What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2022-04-01 compared with 2021-02-18 · 262 added, 176 removed, 405 unchanged (52% of the section changed)

1 unchanged sentence

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm ( PCAOB ID 173 )

Consolidated Balance Sheets

3 unchanged sentences

Notes to Consolidated Financial Statements

Selected Quarterly Financial Data (Unaudited)

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Stockholders and the Board of Directors of Ramaco Resources, Inc.

Lexington, Kentucky

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Ramaco Resources, Inc.

(the "Company") as of December 31, 2021, the related consolidated statements of operations, stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the "financial statements").

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

Basis for Opinion

These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company's financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.

Accordingly, we express no such opinion.

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

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

We believe that our audit provides a reasonable basis for our opinion.

Critical Audit Matters

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

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

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

Information Technology General Controls and Control Environment

Description of Critical Audit Matter

As discussed in Management's Report on Internal Control Over Financial Reporting, the Company identified a material weakness in their internal control over financial reporting related to ineffective information technology general controls (ITGC’s) in the areas of user access and certain automated and manual business process controls that are dependent on the affected ITGCs (control environment).

Based on the ineffective ITGC’s, we identified the performance of the necessary incremental audit procedures over the financial information reliant on the impacted ITGC’s as a critical audit matter.

Significant auditor judgment was required to design and execute the incremental audit procedures and to assess the sufficiency of the procedures performed and evidence obtained.

The primary procedures we performed to address the critical audit matter included the following.

● Involving forensic professionals with specialized skills and knowledge in data analysis to perform an evaluation of the journal entry data, vendor master file, and disbursement files.

Forensic professionals also assisted with the identification of certain entries that required additional testing and for all such entries, we agreed the journal entry data to source documents.

● Tested the underlying records of selected transactions and other data discussed above to support the use of the information in the conduct of the audit;

● We evaluated the collective results of the incremental audit procedures performed to assess the sufficiency of audit evidence obtained related to the information produced by the impacted IT systems.

Asset Retirement Obligations

Description of Critical Audit Matter

At December 31, 2021, the Company’s asset retirement obligations (“ARO”) totaled $22.6 million.

The Company’s ARO primarily consist of spending estimates, based upon detailed engineering calculations, related to reclaiming metallurgical coal land and support facilities in accordance with federal and state reclamation laws as defined by each mining permit.

Legal obligations associated with the retirement of long-lived assets are reflected at their estimated fair value, with a corresponding charge to development costs, at the time they are incurred.

The liability is accreted to its present value each period and the capitalized cost is amortized using the units-of-production method over estimated recoverable reserves upon commencement of mining.

The calculation of reclamation metallurgical coal land and support facilities obligations involve a high degree of subjectivity and auditing the significant assumptions utilized by management in estimating the amount of the liability requires judgment.

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

We obtained an understanding of management’s internal controls and evaluated the design of these controls over the Company’s accounting for ARO, including controls over management’s review of the significant assumptions described above.

In addition, we evaluated the methodology used by the Company’s specialist and testing the significant assumptions and the underlying data, compared assumptions including the credit-adjusted risk-free rate, and inflation rate to current market data, evaluated significant changes from the prior estimate, verified consistency between timing of reclamation activities and projected mine life, considered the appropriateness of the estimated costs based on mine type, compared anticipated costs to recent operating data, and recalculated management's estimate.

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

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

/s/ Crowe LLP

We have served as the Company’s auditor since 2022.

Houston, Texas

March 31, 2022

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Ramaco Resources, Inc.

2 unchanged sentences

We have audited the accompanying consolidated balance sheets of Ramaco Resources, Inc.

(the Company) as of December 31, 2020 and 2019, and the related consolidated statements of operations, equity, and cash flows for each of the years in the three-year period ended December 31, 2020, and the related notes (collectively referred to as the financial statements).

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

(the Company) as of December 31, 2020 and the related consolidated statements of operations, equity, and cash flows for each of the years in the two-year period ended December 31, 2020, and the related notes (collectively referred to as the financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

13 unchanged sentences

/s/ Briggs & Veselka Co.

We have served as the Company’s auditor since 2015.

We served as the Company’s auditor from 2015 to 2021.

Houston, Texas

2 unchanged sentences

Consolidated Balance Sheets

In thousands, except share and per-share amounts

In thousands, except share

Current assets

4 unchanged sentences

Property, plant and equipment, net

Financing lease right-of-use assets, net

Advanced coal royalties

5 unchanged sentences

Current portion of long-term debt

Current portion of financing lease obligations

Other current liabilities

2 unchanged sentences

Long-term debt, net

Long-term financing lease obligations, net

Senior notes, net

Deferred tax liability, net

Other long-term liabilities

3 unchanged sentences

Preferred stock, $ 0.01 par value, 50,000,000 shares authorized, none issued and outstanding

Common stock, $0.01 par value, 260,000,000 shares authorized, 42,706,908 and 40,950,175 shares issued and outstanding, respectively

Common stock, $ 0.01 par value, 260,000,000 shares authorized, 44,092,981 at December 31, 2021 and 42,706,908 at December 31, 2020 shares issued and outstanding

Additional paid-in capital

5 unchanged sentences

Consolidated Statements of Operations

Years ended December 31,

Year ended December 31,

In thousands, except per-share amounts

1 unchanged sentence

Cost of sales (exclusive of items shown separately below)

Asset retirement obligation accretion

Asset retirement obligations accretion

Depreciation and amortization

14 unchanged sentences

Balance at January 1, 2019

Restricted stock surrendered for withholding taxes payable

Stock-based compensation

5 unchanged sentences

Stock-based compensation

Dividends accrued ($ 0.0567 per common share)

Balance at December 31, 2021

10 unchanged sentences

Stock-based compensation

Other income - employee retention tax credit

Other income - PPP Loan

9 unchanged sentences

Purchases of property, plant and equipment

Proceeds from maturities of investment securities

Acquisition of Amonate assets

Net cash from investing activities

2 unchanged sentences

Proceeds from borrowings

Proceeds from notes payable - related party

Payments of debt issuance cost

Repayment of borrowings

Repayment of notes payable - related party

Repayments of financed insurance payable

Repayments of financing leased equipment

Restricted stock surrendered for withholding taxes payable

7 unchanged sentences

Non-cash investing and financing activities:

Leased assets obtained under new financing leases

Dividend accrued not paid

Capital expenditures included in accounts payable and accrued expenses

12 unchanged sentences

Our development portfolio includes four primary properties:

Elk Creek, Berwind, RAM Mine and Knox Creek.

