WARRIOR MET COAL, LLC (Form: S-1, Received: 03/07/2017 11:50:44)

Company Name

Location of

Collateral

Third Party Name

Third Party Address

As filed with the Securities and Exchange Commission on March 7, 2017

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Warrior Met Coal, LLC

to be converted as described herein into a corporation named

Warrior Met Coal, Inc.

(Exact name of registrant as specified in its charter)

Delaware

1220

81-0706839

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

16243 Highway 216

Brookwood, AL 35444

(205) 554-6150

(Address, including zip code and telephone number, including area code, of registrant’s principal executive offices)

Dale W. Boyles

Chief Financial Officer

Warrior Met Coal, LLC

16243 Highway 216

Brookwood, AL 35444

(205) 554-6150

(Name, address, including zip code and telephone number, including area code, of agent for service)

Copies to:

Rosa Testani

Daniel Fisher

Shar Ahmed

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

Bank of America Tower

New York, New York 10036

(212) 872-8115

Daniel Bursky

Andrew Barkan

Fried, Frank, Harris, Shriver & Jacobson LLP

One New York Plaza

New York, New York 10004

(212) 859-8000

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement is declared effective.

If any securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), check the following box. ☐

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer ☐		Accelerated filer	☐
Non-accelerated filer ☒	(Do not check if a smaller reporting company)	Smaller reporting company	☐

CALCULATION OF REGISTRATION FEE



Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price ⁽¹⁾⁽²⁾	Amount of Registration Fee
Common Stock, par value $0.01 per share (including attached preferred stock purchase rights) ⁽³⁾	$100,000,000	$11,590

(1)	Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(o) under the Securities Act.

(2)	Includes the offering price of common stock that may be purchased by the underwriters upon the exercise of their option to purchase additional shares.

(3)

The common stock includes certain preferred stock purchase rights, or the Rights, which will be issued upon the corporate conversion (as defined herein) pursuant to the Rights Plan (as defined herein), between the Company and Computershare Trust Company, N.A. as rights agent. Until the occurrence of certain events specified in the Rights Plan, none of which have occurred as of the filing of this Registration Statement, the Rights will not be exercisable, will be evidenced only by the certificates for or by the book entries in the book-entry system for the common stock, and will be transferred along with and only with, and are not severable from, the common stock. The value attributable to the Rights, if any, will be reflected in the market price of the common stock. No separate consideration will be payable for the Rights.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

EXPLANATORY NOTE

Warrior Met Coal, LLC, the registrant whose name appears on the cover of this registration statement, is a Delaware limited liability company. Prior to the effectiveness of this registration statement, Warrior Met Coal, LLC will be converted into a Delaware corporation pursuant to a statutory conversion, which we refer to as the “corporate conversion” and be renamed Warrior Met Coal, Inc. as described in the section “Corporate Conversion” of the accompanying prospectus. As a result of the corporate conversion, the members of Warrior Met Coal, LLC will become holders of shares of common stock of Warrior Met Coal, Inc. Except as disclosed in the accompanying prospectus, the audited financial statements and related notes thereto and selected consolidated and combined historical and pro forma financial data and other financial information included in this registration statement are those of Warrior Met Coal, LLC and its subsidiaries and its predecessor and do not give effect to the corporate conversion. Shares of common stock of Warrior Met Coal, Inc. are being offered by the accompanying prospectus.

The information in this preliminary prospectus is not complete and may be changed. The selling stockholders may not sell the securities described herein until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell such securities and it is not soliciting an offer to buy such securities in any state where such offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED MARCH 7, 2017

Shares

LOGO

Warrior Met Coal, Inc.

Common Stock

This is the initial public offering of shares of common stock of Warrior Met Coal, Inc. All of the shares of common stock are being offered by the selling stockholders identified in this prospectus. We will not receive any of the proceeds from the shares of common stock being sold in this offering.

Prior to this offering, there has been no public market for our common stock. We anticipate that the initial public offering price will be between $ and $ per share. We intend to apply to list our common stock on the New York Stock Exchange under the symbol “HCC.”

The underwriters may also purchase up to additional shares from the selling stockholders at the initial public offering price, less the underwriting discounts and commissions, within 30 days from the date of this prospectus.

We are an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, have elected to comply with certain reduced public company reporting requirements. See “Prospectus Summary—Implications of Being an Emerging Growth Company.”

Investing in our common stock involves risks. See “ Risk Factors ” on page 18.

Price to
Public

Underwriting
Discounts and
Commissions ⁽¹⁾

Proceeds to
Selling
Stockholders

Per Share

Total

(1)	See “Underwriting” for additional information regarding underwriting compensation.

Neither the Securities and Exchange Commission, any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares on or about , 2017.


Credit Suisse	Citigroup		Morgan Stanley

BMO Capital Markets		RBC Capital Markets



Apollo Global Securities	Clarksons Platou Securities	KKR

The date of this prospectus is , 2017.

