future Indebtedness or other liabilities, including trade payables, of any such subsidiaries.

The New Co-Issuer Notes initially are secured by liens on substantially all of the assets of the Co-Issuers, including by (i) 100 % of the capital stock of PIC Acquisition Corp.

owned by PIC AU Holdings LLC and (ii) all other property subject or purported to be subject, from time to time, to a lien under the Co-Issuers’ collateral trust agreement (collectively, the Wilpinjong Collateral).

The Co-Issuers may redeem some or all of the New Co-Issuer Notes at the redemption prices and on the terms specified in the New Co-Issuer Notes Indenture.

The New Co-Issuer Notes Indenture contains certain events of default, including, in certain circumstances, (i) specified events occurring at the Wilpinjong Mine, (ii) the termination or modification of the Surety Agreement, (iii) the Company’s failure to comply with any obligation under the transaction support agreement entered into prior to, and in contemplation of, the Refinancing Transactions, and (iv) the termination of the management services agreements between the Company and the Co-Issuers.

If the New Co-Issuer Notes are accelerated or otherwise become due and payable as a result of an event of default, certain additional premium amounts may become due and payable in addition to unpaid principal and interest at the time of acceleration.

In addition, the holders of the New Co-Issuer Notes have the right, under certain circumstances specified in the New Co-Issuer Notes Indenture, to exchange their New Co-Issuer Notes for New Peabody Notes.

New Peabody Notes

The terms of the New Peabody Notes are governed by an indenture, as amended and restated as of February 3, 2021, by and among Peabody, the guarantors party thereto, and Wilmington Trust, National Association, as trustee (the New Peabody Notes Indenture).

The New Peabody Notes bear interest at an annual rate of 8.500 %, consisting of 6.000 % per annum in cash and an additional 2.500 % per annum to be paid-in-kind through an increase of the principal amount of the outstanding New Peabody Notes, which is payable on June 30 and December 31 of each year, commencing on June 30, 2021.

The New Peabody Notes will mature on December 31, 2024.

The New Peabody Notes Indenture contains customary covenants that, among other things, limit the Company’s and its restricted subsidiaries’ ability to incur additional Indebtedness, pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments, enter into agreements that restrict distributions from restricted subsidiaries, sell or otherwise dispose of assets, enter into transactions with affiliates, create or incur liens, and merge, consolidate or sell all or substantially all of its assets, and place restrictions on the ability of subsidiaries to pay dividends or make other payments to the Company.

The New Peabody Notes are unconditionally guaranteed, jointly and severally, on a senior secured basis by the Peabody Guarantors on the Peabody Collateral.

The obligations are secured on a pari passu basis by the same collateral that secures the 2025 Notes, the Credit Agreement and the New Company LC Agreement described below.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

New Co-Issuer Term Loans

The New Co-Issuer Term Loans mature on December 31, 2024 and bear interest at a rate of 10.00 % per annum.

The New Co-Issuer Term Loan Agreement contains customary covenants that, among other things, limit the Co-Issuers’ and their subsidiaries’ ability to incur additional Indebtedness, pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments, enter into agreements that restrict distributions from subsidiaries, sell or otherwise dispose of assets, enter into transactions with affiliates, create or incur liens, and merge, consolidate or sell all or substantially all of their assets, and place restrictions on the ability of subsidiaries to pay dividends or make other payments to the Co-Issuers.

The New Co-Issuer Term Loan Agreement is guaranteed and secured to the same extent as the New Co-Issuer Notes as described above.

In addition, the New Co-Issuer Term Loan Agreement contains events of default substantially similar to those described above for the New Co-Issuer Notes Indenture.

New Company LC Agreement

The New Company LC Agreement is guaranteed and secured to the same extent of the New Peabody Notes as described above.

In addition, the New Company LC Agreement contains events of default substantially similar to those described above for the New Peabody Notes.

Under the New Company LC Agreement, the Company is permitted to effectuate open market debt repurchases, subject to certain limitations, including, but not limited to:

(i) the Company’s unrestricted subsidiaries’ liquidity must be greater than or equal to $ 200.0 million after giving effect to such repurchases, and (ii) for every $ 4 of principal repurchased in any fiscal quarter, the Company must make an offer on a pro rata basis to purchase $ 1 of principal amount of debt from holders of the New Peabody Notes and New Company LC Agreement within 30 days of the end of such fiscal quarter at a price equal to the weighted average repurchase price paid over that quarter.

The Company has operating and finance leases for mining and non-mining equipment, office space and certain other facilities under various non-cancellable agreements.

Historically, the majority of the Company’s leases have been accounted for as operating leases.

Refer to Note 1.

“Summary of Significant Accounting Policies.” for the Company’s policies regarding “Leases.”

The Company and certain of its subsidiaries have guaranteed other subsidiaries’ performance under various lease obligations.

3 unchanged sentences

Aside from indemnification of the lessor for the value of the property leased, the Company’s maximum potential obligations under its leases are equal to the respective future minimum lease payments, and the Company assumes that no amounts could be recovered from third parties.

In this regard, the Company has recorded provisions amounting to $ 50.7 million related to the loss of leased equipment at its North Goonyella Mine as described in Note 22.

“Other Events.”

One of the Company’s operating lease agreements for underground mining equipment in Australia entered into in 2013 requires contingent rent to be paid only if and when certain coal is mined at a specified margin as defined in the agreements.

There was no contingent expense related to that arrangement for the periods listed below.

The components of lease expense during the year ended December 31, 2019 were as follows:

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The components of lease expense during the years ended December 31, 2020 and 2019 were as follows:

Year Ended December 31,

10 unchanged sentences

Total finance lease cost $ 4.3 $ 16.8

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Supplemental balance sheet information related to leases at December 31, 2019 was as follows:

December 31, 2019

Supplemental balance sheet information related to leases at December 31, 2020 and 2019 was as follows:

(Dollars in millions)

17 unchanged sentences

Finance leases 11.2 % 6.0 %

Supplemental cash flow information related to leases during the year ended December 31, 2019 was as follows:

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Supplemental cash flow information related to leases during the years ended December 31, 2020 and 2019 was as follows:

Year Ended December 31,

7 unchanged sentences

Finance leases 1.6 1.6

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company's leases have remaining lease terms of 1 year to 11.3 years , some of which include options to extend the terms deemed reasonably certain of exercise.

Maturities of lease liabilities were as follows:

Period Ending December 31,

Operating Leases

Finance Leases

The Company's leases have remaining lease terms ranging from 1 year to 21.0 years, some of which include options to extend the terms deemed reasonably certain of exercise.

The contractual maturities of lease liabilities were as follows:

Period Ending December 31, Operating Leases Finance Leases

(Dollars in millions)

2021 $ 24.8 $ 17.1

2022 17.6 5.8

2023 16.8 1.5

2026 and thereafter 3.8 7.7

3 unchanged sentences

Disclosures Related to Periods Prior to Adoption of ASU 2016-02 “Leases (Topic 842)”

Rental expense under operating leases, including expense related to short-term operating leases, was $ 158.0 million , $ 144.2 million and $ 57.0 million during the year ended December 31, 2018 , the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017 , respectively.

Future minimum lease and royalty payments as of December 31, 2018 were as follows:

Year Ending December 31,

(Dollars in millions)

2024 and thereafter

Total minimum lease payments

Less interest

Present value of minimum capital lease payments

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Rental expense under operating leases, including expense related to short-term operating leases, was $ 158.0 million, during the year ended December 31, 2018 .

(14) Asset Retirement Obligations

2 unchanged sentences

Balance at beginning of period $ 752.3 $ 750.2

Liabilities incurred or acquired

Liabilities settled or disposed ( 38.4 ) ( 47.7 )

6 unchanged sentences

Balance at end of period — closed or inactive locations $ 256.4 $ 226.9

During the year ended December 31, 2018, the Company acquired the Shoal Creek Mine and the related asset retirement obligations, as further discussed in Note 3.

“Acquisition of Shoal Creek Mine.” The changes in mine operations impacted reclamation estimates and are reflected in the asset retirement obligation asset and liability as of December 31, 2019 and 2018 , respectively.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The credit-adjusted, risk-free interest rates utilized to estimate the Company’s asset retirement obligations ranged from 9.16 % for life of mines 3 years or less to 12.74 % for life of mines greater than 20 years for both U.S.

1 unchanged sentence

and Australia reclamation obligations at December 31, 2019.

As of December 31, 2019 and 2018 , the Company had $ 1,401.7 million and $ 1,317.0 million , respectively, in surety bonds and bank guarantees outstanding to secure reclamation obligations.

As of December 31, 2020 and 2019, the Company had $ 1,451.9 million and $ 1,401.7 million, respectively, in surety bonds outstanding to secure reclamation obligations.

Additionally, the Company had $ 315.0 million and $ 106.1 million, respectively, of letters of credit in support of reclamation obligations as of December 31, 2020 and 2019.

3 unchanged sentences

Life insurance benefits are provided to future hourly retirees in accordance with the applicable labor agreement.

Net periodic postretirement benefit cost included the following components:

Year Ended December 31, 2019

Net periodic postretirement benefit cost (benefit) included the following components:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

3 unchanged sentences

Amortization of prior service credit ( 17.3 ) ( 8.7 ) —

Amortization of actuarial loss

Net actuarial loss (gain) 16.5 78.3 ( 128.4 )

Net periodic postretirement benefit cost

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In connection with fresh start reporting, the Company made a policy election to prospectively record amounts attributable to actuarial valuation changes currently in earnings rather than recording such amounts within accumulated other comprehensive income and amortizing to expense over applicable time periods.

Net periodic postretirement benefit cost (benefit) $ 21.7 $ 99.0 $ ( 91.9 )

The actuarial loss for all benefit plans in 2020 was primarily due to the decrease in the discount rate used to measure the benefit obligation offset by the favorable impact of claims experience for the year and updating the mortality base tables and improvement scales to those published by the Society of Actuaries for all participants except those receiving medical benefits under the UMWA Coal Action design.

The actuarial loss for all benefit plans in 2019 was primarily due to the decrease in the discount rate used to measure the benefit obligation and unfavorable medical claims experience for the year.

The actuarial gain for all benefit plans in 2018 was primarily due to the increase in the discount rate used to measure the benefit obligation, favorable medical claims experience for the year and the impact of Medicare Part D amendment from the 2018 Bipartisan Budget Act.

The following includes pre-tax amounts recorded in “Accumulated other comprehensive income”:

Year Ended December 31,

Year Ended December 31, 2018

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

1 unchanged sentence

Amortization:

Actuarial loss

Prior service credit 17.3 8.7 —

Total recorded in “Accumulated other comprehensive income”

The Company amortizes prior service credit over an amortization period of the average remaining service period to full eligibility for participating employees ( 4.9 years and 5.9 years at January 1, 2020 and 2019, respectively).

Prior to April 2, 2017, the Company amortized actuarial gain and loss using a 0 % corridor with an amortization period that covered the average remaining service period to full eligibility for participating employees ( 10.3 years at January 1, 2017).

$ ( 168.1 ) $ 8.7 $ ( 51.7 )

The Company amortizes prior service credit over an amortization period of the average remaining service period to full eligibility for participating employees at the time of the plan change or the expected lifetime of participants in the plan ( 3.9 years and 4.9 years were the remaining amortization periods at January 1, 2021 and 2020, respectively for the plan changes effective December 31, 2018).

New prior service credits established during 2020 are described below.

The estimated prior service credit that will be amortized from accumulated other comprehensive income into net periodic postretirement benefit cost during the year ending December 31, 2021 is $ 43.9 million.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table sets forth the plans’ funded status reconciled with the amounts shown in the consolidated balance sheets:

2 unchanged sentences

Accumulated postretirement benefit obligation at beginning of period $ 659.9 $ 595.4

Service cost 3.8 4.8

Interest cost 20.2 25.1

2 unchanged sentences

Benefits paid ( 42.9 ) ( 47.7 )

Actuarial loss (gain)

Actuarial loss 18.6 80.0

Accumulated postretirement benefit obligation at end of period 476.6 659.9

9 unchanged sentences

Noncurrent obligation (included in “Accrued postretirement benefit costs”) $ ( 413.2 ) $ ( 593.4 )

Peabody Energy Corporation

2019 Form 10-K

In September 2020, the Company announced changes to its postretirement health care benefit plans for non-represented employees and retirees.

Effective January 1, 2021, the Company will no longer subsidize medical costs for Medicare eligible individuals or provide life insurance to salaried and hourly non-union retirees.

The Company will provide non-Medicare eligible salaried and hourly non-union retirees and eligible dependents a health reimbursement arrangement.

There were no changes to benefits for represented participants.

The impact of the changes on future benefits reduced the Company’s accumulated postretirement benefit obligation by $ 185.4 million.

The reduction was attributable to the elimination of health care benefits upon covered individuals’ attainment of Medicare eligibility and the elimination of life insurance benefits for certain non-represented participants.

The reduction in liability was recorded with an offsetting balance in “Accumulated other comprehensive income.” The $ 174.5 million reduction for elimination of health care benefits upon attainment of Medicare eligibility for salaried and non-union hourly retirees and eligible dependents is being amortized to earnings over an average remaining service period to full eligibility for participating employees of 5.1 years when it was established on September 30, 2020.

The remaining $ 10.9 million for the elimination of life insurance benefits and elimination of health care benefits upon attainment of Medicare eligibility for select non-union retirees was amortized to earnings over the average remaining life expectancy of the affected plan, which was 10.5 years as of December 31, 2020.

The weighted-average assumptions used to determine the benefit obligations for the plans as of the end of each year were as follows:

Discount rate 2.55 % 3.40 %

Measurement date December 31, 2020 December 31, 2019

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During October 2018, the Company announced an amendment to its postretirement health care benefit plan that, after December 31, 2018, (a) limits eligibility for retiree medical allowances based upon attainment of certain age and service criteria at December 31, 2018, (b) reduces the annual retiree medical allowance benefits earned by eligible employees and (c) establishes maximum limits on the amount eligible employees may earn and annual benefit payments.

Employees with existing retiree medical allowance balances that lost continuing eligibility due to the amendment were awarded one-time discretionary contributions to their respective employee retirement accounts based upon years of service.

The impact of the amendment on future benefits reduced the Company’s accumulated postretirement benefit obligation by $ 51.7 million .

Of that amount, $ 50.2 million was attributable to the annual benefits and the maximum balance limits and $ 1.5 million was attributable to the limitation of eligibility based on age and service criteria.

The reduction in liability was recorded with an offsetting balance in accumulated other comprehensive income, net of a deferred tax provision, of $ 44.6 million , which is being amortized to earnings over an average remaining service period to full eligibility for participating employees of 5.9 years.