Elk Creek, Berwind, Knox Creek and RAM Mine.

We believe each of these projects possesses geologic and logistical advantages that make our coal among the lowest delivered-cost U.S.

metallurgical coal to a majority of our domestic target customer base, North American blast furnace steel mills and coke plants, as well as international metallurgical coal consumers.

We operate three deep mines and a surface mine at our Elk Creek mining complex.

We operate three deep mines and a surface mine at our Elk Creek Complex.

Development of this complex commenced in 2016 and included construction of a preparation plant and rail load-out facilities.

Development of our Berwind mining complex began in late 2017.

In 2020, we suspended development at the Berwind mining complex due to lower pricing and demand largely caused by the economic impacts of the COVID-19 pandemic.

This complex remains a key part of our anticipated future growth.

We expect to achieve commercial production at the Berwind mining complex approximately six months after we resume the slope project.

The Knox Creek preparation plant processes coal from our Berwind mine as well as coal we may purchase from or toll wash for third parties.

Our RAM Mine property is scheduled for initial production in 2022, subject to permitting and market conditions.

Impact of COVID-19 Pandemic on Our Business— The global spread of COVID-19 has created significant market volatility and economic uncertainty and disruption since early 2020.

In response to the pandemic, governments worldwide have placed significant restrictions on both domestic and international travel and have taken action to restrict the movement of people and suspend some business operations, ranging from targeted restrictions to full national lockdowns.

These lockdowns, restrictions on public gatherings and stay-at-home measures, coupled with the spread and impact of the COVID-19 pandemic, have resulted in a significant worldwide economic slowdown.

In certain cases, states that had begun taking steps to reopen their economies experienced a subsequent surge in cases of COVID-19, causing these states to cease such reopening measures in some cases and reinstitute restrictions in others.

The COVID-19 pandemic may significantly worsen in the United States during the upcoming months, which may cause federal, state and local governments to reconsider imposing more severe restrictions on business and social activities.

In the event governments impose such restrictions, the re-opening of the economy may be further delayed.

The Company has been adversely affected by the deterioration and increased uncertainty in the macroeconomic environment as a result of the impact of COVID-19.

In 2020, two customers notified us that their contractual obligations to purchase metallurgical coal from us would be delayed or curtailed because of COVID-19.

These delays or curtailments reduced our total contracted sales volumes for 2020 by approximately 10% or almost 200,000 tons.

We took other actions to limit our production and reduce capital expenditures in response to the pandemic and reduced global demand for metallurgical coal.

These included :

● an operational furlough of approximately 182 employees at the Elk Creek mining complex in West Virginia for most of the month of April 2020;

● a one-week operational furlough of approximately 157 employees at the Elk Creek mining complex in July 2020;

● the partial closure of our Berwind low volatile development mine complex affecting approximately 44 employees effective in July 2020;

● a reduction or deferral of non-essential capital expenditures including cessation of the slope project at the Berwind mining complex to adapt to the current market conditions.

To date we have not had significant issues with any of our critical suppliers, but we continue to communicate with them and closely monitor their developments to ensure we have access to the goods and services required to maintain our operations.

We continue to actively monitor the situation and may take further actions altering our business operations if we determine they are in the best interests of our employees, customers, suppliers, and stakeholders, or as required by federal, state, or local authorities.

Additional measures we may take could include extensions of operational furloughs, temporary salary reductions for certain executives, staffing reductions and idling or realignment of additional mines as conditions dictate.

It is not clear what potential effects any such alterations or modifications may have on our business.

The impact on our results in future periods could be much more significant and cannot currently be determined and quantified.

Development of our Berwind Complex began in late-2017.

In 2020, we suspended development at the Berwind Complex due to lower pricing and demand largely caused by the economic impacts of the COVID-19 pandemic.

We were able to resume development of Berwind in 2021 as coal market conditions improved.

The Knox Creek preparation plant processes coal from our Berwind Complex (until the Berwind preparation plant becomes operational in 2022) as well as coal we may purchase from or toll wash for third parties.

Our RAM Mine property is scheduled for initial production subject to permitting and market conditions.

In 2021, we acquired the long-idled Amonate Assets from Coronado which are directly adjacent to our Berwind Complex.

We will refurbish the acquired preparation plant and begin development of the acquired reserves in 2022.

COVID-19 Pandemic— The global spread of COVID-19 created significant volatility, uncertainty and economic disruption during 2020.

The Company was adversely affected by the deterioration and increased uncertainty in the macroeconomic outlook as a result of the impact of COVID-19.

After the initial outbreak, we observed a declining demand for, and declines in the spot price of, metallurgical coal as business and consumer activity decelerated across the globe.

Throughout 2021, we saw increases in demand from our primary customers, as the global economic recovery began.

steel prices also have increased significantly due to this recovery and the effects from large-scale government stimulus measures.

We continue to actively monitor the situation and may take further actions altering our business operations that we determine are in the best interests of our employees, customers, suppliers, and stakeholders, or as required by federal, state, or local authorities.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

7 unchanged sentences

Actual results could differ from those estimates.

The most significant estimates are related to the quantity and value of coal inventories, stock-based compensation, asset retirement obligations, contingencies, evaluation of long-lived assets for impairment, and the quantities and values of coal reserves.

The most significant estimates are related to the quantity and value of coal inventories, stock-based compensation, asset retirement

obligations, occupational disease obligations, evaluation of long-lived assets for impairment, and the quantities and values of coal reserves.