LOGO

TABLE OF CONTENTS


PROSPECTUS SUMMARY			1
RISK FACTORS			18
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS			49
USE OF PROCEEDS			51
DIVIDEND POLICY			51
CORPORATE CONVERSION			52
CAPITALIZATION			53
DILUTION			54
SELECTED CONSOLIDATED AND COMBINED HISTORICAL AND PRO FORMA FINANCIAL DATA			55
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			58
INDUSTRY OVERVIEW			83
BUSINESS			91
MANAGEMENT			113
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS			129
PRINCIPAL AND SELLING STOCKHOLDERS			133
DESCRIPTION OF OUR CAPITAL STOCK			139
DESCRIPTION OF CERTAIN INDEBTEDNESS			146
SHARES ELIGIBLE FOR FUTURE SALE			147
MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSEQUENCES FOR NON-U.S. HOLDERS OF OUR COMMON STOCK			149
UNDERWRITING			153
LEGAL MATTERS			162
EXPERTS			162
WHERE YOU CAN FIND MORE INFORMATION			162
INDEX TO FINANCIAL STATEMENTS			F-1
APPENDIX A: GLOSSARY OF SELECTED TERMS			A-1

You should rely only on the information contained in this prospectus or in any free writing prospectus prepared by us or on behalf of us or to which we have referred you. Neither we, the selling stockholders nor the underwriters have authorized any other person to provide you with information different from that contained in this prospectus and any free writing prospectus. If anyone provides you with different or inconsistent information, you should not rely on it. Neither we, the selling stockholders nor the underwriters are making an offer to sell these securities in any jurisdiction where an offer or sale is not permitted. The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of shares of our common stock. The information in any free writing prospectus that we may provide to you in connection with this offering is accurate only as of the date of such free writing prospectus. Our business, financial condition, results of operations and future growth prospects may have changed since those dates.

This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. Please read “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements.”

Industry and Market Data

The data included in this prospectus regarding the metallurgical (“met”) coal industry, including descriptions of trends in the market, as well as our position within the industry, is based on a variety of sources,

including independent industry publications, government publications and other published independent sources, including Wood Mackenzie, the Energy and Minerals Field Institute and the World Coal Association, none of which are affiliated with us, as well as information obtained from customers, distributors, suppliers, trade and business organizations and publicly available information, as well as our good faith estimates, which have been derived from management’s knowledge and experience in our industry. Although we have not independently verified the accuracy or completeness of the third-party information included in this prospectus, based on management’s knowledge and experience, we believe that the third-party sources are reliable and that the third-party information included in this prospectus or in our estimates is accurate and complete. See “Industry Overview” for additional information regarding the met coal industry.

Statements made by Wood Mackenzie included in this prospectus with respect to our competitive position in 2017 are based upon “Operating Margin” and “Total Cash Cost,” as each such term is defined by Wood Mackenzie. “Operating Margin” is defined by Wood Mackenzie as gross revenue less Total Cash Cost. “Total Cash Cost” is defined by Wood Mackenzie as the sum of the direct cash costs associated with the mining, processing and transport of the marketable product, general and administration overhead costs directly related to mine production and royalty, levies and other indirect taxes (excluding profit related taxes).

Coal Reserve Information

The estimates of our proven and probable reserves as of December 31, 2016 included in this prospectus (i) for our Mine No. 4 and Mine No. 7 were prepared by Marshall Miller & Associates, Inc., an independent mining and geological consulting firm (“Marshall Miller”), (ii) for our Blue Creek Energy Mine (as defined below) were prepared by Norwest Corporation, an independent international mining consulting firm (“Norwest”), and (iii) for our other mining properties described in this prospectus were prepared by McGehee Engineering Corp., an independent mining and geological consulting firm (“McGehee”). The estimates of our proven and probable reserves are based on engineering, economic and geologic data, coal ownership information and current and proposed mine plans. Our proven and probable coal reserves are reported as “recoverable coal reserves,” which is the portion of the coal that could be economically and legally extracted or produced at the time of the reserve determination, taking into account mining recovery and preparation plant yield. These estimates are periodically updated to reflect past coal production, new drilling information and other geologic or mining data. Acquisitions or dispositions of coal properties will also change these estimates. Changes in mining methods may increase or decrease the recovery basis for a coal seam, as will changes in preparation plant processes.

“Reserves” are defined by the Security and Exchange Commission’s (the “SEC”) Industry Guide 7 as that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. Industry Guide 7 divides reserves between “proven (measured) reserves” and “probable (indicated) reserves,” which are defined as follows:

•

“Proven (Measured) Reserves.” Reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.

•

“Probable (Indicated) Reserves.” Reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.

Please read “Business—Estimated Recoverable Coal Reserves” for additional information regarding our reserves.