The weighted-average assumptions used to determine the benefit obligations as of the end of each year were as follows:

Discount rate

Measurement date

December 31, 2019

December 31, 2018

The weighted-average assumptions used to determine net periodic benefit cost during each period were as follows:

Year Ended December 31, 2019

The weighted-average assumptions used to determine net periodic benefit cost (benefit) for the plans during each period were as follows:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

Discount rate 3.40 % 4.35 % 3.70 %

Expected long-term return on plan assets

Measurement date

December 31, 2018

December 31, 2017

April 1, 2017

December 31, 2016

Expected long-term return on plan assets (pre-tax) 7.00 % 5.00 % — %

Measurement date December 31, 2019 December 31, 2018 December 31, 2017

The expected rate of return on plan assets is determined by taking into consideration expected long-term returns associated with each major asset class based on long-term historical ranges, inflation assumptions and the expected net value from active management of the assets based on actual results.

Effective January 1, 2020 the Company increased its expected rate of return on plan assets from 5.00 % to 7.00 % reflecting the impact of the Company’s asset allocation and capital market expectations.

Effective January 1, 2021 the Company lowered its expected pre-tax rate of return on plan assets from 7.00 % to 5.75 % reflecting the impact of the Company’s asset allocation and capital market expectations.

The accumulated postretirement benefit obligation exceeded plan assets for all plans as of December 31, 2020 and 2019.

10 unchanged sentences

Year that the rate reaches the ultimate trend rate 2026 2023

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Assumed health care cost trend rates have a significant effect on the expense and liability amounts reported for health care plans.

A one-percentage-point change in the assumed health care cost trend would have the following effects for the year ended December 31, 2019:

One Percentage-

Point Increase

One Percentage-

Point Decrease

(Dollars in millions)

Effect on total service and interest cost components

Effect on total postretirement benefit obligation

The Company has established two Voluntary Employees Beneficiary Association (VEBA) trusts to pre-fund a portion of benefits for non-represented and represented retirees.

1 unchanged sentence

Non-Represented Retiree VEBA Trust (the Non-Represented Trust) are invested in accordance with the investment policy established by the Peabody VEBA Retirement Committee after consultation with outside investment advisors and actuaries.

The asset allocation strategy for the Non-Represented trust is 50 % in equity and 50 % in fixed income assets, which are designed to balance the needs of having growth and stability in the portfolio.

This asset strategy may vary over time based on changes in the status of the Non-Represented Plan, the Company’s risk posture and other factors.

The Peabody Holding Company LLC Represented Retiree VEBA Trust (the Represented Trust) is unfunded at December 31, 2019 and 2018 .

As of December 31, 2020, the asset allocation strategy for the Non-Represented trust is 30 % in equity and 70 % in fixed income assets.

As of December 31, 2019, the asset allocation strategy for the Non-Represented trust was 50 % in equity and 50 % in fixed income assets.

The asset strategy may vary over time based on changes in the status of the Non-Represented Plan, the Company’s risk posture and other factors.

Assets of the Peabody Holding Company LLC Represented Retiree VEBA Trust (the Represented Trust) are invested in cash funds at December 31, 2020 and 2019.

A financial instrument’s level within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

6 unchanged sentences

The mutual funds are traded on a national securities exchange in an active market, are valued using daily publicly quoted net asset value (NAV) prices and accordingly classified within Level 1 of the valuation hierarchy.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

International equity securities.

21 unchanged sentences

Government money market fund which is classified within the Level 1 valuation hierarchy.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values.

3 unchanged sentences

December 31, 2020

Level 1 Level 2 Level 3 Total

(Dollars in millions)

3 unchanged sentences

government securities 1.0 4.2 — 5.2

Cash funds 6.4 — — 6.4

Total assets at fair value $ 19.9 $ 13.8 $ — $ 33.7

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2019

Level 1 Level 2 Level 3 Total

(Dollars in millions)

equity securities $ 13.0 $ — $ — $ 13.0

International equity securities 4.0 — — 4.0

Corporate bonds — 9.2 — 9.2

government securities 2.6 4.5 — 7.1

Cash funds 0.9 — — 0.9

Total assets at fair value $ 20.5 $ 13.7 $ — $ 34.2

Contributions

Annual contributions to the Non-Represented Trust are discretionary.

During the year ended December 31, 2019 , the Company made a pre-funding contribution of $ 17.0 million to the Non-Represented Trust.

Annual contributions to the Non-Represented and Represented Trusts are discretionary.

During the year ended December 31, 2020, the Company made contributions of $ 10.7 million to the Non-Represented Trust and $ 9.6 million to the Represented Trust.

Estimated Future Benefit Payments

The following benefit payments (net of retiree contributions), which reflect expected future service, as appropriate, are expected to be paid by the Company:

The following benefit payments (net of retiree contributions and Medicare Part D reimbursements), which reflect expected future service, as appropriate, are expected to be paid by the Company or satisfied from Non-Represented Trust assets:

Postretirement

5 unchanged sentences

salaried employees and eligible hourly employees at certain PIC subsidiaries (the Peabody Plan).

A subsidiary of PIC also has a defined benefit pension plan covering eligible employees who are represented by the UMWA under the Western Surface Agreement (the Western Plan).

Prior to April 2, 2017, PIC also sponsored an unfunded supplemental retirement plan to provide senior management with benefits in excess of limits under the federal tax law (collectively, the Pension Plans).

Peabody Energy Corporation

2019 Form 10-K

A subsidiary of PIC also has a defined benefit pension plan covering eligible employees who are represented by the UMWA under the Western Surface Agreement (the Western Plan and together with the Peabody Plan, the Pension Plans).

Effective May 31, 2008, the Peabody Plan was frozen in its entirety for both participation and benefit accrual purposes.

In 2020, the Company announced a program to offer a voluntary lump-sum pension payout to eligible active salaried employees and former salaried employees in the Peabody Plan which would settle the Company’s obligation to them.

The program provided participants with a limited time opportunity to elect to receive a lump-sum settlement of their pension benefit or begin to receive their benefit in the form of a monthly annuity in December 2020.

As part of this voluntary lump-sum program, the Company settled $ 51.6 million of its pension obligations for active salaried employees and former salaried employees in the Peabody Plan with an equal amount paid from plan assets.

As a result, the Company recorded a settlement gain of $ 2.7 million during the year ended December 31, 2020.

The settlement gain was reflected in “Net periodic benefit (credit) costs, excluding service cost” on the consolidated statement of operations.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Effective May 31, 2008, the Peabody Plan was frozen in its entirety for both participation and benefit accrual purposes.

The Company adopted an enhanced savings plan contribution structure in lieu of benefits formerly accrued under the Peabody Plan.

In November 2017, the Company purchased a group annuity contract from an insurance company to pay future pension benefits to approximately 1,950 retirees and beneficiaries of the Peabody Plan.

As a result of this transaction, the Company settled $ 71.4 million of its pension obligation, paid from plan assets, and recorded a settlement charge of $ 2.1 million during the period April 2 through December 31, 2017.

Net periodic pension (benefit) cost included the following components:

Year Ended December 31, 2019

Net periodic pension benefit included the following components:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

2 unchanged sentences

Expected return on plan assets ( 29.7 ) ( 31.4 ) ( 42.8 )

Amortization of prior service cost

Amortization of net actuarial losses

Settlement charge

Settlement ( 2.7 ) — —

Net actuarial (gain) loss ( 25.6 ) ( 16.6 ) 4.2

Net periodic pension (benefit) cost

The following includes pre-tax amounts recorded in “Accumulated other comprehensive income”:

January 1 through April 1, 2017

(Dollars in millions)

Amortization:

Net actuarial loss

Prior service cost

Total recorded in “Accumulated other comprehensive income”

Prior to April 2, 2017, the Company amortized actuarial gain and loss using a 5 % corridor with a five -year amortization period.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Net periodic pension benefit $ ( 29.7 ) $ ( 12.5 ) $ ( 4.9 )

The actuarial gain for all pension plans in 2020 was primarily due to actual returns on plan assets exceeding the expected returns for the year and the favorable impact of updating the mortality base tables and improvement scales to those published by the Society of Actuaries offset by the decline in the discount rate used to measure the benefit obligation.

The actuarial gain for all pension plans in 2019 was primarily due to actual returns on plan assets exceeding the expected returns for the year offset by the decline in the discount rate used to measure the benefit obligation.

The actuarial loss for all pension plans in 2018 was primarily due to actual returns on plan assets lower than expected returns for the year offset by the increase in the discount rate used to measure the benefit obligation.

The following summarizes the change in benefit obligation, change in plan assets and funded status of the Pension Plans:

2 unchanged sentences

Projected benefit obligation at beginning of period $ 853.8 $ 795.9

Service cost 0.3 2.0

Interest cost 28.0 33.5

Benefits paid ( 57.5 ) ( 55.6 )

Actuarial loss (gain)

Actuarial loss 43.4 78.0

Settlement ( 51.6 ) —

Projected benefit obligation at end of period 816.4 853.8

4 unchanged sentences

Benefits paid ( 57.5 ) ( 55.6 )

Settlement ( 51.6 ) —

Fair value of plan assets at end of period 847.5 855.2

4 unchanged sentences

Net amount recognized $ 31.1 $ 1.4

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The weighted-average assumptions used to determine the benefit obligations as of the end of each year were as follows:

Discount rate 2.60 % 3.40 %

Measurement date

December 31, 2019

December 31, 2018

The weighted-average assumptions used to determine net periodic pension (benefit) cost during each period were as follows:

Year Ended December 31, 2019

Measurement date December 31, 2020 December 31, 2019

The weighted-average assumptions used to determine net periodic pension benefit during each period were as follows:

Year Ended December 31,

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

Discount rate 3.40 % 4.35 % 3.70 %

Expected long-term return on plan assets 3.60 % 4.20 % 5.65 %

Measurement date

December 31, 2018

December 31, 2017

April 1, 2017

December 31, 2016

Measurement date December 31, 2019 December 31, 2018 December 31, 2017

Effective January 1, 2021, the Company lowered its expected rate of return on plan assets from 3.60 % to 2.80 % reflecting the impact of the Company’s asset allocation and capital market expectations.

The plan assets exceeded the projected benefit obligation and the accumulated benefit obligation for the Peabody Plan as of December 31, 2019 .

The projected benefit obligation and the accumulated benefit obligation exceeded plan assets for the Western Plan as of December 31, 2019 .

The projected benefit obligation and the accumulated benefit obligation exceeded plan assets for all plans as of December 31, 2018 .

The accumulated benefit obligation for all plans was $ 853.8 million and $ 795.9 million as of December 31, 2019 and 2018 , respectively.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of December 31, 2020 and 2019, the accumulated benefit obligation for all plans was $ 816.4 million and $ 853.8 million, respectively, which was equal to the projected benefit obligation for those periods.

As of December 31, 2020 and 2019, the plan assets for the Peabody Plan of $ 672.5 million and $ 689.4 million, respectively, exceeded the projected benefit obligation and accumulated benefit obligation for those periods of $ 632.9 million and $ 675.9 million, respectively.

The projected benefit obligation and accumulated benefit obligation for the Western Plan as of December 31, 2020 and 2019, was $ 183.5 million and $ 177.9 million, respectively, which exceeded the plan assets of $ 175.0 million and $ 165.8 million, respectively, for those periods.

Assets of the Pension Plans

4 unchanged sentences

As a result of discretionary contributions made in recent years, the Pension Plans have become nearly fully funded and therefore, as of December 31, 2020 and 2019, the Master Trust investment portfolio reflected the Company’s target asset mix of 100 % fixed income investments.

Master Trust assets also include investments in various real estate holdings through limited partnerships representing approximately less than 1 % and 1 % of total Master Trust assets as of December 31, 2019 and 2018, respectively.

Master Trust assets also include investments in various real estate holdings through limited partnerships representing approximately less than 1 % of total Master Trust assets as of both December 31, 2020 and 2019.

The Retirement Committees’ intention is to liquidate these real estate holdings when allowable per the terms of the limited partnership agreements.

Generally, dissolution and liquidation of the limited partnerships is required before the Master Trust’s real estate holdings can be liquidated and is estimated to occur at various times through 2022.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Assets of the Master Trust are under management by third-party investment managers, which are selected and monitored by the Retirement Committees.

30 unchanged sentences

Asset-backed securities are classified within the Level 2 valuation hierarchy since fair value inputs are derived prices in active markets and the investments are not traded on a national securities exchange.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Commercial paper.

The Master Trust invests in commercial paper of U.S.

corporations to manage liquidity resulting from payment of participant benefits and certain administrative fees.

Commercial paper is classified within the Level 2 valuation hierarchy since fair value inputs are derived prices in active markets and the investments are not traded on a national securities exchange.

The Master Trust invests in cash funds to manage liquidity resulting from payment of participant benefits and certain administrative fees.

11 unchanged sentences

Some limited partnerships issue dividends to their investors in the form of cash distributions that the Pension Plans invest elsewhere within the Master Trust.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Private mutual funds .

7 unchanged sentences

December 31, 2020

Level 1 Level 2 Level 3 Total

(Dollars in millions)

3 unchanged sentences

Asset-backed securities — 4.7 — 4.7

Cash funds 14.9 — — 14.9

Real estate interests — — 1.2 1.2

3 unchanged sentences

Total plan assets $ 847.5

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2019

Level 1 Level 2 Level 3 Total

(Dollars in millions)

2 unchanged sentences

International government securities — 18.2 — 18.2

Commercial paper

Asset-backed securities — 3.4 — 3.4

Cash funds 33.2 — — 33.2

Real estate interests — — 4.1 4.1

5 unchanged sentences

The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the total value of assets of the plans.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The table below sets forth a summary of changes in the fair value of the Master Trust’s Level 3 investments:

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

Balance, beginning of period $ 4.1 $ 6.2 $ 11.8

Realized (losses) gains

Unrealized gains (losses) relating to investments still held at the reporting date

Realized gains (losses) 1.6 ( 1.0 ) 2.6

Unrealized (losses) gains relating to investments still held at the reporting date ( 2.1 ) 1.4 ( 2.6 )

Purchases, sales and settlements, net ( 2.4 ) ( 2.5 ) ( 5.6 )

5 unchanged sentences

Minimum funding standards are legislated by ERISA and are modified by pension funding stabilization provisions included in the Moving Ahead for Progress in the 21st Century Act of 2012, the Highway and Transportation Funding Act of 2014 and the Bipartisan Budget Act of 2015.

Based upon minimum funding requirements, the Company is not required to make any payments to its qualified pension plans;

however, during the year ended December 31, 2019, the Company made a discretionary contribution of $ 20.0 million to one of its qualified pension plans.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company was not required to make any payments to its qualified pension plans in 2020 based on minimum funding requirements and did not make any discretionary contributions in 2020.

Estimated Future Benefit Payments

4 unchanged sentences

Defined Contribution Plans

The Company sponsors employee retirement accounts under two 401(k) plans for eligible U.S.