Revenue Recognition —Our primary source of revenue is from the sale of coal through contracts with steel producers usually having durations of less than one year.

15 unchanged sentences

Coal inventory costs include labor, supplies, equipment costs, freight, operating overhead, depreciation and amortization.

Coal inventory quantities are adjusted periodically based on aerial surveys of coal

Coal inventory quantities are adjusted periodically based on aerial surveys of coal stockpiles.

Supply inventories are valued at average cost and totaled $ 2.6 million at December 31, 2021 and $ 2.5 million at December 31, 2020.

5 unchanged sentences

Coal exploration costs include those incurred to ascertain existence, location, extent or quality of ore or minerals before beginning the development stage of the mine.

Mining property and mineral rights costs represent the costs incurred to acquire the rights to access and mine certain coal property either through deeds, leases, or other conveyance agreements.

These costs include costs of acquiring, and accessing mineral reserves, resources and surface areas for mining activities.

Capitalized mine development costs represent the costs incurred to prepare mine sites and/or seams of coal for future mining.

1 unchanged sentence

Operating expenditures including certain professional fees and overhead costs are not capitalized but are expensed as incurred.

The capitalized mine development costs are amortized on a units-of-production basis as mining of that mine’s assigned reserves takes place.

The capitalized mine development costs are depleted or amortized on a units-of-production basis as mining of that mine’s assigned reserves takes place.

Depreciation of plant and equipment is calculated on the straight-line method over their estimated useful lives ranging from three to thirty years .

10 unchanged sentences

The liability is accreted to its present value each period and the capitalized cost is amortized using the units-of-production method over estimated recoverable reserves upon commencement of mining.

Deferred Income —We account for the SBA Paycheck Protection Program Loan (“PPP Loan”) as an in-substance government grant because we expect to meet the PPP Loan eligibility criteria and have concluded that the loan represents, in substance, a grant that is expected to be forgiven.

Proceeds from the PPP Loan were initially recognized as a deferred income liability.

Subsequently, we reduced this liability and recognized income on a systematic basis over the period in which the related costs for which the PPP Loan was intended were incurred.

PPP Loan income is presented as other income within the consolidated statements of operations.

Self-Insurance —We are self-insured for certain losses relating to workers’ compensation claims.

We purchase insurance coverage to reduce our exposure to significant levels of these claims.

Self-insured losses are accrued based upon estimates of the aggregate liability for uninsured claims incurred as of the balance sheet date using current and historical claims experience and certain actuarial assumptions.

As of December 31, 2020, the estimated aggregate liability for uninsured claims totaled $1.7 million.

Of this, $0.9 million was included in other long-term liabilities within the consolidated balance sheets.

As of December 31, 2019, the estimated aggregate liability for uninsured claims totaled $1.0 million, including $0.7 million in other long-term liabilities.

Occupational Disease (Pneumoconiosis) Obligations .

We recognize as a liability to provide for occupational disease (pneumoconiosis) benefits to eligible employees, former employees and dependents as required by the Federal Mine Safety and Health Act of 1969, as amended.

The occupational disease benefit obligation represents the present value of the actuarially computed present and future liabilities for such benefits over the employees’ applicable years of service using a discount rate.

Estimating the future occupational disease (pneumoconiosis) benefits requires management to make estimates and judgments regarding timing and existence of a liability utilizing third-party actuaries to assist in preparing what constitutes adequate liability amounts.

Inherent in the fair value calculation are numerous assumptions and judgments including the ultimate costs, inflation factors, credit adjusted discount rates, timing of settlement awards in the legal and regulatory environments.

These estimates are subject to uncertainty due to a variety of factors, including extended lag times in the reporting and resolution of claims, and trends or changes in claim settlement patterns, insurance industry practices and legal interpretations.

1 unchanged sentence

Adjustments to estimated liabilities are recorded in the period in which the change in estimate occurs.

Leases —We determine if an arrangement is a lease at inception.

Operating leases are included in other current assets, other current liabilities, and other long-term liabilities in our consolidated balance sheets.

We do not have any finance leases.

Right of use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

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

Deferred Income —We accounted for the SBA Paycheck Protection Program Loan (“PPP Loan”) as an in-substance government grant because we expected to meet the PPP Loan eligibility criteria and concluded that the loan represents, in substance, a grant that is expected to be forgiven.

Proceeds from the PPP Loan were initially recognized as a deferred income liability.

Subsequently, we reduced this liability and recognized income on a systematic basis over the period in which the related costs for which the PPP Loan was intended were incurred.

PPP Loan income is presented as other income within the consolidated statements of operations.

Leases —We determine if an arrangement is an operating lease or financing lease at inception.

Leases are capitalized on the balance sheet as right-of-use (“ROU”) assets and obligations.

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

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

As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date.

The operating lease ROU asset also includes any lease payments made and excludes lease incentives.

The operating and

financing lease ROU assets also includes any lease payments made and excludes lease incentives.

Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.

Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

Financing lease obligations for financing lease payments are reduced over the lease term according to an amortization schedule.

Leases of mineral reserves are exempted under U.S.

GAAP from recognition within the financial statements.

GAAP from recognition as on the consolidated balance sheets.

Fair Value Measurements — For assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements, fair value is defined 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.

4 unchanged sentences

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

Income Taxes —Income taxes are accounted for using a balance sheet approach.

We account for deferred income taxes by applying statutory tax rates in effect at the reporting date of the balance sheet to differences between the book and tax basis of assets and liabilities.

Income Taxes —Income tax expense (benefit) includes Federal and state income taxes.

Certain income and expenses are not reported in tax returns and financial statements in the same year.

The tax effect of such temporary differences is reported as deferred income taxes.

We account for deferred income taxes by applying statutory tax rates in effect at the reporting date of the balance sheet.

A valuation allowance is established if it is more likely than not that the related tax benefits will not be realized.

