PEABODY ENERGY CORP 10-Q

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. Dividends During the fourth quarter of 2020, the Company entered into a transaction support agreement with its surety bond providers which prohibited the payment of dividends through the earlier of December 31, 2025, or the maturity of the credit agreement unless otherwise agreed to by the parties to the agreement. Additionally, restrictive covenants in the Company’s credit facility also limited the Company’s ability to pay cash dividends. On April 14, 2023, the Company amended the existing transaction support agreement with the surety bond providers to remove the restrictions on shareholder returns, subject to a minimum liquidity threshold, and terminated the credit facility. The declaration and payment of dividends and the amount of dividends will depend on the Company’s annual Available Free Cash Flow (AFCF). AFCF is defined as quarterly operating cash flow minus investing cash flow; distributions to noncontrolling interests; plus/minus changes to restricted cash and collateral (excluding one-time effects of the recent surety agreement amendment) and other anticipated expenditures. Peabody anticipates a regular quarterly cash dividend of $0.075 per share, but all shareholder returns remain at the Board of Director's discretion. On April 27, 2023, the Company declared a dividend per share of $0.075 to be paid on May 31, 2023 to shareholders of record as of May 11, 2023. Share Relinquishments 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 value of common stock tendered by employees is determined based on the closing price of the Company’s common stock on the dates of the respective relinquishments. Share Repurchase Program Similar to the payment of dividends as described above, the same agreement with the Company’s surety bond providers prohibited share repurchases through the earlier of December 31, 2025, or the maturity of the credit agreement unless otherwise agreed to by the parties to the agreement. Additionally, restrictive covenants in its credit facility also limited the Company’s ability to repurchase shares. The April 14, 2023 amendment and termination of the credit facility as described above, allow share repurchases subject to the Company’s annual AFCF. 46 Table of Contents On August 1, 2017, the Company announced that its Board of Directors authorized a share repurchase program to allow repurchases of up to $500 million of the then outstanding shares of its common stock and/or preferred stock (2017 Repurchase Program), which was eventually expanded to $1.5 billion during 2018. Through March 31, 2023, the Company had repurchased 41.5 million shares of its common stock under the 2017 Repurchase Program for $1,340.3 million, which included commissions paid of $0.8 million. On April 17, 2023, the Company announced that its Board of Directors authorized a new share repurchase program (2023 Repurchase Program) authorizing repurchases of up to $1.0 billion of its common stock. The 2017 Repurchase Program was superseded and replaced by the 2023 Repurchase Program. Under the 2023 Repurchase Program, the Company may purchase shares of common stock from time to time at the discretion of management through open market purchases, privately negotiated transactions, block trades, accelerated or other structured share repurchase programs, or other means. The manner, timing, pricing, and amount of any share repurchase transactions will be based on a variety of factors, including market conditions, applicable legal requirements, and alternative opportunities that the Company may have for the use or investment of capital. Issuances of Equity Securities In June 2021, the Company announced an at-the-market equity offering program pursuant to which the Company could offer and sell up to 12.5 million shares of its common stock. The at-the-market equity offering program was further expanded to 32.5 million shares during 2021. The shares are offered and sold pursuant to the Company’s Registration Statement on Form S-3, which was declared effective by the Securities and Exchange Commission on April 23, 2021, as supplemented by prospectus supplements dated June 4, 2021, September 17, 2021, and December 17, 2021 relating to the offer and sale of the shares. Through March 31, 2023, the Company has sold approximately 24.8 million shares for net cash proceeds of $269.8 million. No sales were made under this at-the-market equity offering program during the three months ended March 31, 2023, leaving approximately 7.7 million shares available for sale. On March 7, 2022, the Company entered into an at-the-market equity offering program pursuant to which the Company could offer and sell shares of its common stock having an aggregate gross sales price of up of $225 million. The shares are offered and sold pursuant to the Company’s Registration Statement on Form S-3, which was declared effective by the Securities and Exchange Commission on April 23, 2021, as supplemented by a prospectus supplement dated March 7, 2022 relating to the offer and sale of the shares. During the three months ended March 31, 2022, the Company sold approximately 10.1 million shares for net proceeds of $222.0 million, thereby concluding this at-the-market equity offering program. Purchases of Equity Securities The following table summarizes all share purchases for the three months ended March 31, 2023: Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Dollar Value that May Yet Be Used to Repurchase Shares Under the Publicly Announced Program (2) (In millions) January 1 through January 31, 2023 138,407 $ 26.03 — $ 160.5 February 1 through February 28, 2023 365,946 26.19 — 160.5 March 1 through March 31, 2023 — — — 160.5 Total 504,353 26.15 — (1) Shares withheld to cover the withholding taxes upon the vesting of equity awards, which are not part of the publicly announced repurchase programs. (2) The 2017 Repurchase Program was in effect until the announcement of the 2023 Repurchase Program on April 17, 2023. The maximum dollar value available for repurchase reflects the amount available as of the month-end date for each period shown. 47 Table of Contents Item 4. Mine Safety Disclosures. Peabody’s “Safety and Sustainability Management System” has been designed to set clear and consistent expectations for safety, health and environmental stewardship across the Company’s business. It aligns to the National Mining Association’s CORESafety® framework and encompasses three fundamental areas: leadership and organization, risk management and assurance. Peabody also partners with other companies and certain governmental agencies to pursue new technologies that have the potential to improve its safety performance and provide better safety protection for employees. Peabody continually monitors its safety performance and regulatory compliance. The information concerning mine safety violations or other regulatory matters required by SEC regulations is included in Exhibit 95 to this Quarterly Report on Form 10-Q. Item 6. Exhibits. See Exhibit Index on following pages. 48 Table of Contents EXHIBIT INDEX The exhibits below are numbered in accordance with the Exhibit Table of Item 601 of Regulation S-K. Exhibit No. Description of Exhibit 10.1 Amendment to Surety Transaction Support Agreement and Surety Term Sheet , dated as of April 14, 2023, by and among Peabody Energy Corporation, certain subsidiaries of Peabody Energy Corporation party thereto and the providers of its surety program (Incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K filed April 1 7 , 2023). 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). † Filed herewith. 49 Table of Contents SIGNATURE Pursuant to the requirements 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. PEABODY ENERGY CORPORATION Date: May 4, 2023 By: /s/ MARK A. SPURBECK Mark A. Spurbeck Executive Vice President and Chief Financial Officer (On behalf of the registrant and as Principal Financial Officer) 50