The Company sponsors employee retirement accounts under three 401(k) plans for eligible U.S.

The Company matches voluntary contributions to each plan up to specified levels.

The expense for these plans was $ 27.8 million , $ 30.3 million , $ 25.5 million and $ 5.5 million for the years ended December 31, 2019 and 2018, the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017, respectively.

In May 2020 the Company amended one of its plans to eliminate the formula for calculating matching contributions and provide the Company sole discretion in making any matching contributions.

In addition, in May 2020 the Company also temporarily suspended matching contributions due to challenging business conditions of COVID-19.

The expense for these plans was $ 9.6 million, $ 27.8 million and $ 30.3 million for the years ended December 31, 2020, 2019 and 2018, respectively.

A performance contribution feature in one of the plans allows for additional discretionary contributions from the Company.

There was no performance contribution granted for the year ended December 31, 2019.

There was no performance contribution granted for the years ended December 31, 2020 and 2019.

There were no discretionary performance contributions paid during the year ended December 31, 2020.

Prior performance contributions of $ 8.9 million and $ 8.5 million were paid during the years ended December 31, 2019 and 2018, respectively.

There were no performance contributions paid during the period April 2 through December 31, 2017 or the period January 1 through April 1, 2017 .

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Superannuation

The Company makes superannuation contributions for eligible Australia employees in accordance with the employer contribution rate set by the Government of Australia.

The expense related to these contributions was $ 26.5 million , $ 31.6 million , $ 19.9 million and $ 6.1 million for the years ended December 31, 2019 and 2018, the period April 2 through December 31, 2017 and the period January 1 through April 1, 2017, respectively.

The expense related to these contributions was $ 20.5 million, $ 26.5 million and $ 31.6 million for the years ended December 31, 2020, 2019 and 2018, respectively.

A performance contribution feature allows for additional discretionary contributions from the Company.

There was no performance contribution granted for the year ended December 31, 2019.

There was no performance contribution granted for the years ended December 31, 2020 and 2019.

There were no discretionary performance contributions paid during the year ended December 31, 2020.

Prior performance contributions of approximately $ 3 million were paid during both of the years ended December 31, 2019 and 2018.

There were no discretionary performance contributions paid during the period April 2 through December 31, 2017 or the period January 1 through April 1, 2017.

(17) Stockholders’ Equity

Successor Company

In accordance with the Company’s Fourth Amended and Restated Certificate of Incorporation, the Company has 450.0 million authorized shares of Common Stock, par value $ 0.01 per share.

1 unchanged sentence

The holders of Common Stock do not have cumulative voting rights in the election of directors.

Holders of Common Stock are entitled to receive ratably dividends if, as and when dividends are declared from time to time by the Board out of funds legally available for that purpose, after payment of dividends required to be paid on any outstanding preferred stock or series common stock.

Holders of Common Stock are entitled to receive ratably dividends if, as and when dividends are declared from time to time by the Board of Directors (the Board) out of funds legally available for that purpose, after payment of dividends required to be paid on any outstanding preferred stock or series common stock.

Upon dissolution, liquidation or winding up of the Company, the holders of Common Stock are entitled to receive ratably the assets available for distribution to the stockholders after payment of liabilities and subject to the right of holders of any outstanding preferred stock or series common stock.

1 unchanged sentence

There are no redemption or sinking fund provisions applicable to the Common Stock.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table summarizes Common Stock activity during the periods presented below:

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

2020 2019 2018

(In millions)

1 unchanged sentence

Shares issued for preferred share conversions — — 25.5

Shares issued for warrant conversions

Shares issued for vested restricted stock units 1.3 1.5 1.1

8 unchanged sentences

Year Ended December 31, 2018

April 2 through December 31, 2017

(In millions)

Shares outstanding at the beginning of the period 13.5

Shares converted to Common Stock ( 13.5 )

Shares issued for payable in-kind preferred stock dividends

Shares outstanding at the end of the period —

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The shares of Series A Convertible Preferred Stock retained the status of authorized but unissued shares of preferred stock following the conversion and accordingly, the Company has 100.0 million authorized shares of preferred stock.

7 unchanged sentences

There were no outstanding shares of series common stock as of December 31, 2020.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Treasury Stock

Share repurchases.

The Board has authorized a share repurchase program, as amended, to allow repurchases of up to $ 1.5 billion of the outstanding shares of the Company’s common stock and/or preferred stock (Repurchase Program).

Repurchases may be made from time to time at the Company’s discretion.

The specific timing, price and size of purchases will depend on the share price, general market and economic conditions and other considerations, including compliance with various debt agreements as they may be amended from time to time.

On August 1, 2017, the Board authorized a $ 500.0 million share repurchase program of the outstanding shares of the Company’s common stock and/or preferred stock (Repurchase Program).

On April 25, 2018, the Company announced that the Board authorized the expansion of the Repurchase Program to $ 1.0 billion.

On October 30, 2018, the Company announced that the Board authorized an additional expansion of the Repurchase Program to $ 1.5 billion.

The Repurchase Program does not have an expiration date and may be discontinued at any time.

3 unchanged sentences

As of December 31, 2020, there was $ 160.5 million available for repurchase under the Repurchase Program.

No additional repurchases are currently planned.

Share repurchases were suspended by the Company during 2019, and as further described in Note 1.

“Summary of Significant Accounting Policies,” during the fourth quarter of 2020, the Company entered into transaction support agreements with its surety bond providers which prohibit the repurchase of shares through December 31, 2024, unless otherwise agreed to by the parties to the agreements.

Additionally, restrictive covenants in the Company’s credit facility and in the indentures governing its senior secured notes also limit the Company’s ability to repurchase shares.

Prior to the suspension, repurchases were made at the Company’s discretion.

The specific timing, price and size of purchases depended upon the share price, general market and economic conditions and other considerations, including compliance with various debt agreements in effect at the time repurchases were made.

On August 14, 2018, Peabody Energy Corporation entered into a share repurchase agreement (the Share Repurchase Agreement) by and among the Company and its related parties, Elliott Associates, LP, Liverpool Limited Partnership and Sprayberry Investments Inc.

4 unchanged sentences

The Company routinely allows employees to relinquish Common Stock to pay estimated taxes upon the vesting of restricted stock units and the payout of performance units that are settled in Common Stock under its equity incentive plans.

The number of shares of Common Stock relinquished was 0.4 million for both the periods ended December 31, 2019 and 2018.

The number of shares of Common Stock relinquished was 0.4 million for each of the years ended December 31, 2020, 2019 and 2018.

The value of the Common Stock tendered by employees was based upon the closing price on the dates of the respective transactions.

Predecessor Company

In accordance with the Plan and as previously disclosed, each share of the Company’s common stock outstanding prior to the Effective Date, including all options and warrants to purchase such stock, was extinguished, canceled and discharged, and each such share, option or warrant had no further force or effect as of the Effective Date.

Furthermore, all of the Company’s equity award agreements under prior incentive plans, and the awards granted pursuant thereto, were extinguished, canceled and discharged and had no further force or effect as of the Effective Date.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(18) Share-Based Compensation

Successor Company

The Company has established the Peabody Energy Corporation 2017 Incentive Plan (the 2017 Incentive Plan) for employees, non-employee directors and consultants that allows for the issuance of share-based compensation in various forms including options (including non-qualified stock options and incentive stock options), stock appreciation rights, restricted stock, restricted stock units, deferred stock, performance units, dividend equivalents and cash incentive awards.

1 unchanged sentence

As of December 31, 2020, there are approximately 7.3 million shares of the Company’s Common Stock available for grant.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Share-Based Compensation Expense and Cash Flows

3 unchanged sentences

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

2020 2019 2018

(Dollars in millions)

Share-based compensation expense $ 13.5 $ 38.3 $ 34.9

Tax benefit — — —

Share-based compensation expense, net of tax benefit $ 13.5 $ 38.3 $ 34.9

3 unchanged sentences

Deferred Stock Units

During the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 , the Company granted deferred stock units to each of the non-employee members of the Board.

During the years ended December 31, 2020, 2019 and 2018, the Company granted deferred stock units to each of the non-employee members of the Board.

The fair value of these units is equal to the market price of the Company’s Common Stock at the date of grant.

1 unchanged sentence

Restricted Stock Units

The Emergence Awards granted to the Company’s executive officers generally will vest ratably on each of the first three anniversaries of the Effective Date, subject to, among other things, each such executive officer’s continued employment with the Company.

The Emergence Awards will become fully vested upon each such executive officer’s termination of employment by the Company and its subsidiaries without Cause or by the executive for Good Reason (each, as defined in the 2017 Incentive Plan or award agreement) or due to a termination of employment with the Company and its subsidiaries by reason of death or Disability (as defined in the 2017 Incentive Plan or award agreement).

On the Effective Date, the Company granted restricted stock units under the 2017 Incentive Plan and the terms of the relevant restricted stock unit agreement to all employees, including its executive officers (the Emergence Awards).The Emergence Awards granted to the Company’s executive officers vested ratably on each of the first three anniversaries of the Effective Date, subject to, among other things, each such executive officer’s continued employment with the Company.

The Emergence Awards became fully vested upon each such executive officer’s termination of employment by the Company and its subsidiaries without Cause or by the executive for Good Reason (each, as defined in the 2017 Incentive Plan or award agreement) or due to a termination of employment with the Company and its subsidiaries by reason of death or Disability (as defined in the 2017 Incentive Plan or award agreement).

In order to receive the Emergence Awards, the executive officers were required to execute restrictive covenant agreements protecting the Company’s interests.

There are no unvested Emergence Awards outstanding as of December 31, 2020.

The Company grants restricted stock units to certain senior management and non-senior management employees.

2 unchanged sentences

Compensation cost for both senior and non-senior management employees is recognized on a straight-line basis over the requisite service period.

The payouts for active grants awarded during the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 will be settled in the Company’s Common Stock.

Peabody Energy Corporation

2019 Form 10-K

The payouts for active grants awarded during the years ended December 31, 2020, 2019 and 2018 will be settled in the Company’s Common Stock.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

1 unchanged sentence

A summary of restricted stock unit activity is as follows:

Year Ended December 31, 2019

Year Ended December 31, 2020 Weighted

Nonvested at December 31, 2019 1,706,025 $ 26.89

Granted 1,706,907 9.71

Vested ( 1,105,979 ) 24.37

Forfeited ( 676,997 ) 16.38

Nonvested at December 31, 2020 1,629,956 $ 14.49

The total fair value at grant date of restricted stock units granted during the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 was $ 19.8 million , $ 18.2 million and $ 79.8 million , respectively.

The total fair value at grant date of restricted stock units granted during the years ended December 31, 2020, 2019 and 2018 was $ 16.6 million, $ 19.8 million and $ 18.2 million, respectively.

The restricted stock units receive dividend equivalent units (DEUs) upon payment of cash dividends to holders of Common Stock.

1 unchanged sentence

As of December 31, 2020, there were approximately 32,000 nonvested DEUs.

The total fair value of restricted stock units and DEUs vested was $ 40.3 million , $ 46.2 million and $ 0.9 million during the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 , respectively.

The total fair value of restricted stock units and DEUs vested was $ 5.6 million, $ 40.3 million and $ 46.2 million during the years ended December 31, 2020, 2019 and 2018, respectively.

Performance Units

3 unchanged sentences

In addition, the payout of the performance units can be increased or decreased by up to 25 % of the award based on three-year stock price performance compared to a custom peer group (market condition).

There were no performance units granted during the period April 2 through December 31, 2017.

Awards granted during the years ended December 31, 2020, 2019 and 2018 will be settled in the Company's Common Stock.

A summary of performance unit activity is as follows:

Year Ended December 31, 2019

Year Ended December 31, 2020 Weighted

Remaining Contractual Life

Nonvested at December 31, 2019 426,606 1.6

Granted 686,082

Forfeited ( 254,100 )

Nonvested at December 31, 2020 858,588 1.5

3 unchanged sentences

As of December 31, 2020, there were approximately 33,000 nonvested DEUs

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The performance condition awards were valued utilizing the grant date fair values of the Company’s Common Stock adjusted for dividends foregone during the vesting period.

5 unchanged sentences

Dividend yield — % — %

Predecessor Company

In accordance with the Plan and as previously disclosed, each share of the Company’s common stock outstanding prior to the Effective Date, including all options and warrants to purchase such stock, were extinguished, canceled and discharged, and each such share, option or warrant had no further force or effect as of the Effective Date.

Share-Based Compensation Expense and Cash Flows

The Predecessor Company’s share-based compensation expense was recorded in “Selling and administrative expenses” in the consolidated statements of operations.

Cash received by the Predecessor Company upon the exercise of stock options and when employees purchased stock under the employee stock purchase plans was reflected as a financing activity in the consolidated statements of cash flows.

Share-based compensation expense and cash flow amounts were as follows:

January 1 through April 1, 2017

(Dollars in millions)

Share-based compensation expense - equity classified awards

Share-based compensation expense, net of tax benefit

Cash received upon the exercise of stock options and from employee stock purchases

Write-off tax benefits related to share-based compensation

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive (Loss) Income

(19) Accumulated Other Comprehensive Income

The following table sets forth the after-tax components of accumulated other comprehensive (loss) income and changes thereto:

Actuarial Loss

Associated with

Postretirement

Prior Service

Adjustment Prior Service

Credit (Cost) Associated

Postretirement

Comprehensive (Loss)

Comprehensive

(Dollars in millions)

Predecessor Company

December 31, 2017 $ 1.4 $ — $ 1.4

Reclassification from other comprehensive income to earnings

Current period change ( 5.9 ) 44.6 38.7

Fresh start reporting adjustment

April 1, 2017

Successor Company

Current period change

December 31, 2018 ( 4.5 ) 44.6 40.1

Reclassification from other comprehensive income to earnings — ( 8.7 ) ( 8.7 )

Current period change 0.2 — 0.2

3 unchanged sentences

December 31, 2020 $ 1.8 $ 204.0 $ 205.8

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The components of accumulated other comprehensive income related to postretirement plans and workers’ compensation obligations and cash flow hedges related to Predecessor periods were eliminated in accordance with fresh start reporting.

As such, there were no amounts reclassified out of “ Accumulated other comprehensive income ” during the year ended December 31, 2018 or the period April 2 through December 31, 2017 .