8 unchanged sentences

Geology, coal transportation routes to customers, regulatory environments and coal quality or type are characteristic to a basin.

For financial reporting purposes, these operations represent a single segment because

each possesses similar production methods, distribution methods, and customer quality and consumption characteristics, resulting in similar long-term expected financial performance.

For financial reporting purposes, these operations represent a single segment because each possesses similar production methods, distribution methods, and customer quality and consumption characteristics, resulting in similar long-term expected financial performance.

Stock-Based Compensation —We account for employee stock-based compensation using the fair value method.

8 unchanged sentences

Financial instruments that potentially subject us to a significant concentration of credit risk consist primarily of cash and cash equivalents, restricted cash and accounts receivable.

We maintain deposits in federally insured financial institutions in excess of federally insured limits.

We maintain deposits in federally insured financial

institutions in excess of federally insured limits.

We monitor the credit ratings and concentration of risk with these financial institutions on a continuing basis to safeguard cash deposits.

8 unchanged sentences

The total balance due from these customers at December 31, 2020 was approximately 46 % of total accounts receivable.

During 2018, sales to six customers accounted for approximately 71% of total revenue.

During 2019, sales to three customers accounted for approximately 53 % of total revenue.

Reclassifications —Financial statements presented for prior periods include reclassifications that were made to conform to the current-year presentation.

Recent Accounting Pronouncements —In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers .

This standard supersedes nearly all existing revenue recognition guidance under U.S.

The core principle of ASU 2014-09 is to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services.

ASU 2014-09 defines a five-step process to achieve this core principle and, in doing so, it is possible that more judgment and estimates may be required within the revenue recognition process than is required under present U.S.

These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation.

The new standard also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments.

We adopted this new standard on January 1, 2018 using the modified retrospective method of adoption.

The adoption of this standard did not have a material effect on our financial position, results of operations or cash flows, but resulted in increased disclosures related to revenue recognition policies and disaggregation of revenue.

In February 2016, the FASB issued ASU 2016-02, Leases , which aims to make leasing activities more transparent and comparable and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and corresponding lease liability, including leases currently accounted for as operating leases.

Recent Accounting Pronouncements Adopted —In February 2016, the FASB issued ASU 2016-02, Leases , which aims to make leasing activities more transparent and comparable and requires substantially all leases be recognized by lessees on their balance sheet as a right-of-use asset and corresponding lease liability, including leases currently accounted for as operating leases.

Leases of mineral reserves and related land leases are exempted from the standard.

2 unchanged sentences

We made an accounting policy election to not separate lease and non-lease components for all leases.

The adoption of this standard resulted in the recognition of right-of-use assets and lease liabilities of $0.3 million, which were not previously recorded on our consolidated balance sheet.

The adoption of this standard resulted in the recognition of right-of-use assets and lease liabilities of $ 0.3 million in 2020, which were not previously recorded on our consolidated balance sheet.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses , which replaces the existing incurred loss impairment model with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.

6 unchanged sentences

In December 2019, the FASB issued ASU 2019-12, Income Taxes , which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law.

The standard will be effective for us in the first quarter of 2021.

We do not expect that the adoption of this ASU will have a significant impact on our consolidated financial statements.

In March 2020, the FASB issued ASU No.

The standard was effective for us in the first quarter of 2021.

The adoption of this ASU did not have a material impact on our consolidated financial statements.

Recent Accounting Pronouncements Being Assessed —In March 2020, the FASB issued ASU No.

2020-04, Reference Rate Reform (Topic 848):

1 unchanged sentence

The amendments are effective for all entities beginning on March 12, 2020 through December 31, 2022.

The Company may elect to apply the amendments prospectively through December 31, 2022.

The Company may elect to apply the

amendments prospectively through December 31, 2022.

The Company has not adopted this ASU as of December 31, 2021.

4 unchanged sentences

Plant and equipment

Mining property and mineral rights

Construction in process

4 unchanged sentences

Depreciation and amortization included:

Years ended December 31,

Year ended December 31,

(In thousands)

Depreciation of plant and equipment

Depreciation of right of use assets

Amortization of capitalized

1 unchanged sentence

Total depreciation and amortization

In the fourth quarter of 2019, we acquired multiple permits from various affiliates of Omega Highwall Mining, LLC.

Consideration for the transaction included assumption of approximately $0.6 million of ARO liability, curing minor lease defaults, and paying advance royalties under two assumed lease instruments.

The total out-of-pocket consideration was less than $0.1 million, most of which is recoupable against future royalty payments.

These permits are in close proximity to our Knox Creek preparation plant and loadout infrastructure, and provide immediate access to two separate mining areas in Southwestern Virginia.

On January 3, 2020, we entered into a mineral lease with the McDonald Land Company for coal reserve tracts which, in many cases, are located immediately adjacent to our Elk Creek complex.

This lease adds more than 21 million proven and probable reserves in approximately 20 different coal seams to our Elk Creek reserve base.

In December 2021, we acquired what are referred to as the “Amonate Assets” from Coronado, pursuant to an asset purchase agreement.

The acquisition, for a total cash consideration of $ 30 million, included a mine complex located in McDowell County, West Virginia and Tazewell County, Virginia adjacent and contiguous to the Company’s existing Berwind Complex.

The acquisition primarily consists of high quality, low and mid-vol metallurgical coal reserves and resources, much of which will be mined from the Company’s Berwind Complex.

Also purchased were several additional permitted mines and a currently idled 1.3-million-ton per annum capacity coal preparation plant.

NOTE 4—FAIR VALUES OF FINANCIAL INSTRUMENTS

9 unchanged sentences

Accounts payable

Senior notes, excluding discounts of $ 2,137

Other current liabilities - financed insurance payable

We use a market approach to determine the fair value of our fixed-rate debt using observable market data, which resulted in a Level 2 fair-value measurement.

Nonrecurring fair value measurements include asset retirement obligations, the estimated fair value of which is calculated as the present value of estimated cash flows related to its reclamation liabilities using Level 3 inputs.