PROSPECTUS SUMMARY

This summary contains basic information about us and this offering. Because it is a summary, it does not contain all the information that you should consider before investing in our common stock. You should read and carefully consider this entire prospectus before making an investment decision, especially the information presented under the heading “Risk Factors,” “Cautionary Note Regarding Forward-Looking Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our audited combined and consolidated Predecessor and Successor financial statements and the accompanying notes thereto and our unaudited pro forma condensed combined financial statements and the accompanying notes thereto included elsewhere in this prospectus.

Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will complete a corporate conversion pursuant to which Warrior Met Coal, LLC will be converted into a Delaware corporation and be renamed Warrior Met Coal, Inc. as described under “Corporate Conversion.” We refer to this transaction herein as the “corporate conversion.” Except as otherwise indicated or required by the context, all references in this prospectus to the “Company,” “we,” “us,” “our” or “Successor” relate to (1) Warrior Met Coal, LLC, a Delaware limited liability company, and its subsidiaries for periods beginning as of April 1, 2016 and ending immediately before the completion of our corporate conversion, and (2) Warrior Met Coal, Inc., a Delaware corporation, and its subsidiaries for periods beginning with the completion of our corporate conversion and thereafter. References in this prospectus to the “Predecessor” refer to the assets acquired and liabilities assumed by Warrior Met Coal, LLC from Walter Energy, Inc., a Delaware corporation (“Walter Energy”), in the Asset Acquisition on March 31, 2016, as further described below under “—Corporate History and Structure—Walter Energy Restructuring.” The Predecessor periods included in this prospectus begin as of January 1, 2015 and end as of March 31, 2016. References in this prospectus to “selling stockholders” refer to those entities identified as selling stockholders in “Principal and Selling Stockholders.” “Met coal,” “hard coking coal” or “coking coal” as used in this prospectus means metallurgical coal. We have provided definitions for some of the other industry terms used in this prospectus in the “Glossary of Selected Terms” included elsewhere in this prospectus as Appendix A.

Warrior Met Coal, Inc.

Our Business

We are a large scale, low-cost U.S.-based producer and exporter of premium met coal operating two highly productive underground mines in Alabama, Mine No. 4 and Mine No. 7, that have an estimated annual production capacity of 7.3 million metric tons of coal. According to Wood Mackenzie, in 2017, we are expected to be the largest seaborne met coal supplier in the Atlantic Basin, and a top ten supplier to the global seaborne met coal market. As of December 31, 2016, based on a reserve report prepared by Marshall Miller, our two operating mines had approximately 107.8 million metric tons of recoverable reserves and, based on a reserve report prepared by Norwest, our undeveloped Blue Creek Energy Mine (as discussed below) contained 103.0 million metric tons of recoverable reserves. The premium hard coking coal (“HCC”) we produce at Mine No. 4 and Mine No. 7 is of a similar quality to coal referred to as the “benchmark HCC” produced in Australia, which is used to set quarterly pricing for the met coal industry.

Our operations are high margin when compared to our competitors. According to Wood Mackenzie, in 2017 our overall operations are expected to be positioned in the first quartile (18th percentile) based on “Operating Margin” as defined by Wood Mackenzie, among mines operated by U.S. seaborne met coal exporters. In addition, according to Wood Mackenzie, in 2017 our overall operations are expected to be positioned in the second quartile (33rd percentile) based on Operating Margin, among all mines operating in the global seaborne met coal market.

We believe our high margin operations relative to our competitors are a direct result of a combination of factors, notably our (1) highly productive mining operations, (2) high-quality coal products, (3) close proximity and efficient access to the Port of Mobile, Alabama and (4) seaborne freight advantage to reaching our primary end markets:

•

We employ a highly efficient longwall mining method with development support from continuous miners at both of our operating mines. This mining method, together with a redesigned flexible mine plan developed and implemented around the time of the Asset Acquisition (as defined below), new logistics contracts and a new initial Collective Bargaining Agreement (“CBA”) with the United Mine Workers of America (“UMWA”), has enabled us to structurally reduce the operating costs at our Mine No. 4 and Mine No. 7, while also increasing our ability to adjust our cost structure with respect to the HCC benchmark price. We believe the step-down in costs and greater variability in our cost structure relative to Walter Energy equip our operations to endure adverse price environments and generate strong cash flows in favorable price environments.

•

Our HCC, mined from the Southern Appalachian portion of the Blue Creek coal seam, is characterized by low sulfur, low-to-medium ash, and low-to-medium volatility. These qualities make our coal ideally suited as a coking coal for the manufacture of steel. As a result of our high quality coal, our realized price has historically been in line with or at a slight discount to the HCC benchmark, which helps drive our high operating margins.

•

Our two operating mines are located approximately 300 miles from our export terminal at the Port of Mobile, Alabama, which we believe to be the shortest mine-to-port distance of any U.S.-based met coal producer. Our low cost, flexible and efficient rail and barge network underpins our cost advantage and dependable access to the seaborne markets. Furthermore, in the event of lower coal prices, we have a variable transportation cost structure that results in lower cash requirements.

•

We sell our coal to a diversified customer base of blast furnace steel producers, primarily located in Europe and South America. We enjoy a shipping time and distance advantage serving customers throughout the Atlantic Basin relative to competitors located in Australia and Western Canada.