The following table provides additional information regarding items reclassified out of “ Accumulated other comprehensive income ” into earnings during the periods presented below:

Amount reclassified from accumulated other comprehensive loss (1)

Details about accumulated other comprehensive loss components

Year Ended December 31, 2019

January 1 through April 1, 2017

Affected line item in the consolidated statement of operations

(Dollars in millions)

Net actuarial loss associated with postretirement plans and workers’ compensation obligations:

Postretirement health care and life insurance benefits

Net periodic benefit costs, excluding service cost

Defined benefit pension plans

Net periodic benefit costs, excluding service cost

Workers’ compensation amortization

Net periodic benefit costs, excluding service cost

Total before income taxes

Income tax benefit

Total after income taxes

Prior service credit (cost) associated with postretirement plans:

Postretirement health care and life insurance benefits

Net periodic benefit costs, excluding service cost

Defined benefit pension plans

Net periodic benefit costs, excluding service cost

Total before income taxes

Income tax provision

Total after income taxes

Cash flow hedges:

Foreign currency cash flow hedge contracts

Operating costs and expenses

Fuel and explosives commodity swaps

Operating costs and expenses

Insignificant items

Total before income taxes

Income tax benefit

Total after income taxes

(1) Presented as gains (losses) in the consolidated statements of operations.

Comprehensive loss differed from net loss by the amount of unrealized gain or loss resulting from valuation changes of the Company’s cash flow hedges (see Note 9.

“Derivatives and Fair Value Measurements” for information related to the Company’s cash flow hedges), the change in actuarial loss and prior service cost of postretirement plans and workers’ compensation obligations (see Note 17.

“Postretirement Health Care and Life Insurance Benefits,” Note 18.

“Pension and Savings Plans” and Note 6.

“Discontinued Operations” for information related to the Company’s postretirement and pension plans) and foreign currency translation adjustment related to the Company’s investments in Middlemount, whose functional currency is the Australian dollar.

The values of the Company’s cash flow hedging instruments were primarily affected by the U.S.

dollar/Australian dollar exchange rate and changes in the prices of certain coal and diesel fuel products.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Postretirement health care and life insurance benefits reclassified from “Accumulated other comprehensive income” to earnings of $ 17.3 million and $ 8.7 million during the years ended December 31, 2020 and 2019, respectively, are included in “Net periodic benefit (credit) costs, excluding service cost” in the accompanying consolidated statements of operations.

There were no amounts reclassified out of “Accumulated other comprehensive income” into earnings during the year ended December 31, 2018.

Comprehensive loss differed from net loss by the amount of the change in prior service cost of postretirement plans (see Note 15.

“Postretirement Health Care and Life Insurance Benefits” for information related to the Company’s postretirement plans) and foreign currency translation adjustment related to the Company’s investments in Middlemount, whose functional currency is the Australian dollar.

(20) Other Events

Cost Repositioning Program

As part of its cost repositioning program, the Company idled nine individual mines for periods ranging from one week to multiple months throughout the year ended December 31, 2020.

Included in the count was the Shoal Creek Mine in Alabama, which was idled in October 2020 to reset the cost structure of the mine amid weak pricing and demand, and the Metropolitan Mine in New South Wales, Australia, which was idled in late December 2020.

United Wambo Joint Venture with Glencore

In December 2019, after receiving the requisite regulatory and permitting approvals, the Company formed an unincorporated joint venture with Glencore plc (Glencore), in which the Company holds a 50 % interest, to combine the existing operations of the Company’s Wambo Open-Cut Mine in Australia with the adjacent coal reserves of Glencore’s United Mine.

The Company will proportionally consolidate the entity based upon its economic interest.

Glencore will manage the mining operations of the joint venture (United Wambo Joint Venture).

Both parties contributed mining tenements and other assets upon formation.

The Company proportionally consolidates the entity based upon its economic interest.

Both parties contributed mining tenements upon formation of the joint venture (United Wambo Joint Venture), and combined operations commenced in December 2020.

During the year ended December 31, 2020, the Company contributed approximately $ 72 million towards construction and development, which is reflected as “Additions to property, plant, equipment and mine development” in the accompanying consolidated statements of cash flows.

As per the joint venture agreement, the Company fully owned and operated the Wambo Open-Cut Mine through the date that combined operations commenced.

At that date, the parties contributed mining equipment and other assets, and certain additional construction and development activities are ongoing.

Glencore is responsible for managing the mining operations of the joint venture.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company accounted for its interest in the United Wambo Joint Venture at fair value and recognized a gain of $ 48.1 million, which was classified in “Gain on formation of United Wambo Joint Venture” in the accompanying consolidated statements of operations during the year ended December 31, 2019.

The gain represents the difference between the fair value of the Company’s interest in the joint venture, $ 63.7 million , and the carrying value of the Company’s net assets contributed upon formation, $ 15.6 million .

The fair value of the Company’s interest in the joint venture is based on applying the income and cost valuation methods to the combined mining tenements and includes a provision for the estimated fair value of related asset retirement obligations.

The gain represented the difference between the fair value of the Company’s interest in the joint venture, $ 63.7 million, and the carrying value of the Company’s net assets contributed upon formation, $ 15.6 million.

The fair value of the Company’s interest in the joint venture was based on applying the income and cost valuation methods to the combined mining tenements and included a provision for the estimated fair value of related asset retirement obligations.

PRB Colorado Joint Venture with Arch

On June 18, 2019, the Company entered into a definitive implementation agreement (the Implementation Agreement) with Arch, to establish a joint venture that will combine the respective Powder River Basin and Colorado operations of Peabody and Arch.

Pursuant to the terms of the Implementation Agreement, Peabody will hold a 66.5 % economic interest in the joint venture and Arch will hold a 33.5 % economic interest.

The Company expects to proportionally consolidate the entity based upon its economic interest.

Governance of the joint venture will be overseen by the joint venture’s board of managers, which will be comprised of Peabody and Arch representatives with voting powers proportionate with the companies’ economic interests, with the exception of certain specified matters which will require supermajority approval.

Peabody will manage the operations of the joint venture, subject to the supervision of the joint venture’s board of managers.

Formation of the joint venture is subject to customary closing conditions, including the termination or expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, the receipt of certain other required regulatory approvals and the absence of injunctions or other legal restraints preventing the formation of the joint venture.

The proposed joint venture is progressing through the U.S.

Federal Trade Commission regulatory review process and the Company expects a decision in the first quarter, which would result in the clearance to form the joint venture or litigation to block its execution.

In September 2019, the Company amended its Credit Agreement to expressly permit formation of the joint venture and is exploring various alternatives under the Indenture governing the Senior Notes.

At such time as control over the existing operations is exchanged, the Company will account for its interest in the combined operations at fair value, which could result in a significant loss.

North Goonyella

The Company’s North Goonyella Mine in Queensland, Australia experienced a fire in a portion of the mine during September 2018 and mining operations have been suspended since then.

No mine personnel were physically harmed by the September 2018 events.

On November 13, 2018, the Queensland Mine Inspectorate (QMI) initiated an investigation into the events that occurred at the mine to determine the cause of the event, assess the response to it and make recommendations to reduce the possibility of future incidents and improve response.

During the first quarter of 2019, the Company completed segmenting of the mine into multiple zones to facilitate a phased reventilation and re-entry of the mine.

The Company commenced reventilation of the first zone of the mine during the second quarter of 2019 and subsequently re-entered the area in the third quarter.

Following these activities and a detailed review and assessment of North Goonyella, the Company determined that due to the time, cost and required regulatory approach to ventilate and re-enter the rest of the mine, the Company will not pursue attempts to access certain portions of the mine through existing mine workings, but instead will move to the southern panels.

The Company is currently in discussions with the QMI regarding ventilation and re-entry of the second zone of the current mine configuration.

In 2020, the Company is commencing a commercial process for North Goonyella in conjunction with the existing mine development.

The process comes in response to expressions of interest from potential strategic partners and other producers.

Commercial outcomes could include a strategic financial partner, joint venture structure or complete sale of North Goonyella.

Peabody Energy Corporation

2019 Form 10-K

On June 18, 2019, the Company entered into a definitive implementation agreement with Arch, to establish a joint venture that would have combined their respective Powder River Basin (PRB) and Colorado operations.

On February 26, 2020, the U.S.

Federal Trade Commission (FTC) sought a preliminary injunction to challenge the Company’s proposed joint venture.

On September 29, 2020, the United States District Court for the Eastern District of Missouri (the District Court) granted the FTC’s request for a preliminary injunction.

Effective September 30, 2020, Peabody and Arch terminated their agreement to establish the joint venture.

Acquisition of Shoal Creek Mine

for a purchase price of $ 389.8 million after customary purchase price adjustments, which was funded with available cash on hand.

The acquisition expanded the Company’s seaborne metallurgical mining platform.

The purchase accounting allocations were recorded in the accompanying consolidated financial statements as of, and for the period subsequent to the acquisition date.

The Company finalized the valuation of the net assets acquired and related purchase price allocation during the year ended December 31, 2019.

The total purchase price was allocated as follows:

$ 365.3 million to property, plant, equipment and mine development;

$ 39.9 million to inventories;

$ 11.3 million to asset retirement obligations;

and $ 4.1 million to various current liabilities.

Due to the unobservable inputs to the valuation, the fair value would be considered Level 3 in the fair value hierarchy.

The results of Shoal Creek Mine subsequent to the acquisition date are included in the accompanying consolidated statements of operations and are reported in the Seaborne Metallurgical Mining segment.

The Shoal Creek Mine contributed revenues of $ 12.8 million and less than $ 0.1 million of net income from December 4, 2018 through December 31, 2018.

This excludes acquisition costs recorded during the year ended December 31, 2018 of $ 7.4 million, which primarily consisted of professional fees.

These acquisition costs are recorded in the “Transaction costs related to business combinations and joint ventures” line item in the consolidated statements of operations.

The following unaudited pro forma financial information provides the estimated combined results of operations of the Company and Shoal Creek Mine for the year ended December 31, 2018, on a pro forma basis, as though the operations of the Shoal Creek Mine had been combined with the Company’s operations as of January 1, 2018:

revenues of $ 6,008.4 million;

income from continuing operations, net of income taxes of $ 826.6 million;

basic earnings per share from continuing operations of $ 5.84 ;

and diluted earnings per share from continuing operations of $ 5.75 .

On a pro forma basis, the acquisition would have had no impact on taxable income due to the Company’s federal NOLs, as further described in Note 10.

“Income Taxes.”

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the year ended December 31, 2018, the Company recorded $ 58.0 million in containment and idling costs related to the events at North Goonyella and a provision of $ 66.4 million for expected equipment losses.

As work progressed and more information became available, the Company recorded an additional $ 111.5 million in containment and idling costs and an additional provision of $ 83.2 million related to equipment losses during the year ended December 31, 2019.

The combined provision includes $ 50.7 million for the estimated cost to replace leased equipment, $ 45.6 million related to the cost of Company-owned equipment, $ 39.7 million related to unrecoverable longwall panel development and $ 13.6 million of other charges, which represents the best estimate of loss based on the assessments made at December 31, 2019.

In the event that no future mining occurs at the North Goonyella Mine or the Company is unable to find a commercial alternative, the Company may record additional charges for the remaining carrying value of the North Goonyella Mine of up to approximately $ 300 million .

Incremental exposures above the aforementioned include take-or-pay obligations and other costs associated with idling or closing the mine.

Pro forma information is not provided for the years ended December 31, 2020 or 2019 because the operations of the Shoal Creek Mine are reflected in the Company’s actual consolidated results for the entire year.

North Goonyella

The Company’s North Goonyella Mine in Queensland, Australia experienced a fire in a portion of the mine during September 2018 and mining operations have been suspended since then.

During the years ended December 31, 2019 and 2018, the Company recorded provisions for equipment losses of $ 83.2 million and $ 66.4 million, respectively, related to the fire, representing the best estimate of losses to date.

No additional provisions for equipment losses were recorded during the year ended December 31, 2020.

The Company has also incurred containment and idling costs subsequent to the mine’s suspension which amounted to $ 32.3 million, $ 111.5 million and $ 58.0 million during the years ended December 31, 2020, 2019 and 2018, respectively.

In March 2019, the Company entered into an insurance claim settlement agreement with its insurers and various re-insurers under a combined property damage and business interruption policy and recorded a $ 125 million insurance recovery, the maximum amount available under the policy above a $ 50 million deductible.

The Company has collected the full amount of the recovery.

On April 30, 2019, Peabody (Bowen) Pty Ltd entered into an option exercise and release agreement with Yancoal Technology Development Pty Ltd pursuant to which Peabody (Bowen) Pty Ltd exercised an option to acquire from Yancoal Technology Development Pty Ltd the longwall mining equipment used under license at the North Goonyella Mine for $ 54.2 million , which was consistent with what the Company recorded as a provision for equipment losses for the related impaired assets.

The Company is currently evaluating various alternatives regarding the future utility of the mine.

“Asset Impairment.” Incremental exposures above the aforementioned include take-or-pay obligations and other costs associated with idling or closing the mine.

Divestitures and Other Transactions

3 unchanged sentences

During the fourth quarter of 2019, the parties entered into a settlement agreement to finalize such consideration for an additional $ 78.5 million payable to the Company.

Of this amount, $ 35.4 million was receivable at December 31, 2019 and $ 16.3 million of such receivable was collected in January 2020.

Of this amount, $ 35.4 million was receivable at December 31, 2019, all of which was collected during the year ended December 31, 2020.

In June 2018, Peabody entered into an agreement to sell approximately 23 million tonnes of metallurgical coal resources adjacent to its Millennium Mine to Stanmore Coal Limited for approximately $ 22 million.

6 unchanged sentences

The necessary approval of the Australian Foreign Investment Review Board to complete the transaction was received on March 29, 2018, satisfying all the conditions precedent to the sale, and the Company recorded a gain of $ 20.6 million, which is included within “Net gain on disposals” in the accompanying consolidated statements of operations for the year ended December 31, 2018.

On November 28, 2017, the Company paid $ 3.0 million for a third-party’s assumption of all rights and obligations related to a guarantee liability recorded pursuant to a 2007 transaction wherein the Company purchased approximately 345 million tons of coal reserves and surface lands in the Illinois Basin.

In conjunction with the 2007 purchase, the Company agreed to guarantee certain reclamation and bonding commitments of an affiliate of the seller.

The Company extinguished its associated $ 34.2 million liability upon completion of the 2017 transaction and recorded a gain of $ 31.2 million which is included within “Net gain on disposals” in the accompanying consolidated statements of operations for the period April 2 through December 31, 2017.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

On November 27, 2017, the Company completed the sale of the majority of its Burton Mine and related infrastructure to the Lenton Joint Venture for $ 11.7 million .

The Lenton Joint Venture assumed the reclamation obligations associated with the assets acquired in the sale.

The transaction reduced the Company’s asset retirement obligation by $ 40.5 million and reduced the amount of restricted cash held in support of such obligations by approximately $ 30 million .

The Burton Mine, located in Queensland’s Bowen Basin, entered a care, maintenance and rehabilitation phase in December 2016 and had no carrying value at the time of sale.

In connection with the transaction, the Company recorded a gain of $ 52.2 million which is included within “Net gain on disposals” in the accompanying consolidated statements of operations for the period April 2 through December 31, 2017.