The significant inputs used to calculate such liabilities include estimates of costs to be incurred, our credit adjusted discount rate, inflation rates and estimated date of reclamation.

The estimated fair value of cash, accounts receivable, and accounts payable approximate the carrying amount due to the relatively short maturity of these instruments.

The fair value of the Company's other debt approximates its fair value because the debt has terms that are at prevailing market terms currently available to the Company.

We use an observable market data approach to determine the fair value of our Senior Notes, a Level 1 fair-value measurement.

Nonrecurring fair value measurements include asset retirement and occupational disease obligations, the estimated fair value of which is calculated as the present value of estimated cash flows related to its liabilities using Level 3 inputs.

The significant inputs used to calculate such liabilities include estimates of costs to be incurred, our discount rate, inflation rates and estimated date of expenditures.

NOTE 5—ASSET RETIREMENT OBLIGATIONS

We estimate asset retirement obligations (“ARO”) for final reclamation based upon detailed engineering calculations of the amount and timing of the future cash spending for a third-party to perform the required work.

Spending estimates were escalated for inflation at 2% per year and the estimated cash outflows were then discounted at 4% at December 31, 2020 and 2019.

Spending estimates were escalated for inflation at 2.3 % and 2.0 % per year in 2021 and 2020, respectively, and the estimated cash outflows were then discounted at 4 % at both December 31, 2021 and 2020.

Amounts recorded related to asset retirement obligations were as follows:

6 unchanged sentences

Balance at end of year

NOTE 6—WORKERS’ COMPENSATION AND OCCUPATIONAL DISEASE OBLIGATIONS

We are self-insured for certain losses relating to workers’ compensation claims and occupational disease obligations under the Federal Mine Safety and Health Act of 1969, as amended.

We purchase insurance coverage to reduce our exposure to significant levels of these claims.

As of December 31, 2021, the estimated aggregate liability for uninsured claims totaled $ 3.9 million, including $ 1.4 million of occupational disease obligations.

Of the aggregate liability, $ 2.4 million was included in other long-term liabilities within the consolidated balance sheets.

As of December 31, 2020, the estimated aggregate liability for uninsured claims totaled $ 1.7 million, including $ 0.9 million in other long-term liabilities.

Our outstanding debt consisted of the following:

1 unchanged sentence

Revolving Credit Facility

Equipment Loan

Equipment Loans

Current portion of long-term debt

Long-term debt, net

Revolving Credit Facility and Term Loan —On November 2, 2018, we entered into a Credit and Security Agreement (as amended, the “Revolving Credit Facility”) with KeyBank National Association (“KeyBank”).

The Revolving Credit Facility was amended on February 20, 2020 and consists of a $10.0 million term loan (the “Term Loan”) and up to $30.0 million revolving line of credit, including $3.0 million letter of credit availability.

Revolving Credit Facility and Term Loan — On November 2, 2018, we entered into a Credit and Security Agreement (as amended or amended and restated) with KeyBank, as the administrative agent, and other lenders party thereto.

The Credit Agreement was amended on February 20, 2020 and March 19, 2021.

On October 29, 2021, we entered into the Amendment and Restatement with KeyBank.

Prior to the Amendment and Restatement, the Credit Agreement consisted of the $ 10.0 million Term Loan and up to $ 30.0 million revolving line of credit, including $ 3.0 million letter of credit availability.

The Amendment and Restatement increased the overall availability under the revolving credit line to $ 40.0 million and extended the maturity date to December 31, 2024.

All personal property assets, including, but not limited to accounts receivable, coal inventory and certain mining equipment are pledged to secure the Revolving Credit Facility.

The Revolving Credit Facility has a maturity date of December 31, 2023 and bears interest based on LIBOR + 2.0% or Base Rate + 1.5%.

Base Rate is the highest of (i) KeyBank’s prime rate, (ii) Federal Funds Effective Rate + 0.5%, or (iii) LIBOR + 2.0%.

Advances under the Revolving Credit Facility are made initially as base rate loans, but may be converted to LIBOR rate loans at certain times at our discretion.

As of December 31, 2020, we had remaining availability under the Revolving Credit Facility of $16.7 million.

The Revolving Credit Facility has a maturity date of December 31, 2024 and bears interest based on SOFR + 2.0 % or Base Rate + 1.5 %.

“Base Rate” is the highest of (i) KeyBank’s prime rate, (ii) Federal Funds Effective Rate + 0.5 %, or (iii) SOFR + 2.0 %.

Advances under the Revolving Credit Facility are made initially as Base Rate loans but may be converted to SOFR rate loans at certain times at our discretion.

At December 31, 2021, there was no amount outstanding under the Revolving Credit Facility and we had remaining availability of $ 39.1 million.

The Term Loan is secured under a Master Security Agreement with a pledge of certain underground and surface mining equipment, bears interest at LIBOR + 5.15 % and is required to be repaid in monthly installments of $ 278 thousand including accrued interest.

The Revolving Credit Facility contains usual and customary covenants including limitations on liens, additional indebtedness, investments, restricted payments, asset sales, mergers, affiliate transactions and other customary limitations, as well as financial covenants.

As of December 31, 2020, we were in compliance with all debt covenants.

Equipment Financing Loan —On April 16, 2020, we entered into an equipment loan with Key Equipment Finance, a division of KeyBank, as lender, in the original principal amount of approximately $4.7 million for the financing of existing underground and surface equipment (the “Equipment Financing Loan”).

The loan bears interest at 7.45% per annum and is payable in 36 monthly installments of $147 thousand.

There is a 3% premium for prepayment of the loan within the first 12 months.

The Credit Agreement contains usual and customary covenants including limitations on liens, additional indebtedness, investments, restricted payments, asset sales, mergers, affiliate transactions and other customary limitations, as well as financial covenants.

At December 31, 2021, we were in compliance with all financial covenants under the Credit Agreement.