To complement our highly efficient, low-cost operations, we have the ability to quickly adjust our production levels in response to market conditions. Our mine plan was redesigned and implemented around the time of the Asset Acquisition, allowing us to maximize profitability and operating cash flow. For example, we operated our mines at reduced levels in the early part of 2016 in response to weak met coal market conditions throughout the first nine months of 2016, during which we produced 2.2 million metric tons of met coal. During the fourth quarter of 2016, we commenced ramping up production in response to the increase in the HCC benchmark price, which resulted in us producing 3.1 million metric tons of met coal for the year ended December 31, 2016. During 2013, when the HCC quarterly benchmark price averaged $159 per metric ton, our two operating mines produced a combined 7.3 million metric tons, which we estimate equals our current capacity. We are increasing our production during 2017 and, given our favorable cost structure, generate significantly higher operating cash flow.

For the year ended December 31, 2015 and the nine months ended December 31, 2016, our coal operations:

•

generated sales of $514.3 million and $276.6 million, respectively; and

•

incurred cost of sales of $601.5 million and $244.7 million, respectively.

Our Competitive Strengths

We believe that we have the following competitive strengths:

resources are allocated to the mining, transportation and marketing of met coal. The premium HCC we produce at Mine No. 4 and Mine No. 7 is of a similar quality to coal referred to as the “benchmark HCC” produced in Australia, which is used to set quarterly pricing for the met coal industry. Coal from Mine No. 7 is classified as a premium low-volatility HCC and coal from Mine No. 4 is classified as a premium mid-volatility HCC. The combination of low sulfur, low-to-medium ash, low-to-medium volatility, and other characteristics of our coal, as well as our ability to blend them, makes our HCC product an important component within our customers’ overall coking coal requirements. As a result, our realized price has historically been in line with or at a slight discount to the HCC benchmark. Our 2016 average realized price of 99% of the HCC benchmark is in significant contrast to other U.S. met coal producers, which we believe sell a relatively higher proportion of lower rank coals to domestic steel producers and achieved realized prices of approximately 80% to 90% of the HCC benchmark in 2016, based on data from public filings made by such other U.S. met coal producers, as adjusted based on mine-to-port transportation cost estimates from Wood Mackenzie.

Productive longwall mines with low operating costs . We employ a highly efficient longwall mining method with development support from continuous miners at both of our operating mines. This mining method, combined with a redesigned flexible mine plan implemented around the time of the Asset Acquisition allows us to adjust our production levels in response to market conditions to ensure maximum profitability and operating cash flow, throughout coal-pricing cycles. Around the time of the Asset Acquisition, we were able to structurally reduce the operating and logistical costs associated with Mine No. 4 and Mine No. 7. For the nine months ended December 31, 2016, our two operating mines had an average cash cost of sales of $82.84 per metric ton, compared to $112.96 per metric ton for the year ended December 31, 2015. Of note, we achieved this 26.7% reduction in cash cost of sales even though we are still in the process of ramping up production at Mine No. 4 and the second longwall within Mine No. 7. See “—Summary Consolidated and Combined Historical and Pro Forma Financial Data—Non-GAAP Financial Measures—Cash Cost of Sales” for the definition of cash cost of sales and a reconciliation of cash cost of sales to our most directly comparable financial measure calculated and presented in accordance with GAAP. These cost reductions were driven in large part by structurally sustainable changes to our overall operations we implemented around the time of the Asset Acquisition, in particular our new flexible mine plan, new initial CBA with the UMWA, and reduced rail, barge and port costs. According to Wood Mackenzie, in 2017, our overall operations are expected to be positioned in the first quartile (18th percentile) based on Operating Margin, among mines operated by U.S. seaborne met coal exporters. In addition, according to Wood Mackenzie, in 2017, our overall operations are expected to be positioned in the second quartile (33rd percentile) based on Operating Margin among all mines operating in the global seaborne met coal market.

Largest seaborne met coal supplier based in the Atlantic Basin with diverse customer base and significant reserve base . According to Wood Mackenzie, in 2017, we are expected to be the largest seaborne supplier of met coal based in the Atlantic Basin. Our location provides us with a significant freight advantage in serving our European and South American customers relative to competitors located in Australia and Western Canada whose coal must be shipped significantly longer distances. This advantage results in a higher margin for our met coal. We have a diverse customer base and have supplied many of our top customers continuously over the last decade. Our ability to serve customers in the Atlantic Basin is supported, as of December 31, 2016, based on a reserve report prepared by Marshall Miller, by approximately 107.8 million metric tons of recoverable coal reserves at our two operating mines. Together, these reserves provide an implied mine life of approximately 15 years at our historical operating rates. We have additional significant embedded growth potential that can be developed at our operating mines and at our undeveloped Blue Creek Energy Mine in a supportive met coal pricing environment. In particular, our undeveloped Blue Creek Energy Mine in Tuscaloosa County, Alabama contains, based on a reserve report prepared by Norwest, an additional 103.0 million metric tons of high-quality met coal recoverable reserves. Management is evaluating the future development of this new mine.