The Company had a 37.5 % interest in Dominion Terminal Associates, a partnership that operates a coal export terminal in Newport News, Virginia that exports both metallurgical and thermal coal primarily to Europe and Brazil.

On March 31, 2017, the Company completed a sale of its interest in Dominion Terminal Associates to Contura Terminal, LLC and Ashland Terminal, Inc., both of which are partners of the Dominion Terminal Associates.

The Company collected $ 20.5 million in proceeds and recorded $ 19.7 million of gain on the sale, which was classified in “Net gain on disposals” in the consolidated statement of operations during the period January 1 through April 1, 2017.

In November 2016, the Company entered into a definitive share sale and purchase agreement (SPA) for the sale of all of its equity interest in Metropolitan Collieries Pty Ltd, the entity that owns the Metropolitan Mine in New South Wales, Australia and the associated interest in the Port Kembla Coal Terminal, to South32 Limited (South32).

The SPA provided for a cash purchase price of $ 200.0 million and certain contingent consideration, subject to a customary working capital adjustment.

South32 terminated the agreement in April 2017 after it was unable to obtain necessary approvals from the Australian Competition and Consumer Commission within the timeframe required under the SPA.

As a result of the termination, the Company retained an earnest deposit posted by South32 which was recorded in “Revenues” in the accompanying consolidated statements of operations during the period April 2 through December 31, 2017.

In November 2015, the Company entered into a definitive agreement to sell its New Mexico and Colorado assets to Bowie Resource Partners, LLC (Bowie) in exchange for cash proceeds of $ 358 million and the assumption of certain liabilities.

Bowie agreed to pay the Company a termination fee of $ 20 million (Termination Fee) in the event the Company terminated the agreement because Bowie failed to obtain financing and close the transaction.

On April 12, 2016, Peabody terminated the agreement and demanded payment of the Termination Fee.

Following a favorable judgment by the Bankruptcy Court, the Company collected the Termination Fee from Bowie.

The Termination Fee is included in “Revenues” in the accompanying consolidated statements of operations during the period April 2 through December 31, 2017.

(21) Earnings per Share (EPS)

3 unchanged sentences

Dilutive securities are not included in the computation of loss per share when a company reports a net loss from continuing operations as the impact would be anti-dilutive.

During the periods which included the Company’s Convertible Preferred Stock and the Predecessor Company’s restricted stock awards, basic and diluted EPS were computed using the two-class method, which is an earnings allocation that determines EPS for each class of common stock and participating securities according to dividends declared and participation rights in undistributed earnings.

The Company’s Convertible Preferred Stock was considered a participating security because holders were entitled to receive dividends on an if-converted basis.

The Predecessor Company’s restricted stock awards were considered participating securities because holders were entitled to receive non-forfeitable dividends during the vesting term.

The calculation of diluted EPS for the Predecessor Company also considered the impact of its Convertible Junior Subordinated Debentures due December 2066 (the Debentures).

During the period which included the Company’s Series A Convertible Preferred Stock, basic and diluted EPS were computed using the two-class method, which is an earnings allocation that determines EPS for each class of common stock and participating securities according to dividends declared and participation rights in undistributed earnings.

The Company’s Series A Convertible Preferred Stock was considered a participating security because holders were entitled to receive dividends on an if-converted basis.

Diluted EPS assumes that participating securities are not executed or converted.

5 unchanged sentences

“Share-Based Compensation.”

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Up to the time of cancellation, a conversion of the Debentures could have resulted in payment for any conversion value in excess of the principal amount of the Debentures in the Predecessor Company’s common stock.

For diluted EPS purposes, potential common stock was calculated based on whether the market price of the Predecessor Company’s common stock at the end of each reporting period was in excess of the conversion price of the Debentures.

The effect of the Debentures was excluded from the calculation of diluted EPS for all Predecessor periods presented herein because to do so would have been anti-dilutive for those periods.

The computation of diluted EPS excluded aggregate share-based compensation awards of approximately 1.9 million and 0.3 million for the year ended December 31, 2019 and the period January 1 through April 1, 2017 , respectively, and less than 0.1 million for both the year ended December 31, 2018 and the period April 2 through December 31, 2017, because to do so would have been anti-dilutive for those periods.

The computation of diluted EPS excluded aggregate share-based compensation awards of approximately 2.2 million, 1.9 million and less than 0.1 million for the years ended December 31, 2020, 2019 and 2018 respectively, because to do so would have been anti-dilutive for those periods.

Because the potential dilutive impact of such share-based compensation awards is calculated under the treasury stock method, anti-dilution generally occurs when the exercise prices or unrecognized compensation cost per share of such awards are higher than the Company’s average stock price during the applicable period.

Anti-dilution also occurs when a company reports a net loss from continuing operations, and the dilutive impact of all share-based compensation awards are excluded accordingly.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

2 unchanged sentences

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

(In millions, except per share amounts)

2020 2019 2018

(In millions, except per share data)

EPS numerator:

(Loss) income from continuing operations, net of income taxes

$ ( 1,859.8 ) $ ( 188.3 ) $ 645.7

Series A Convertible Preferred Stock dividends — — 102.5

Net income attributable to noncontrolling interests

Net (loss) income attributable to noncontrolling interests ( 3.5 ) 26.2 16.9

(Loss) income from continuing operations attributable to common stockholders, before allocation of earnings to participating securities

( 1,856.3 ) ( 214.5 ) 526.3

Earnings allocated to participating securities — — 7.9

(Loss) income from continuing operations attributable to common stockholders, after allocation of earnings to participating securities (1)

Income (loss) from discontinued operations, net of income taxes

Income (loss) from discontinued operations allocated to participating securities

Income (loss) from discontinued operations attributable to common stockholders, after allocation of earnings to participating securities

( 1,856.3 ) ( 214.5 ) 518.4

(Loss) income from discontinued operations, net of income taxes ( 14.0 ) 3.2 18.1

Income from discontinued operations allocated to participating securities — — 0.3

(Loss) income from discontinued operations attributable to common stockholders, after allocation of earnings to participating securities ( 14.0 ) 3.2 17.8

Net (loss) income attributable to common stockholders, after allocation of earnings to participating securities (1)

$ ( 1,870.3 ) $ ( 211.3 ) $ 536.2

EPS denominator:

2 unchanged sentences

Weighted average shares outstanding — diluted (2)

97.7 103.7 121.0

Basic EPS attributable to common stockholders:

(Loss) income from continuing operations $ ( 18.99 ) $ ( 2.07 ) $ 4.35

Income (loss) from discontinued operations

(Loss) income from discontinued operations ( 0.15 ) 0.03 0.15

Net (loss) income attributable to common stockholders $ ( 19.14 ) $ ( 2.04 ) $ 4.50

1 unchanged sentence

(Loss) income from continuing operations $ ( 18.99 ) $ ( 2.07 ) $ 4.28

Income (loss) from discontinued operations

(Loss) income from discontinued operations ( 0.15 ) 0.03 0.15

Net (loss) income attributable to common stockholders $ ( 19.14 ) $ ( 2.04 ) $ 4.43

The reallocation adjustment for participating securities to arrive at the numerator to calculate diluted EPS was $ 0.1 million and $ 1.2 million for the year ended December 31, 2018 and the period April 2 through December 31, 2017, respectively.

(1) The reallocation adjustment for participating securities to arrive at the numerator to calculate diluted EPS was $ 0.1 million for the year ended December 31, 2018.

(2) The two-class method assumes that participating securities are not exercised or converted.

As such, weighted average diluted shares outstanding excluded 2.1 million shares and 33.5 million shares related to the participating securities for the year ended December 31, 2018, and the period April 2 through December 31, 2017, respectively.

In accordance with the Plan, each share of the Predecessor Company’s common stock outstanding prior to the Effective Date, including all options and warrants to purchase such stock, was extinguished, canceled and discharged, and each such share, option or warrant has no further force or effect after the Effective Date.

Furthermore, all of the Predecessor Company’s equity award agreements under prior incentive plans, and the equity awards granted pursuant thereto, were extinguished, canceled and discharged and have no further force or effect after the Effective Date.

Peabody Energy Corporation

2019 Form 10-K

As such, weighted average diluted shares outstanding excluded 2.1 million shares related to the participating securities for the year ended December 31, 2018.

As of January 31, 2018, all 30.0 million shares of Series A Convertible Preferred Stock issued upon the Effective Date had been converted into 59.3 million shares of Common Stock, which is inclusive of the shares that had been issued for the payable in-kind preferred stock dividends.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of January 31, 2018, all 30.0 million shares of Convertible Preferred Stock issued upon the Effective Date had been converted into 59.3 million shares of Common Stock, which is inclusive of the shares that had been issued for the payable in-kind preferred stock dividends.

(22) Management — Labor Relations

2 unchanged sentences

Approximately 29 % of those hourly employees were represented by organized labor unions and were employed by mines that generated 18 % of the Company’s 2020 coal production from continuing operations.

In the U.S., two mines are represented by an organized labor union.

In the U.S., one mine is represented by an organized labor union.

In Australia, the coal mining industry is unionized and the majority of hourly workers employed at the Company’s Australian mining operations are members of trade unions.

3 unchanged sentences

The following table presents the Company’s active mining operations as of December 31, 2020 in which the employees are represented by organized labor unions:

Current Agreement Expiration Date

September 2019

Mine Current Agreement Expiration Date

November 2024

Shoal Creek (2)

Owner-operated mines:

North Goonyella (3)

December 2018

Millennium (4)

Wilpinjong (3)

4 unchanged sentences

(1) Prior to its closure in 2019, hourly workers at the Company’s Kayenta Mine in Arizona were represented by the UMWA under the Western Surface Agreement, which was effective through September 16, 2019.

This agreement covered mostly now terminated hourly employees who generated approximately 3 % of the Company’s U.S.

production during the year ended December 31, 2019 .

The Company is in negotiations with the UMWA for an agreement covering the hourly workers expected to be involved in mining reclamation.

The Company concluded negotiations with the UMWA for a 4 year agreement covering the hourly workers expected to be involved in mining reclamation.

(2) Hourly workers at the Company’s Shoal Creek Mine in Alabama are represented by the UMWA under the Shoal Creek Wage Agreement, which is effective through April 1, 2021.

This agreement covers approximately 11 % of the Company’s U.S.

subsidiaries’ hourly employees who generated approximately 1 % of the Company’s U.S.

This agreement covers hourly employees who generated approximately 1 % of the Company’s U.S.

production during the year ended December 31, 2020.

The Company acquired the Shoal Creek Mine on December 3, 2018, as further described in Note 3.

“Acquisition of Shoal Creek Mine.”

Employees of the North Goonyella Mine operated under a separate labor agreement which expired in December 2018.

Due to the idling of the mine, as further described in Note 22.

“Other Events,” hourly employees were terminated and there are no current negotiations for a new labor agreement.

The current labor agreement for Millennium Mine expired in March 2019 and the Company has announced plans to close the mine in 2020.

The Company, employees and unions agreed via a memorandum of understanding to an extension of the expired agreement through March 2020, and a new labor agreement will not be required.

Hourly employees of this mine comprise approximately 1 % of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 2 % of the Company’s Australian production during the year ended December 31, 2019 .

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The current Wilpinjong labor agreement for Wilpinjong Mine expires in May 2020.

The hourly employees at the mine are temporarily laid off for an extended period and the Company issued a notice to the union in January 2021 to terminate the labor agreement and commence negotiations for a new agreement.

(3) The current Wilpinjong labor agreement for Wilpinjong Mine expired in May 2020.

Management, employees and the union are currently negotiating a new agreement.

Hourly employees of this mine comprise approximately 39 % of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 59 % of the Company’s Australian production during the year ended December 31, 2020.

4 unchanged sentences

(5) Employees of the Company’s Metropolitan Mine operate under a separate labor agreement, which expires in January 2021.

Management, employees and the union have commenced negotiations for a new agreement.

There is also a deputy labor agreement which expires in April 2022.

1 unchanged sentence

Hourly employees of this mine comprise approximately 14 % of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 4 % of the Company’s Australian production during the year ended December 31, 2020.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(6) Employees of the Wambo Open-Cut Mine operate under a separate enterprise agreement which will expire in March 2022.

Negotiations for the new agreement concluded in the fourth quarter of 2019.

There were market-related wage increases agreed over the three-year term of the new labor agreement.

The Wambo Open Cut enterprise agreement and employees transferred to Glencore on December 1, 2020 as part of the new Joint Venture.

Employees of the Company's Wambo Underground Mine operate under a separate labor agreement.

4 unchanged sentences

Hourly employees of this mine comprise approximately 23 % of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 9 % of the Company’s Australian production during the year ended December 31, 2020.

Employees of the North Goonyella Mine operated under a labor agreement which expired in December 2018.

Due to the idling of the mine, as further described in Note 20.

“Other Events,” hourly employees were terminated and there are no employees employed under the agreement and there are no current negotiations for a new labor agreement.

(23) Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees

In the normal course of business, the Company is a party to various guarantees and financial instruments that carry off-balance-sheet risk and are not reflected in the accompanying consolidated balance sheets.

At December 31, 2019 , such instruments included $ 1,609.2 million of surety bonds and bank guarantees and $ 200.5 million of letters of credit.

At December 31, 2020, such instruments included $ 1,633.6 million of surety bonds and $ 437.6 million of letters of credit.

Such financial instruments provide support for the Company’s reclamation bonding requirements, lease obligations, insurance policies and various other performance guarantees.

4 unchanged sentences

Such requirements are typically established by statute or under mining permits.

Historically, such assurances have taken the form of third-party instruments such as surety bonds, bank guarantees, letters of credit, cash collateral held in restricted accounts, and self-bonding arrangements in the U.S.

In connection with its emergence from the Chapter 11 Cases, the Company elected to utilize primarily a portfolio of surety bonds to support its U.S.

At December 31, 2019 , the Company’s asset retirement obligations of $ 752.3 million were supported by surety bonds of $ 1,401.7 million as well as letters of credit issued under the Company’s receivables securitization program and Revolver amounting to $ 106.1 million .

At December 31, 2020, the Company’s asset retirement obligations of $ 728.2 million were supported by surety bonds of $ 1,451.9 million, as well as letters of credit issued under the Company’s receivables securitization program and Revolver.

Letters of credit issued at December 31, 2020 amounted to $ 315.0 million, which served as collateral for surety bonds in support of asset retirement obligations.

Accounts Receivable Securitization

1 unchanged sentence

The receivables securitization program (Securitization Program) is subject to customary events of default set forth in the Receivables Purchase Agreement.

The Securitization Program provides for up to $ 250.0 million in funding accounted for as a secured borrowing, limited to the availability of eligible receivables, and may be secured by a combination of collateral and the trade receivables underlying the program, from time to time.