Key Equipment Finance Loan— On April 16, 2020, we entered into an equipment loan with Key Equipment Finance, a division of KeyBank, as lender, in the principal amount of approximately $ 4.7 million for the financing of existing underground and surface equipment (the “Equipment Loan”).

The Equipment Loan bears interest at 7.45 % per annum and is payable in 36 monthly installments of $ 147 thousand.

There is a 3 % premium for prepayment of the note within the first 12 months.

This premium declines by 1 % during each successive 12-month period.

9.00% Senior Unsecured Notes due 2026— On July 13, 2021, we completed an offering of $ 34.5 million, in the aggregate, of the Company’s 9.00 % Senior Unsecured Notes due 2026 (the “Senior Notes”), less $ 2.4 million for note offering costs.

The Senior Notes mature on July 30, 2026, unless redeemed prior to maturity.

The Senior Notes bear

interest at a rate of 9.00 % per annum, payable quarterly in arrears on the 30th day of January, April, July and October of each year, commencing on July 30, 2021.

We may redeem the Senior Notes in whole or in part, at our option, at any time on or after July 30, 2023, or upon certain change of control events, at a redemption price equal to 100 % of the principal amount plus accrued and unpaid interest to, but not including, the date of redemption Issuance costs for the Senior Notes included underwriters’ fees, attorney, accounting and filing costs totaling $ 2.4 million These issuance costs are reported as a debt discount which is being amortized over the Senior Notes term using an effective rate method.

The outstanding principal balance under the Senior Notes was $ 34.5 million at December 31, 2021 and is presented net of unamortized discounts of $ 2.1 million.

The effective interest rate is approximately 10.45 %.

Fletcher & Co.

Loan— On July 23, 2021 and November 24, 2021, we entered into equipment loans with J.

Fletcher & Co., as lender, in the principal amount of approximately $ 0.9 million and $ 3.9 million, respectively, for the financing of underground equipment (the “Fletcher Equipment Loan”).

The Fletcher Equipment Loan bears interest at 0 % per annum and is payable in 24 monthly installments totaling $ 200 thousand.

Komatsu Financial Limited Partnership Loan— On August 16, 2021, we entered into an equipment loan with Komatsu Financial Limited Partnership, as lender, in the principal amount of approximately $ 1.0 million for the financing of surface equipment (the “Komatsu Equipment Loan”).

The Komatsu Equipment Loan bears interest at 4.6 % per annum and is payable in 36 monthly installments of $ 36 thousand for the first six months and then at $ 28 thousand until maturity.

SBA Paycheck Protection Program Loan— On April 20, 2020, we received proceeds from the PPP Loan in the amount of $ 8.4 million from KeyBank, as lender, pursuant to the PPP of the CARES Act.

The purpose of the PPP is to encourage the continued employment of workers.

We used all of the PPP Loan proceeds for eligible payroll expenses, lease, interest and utility payments.

We recognized $ 8.4 million of other income during 2020 for the anticipated full forgiveness of Paycheck Protection Program loan we received.

On July 29, 2021, we were notified by KeyBank that full forgiveness had been approved by the SBA.

Maturities of our long-term debt are as follows:

1 unchanged sentence

Years ending December 31:

NOTE 7— SBA PAYCHECK PROTECTION PROGRAM LOAN

On April 20, 2020, we received proceeds from the PPP Loan in the amount of approximately $8.4 million from KeyBank, as lender, pursuant to the Paycheck Protection Program (“PPP”) of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”).

The purpose of the PPP is to encourage the continued employment of workers.

Based upon receipt of this funding, we elected to recall our furloughed workers at our Elk Creek complex.

We used all of the PPP Loan proceeds for eligible payroll expenses, lease, interest and utility payments.

The PPP Loan matures on April 16, 2022 and bears interest at a rate of 1% per annum.

Pursuant to the subsequently enacted Paycheck Protection Flexibility Act of 2020 , we are permitted to defer required monthly payments of principal and interest until such time as an approval or denial of forgiveness is received from the U.S.

Small Business Administration (“SBA”).

The PPP Loan is evidenced by a promissory note dated April 16, 2020, which contains customary events of default relating to, among other things, payment defaults and breaches of representations and warranties.

The PPP Loan may be prepaid by the Company at any time prior to maturity with no prepayment penalties.

All or a portion of the PPP Loan and accrued interest thereon may be forgiven by the SBA upon documentation of expenditures in accordance with the SBA requirements and proper application by the Company.

Under the CARES Act and Paycheck Protection Flexibility Act of 2020 , loan forgiveness is available for the sum of documented payroll costs, covered rent payments, covered mortgage interest and covered utilities during either the eight-week period or 24-week period beginning on the date of loan funding.

For purposes of the PPP Loan, payroll costs exclude cash compensation of an individual employee in excess of $100 thousand, prorated annually.

Not more than 40% of the forgiven amount may be for non-payroll costs.

Forgiveness could be reduced if full-time headcount declines, or if salaries and wages for employees with salaries of $100 thousand or less annually are reduced by more than 25%.

Our application for forgiveness was approved by KeyBank and is currently being reviewed by the SBA.

We believe it is probable that the full amount of the PPP Loan principal, together with accrued interest thereon, will be forgiven.

Accordingly, we recognized $8.4 million as other income in the consolidated statement of operations for 2020.

Total debt before discounts

NOTE 8— LEASES

Operating Leases — We lease facilities under various noncancelable operating lease agreements.

Our leases have remaining lease terms of less than two years.

Operating lease expense for facilities totaled $0.2 million, $0.2 million and $0.1 million in 2020, 2019 and 2018, respectively.

At December 31, 2020 and 2019, operating lease ROU assets totaled $0.1 million and $0.2 million, respectively.

Operating lease liabilities at December 31, 2020 totaled $0.1 million.

Of this, $31 thousand is included in other long-term liabilities within the consolidated balance sheets.

Operating lease liabilities at December 31, 2019 totaled $0.2 million.

Of this, $0.1 million is included in other long-term liabilities within the consolidated balance sheets.