Significant logistical advantage and secure infrastructure access to reach the seaborne market . Our two operating mines are located approximately 300 miles from our export terminal capacity in Mobile, Alabama and have multiple alternative transportation routes to move our coal to port. These alternatives include direct rail access at the mine sites and a wholly owned barge load-out facility, enabling us to utilize the lowest cost option between the two at any given point in time. Around the time of the Asset Acquisition, we successfully negotiated a reduction in rail, barge and port costs. In addition, we have a contract with the Port of Mobile, Alabama, that provides us up to 8.0 million metric tons of annual port capacity through July 2026 for our coal at very competitive rates. The total annual capacity of the McDuffie Coal Terminal at the Port of Mobile, Alabama is approximately 27.2 million metric tons and this coal terminal is presently utilized for all of our coal exports. According to Wood Mackenzie, our operating mines are expected to be in the first quartile (10th percentile) for transportation costs from mine to port in the United States in 2017, contributing to our competitive cost advantage relative to other U.S. exporters who collectively comprise the vast majority of met coal produced in the Atlantic Basin.

Strong leverage to met coal prices with strong operating cash flow generation . Our overall operations have robust operating margins, require modest sustaining capital expenditures and are expected to generate significant operating cash flows in a range of met coal price environments. We acquired our operations in the Asset Acquisition on a debt-free basis and with minimal legacy liabilities and, as a result, we have a strong balance sheet and currently have minimal interest expense. We expect our operating cash flows to benefit from a low effective tax rate, predominantly driven by significant net operating loss carryforwards (“NOLs”) that were acquired in connection with the Asset Acquisition. Our new initial CBA, combined with our flexible rail, port and barge logistics and our royalty structure, results in a highly variable operating cost profile that allows our cash cost of sales to move with changes in the price we realize for our coal. Our variable cost structure dramatically lowers our cash cost of sales if our realized price falls, while being effectively capped in higher price environments allowing us to generate significant operating cash flow. The following table presents illustrative run rate cash cost of sales:


HCC benchmark ($ per metric ton)	$	100	$	120	$	150	$	175	$	200
Illustrative cash cost of sales ($ per metric ton)	$	80	$	92	$	97	$	101	$	104

Dynamic mine plan allows flexibility to quickly adjust production . Our lean organization and dynamic mine plan allow us to quickly ramp up or ramp down production in response to market conditions with minimal one-time costs associated with the change in production levels. During the year ended December 31, 2016, when the HCC benchmark averaged $114.25 per metric ton but had a low of $81 per metric ton in the first quarter of 2016, we produced 3.1 million metric tons of met coal compared to 4.9 million metric tons for the year ended December 31, 2015, when the HCC benchmark averaged $102.13 per metric ton (with a low of $89 per metric ton in the fourth quarter of 2015). Similarly, in the fourth quarter of 2016, in response to the substantial increase in met coal prices, we rapidly restarted our Mine No. 4 and ramped up production at the second longwall within Mine No. 7 to increase our production rates. Our production in the fourth quarter of 2016 was 0.9 million metric tons, when the HCC benchmark was $200 per metric ton versus 0.6 million metric tons in the fourth quarter of 2015, when the HCC benchmark was $89 per metric ton. On an annual basis, we believe we can ramp up production to 7.3 million metric tons, which was our historical high production level set in 2013.

Highly experienced leadership team with proven commitment to safety and operational excellence . Our Chief Executive Officer (“CEO”), Walter J. Scheller, III, is the former CEO of Walter Energy and has six years of direct experience managing Mine No. 4 and Mine No. 7, and over 30 years of experience in longwall coal mining. Furthermore, following the Asset Acquisition, we hired several key personnel with extensive direct operational experience in met coal longwall mining, including our Chief Operating Officer, Jack Richardson, and our Chairman, Stephen D. Williams. We have a strong record of operating safe mines and are committed to environmental excellence. Our dedication to safety is at the core of all of our overall operations as we work to

further reduce workplace incidents by focusing on policy awareness and accident prevention. Our continued emphasis on enhancing our safety performance has resulted in zero fatal incidents as well as non-fatal days lost incidence rates of 3.73 at Mine No. 4 and 3.27 at Mine No. 7 for the year ended December 31, 2016, which are considerably lower than the 2016 national average incident rate for all underground coal mines in the United States of 4.99 non-fatal days lost per site.

Our Business Strategies

Our objective is to increase shareholder value through our continued focus on asset optimization and cost management to drive profitability and cash flow generation. Our key strategies to achieve this objective are described below:

Maximize profitable production . In the year ended December 31, 2016, we produced 3.1 million metric tons of met coal, predominantly from Mine No. 7, as we temporarily idled our Mine No. 4 in early 2016. We have the flexibility to increase annual production with the addition of mine-worker shifts and relatively modest incremental capital expenditures. We operated at an annual combined production level of 7.3 million metric tons from Mine No. 4 and Mine No. 7 as recently as 2013. Based on our management’s operational experience, we are confident in our ability to produce at or close to this capacity in a safe and efficient manner, and with a comparable cost profile to our current costs, should market conditions warrant.