The Securitization Program expires April 1, 2022 and provides for up to $ 250.0 million in funding accounted for as a secured borrowing, limited to the availability of eligible receivables, and may be secured by a combination of collateral and the trade receivables underlying the program, from time to time.

Funding capacity under the Securitization Program may also be utilized for letters of credit in support of other obligations.

During 2019, the Company entered into an amendment to the Securitization Program to extend its term through April 1, 2022 and reduce program fees.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During 2020, the Receivables Purchase Agreement was amended to reduce certain dilutive constraints on eligible receivables and modify the Company’s reporting requirements under the Securitization Program.

Under the terms of the Securitization Program, the Company contributes the trade receivables of its participating subsidiaries on a revolving basis to P&L Receivables, its wholly-owned, bankruptcy-remote subsidiary, which then sells the receivables to unaffiliated banks.

1 unchanged sentence

The assets and liabilities of P&L Receivables are consolidated with Peabody, and the Securitization Program is treated as a secured borrowing for accounting purposes, but the assets of P&L Receivables will be used first to satisfy the creditors of P&L Receivables, not Peabody’s creditors.

The borrowings under the Securitization Program remain outstanding throughout the term of the agreement, subject to the Company maintaining sufficient eligible receivables, by continuing to contribute trade receivables to P&L Receivables, unless an event of default occurs.

At December 31, 2019 , the Company had no outstanding borrowings and $ 132.7 million of letters of credit drawn under the Securitization Program.

The letters of credit were primarily in support of portions of the Company’s obligations for reclamation, workers’ compensation and postretirement benefits.

The borrowings under the Securitization Program bear interest at LIBOR plus 1.5 % per annum and remain outstanding throughout the term of the agreement, subject to the Company maintaining sufficient eligible receivables, by continuing to contribute trade receivables to P&L Receivables, unless an event of default occurs.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

At December 31, 2020, the Company had no outstanding borrowings and $ 112.3 million of letters of credit issued under the Securitization Program.

The letters of credit were primarily in support of portions of the Company’s obligations for property and casualty insurance.

Availability under the Securitization Program, which is adjusted for certain ineligible receivables, was $ 19.3 million at December 31, 2020.

The Company had no cash collateral requirement under the Securitization Program at either December 31, 2019 or 2018 .

The Company incurred fees associated with the Securitization Program of $ 5.5 million , $ 5.2 million and $ 5.3 million during the years ended December 31, 2019 and 2018 and the period April 2 through December 31, 2017 , respectively, which have been recorded as “Interest expense” in the accompanying statements of operations.

As it relates to the former receivables securitization facility in place prior to the Effective Date, the Company incurred interest expense of $ 2.0 million during the period January 1 through April 1, 2017.

Collateral Arrangements and Restricted Cash

The Company remits cash to certain regulatory authorities and other third parties as collateral for financial assurances associated with a variety of long-term obligations and commitments surrounding the mining, reclamation and shipping of its production.

The Company had no collateral posted under the Securitization Program at either December 31, 2020 or 2019.

The Company incurred interest and fees associated with the Securitization Program of $ 2.6 million, $ 3.3 million and $ 5.2 million during the years ended December 31, 2020, 2019 and 2018, respectively, which have been recorded as “Interest expense” in the accompanying statements of operations.

Cash Collateral Arrangements and Restricted Cash

From time to time, the Company is required to remit cash to certain regulatory authorities and other third parties as collateral for financial assurances associated with a variety of long-term obligations and commitments surrounding employee related matters and the mining, reclamation and shipping of its production.

The Company had no such cash collateral or restricted cash requirements as of either December 31, 2020 or 2019.

The Company had $ 323.1 million held by third parties related to such obligations at December 31, 2017.

7 unchanged sentences

“Other Events.”

The Company has provided financial guarantees under certain long-term debt agreements entered into by its subsidiaries and substantially all of the Company’s U.S.

Substantially all of the Company’s U.S.

subsidiaries provide financial guarantees under long-term debt agreements entered into by the Company.

2 unchanged sentences

Unconditional Purchase Obligations

As of December 31, 2019 , purchase commitments for capital expenditures were $ 39.7 million , all of which is obligated in the next year.

As of December 31, 2020, purchase commitments for capital expenditures were $ 37.0 million, all of which is obligated in the next five years, with $ 29.3 million obligated within the next 12 months.

In Australia, the Company has generally secured the ability to transport coal through rail contracts and ownership interests in five east coast coal export terminals that are primarily funded through take-or-pay arrangements with terms ranging up to 22 years.

2 unchanged sentences

commitments under take-or-pay arrangements totaled $ 1.2 billion, of which approximately $ 95 million is obligated within the next year.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Contingencies

2 unchanged sentences

The Company discusses its significant legal proceedings below, including ongoing proceedings and those that impacted the Company’s results of operations for the periods presented.

Litigation Relating to the Chapter 11 Cases

Ad Hoc Committee.

On March 22, 2017, a group of creditors (the Ad Hoc Committee) that held certain interests in the Company's prepetition indebtedness appealed the Bankruptcy Court’s order confirming the Plan, requesting that the United States District Court for the Eastern District of Missouri (the District Court) reverse the Bankruptcy Court’s confirmation of the Plan and the order approving the Private Placement Agreement and Backstop Commitment Agreement.

On December 29, 2017, the District Court entered an order dismissing the Ad Hoc Committee's appeal, and, in the alternative, affirming the order confirming the Plan.

On January 26, 2018, the Ad Hoc Committee appealed the District Court's order to the United States Court of Appeals for the Eighth Circuit (the Eighth Circuit).

In its appeal, the Ad Hoc Committee asked the Eighth Circuit to award the Ad Hoc Committee members either unspecified damages or the right to buy an unspecified amount of Company stock at a discount.

Oral argument on the appeal was held April 16, 2019, and the Eighth Circuit issued a unanimous opinion in Peabody’s favor on August 9, 2019.

The Ad Hoc Committee did not seek rehearing or petition the Supreme Court for certiorari by the deadline of November 7, 2019.

Litigation Relating to Continuing Operations

Peabody Monto Coal Pty Ltd, Monto Coal 2 Pty Ltd and Peabody Energy Australia PCI Pty Ltd (PEA-PCI).

On October 1, 2007, a claim was made against Peabody Monto Coal Pty Ltd, a wholly-owned subsidiary of Macarthur Coal Limited (Macarthur) that is now a wholly-owned subsidiary of the Company, and Monto Coal 2 Pty Ltd, an equity accounted investee of Macarthur, now known as PEA-PCI.

The claim, made by the minority interest holders in the joint venture, alleged that the Macarthur companies breached certain agreements by failing to develop a mine project.

The claim was amended to assert that Macarthur also induced the alleged breach of the Monto Coal Joint Venture Agreement.

The Company acquired Macarthur and its subsidiaries in 2011.

The claim originally sought damages of up to $ 1.1 billion Australian dollars, plus interest and costs, but was amended in November 2019 to seek $ 18 million Australian dollars, plus interest and costs.

The Company asserted that the Macarthur companies were never under an obligation to develop the mine project because the project was not economically viable.

A trial commenced in the Supreme Court of Queensland, Australia on April 8, 2019 and concluded on December 12, 2019.

Before a decision was handed down, the parties reached a settlement to end the multi-year dispute, the terms of which included the Company (a) transferring its interests in Monto Coal 2 Pty Ltd, and therefore the Monto Coal Joint Venture, to the claimant;

and (b) agreeing to use commercially reasonable efforts to transfer certain other assets to the claimant.

These settlement terms are not expected to result in a material impact to the Company’s financial accounts.

As a result of the settlement, the parties filed a dismissal of the litigation on January 24, 2020.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

County of San Mateo, County of Marin, City of Imperial Beach.

The Company was named as a defendant, along with numerous other companies, in three nearly identical lawsuits brought by municipalities in California on July 17, 2017.

The lawsuits seek to hold a wide variety of companies that produce fossil fuels liable for the alleged impacts of the greenhouse gas emissions attributable to those fuels and seek compensatory and punitive damages in an amount to be proven at trial, attorneys’ fees and costs, disgorgement of profits and equitable relief of abatement.

The lawsuits primarily assert that the companies’ products have caused a sea level rise that is damaging the plaintiffs.

The complaints specifically alleged that the defendants’ activities from 1965 to 2015 caused such damage.

The Company filed a motion to enforce the Plan because it enjoins claims that arose before the effective date of the Plan.

The motion to enforce was granted on October 24, 2017, and the Bankruptcy Court ordered the plaintiffs to dismiss their lawsuits against the Company.

On November 26, 2017, the plaintiffs appealed the Bankruptcy Court’s October 24, 2017 order to the District Court.

On November 28, 2017, the plaintiffs sought a stay pending appeal from the Bankruptcy Court, which was denied on December 8, 2017.

On December 19, 2017, the plaintiffs moved the District Court for a stay pending appeal.

The District Court denied the stay request on September 20, 2018, and the plaintiffs have appealed that decision to the Eighth Circuit.

On March 29, 2019, the District Court affirmed the Bankruptcy Court ruling enjoining the plaintiffs from proceeding with their lawsuits against the Company.

That ruling likewise is being appealed.

In the underlying cases pending in California, the U.S.

District Court for the Northern District of California granted plaintiffs’ motion for remand and decided the cases should be heard in state court.

The defendants appealed the order granting remand to the Ninth Circuit and sought a stay of the U.S.

District Court for the Northern District of California decision pending completion of the Ninth Circuit appeal.

District Court for the Northern District of California granted defendants’ request for a stay pending completion of the Ninth Circuit appeal.

The plaintiffs filed a motion to dismiss part of the appeal.

The parties are now litigating at the Ninth Circuit whether a state or federal court should hear these lawsuits.

Regardless of whether state court or federal court is the venue, the Company believes the lawsuits against it should be dismissed under enforcement of the Plan.

The Company does not believe the lawsuits are meritorious and, if the lawsuits are not dismissed, the Company intends to vigorously defend them.

Litigation Relating to Continuing Operations

Securities Class Action.

On September 28, 2020, the Oklahoma Firefighters Pension and Retirement System brought a securities lawsuit against the Company and certain of its officers in the U.S.

District Court for the Southern District of New York on behalf of a putative class of shareholders (Plaintiffs) who purchased Company stock between April 3, 2017, and October 28, 2019 (Class Period), for alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder (Securities Class Action).

Plaintiffs allege that defendants made false or misleading statements and/or failed to disclose certain adverse facts pertaining to safety practices at the Company’s North Goonyella Mine and that, after a September 28, 2018 fire at the mine, made false or misleading statements and/or failed to disclose certain adverse facts pertaining to the feasibility of the Company’s plan to restart the mine after the fire.

The Company believes the lawsuit lacks merit and intends to vigorously defend against the allegations.

On January 12, 2021, the Court appointed Oregon Public Employees Retirement Fund as lead plaintiff.

On January 25, 2021, the Court entered a scheduling order for this matter.

Plaintiffs must file their amended complaint by March 19, 2021.

The defendants must file their motion to dismiss by June 7, 2021.

Additional briefings at this phase of litigation should be completed by the end of August 2021.

Derivative Actions.

On December 22, 2020, a plaintiff, putatively on behalf of the Company, brought a shareholder derivative lawsuit in the United States District Court for the District of Delaware against certain directors and a former officer of the Company, as defendants.

The Company was also named as a nominal defendant.

Plaintiff did not make a demand on the Company’s board before instituting the lawsuit, and alleges such demand would have been futile.

In the complaint, Plaintiff alleges that defendants allegedly failed to disclose adverse facts relating to the safety practices at the Company’s North Goonyella mine, thereby leading to a September 28, 2018 fire, and allegedly failed to disclose adverse facts pertaining to the feasibility of reopening the mine.

The derivative complaint alleges (i) contribution against certain current and former officers for securities fraud based on the Securities Class Action, and against all defendants, (ii) breach of fiduciary duties, (iii) waste of corporate assets for causing the Company to incur legal liability, and (iv) unjust enrichment.

On February 10, 2021, a second plaintiff, putatively on behalf of the Company, filed a similar shareholder derivative lawsuit in the United States District Court for the District of Delaware against the directors, two current officers and a former officer of the Company, as defendants.

The Company was named as a nominal defendant.

This suit makes claims similar to those made in the Phelps matter, but asserts a claim for alleged misstatements in a proxy statement under Section 14(a) of the Securities and Exchange Act of 1934.

The Company believes both lawsuits lack merit and intends to vigorously defend against the allegations.

At times, the Company becomes a party to other disputes, including those related to contract miner performance, claims, lawsuits, arbitration proceedings, regulatory investigations and administrative procedures in the ordinary course of business in the U.S., Australia and other countries where the Company does business.

Based on current information, the Company believes that such other pending or threatened proceedings are likely to be resolved without a material adverse effect on its financial condition, results of operations or cash flows.

Summary of Quarterly Financial Information (Unaudited)

A summary of the unaudited quarterly results of operations for the years ended December 31, 2019 and 2018 is presented below.

Year Ended December 31, 2019

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

(In millions, except per share data)

Operating profit (loss)

Income (loss) from continuing operations, net of income taxes

Net income (loss)

Net income (loss) attributable to common stockholders

Basic EPS — continuing operations (1)

Diluted EPS — continuing operations (1)

Weighted average shares used in calculating basic EPS

Weighted average shares used in calculating diluted EPS

EPS for the quarters may not sum to the amounts for the year as each period is computed on a discrete basis.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Operating profit for the first quarter of 2019 reflected $ 125.0 million related to insurance recoveries for property settlements resulting from the North Goonyella fire in September 2018.

Operating loss for the fourth quarter 2019 reflected a $ 48.1 million gain on formation of the United Wambo Joint Venture as it relates to the difference between the fair value of Peabody’s interest and the carrying value of the mining tenements and other assets contributed.

Operating loss for the third and fourth quarter of 2019 reflected the favorable net impact associated with the final commercial negotiations for the Kayenta Mine of $ 14.0 million and $ 69.3 million , respectively.

Operating loss for the third and fourth quarter of 2019 reflected $ 8.2 million and $ 11.8 million , respectively, in transactions costs related to the joint venture with Arch.

Operating loss for the third and fourth quarter of 2019 reflected asset impairment charges of $ 20.0 million and $ 250.2 million , respectively, related to mines within the Midwestern U.S.

Mining and Western U.S.

mining segments, certain unallocated U.S.

coal reserves and an investment in equity securities.

Operating results for the first and fourth quarter reflected $ 24.7 million and $ 58.5 million related to the provision for North Goonyella equipment loss, respectively.

Operating loss for the fourth quarter 2019 reflects $ 23.0 million in restructuring charges for workforce reductions.