Maturities of operating lease liabilities are as follows:

The Company has various financing leases for mining equipment which originated in the second and third quarters of 2021.

These leases are generally for terms up to 36 months and expire through 2024.

We have one operating lease for office space that will expire mid-2022.

Operating lease expense was $ 0.1 million per year in 2021, 2020 and 2019.

Right-of-use assets and lease liabilities are determined as the present value of the lease payments, discounted using either the implicit interest rate in the lease or our estimated incremental borrowing rate based on similar terms, payments and the economic environment where the leased asset is located.

Below is a summary of our leases:

(In thousands)

Years ending December 31:

Total lease payments

Less imputed interest

As of December 31, 2020, the weighted average remaining lease term was 1.3 years and the weighted average discount rate used in computing the lease obligations was 8.5%.

Classification

December 31, 2021

December 31, 2020

Right-of-use assets

Financing lease right-of-use assets, net

Total right-of-use assets

Current lease liabilities

Current portion of financing lease obligations

Other current liabilities

Non-current lease liabilities

Long-term portion of financing lease obligations

Other long-term liabilities

Total lease liabilities

Minimum lease payments for our lease obligations are as follows:

December 31, 2021

(In thousands)

Future minimum lease payments:

Total undiscounted lease payments

Amounts representing interest

Present value of lease obligations

Weighted average remaining term (years)

Weighted average discount rate

As of December 31, 2021, we had financing lease obligations of $ 8.1 million and $0.02 million of operating leases.

Of this amount, $ 3.5 million was included in current liabilities within the consolidated balance sheets.

As of December 31, 2020, we had no financing lease obligations and $ 0.1 million of operating leases.

Coal Leases and Associated Royalty Commitments —Leases of mineral reserves and related land leases are exempted under U.S.

5 unchanged sentences

Royalties or throughput payments are based on a percentage of the gross selling price received for the coal we mine.

Payments of minimum coal royalties and throughput payments for leases with Ramaco Coal, LLC commenced in 2017 pursuant to the terms of the agreements.

Future minimum lease and royalty payments for each of the next five years and thereafter are as follows:

Payments of minimum coal royalties and throughput payments for leases with Ramaco Coal, LLC commenced in

2017 pursuant to the terms of the agreements.

Please see Note 12 to the Notes to Consolidated Financial Statements for further discussion related parties.

Future minimum coal lease and royalty payments for each of the next five years and thereafter are as follows:

(In thousands)

9 unchanged sentences

The options have a ten-year term from the grant date and are fully vested.

The options remain outstanding and unexercised and were not in-the-money at December 31, 2020.

The options remain outstanding and unexercised and were in-the-money at December 31, 2021 and had an intrinsic value of $ 7.7 million.

We grant restricted stock to certain senior executive employees and directors.

The shares vest over one to three and a half years from the date of grant.

The shares generally vest over one to three and a half years from the date of grant.

During the vesting period, the participants have voting rights and may receive dividends, but the shares may not be sold, assigned, transferred, pledged or otherwise encumbered.

Unvested shares are

forfeited upon termination of employment, unless an employee enters into another written arrangement.

Unvested shares are forfeited upon termination of employment, unless an employee enters into another written arrangement.

The fair value of the restricted shares on the date of the grant is amortized ratably over the service period.

21 unchanged sentences

Contingent Transportation Purchase Commitments —We secure the ability to transport coal through rail contracts and export terminals that are sometimes funded through take-or-pay arrangements.

As of December 31, 2020, contingent liabilities under these take-or-pay arrangements expiring March 31, 2021 totaled $3.3 million.

As of December 31, 2021, contingent liabilities under these take-or-pay arrangements expiring between December 31, 2022 and March 31, 2024 totaled $ 13.2 million.

The level of these take or pay liabilities will be reduced at a per ton rate as such rail and export terminal services are utilized against the required minimum tonnage amounts over the contract term stipulated in such rail and export terminal contracts.

1 unchanged sentence

No amounts have been accrued in the consolidated financial statements with respect to any matters.

On November 5, 2018, one of three raw coal storage silos that fed our Elk Creek plant experienced a partial structural failure.

A temporary conveying system completed in late-November 2018 restored approximately 80% of the plant capacity.

On November 5, 2018, one of our three raw coal storage silos that fed our Elk Creek plant experienced a partial structural failure.

A temporary conveying system completed in late-November 2018 restored approximately 80% of our plant capacity.

We completed a permanent belt workaround and restored the preparation plant to its full processing capacity in mid-2019.

Our insurance carrier, Federal Insurance Company, disputed our claim for coverage based on certain exclusions to the applicable policy and therefore on August 21, 2019 we filed suit against Federal Insurance

Company and Chubb INA Holdings, Inc.

Our insurance carrier, Federal Insurance Company, disputed our claim for coverage based on certain exclusions to the applicable policy and, therefore, on August 21, 2019 we filed suit against Federal Insurance Company and Chubb INA Holdings, Inc.

in Logan County Circuit Court in West Virginia seeking a declaratory judgment that the partial silo collapse was an insurable event and to require coverage under our policy.

Defendants removed the case to the United States District Court for the Southern District of West Virginia, and upon removal, we substituted ACE American Insurance Company as a defendant in place of Chubb INA Holdings, Inc.

Currently, the case is scheduled for trial beginning June 29, 2021, in Charleston, West Virginia.

The trial in the matter commenced on June 29, 2021, in Charleston, West Virginia.

On July 15, 2021, the jury returned a verdict in our

favor for $ 7.7 million in compensatory damages and on July 16, 2021, made an additional award of $ 25.0 million for inconvenience and aggravation.

On August 12, 2021, the defendants filed a post-trial motion for judgment as a matter of law or in the alternative to alter or amend the judgment or for a new trial.

The parties fully briefed the motion and it stood submitted on August 31, 2021.