Maintain and further improve our low-cost operating cost profile . While we have already achieved significant structural cost reductions at our two operating mines around the time of the Asset Acquisition, we see further opportunities to reduce our costs over time. Our new initial CBA with the UMWA has been structured to support these ongoing cost optimization initiatives. For example, the CBA allows for bonus incentives tied to HCC benchmarks and other opportunities to optimize costs. Additionally, the CBA enables us to contract out work under certain circumstances. We believe this type of structural incentive provision and workforce flexibility in the CBA is helpful to further align our organization with operational excellence and to increase the proportion of our costs that vary in response to changes in the HCC benchmark price.

Broaden our marketing reach and potentially increase the realized prices we achieve for our coal . We have implemented a strategy to improve both our sales and marketing focus, with a goal of achieving better pricing relative to the HCC benchmark price, which includes: (i) using a combination of benchmark and index pricing with our contract customers; (ii) opportunistic selling into the spot met coal market; and (iii) selected instances of entering into longer term fixed price contracts. Each of these elements is intended to further embed our coal product among a broader group of steel customers. Traditionally, we have predominantly marketed our coal to European and South American buyers. However, we expect to increase our focus on Asian customers, in particular, Japanese steel mills, some of which have expressed a desire to diversify their supply of premium HCC away from Australian coals. In the near term, our target geographic customer mix is 60% in Europe, 30% in South America and 10% in Asia. We have an arrangement with Xcoal Energy & Resource (“Xcoal”) to serve as Xcoal’s exclusive and strategic partner for exports of low volatility HCC. Under this arrangement, Xcoal takes title to and markets coal that we would historically have sold on the spot market, in an amount of up to 10% of our sales. While the volumes being sold through this arrangement with Xcoal are relatively limited, we are positioned to potentially benefit from Xcoal’s expertise and relationships across all coal that we sell. To that end, we also have an incentive-based arrangement with Xcoal to cover other tonnage, in the event Xcoal is able to offer us a higher realized price relative to the HCC benchmark than we have previously achieved.

Creek Energy Mine, which, based on a reserve report prepared by Norwest, had 103.0 million metric tons of high quality met coal recoverable reserves as of December 31, 2016. We believe that the Blue Creek Energy Mine is a large block of high quality coal reserves that could support a new longwall operation with a mine life of greater than 30 years. As such, management is evaluating additional leases for this site as well as considering approving additional engineering work to further evaluate this opportunity. Should we decide to develop it in the future, we expect that the Blue Creek Energy Mine would significantly increase our annual production.

Met Coal Industry Overview

Met coal or coking coal is an essential ingredient in the production of steel using blast furnaces. According to Wood Mackenzie, approximately 74.2% of the world’s steel production in 2016, or 1,211 million metric tons, was estimated to be manufactured using blast furnaces. Three major types of met coal are produced globally with varying characteristics: HCC, semi soft coking coal (“SSCC”) and pulverized coal for injection (“PCI”). Unlike SSCC and PCI, HCC currently has no substitutes and must be used in the production of steel by the blast furnace method. Furthermore, the physical properties of individual HCC seams have a significant impact on their suitability and value in use for blast furnace steel production. In particular, HCC that exhibits low volatile matter and limited swell is required for blending with coal containing less desirable qualities.

Global steel production is estimated to be 1,633 million metric tons in 2016, which is a 0.4% increase from 2015 and a 6.0% increase from 2011. Future growth in global steel demand and production will be largely driven by infrastructure investment and urbanization in developing markets, particularly China and India which are expected to account for 50.0% and 5.9% of global steel production in 2016, respectively, according to Wood Mackenzie. Global steel consumption and production will also be impacted by infrastructure improvement in developed countries, in particular the United States. Steel production in the United States was 78.4 million metric tons in 2016, representing a 0.6% decrease from 2015 and an 11.6% decrease from recent peak production in 2012. Approximately 33.4% of 2016 steel production in the United States, or 26.2 million metric tons, was manufactured using blast furnaces. Further, Wood Mackenzie forecasts global steel production to grow from current levels to 1,693 million metric tons in 2020, a 3.7% increase.