Operating results for the second and fourth quarters included income from equity affiliates of $ 9.7 million and $ 10.9 million , respectively, while third quarter results reflected a loss of $ 20.7 million resulting from suspended operations and change in mine plan.

Results from continuing operations, net of income taxes for the first, second, third and fourth quarters of 2019 included steady interest expense of $ 35.8 million , $ 36.0 million , $ 35.4 million and $ 36.8 million , respectively, partially offset by interest income of $ 8.3 million , $ 7.2 million , $ 7.0 million and $ 4.5 million in the first, second, third and fourth quarters of 2019, respectively.

Loss from continuing operations, net of income taxes for the fourth quarter of 2019 included an adjustment of $ 67.4 million related to net mark-to-market losses on actuarially determined liabilities.

Year Ended December 31, 2018

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

(In millions, except per share data)

Operating profit

Income from continuing operations, net of income taxes

Net income attributable to common stockholders

Basic EPS — continuing operations (1)

Diluted EPS — continuing operations (1)

Weighted average shares used in calculating basic EPS

Weighted average shares used in calculating diluted EPS

EPS for the quarters may not sum to the amounts for the year as each period is computed on a discrete basis.

Operating profit for the first and third quarter of 2018 reflected $ 30.6 million and $ 20.7 million of gains on disposal of assets, respectively, primarily driven by net gains on the sale of certain surplus land assets in Queensland’s Bowen Basin and the sale of surplus coal resources associated with the Company’s Millennium Mine of $ 20.6 million and $ 20.5 million , respectively.

Operating profit for the third and fourth quarter of 2018 reflected $ 49.3 million and $ 17.1 million related to the provision for North Goonyella equipment loss, respectively.

Operating profit for the first, second and third quarter of 2018 included steady income from equity affiliates of $ 22.0 million , $ 25.2 million and $ 17.2 million , respectively, due to favorable coal pricing at Middlemount.

Operating profit for the fourth quarter of 2018 included acquisition costs related to the Shoal Creek Mine of $ 4.9 million .

Income from continuing operations, net of income taxes for the first, second, third and fourth quarters of 2018 included steady interest expense of $ 36.3 million , $ 38.3 million , $ 38.2 million and $ 36.5 million respectively, partially offset by interest income of $ 7.2 million , $ 7.0 million , $ 10.1 million and $ 9.3 million in the first, second, third and fourth quarters of 2018, respectively.

Income from continuing operations, net of income taxes for the first quarter of 2018 included a credit of $ 12.8 million for reorganization items, net due to a bankruptcy claims accrual adjustment in relation to the Company’s emergence from the Chapter 11 Cases.

Income from continuing operations, net of income taxes for the fourth quarter of 2018 reflected $ 125.5 million of net mark-to-market gains on actuarially determined liabilities.

The Company reassesses the probability and estimability of contingent losses as new information becomes available.

(25) Segment and Geographic Information

The Company reports its results of operations primarily through the following reportable segments:

Seaborne Thermal Mining, Seaborne Metallurgical Mining, Powder River Basin Mining, Midwestern U.S.

Mining, Western U.S.

Mining and Corporate and Other.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the year ended December 31, 2019, the Cottage Grove Mine in the Midwestern U.S.

Mining segment and the Kayenta Mine in the Western U.S.

Mining segment shipped their final tons.

The Company also announced the closures of the Wildcat HiIls Underground and Somerville Central Mines in the Midwestern U.S.

Mining segment, with both of those operations expecting to ship their final tons in 2020.

Due to these changes, the Company will update its reportable segments beginning in the first quarter of 2020 to combine the Midwestern U.S.

Mining segment with the Western U.S.

Mining segment, which reflects the manner in which the chief operating decision maker (CODM) views the Company’s businesses going forward for purposes of reviewing performance, allocating resources and assessing future prospects and strategic execution.

Beginning the first quarter of 2020, the Company will report its results of operations primarily through the following reportable segments:

During the year ended December 31, 2019, the Cottage Grove and Kayenta Mines closed, and the Company announced the planned closures of the Wildcat HiIls Underground and Somerville Central Mines.

Due to these changes, the Company revised its reportable segments beginning in the first quarter of 2020 to reflect the manner in which the chief operating decision maker (CODM) views the Company’s businesses going forward for purposes of reviewing performance, allocating resources and assessing future prospects and strategic execution.

The Company now reports its results of operations primarily through the following reportable segments:

Seaborne Thermal Mining, Seaborne Metallurgical Mining, Powder River Basin Mining, Other U.S.

Thermal Mining and Corporate and Other.

Prior period results have been recast for comparability.

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The business of the Company’s seaborne operating platform is primarily export focused with customers spread across several countries, with a portion of its thermal and metallurgical coal sold within Australia.

14 unchanged sentences

The mines in that segment are characterized by surface mining extraction processes, coal with a lower sulfur content and Btu and higher customer transportation costs (due to longer shipping distances).

The Company’s Midwestern U.S.

Mining operations include its Illinois and Indiana mining operations, which are characterized by a mix of surface and underground mining extraction processes, coal with a higher sulfur content and Btu and lower customer transportation costs (due to shorter shipping distances).

The Company’s Western U.S.

Mining operations historically reflect the aggregation of its New Mexico, Arizona and Colorado mining operations.

The mines in that segment are characterized by a mix of surface and underground mining extraction processes and coal with a mid-range sulfur content and Btu.

Geologically, the Company’s Powder River Basin Mining operations mine sub-bituminous coal deposits, its Midwestern U.S.

Mining operations mine bituminous coal deposits and its Western U.S.

Mining operations mine both bituminous and sub-bituminous coal deposits.

The Company’s Corporate and Other segment includes selling and administrative expenses, including its technical and shared services functions, results from equity affiliates, corporate hedging activities, trading and brokerage activities, certain mining and export/transportation joint ventures, restructuring charges and activities associated with the optimization of its coal reserve and real estate holdings, minimum charges on certain transportation-related contracts, the closure of inactive mining sites and certain commercial matters.

The Company’s Other U.S.

Thermal Mining operations historically reflect the aggregation of its Illinois, Indiana, New Mexico, Colorado and Arizona mining operations.

The mines in that segment are characterized by a mix of surface and underground mining extraction processes, coal with a higher sulfur content and Btu and lower customer transportation costs (due to shorter shipping distances).

Geologically, the Company’s Powder River Basin Mining operations mine sub-bituminous coal deposits and its Other U.S.

Thermal Mining operations mine both bituminous and sub-bituminous coal deposits.

The Company’s Corporate and Other segment includes selling and administrative expenses, including its technical and shared services functions;

results from equity affiliates;

corporate hedging activities;

trading and brokerage activities;

results from certain mining and export/transportation joint ventures;

minimum charges on certain transportation-related contracts;

the closure of inactive mining sites;

and certain commercial matters.

The Company’s CODM uses Adjusted EBITDA as the primary metric to measure the segments’ operating performance.

1 unchanged sentence

Adjusted EBITDA is also adjusted for the discrete items that management excluded in analyzing the segments’ operating performance, as displayed in the reconciliation below.

The Company has retrospectively modified its calculation of Adjusted EBITDA to exclude restructuring charges and transaction costs related to business combinations and joint ventures as management does not view these items as part of its normal operations.

Management believes non-GAAP performance measures are used by investors to measure the Company’s operating performance and lenders to measure the Company’s ability to incur and service debt.

1 unchanged sentence

GAAP measures of performance and may not be comparable to similarly-titled measures presented by other companies.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Segment results for the year ended December 31, 2020 were as follows:

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate

and Other Consolidated

(Dollars in millions)

Revenues $ 711.8 $ 486.5 $ 991.1 $ 707.3 $ ( 15.6 ) $ 2,881.1

Adjusted EBITDA 163.2 ( 130.2 ) 194.8 168.4 ( 137.4 ) 258.8

Additions to property, plant, equipment and mine development

Income from equity affiliates

100.7 50.8 13.2 23.3 3.4 191.4

Loss from equity affiliates — — — — 60.1 60.1

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Segment results for the year ended December 31, 2019 were as follows:

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

(Dollars in millions)

Adjusted EBITDA

Additions to property, plant, equipment and mine development

Federal coal lease expenditures

Income from equity affiliates

Segment results for the period April 2 through December 31, 2017 were as follows:

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate

and Other Consolidated

(Dollars in millions)

Revenues $ 971.7 $ 1,033.1 $ 1,228.7 $ 1,309.4 $ 80.5 $ 4,623.4

Adjusted EBITDA 329.4 140.2 221.2 361.4 ( 169.2 ) 883.0

Additions to property, plant, equipment and mine development

42.1 143.4 42.8 54.0 3.1 285.4

Income from equity affiliates

Segment results for the period January 1 through April 1, 2017 were as follows:

Seaborne Thermal Mining

Seaborne Metallurgical Mining

Powder River Basin Mining

— — — — ( 3.4 ) ( 3.4 )

Segment results for the year ended December 31, 2018 were as follows:

Seaborne Thermal Mining Seaborne Metallurgical Mining Powder River Basin Mining Other U.S.

Thermal Mining Corporate

and Other Consolidated

(Dollars in millions)

Revenues $ 1,099.2 $ 1,553.0 $ 1,424.8 $ 1,393.0 $ 111.8 $ 5,581.8

Adjusted EBITDA 452.0 441.4 284.5 290.6 ( 80.6 ) 1,387.9

Additions to property, plant, equipment and mine development

66.6 88.7 81.0 60.5 4.2 301.0

Federal coal lease expenditures — — — 0.5 — 0.5

Income from equity affiliates

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

— — — — ( 68.1 ) ( 68.1 )

Asset details are reflected at the division level only for the Company’s mining segments and are not allocated between each individual segment as such information is not regularly reviewed by the Company’s CODM.

Further, some assets service more than one segment within the division and an allocation of such assets would not be meaningful or representative on a segment by segment basis.

Assets related to closed, suspended or otherwise inactive mines are included within the Corporate and Other category.

Assets as of December 31, 2020 were as follows:

Seaborne Mining

Thermal Mining

Seaborne Mining U.S.

Thermal Mining Corporate

and Other Consolidated

(Dollars in millions)

Total assets $ 1,763.0 $ 1,345.3 $ 1,558.8 $ 4,667.1

Property, plant, equipment and mine development, net

1,347.3 1,258.8 445.0 3,051.1

Operating lease right-of-use assets 30.8 3.5 15.6 49.9

Assets as of December 31, 2019 were as follows:

Seaborne Mining

Thermal Mining

Seaborne Mining U.S.

Thermal Mining Corporate

and Other Consolidated

(Dollars in millions)

Total assets $ 2,001.3 $ 3,044.8 $ 1,496.7 $ 6,542.8

Property, plant, equipment and mine development, net

1,610.9 2,776.9 291.3 4,679.1

Operating lease right-of-use assets 32.1 30.3 20.0 82.4

Assets as of December 31, 2018 were as follows:

Seaborne Mining

Thermal Mining

Seaborne Mining U.S.

Thermal Mining Corporate

and Other Consolidated

(Dollars in millions)

Total assets $ 2,044.6 $ 3,481.7 $ 1,897.4 $ 7,423.7

Property, plant, equipment and mine development, net

Peabody Energy Corporation

2019 Form 10-K

1,661.3 3,180.4 365.3 5,207.0

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

2 unchanged sentences

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

(Dollars in millions)

2 unchanged sentences

Asset retirement obligation expenses 45.7 58.4 53.0

Restructuring charges 37.9 24.3 1.2

Transaction costs related to business combinations and joint ventures 23.1 21.6 7.4

Gain on formation of United Wambo Joint Venture — ( 48.1 ) —

4 unchanged sentences

Interest expense 139.8 144.2 151.3

Loss on early debt extinguishment

Interest income ( 9.4 ) ( 27.0 ) ( 33.6 )

Net mark-to-market adjustment on actuarially determined liabilities

( 5.1 ) 67.4 ( 125.5 )

Reorganization items, net — — ( 12.8 )

Gain on disposal of reclamation liability

Gain on disposal of Burton Mine assets

Break fees related to terminated asset sales

Unrealized (gains) losses on economic hedges

Unrealized losses (gains) on economic hedges 29.6 ( 42.2 ) ( 18.3 )

Unrealized (gains) losses on non-coal trading derivative contracts ( 7.1 ) ( 1.2 ) 0.7

Fresh start coal inventory revaluation

Fresh start take-or-pay contract-based intangible recognition

Income tax provision (benefit)

Take-or-pay contract-based intangible recognition ( 8.2 ) ( 16.6 ) ( 26.7 )

Income tax provision 8.0 46.0 18.4

Total Adjusted EBITDA $ 258.8 $ 883.0 $ 1,387.9

3 unchanged sentences

The remaining $ 33.9 million, applicable to incremental costs and business interruption losses, is included in Adjusted EBITDA for the year ended December 31, 2019.

Peabody Energy Corporation

2019 Form 10-K

PEABODY ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table presents revenues as a percent of total revenue from external customers by geographic region:

Year Ended December 31,

Year Ended December 31, 2018

April 2 through December 31, 2017

January 1 through April 1, 2017

2020 2019 2018

56.2 % 53.6 % 47.8 %

Japan 13.3 % 15.4 % 10.1 %

Taiwan 7.7 % 6.0 % 8.1 %

Australia 6.9 % 5.8 % 6.6 %

China 3.8 % 3.8 % 5.9 %

India 2.6 % 1.2 % 6.2 %

Vietnam 2.4 % 2.0 % 0.5 %

South Korea 0.8 % 2.9 % 3.1 %

Other 6.3 % 9.3 % 11.7 %

Total 100.0 % 100.0 % 100.0 %

The Company attributes revenue to individual countries based on the location of the physical delivery of the coal.

Peabody Energy Corporation

2019 Form 10-K

Peabody Energy Corporation 2020 Form 10-K

PEABODY ENERGY CORPORATION

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

Beginning of Period

Costs and Expenses

Charged to Other Accounts

Deductions (1)

Description Balance at

Beginning of Period Charged to

Costs and Expenses Deductions (1)

Other Balance

at End of Period

4 unchanged sentences

Reserve for materials and supplies 7.9 3.5 ( 1.0 ) — 10.4

Allowance for doubtful accounts

Tax valuation allowances 2,068.4 373.2 — ( 154.3 ) (2) 2,287.3

3 unchanged sentences

Reserve for materials and supplies 0.2 8.9 ( 1.2 ) — 7.9

Allowance for doubtful accounts

Tax valuation allowances

April 2 through December 31, 2017

Reserves deducted from asset accounts:

Advance royalty recoupment reserve

Reserve for materials and supplies

Allowance for doubtful accounts

Allowance for credit losses 4.4 ( 4.4 ) — — —

Tax valuation allowances 2,094.3 ( 29.8 ) — 3.9 2,068.4

January 1 through April 1, 2017

Year Ended December 31, 2018

Reserves deducted from asset accounts:

1 unchanged sentence

Reserve for materials and supplies 0.6 0.5 ( 0.9 ) — 0.2

Allowance for doubtful accounts

Allowance for credit losses 4.6 ( 0.2 ) — — 4.4

Tax valuation allowances 2,432.5 ( 275.0 ) — ( 63.2 ) (3) 2,094.3

(1) Reserves utilized, unless otherwise indicated.