On March 4, 2022, the court entered its memorandum opinion and order on the motion reducing the jury award to a total of $ 1.8 million, including pre-judgment interest, based largely on the court’s decision to vacate and set aside, in its entirety, the jury award of damages for inconvenience and aggravation.

The same day, the court entered the judgment in accordance with the memorandum opinion and order.

We are considering our options related to this decision, including an appeal to the US Court of Appeals for the 4th Circuit.

NOTE 11—REVENUE

3 unchanged sentences

Disaggregated information about our revenue is presented below:

Years ended December 31,

Year ended December 31,

(In thousands)

5 unchanged sentences

Mineral Lease and Surface Rights Agreements —Much of the coal reserves and surface rights that we control were acquired through a series of mineral leases and surface rights agreements with Ramaco Coal, LLC.

Production royalty payables due to Ramaco Coal, LLC totaling $0.4 million and $0.5 million at December 31, 2020 and 2019, respectively, were included in accounts payable in the consolidated balance sheets.

Production royalty payables due to Ramaco Coal, LLC totaling $ 0.4 million at both December 31, 2021 and 2020, were included in accounts payable in the consolidated balance sheets.

Royalties paid to Ramaco Coal, LLC in 2021, 2020 and 2019 totaled $ 5.7 million, $ 4.5 million and $ 9.0 million, respectively.

2 unchanged sentences

The services will be provided for 12-month terms, but may be terminated by either party at the end of any 12-month term by providing written notice at least 30 days prior to the end of the then-current term.

Charges to Ramaco Coal, LLC were $0.2 million in both 2020 and 2019.

In 2018, there were no charges to Ramaco Coal, LLC.

Charges to Ramaco Coal, LLC were $ 0.1 million in 2021 and $ 0.2 million in both 2020 and 2019.

NOTE 13—INCOME TAXES

6 unchanged sentences

Deferred taxes

Provision for income taxes, net

Income tax expense (benefit)

The items accounting for differences between income taxes computed at the federal statutory rate and the provision recorded for income taxes were as follows:

3 unchanged sentences

State taxes, net of federal benefits

State tax rate changes, net of federal benefits

Percentage depletion

PPP Loan forgiveness

Change in valuation allowance

Stock-based compensation

8 unchanged sentences

Total deferred tax assets

Less valuation allowance

Deferred tax assets, net

Deferred tax liabilities:

1 unchanged sentence

Net deferred tax liabilities

As of December 31, 2020, our federal net operating loss carryforwards for income tax purposes were approximately $94 million.

As of December 31, 2021, our federal net operating loss carryforwards were approximately $ 67 million.

Total state loss carryforwards were approximately $ 57 million.

6 unchanged sentences

Net income (loss)

Weighted average shares used to compute basic EPS

Dilutive effect of stock-based awards

Weighted average shares used to compute diluted EPS

Weighted average shares used to compute basic earnings (loss) per share

Dilutive effect of stock option awards

Weighted average shares used to compute diluted earnings (loss) per share

Earnings (loss) per share

Diluted EPS for 2020 and 2019 excludes 937,424 options to purchase our common stock because their effect would be anti-dilutive.

SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The following table presents selected quarterly financial data derived from our unaudited interim financial statements.

The following data is only a summary and should be read with our historical consolidated financial statements and related notes contained in this document.

(In thousands, except per share amounts)

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Total revenues

Gross profit (a)

Operating income

Net earnings per share:

Total revenues

Gross profit (a)

Operating income

Net earnings per share:

(a) Represents total revenue less cost of sales.

(b) The sum of quarterly per share amounts may not equal amounts reported for the annual periods due to the effects of rounding.

NOTE 15—SUBSEQUENT EVENTS

On February 18, 2022, the Company announced that its Board of Directors ("Board") approved a 100 % increase in its initial regular quarterly dividend to $ 5.0 million from the formerly approved $ 2.5 million quarterly dividend that was announced in December 2021.

This will involve a commensurate increase in its annual base dividend to $ 20 million from $ 10 million.

Specifically, the first quarter dividend will be paid on March 15, 2022, to shareholders of record on March 1, 2022 in the amount of approximately $ 0.11 per share, which annualizes to approximately $ 0.45 per share.

On February 23, 2022, Ramaco Development, LLC (“Development”), a wholly owned subsidiary of the Company, entered into a unit purchase agreement (the “Agreement”) with the Company, Ramaco Coal Holdings, LLC (the “Seller”) and Ramaco Coal, LLC (“Target”), pursuant to which Development agreed to purchase 100 % of the issued and outstanding equity interests of Target for cash consideration of $ 65 million (the “Purchase Price”).

The Purchase Price consists of $ 5 million to be paid upon the closing of the transaction and $ 60 million in deferred cash payments, to be paid quarterly in such amounts, with interest thereon, as provided in the Agreement.

Such deferred payments shall be completed no later than December 31, 2023.

On February 28, 2022 the Company issued the following statement related to the death of Steven H.

Hively of Philippi, West Virginia at the Berwind Mine Complex operated by Ramaco Resources, LLC, a subsidiary of the Company.

"We were saddened to learn early this morning that a contract employee working underground at our Berwind Mine Complex in McDowell County, West Virginia passed away.

We extend our heartfelt thoughts, prayers, and condolences to Mr.

Hively's family, friends and co-workers.

Hively was an experienced miner employed by GMS Mine Repair & Maintenance, Inc.

a longtime independent contractor for the Company.

The accident was reported immediately to state and federal safety authorities who, along with the company and contractor, are now investigating.

The Company is committed to find the cause of this accident."

Regarding the November 5, 2018 Elk Creek raw coal silo failure litigation, on August 12, 2021, the defendants filed a post-trial motion for judgment as a matter of law or in the alternative to alter or amend the judgment or for a new trial.

The parties fully briefed the motion and it stood submitted on August 31, 2021.

damages for inconvenience and aggravation.

The same day, the court entered the judgment in accordance with the memorandum opinion and order.

We are considering our options related to this decision, including an appeal to the US Court of Appeals for the 4th Circuit.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data