Met coal, and in particular HCC, is a scarce commodity with large scale mineable deposits limited to specific geographic regions located in the Eastern United States, Western Canada, Eastern Australia, Russia, China, Mozambique and Mongolia. Collectively, these countries are expected to represent 95.7% of global met coal production in 2016 according to Wood Mackenzie. Global met coal production is estimated to be 1,070 million metric tons in 2016, of which only 597 million metric tons, or 55.8%, was classified as HCC, according to Wood Mackenzie. Of this amount, Wood Mackenzie estimates that 192 million metric tons of HCC were traded on the seaborne market. Costs of production for met coal are driven by mine fundamentals and input costs such as labor, fuel and local currency. As mines age, mining costs tend to rise, driven by deeper open cut operations with higher strip ratios and greater distance from shafts and ramps to production areas underground. According to Wood Mackenzie, “Total Cash Cost” (as defined by Wood Mackenzie) of met coal production in Australia has risen by an estimated 15% from 2009 to 2017, when measured in local currency. In recent years, many producers responded to low prices by taking action to reduce costs and capital expenditures. As evidenced by recent mine closures, we believe that many producers will be unable to maintain costs at that level due to deferral of investment in aging equipment and infrastructure, and therefore we expect the marginal cost of production to increase over time.

Met coal trades in a global seaborne market and in domestic markets in areas of China and the United States where coal mines are located closer to regional suppliers than ocean ports. According to Wood Mackenzie, seaborne trade of met coal is expected to be 278 million metric tons in 2016. The United States is an important met coal supplier to the seaborne export market, and is the second largest supplier behind Australia. For 2016,

Wood Mackenzie estimates these two countries were responsible for 11.7% and 66.6% of global seaborne met coal exports, respectively.

Over the last several years, significant oversupply in the market depressed prices, resulting in mine closures and production curtailments. The United States, with a relatively larger number of high-cost mines, experienced significant contraction in met coal production, from 82.9 million metric tons of production in 2012 to an expected 55.0 million metric tons in 2016, a 33.7% reduction.

Prices for met coal are generally set in the seaborne market, primarily driven by Japanese and Chinese import demand and Australian supply. Chinese import demand depends in part on Chinese steel production and domestic coal production. Of note, China is the largest met coal producer and consumer in the world, consuming over 99% of its 2016 production of 663 million metric tons of met coal domestically. However, due to the lower quality coal that is produced domestically and the distance of Chinese mines relative to the location of coastal steel mills, according to Wood Mackenzie, the Chinese domestic met coal market has a structural need for at least 30 million metric tons of premium benchmark quality HCC. Wood Mackenzie believes that this shortfall will be filled predominantly through the seaborne market, providing sustained demand support in the global seaborne market for premium quality HCC.

A quarterly benchmark HCC price is set between major Australian suppliers and major Japanese steel mill customers, and that price serves as a reference for most met coal, with adjustments for quality differences; there is also a spot market in which smaller volumes transact. Met coal prices have been highly volatile in the last decade due to seaborne supply disruptions, and more recently Chinese restrictions on domestic coal production. In 2008, benchmark coking coal prices reached $298 per metric ton in response to flooding in Australia’s producing regions, falling to $129 per metric ton in 2009. In 2011, benchmark prices reached $330 per metric ton as a result of flooding in Australia, falling back to $81 per metric ton five years later in early 2016.

In response to lower prices in 2015 and the first nine months of 2016, higher cost producers decreased or discontinued production, and we believe that they have been unable to respond quickly to higher prices due to the significant financial and regulatory burden associated with mine reopening, particularly in the United States. Additionally, Australian and Canadian mines are operating near capacity and would require significant capital investment to materially increase output. The lack of supply response was evident in late 2016, when in response to Chinese policy action, industry consolidation, and flooding in Chinese producing regions, the market saw a significant tightening in the global seaborne supply and demand balance, resulting in a corresponding increase in prices, with prices in the spot market increasing above $300 per metric ton in late 2016 and the first quarter 2017 benchmark contract price being set at $285 per metric ton.

Some of the factors that caused the recent rise in spot market pricing to above $300 per metric ton have eased, resulting in a decline in spot market prices to below $200 per metric ton. We believe this decline has been driven by (i) the temporary relaxation by the Chinese government of policies that were aimed to reduce domestic coal production and (ii) the resumption of production at Australian mines that had faced supply disruptions. Notwithstanding the recent pullback, spot market prices remain more than approximately 98% higher than the first quarter 2016 benchmark HCC settlement price of $81 per metric ton. The second quarter 2017 benchmark is expected to be set in late March 2017.

Over the long term, price levels between supply shock-induced spikes have been influenced by the marginal cost of production, which we expect to rise in coming years. According to Wood Mackenzie, in 2017, the Total Cash Cost of production for a mine at the 90th percentile of the global seaborne met coal cost curve is expected to be $93.34 per metric ton.

Risk Factors

There are a number of risks that you should understand before making an investment decision regarding this offering. These risks are discussed more fully in the section entitled “Risk Factors” beginning on page 18. These risks include, but are not limited to:

•

Our business may suffer as a result of a substantial or extended decline in met coal pricing, demand and other factors beyond our control, which could negatively affect our operating results and cash flows.

•

Met coal mining involves many hazards and operating risks and is dependent upon many factors and conditions beyond our control, which may cause our profitability and our financial position to decline.

•

Significant competition, as well as changes in foreign markets or economics, could harm our sales, profitability and cash flows.