Fresh start reporting adjustments.

Release of valuation allowance primarily related to carrybacks of U.S.

net operating losses.

(2) Includes the impact of a decrease in Australia NOLs due to a cancellation of intercompany debt, partially offset by the impact of the increase in the Australian dollar exchange rates.

(3) Includes the impact of the decrease in Australian dollar exchange rates, partially offset by the impact of final attribute reduction adjustments in the U.S.

Peabody Energy Corporation

2019 Form 10-K

EXHIBIT INDEX

The exhibits below are numbered in accordance with the Exhibit Table of Item 601 of Regulation S-K.

Description of Exhibit

Debtors’ Second Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code as revised March 15, 2017 (Incorporated by reference to Exhibit 2.2 of the Registrant’s Current Report on Form 8-K, filed March 20, 2017).

Order Confirming Debtors’ Second Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code on March 17, 2017 (Incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K, filed March 20, 2017).

Asset Purchase Agreement, dated as of September 20, 2018, by and between Drummond Company, Inc.

Implementation Agreement, dated as of June 18, 2019, between Peabody Energy Corporation and Arch Coal, Inc.

(Incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K/A filed on June 19, 2019).

Fourth Amended and Restated Certificate of Incorporation of the Registrant (Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed April 3, 2017).

Amended and Restated By-Laws of the Registrant (Incorporated by reference to Exhibit 3.3 of the Registrant’s Current Report on Form 8-K filed April 3, 2017).

Specimen of stock certificate representing the Registrant’s common stock, $.01 par value (Incorporated by reference to Exhibit 4.13 to Amendment No.

4 to the Registrant’s Form S-1 Registration Statement No.

333-55412, filed May 1, 2001).

Indenture, dated as of February 15, 2017, between Peabody Securities Finance Corporation and Wilmington Trust, National Association, as Trustee, governing 6.000% Senior Secured Notes due 2022 and 6.375% Senior Secured Notes due 2025 (Incorporated by reference to Exhibit 4.1 of the Registrant’s Current Report on Form 8-K, filed February 15, 2017).

First Supplemental Indenture, dated as of April 3, 2017, among the Registrant, Peabody Securities Finance Corporation, the subsidiary guarantors party thereto and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.3 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

Second Supplemental Indenture, dated as of May 7, 2018, among the Registrant, NGS Acquisition Corp., LLC, and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.4 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

Third Supplemental Indenture, dated as of August 9, 2018, between the Registrant and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2018).

Fourth Supplemental Indenture, dated as of December 7, 2018, among the Registrant, Peabody Southeast Mining, LLC, and Wilmington Trust, National Association, as trustee (Incorporated by reference to Exhibit 4.6 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

Description of Securities.

Federal Coal Lease WYW0321779:

North Antelope/Rochelle Mine (Incorporated by reference to Exhibit 10.3 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

Federal Coal Lease WYW119554:

North Antelope/Rochelle Mine (Incorporated by reference to Exhibit 10.4 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

Federal Coal Lease WYW5036:

Rawhide Mine (Incorporated by reference to Exhibit 10.5 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

Federal Coal Lease WYW3397:

Caballo Mine (Incorporated by reference to Exhibit 10.6 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

Federal Coal Lease WYW83394:

Caballo Mine (Incorporated by reference to Exhibit 10.7 of the Registrant’s Form S-4 Registration Statement No.

333-59073, filed July 14, 1998).

Federal Coal Lease WYW136142 (Incorporated by reference to Exhibit 10.8 of Amendment No.

1 to the Registrant’s Form S-4 Registration Statement No.

333-59073, filed September 8, 1998).

Royalty Prepayment Agreement by and among Peabody Natural Resources Company, Gallo Finance Company and Chaco Energy Company, dated September 30, 1998 (incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1998).

Federal Coal Lease WYW154001:

North Antelope Rochelle South (Incorporated by reference to Exhibit 10.68 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004).

Federal Coal Lease WYW150210:

North Antelope Rochelle Mine (Incorporated by reference to Exhibit 10.8 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2005).

Federal Coal Lease WYW151134 effective May 1, 2005:

West Roundup (Incorporated by reference to Exhibit 10.1 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2005).

Federal Coal Lease Readjustment WYW78633:

Caballo (Incorporated by reference to Exhibit 10.24 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

Transfer by Assignment and Assumption of Federal Coal Lease WYW172657:

Caballo West (Incorporated by reference to Exhibit 10.25 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

Federal Coal Lease WYW176095:

Porcupine South (Incorporated by reference to Exhibit 10.26 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

Federal Coal Lease WYW173408:

North Porcupine (Incorporated by reference to Exhibit 10.27 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

Federal Coal Lease WYW172413:

School Creek (Incorporated by reference to Exhibit 10.28 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012).

Separation Agreement, Plan of Reorganization and Distribution, dated October 22, 2007, between the Registrant and Patriot Coal Corporation (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

Tax Separation Agreement, dated October 22, 2007, between the Registrant and Patriot Coal Corporation (Incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

Coal Act Liabilities Assumption Agreement, dated October 22, 2007, among Patriot Coal Corporation, Peabody Holding Company, LLC and the Registrant (Incorporated by reference to Exhibit 10.3 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

Salaried Employee Liabilities Assumption Agreement, dated October 22, 2007, among Patriot Coal Corporation, Peabody Holding Company, LLC, Peabody Coal Company, LLC and the Registrant (Incorporated by reference to Exhibit 10.5 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

Coal Supply Agreement, dated October 22, 2007, between Patriot Coal Sales LLC and COALSALES II, LLC (Incorporated by reference to Exhibit 10.6 of the Registrant’s Current Report on Form 8-K, filed October 25, 2007).

Settlement Agreement entered into as of October 24, 2013, by and among Patriot Coal Corporation, on behalf of itself and its affiliates, the Registrant, on behalf of itself and its affiliates, and the United Mine Workers of America, on behalf of itself and the UMWA Employees and UMWA Retirees (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed October 30, 2013).

Purchase and Sale Agreement, dated as of November 20, 2015, by and between Four Star Holdings, LLC and Western Megawatt Resources, LLC (Incorporated by reference to Exhibit 10.28 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2015).

Employment Agreement entered into as of August 21, 2013, by and between Peabody Energy Corporation and Glenn L.

Kellow (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on August 27, 2013).

Restrictive Covenant Agreement entered into as of August 21, 2013, by and between Peabody Energy Corporation and Glenn L.

Kellow (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on August 27, 2013).

Letter dated January 27, 2015 to Glenn L.

Kellow from the Chairman of the Compensation Committee of the Peabody Energy Corporation Board of Directors (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 28, 2015).

Letter Agreement entered into as of January 27, 2015, by and between Peabody Energy Corporation and Glenn L.

Kellow (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on January 28, 2015).

Letter Agreement entered into as of April 20, 2015, by and between Peabody Energy Corporation and Glenn L.

Kellow (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on April 21, 2015).

Restated Employment Agreement entered into as of January 7, 2013 by and between the Registrant and Charles F.

Meintjes (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed January 10, 2013).

Restated Employment Agreement entered into as of December 20, 2012 by and between the Registrant and Kemal Williamson (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on December 26, 2012).

Peabody Energy Corporation 2019 Executive Severance Plan.

(Incorporated by reference to Exhibit 10.32 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

Limited Waiver to Purchase and Sale Agreement by and between Four Star Holdings, LLC and Western Megawatt Resources, LLC dated March 30, 2016 (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed March 31, 2016).

Fifth Amended and Restated Receivables Purchase Agreement, dated as of March 25, 2016, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various Sub-Servicers listed on the signature pages thereto, all Conduit Purchasers listed on the signature pages thereto, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed March 31, 2016).

First Amendment to the Fifth Amended and Restated Receivables Purchase Agreement, dated as of April 12, 2016, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various Sub-Servicers listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as the Sole Purchaser, Committed Purchaser, LC Bank and LC Participant (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 13, 2016).

Second Amendment to the Fifth Amended and Restated Receivables Purchase Agreement, dated as of April 18, 2016, by and among Peabody Energy Corporation, P&L Receivables Company, LLC, the various Sub-Servicers listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as the Sole Purchaser, Committed Purchaser, LC Bank and LC Participant (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 22, 2016).

Superpriority Secured Debtor-In-Possession Credit Agreement, dated as of April 18, 2016, by and among Peabody Energy Corporation, the guarantors party thereto, the lenders party thereto and Citibank, N.A.

as Administrative Agent and L/C Issuer (Incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed April 22, 2016).

Amendment No.

as Administrative Agent (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed May 24, 2016).

Amendment No.

as Administrative Agent (Incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed May 24, 2016).

Amendment No.

5 to Superpriority Secured Debtor-In-Possession Credit Agreement, by and among Peabody Energy Corporation, Peabody Global Funding, LLC (f/k/a Global Center for Energy and Human Development, LLC) and certain Debtors parties thereto as guarantors, the lenders party thereto and Citibank, N.A., as administrative agent (Incorporated by reference to the Registrant’s Current Report on Form 8-K filed November 23, 2016).

Amendment No.

6 to Superpriority Secured Debtor-In-Possession Credit Agreement, by and among Peabody Energy Corporation, Peabody Global Funding, LLC and certain Debtors parties thereto as guarantors, the lenders party thereto and Citibank, N.A., as administrative agent (Incorporated by reference to the Registrant’s Current Report on Form 8-K filed December 14, 2016).

Plan Support Agreement entered into as of December 22, 2016 by and among the Registrant and certain other parties thereto (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed December 23, 2016).

Private Placement Agreement entered into as of December 22, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed December 23, 2016).

Amendment to Private Placement Agreement entered into as of December 28, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed December 30, 2016).

Second Amendment to Private Placement Agreement entered into as of February 8, 2017 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.127 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016).

Backstop Commitment Agreement entered into as of December 23, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed December 23, 2016).

Amendment to Backstop Commitment Agreement entered into as of December 28, 2016 by and among the Registrant and certain of its creditors party thereto (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed December 30, 2016).

Share Sale and Purchase Agreement entered into as of November 3, 2016 by and among Peabody Australia Mining Pty Ltd, Peabody Energy Australia Pty Ltd, South32 Aluminium (Holdings) Pty Ltd, and South32 Treasury Limited (Incorporated by reference to Exhibit 10.124 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016).

Exit Facility Commitment Letter entered into as of January 11, 2017, by and among the Registrant, Goldman Sachs Bank USA, JPMorgan Chase Bank, N.A., Credit Suisse AG, Credit Suisse Securities (USA) LLC, Macquarie Capital Funding LLC and Macquarie Capital (USA) Inc.

(Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 12, 2017).

Receivables Purchase Facility Commitment Letter entered into as of January 27, 2017, by and among the Registrant, P&L Receivables Company, LLC and PNC Bank, National Association (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 27, 2017).

Notice Letter and Term Sheet dated as of February 15, 2017, for Amendments to the Receivables Purchase Facility Commitment Letter entered into as of January 27, 2017, by and among the Registrant, P&L Receivables Company, LLC and PNC Bank, National Association (Incorporated by reference to Exhibit 10.128 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016).

Settlement Agreement dated as of March 13, 2017 by and among the Registrant, certain subsidiaries of the Registrant, and the United Mine Workers of America 1974 Pension Plan and Trust (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on March 17, 2017).

Sixth Amended and Restated Receivables Purchase Agreement, dated as of April 3, 2017, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various Sub-Servicers listed on the signature pages thereto, all Conduit Purchasers listed on the signature pages thereto, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.4 of the Registrant’s Current Report on Form 8-K filed April 3, 2017).

First Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of June 30, 2017, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, the various parties identified on the signature pages thereto as Sub-Servicers, Metropolitan Collieries Pty Ltd, and PNC Bank, National Association, as Administrator and as the sole Purchaser Agent, Committed Purchaser, LC Bank and LC Participant on the date thereof (Incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q, filed August 14, 2017).

Second Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of December 13, 2017, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, Regions Bank, and PNC Bank, National Association, as Administrator and as the sole Purchaser Agent, Committed Purchaser, LC Bank and LC Participant on the date thereof (Incorporated by reference to Exhibit 10.57 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017).

Fifth Amendment to the Sixth Amended and Restated Receivables Purchase Agreement, dated as of April 3, 2019, by and among P&L Receivables Company, LLC, Peabody Energy Corporation, all Committed Purchasers listed on the signature pages thereto, all Purchaser Agents listed on the signature pages thereto, all LC Participants listed on the signature pages thereto, and PNC Bank, National Association, as Administrator and as LC Bank (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed April 4, 2019).

Credit Agreement dated as of April 3, 2017, among the Registrant, as Borrower, Goldman Sachs Bank USA, as Administrative Agent, and the other lenders party thereto (Incorporated by reference to Exhibit 10.3 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

Amendment No.

Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 4.6 of the Registrant’s Registration Statement on Form S-8, filed April 3, 2017).

Registration Rights Agreement, dated as of April 3.

2017, among the Registrant and the stockholders party thereto (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed, April 3, 2017).

Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.9 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017).

Form of Restricted Stock Unit Agreement (Incorporated by reference to Exhibit 10.7 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

Form of Restrictive Covenant Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.8 of the Registrant’s Current Report on Form 8-K, filed April 3, 2017).

Form of Deferred Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.12 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017).

Form of Performance Share Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan.

(Incorporated by reference to Exhibit 10.68 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017).

Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.73 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

Form of Deferred Stock Unit Agreement under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.74 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018).

Form of Restricted Stock Unit Agreement (ELT Level 2019 Special Award) under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.75 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019).

Form of Restricted Stock Unit Agreement (Director Level and Above 2019 Special Award) under the Peabody Energy Corporation 2017 Incentive Plan (Incorporated by reference to Exhibit 10.76 of the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019).

List of Subsidiaries.

Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.

Certification of periodic financial report by the Registrant’s Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of periodic financial report by the Registrant’s Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of periodic financial report pursuant to 18 U.S.C.

Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Registrant’s Chief Executive Officer.

Certification of periodic financial report pursuant to 18 U.S.C.

Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Registrant’s Chief Financial Officer.

Mine Safety Disclosure required by Item 104 of Regulation S-K.

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These exhibits constitute all management contracts, compensatory plans and arrangements required to be filed as an exhibit to this form pursuant to Item 15(a)(3) and 15(b) of this report.

Filed herewith.

Peabody Energy Corporation 2020 Form 10-K

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 9A. Controls and Procedures