•

Extensive environmental, health and safety laws and regulations impose significant costs on our operations and future regulations could increase those costs, limit our ability to produce or adversely affect the demand for our products.

Corporate History and Structure

Walter Energy Restructuring

Warrior Met Coal, LLC was formed on September 3, 2015 by certain lenders under Walter Energy’s 2011 Credit Agreement, dated as of April 1, 2011 (the “2011 Credit Agreement”), and the noteholders under Walter Energy’s 9.50% Senior Secured Notes due 2019 (such lenders and noteholders, collectively, “Walter Energy’s First Lien Lenders”) in connection with the acquisition by the Company of certain core assets of Walter Energy and certain of its wholly owned subsidiaries (the “Walter Energy Debtors”) related to their Alabama mining operations. The acquisition was accomplished through a credit bid of the first lien obligations of the Walter Energy Debtors pursuant to section 363 of the U.S. Bankruptcy Code and an order by the Bankruptcy Court (I) Approving the Sale of the Acquired Assets Free and Clear of Claims, Liens, Interests and Encumbrances; (II) Approving the Assumption and Assignment of Certain Executory Contracts and Unexpired Leases; and (III) Granting Related Relief (Case No. 15-02741, Docket No. 1584) (the “Sale Order” and the transactions contemplated thereunder, the “Asset Acquisition”). Prior to the closing of the Asset Acquisition, the Company had no operations and nominal assets. The Asset Acquisition closed on March 31, 2016.

Upon closing of the Asset Acquisition and in exchange for a portion of the outstanding first lien obligations of the Walter Energy Debtors, Walter Energy’s First Lien Lenders were entitled to receive, on a pro rata basis, a distribution of Class A Units in Warrior Met Coal, LLC. As of the date of this prospectus, there continue to be certain unfunded revolving loans under the 2011 Credit Agreement in the form of outstanding undrawn letters of credit arising under the first lien obligations of the Walter Energy Debtors. To the extent such letters of credit are drawn, including following the closing of this offering, the revolving lenders are entitled to an additional distribution of our equity interests. The maximum amount of equity that could be distributed on account of outstanding, but undrawn, letters of credit is less than 0.1% of our outstanding equity before giving effect to this offering.

In connection with the Asset Acquisition, we conducted rights offerings to Walter Energy’s First Lien Lenders and certain qualified unsecured creditors to purchase newly issued Class B Units of Warrior Met Coal, LLC, which diluted the Class A Units on a pro rata basis (the “Rights Offerings”). Proceeds from the Rights Offerings were used to pay certain costs associated with the Asset Acquisition and for general working capital purposes.

The transactions described above are collectively referred to as the “Walter Energy Restructuring.”

Post-IPO Corporate Structure

Upon completion of the corporate conversion and this offering, investment funds managed, advised or sub-advised by Apollo Global Management LLC (“Apollo”) or its affiliates (such funds, the “Apollo Funds”) will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full), investment funds managed, advised or sub-advised by GSO Capital Partners LP (“GSO”) or its affiliates (such funds, the “GSO Funds”) will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full), investment funds managed, advised or sub-advised by KKR & Co. L.L.P. (“KKR”) or its affiliates (such funds, the “KKR Funds”) will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full), and investment funds managed, advised or sub-advised by Franklin Mutual Advisers, LLC (“Franklin Mutual”) or its affiliates (such funds, the “Franklin Funds” and, together with the Apollo Funds, the GSO Funds and the KKR Funds, the “Principal Shareholders”) will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full). In addition, members of our management team will own an approximate aggregate % interest in us.

Implications of Being an Emerging Growth Company

As a company with less than $1.0 billion in revenue during its last fiscal year, we qualify as an “emerging growth company” as defined in The Jumpstart our Business Startups Act (the “JOBS Act”). For as long as a company is deemed to be an emerging growth company, it may take advantage of specified reduced reporting and other regulatory requirements that are generally unavailable to other public companies. These provisions include:

•

the presentation of only two years of audited financial statements and only two years of related Management’s Discussion and Analysis of Financial Condition and Results of Operations included in an initial public offering registration statement;

•

an exemption to provide less than five years of selected financial data in an initial public offering registration statement;

•

an exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board (“PCAOB”) requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer; and

•

reduced disclosure about the company’s executive compensation arrangements.

An emerging growth company is also exempt from Section 404(b) of The Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), which requires that the independent registered public accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of internal control over financial reporting, and from Sections 14A(a) and (b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which require stockholder approval of executive compensation and golden parachutes.

In addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the

“Securities Act”), for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.

We have elected to take advantage of all of the applicable JOBS Act provisions, except that we will elect to opt out of the exemption that allows emerging growth companies to extend the transition period for complying with new or revised financial accounting standards. This election is irrevocable.

Accordingly, the information that we provide you may be different than what you may receive from other public companies in which you hold equity interests.

We may take advantage of these provisions until we are no longer an emerging growth company, which will occur upon the earliest of:

•

the last day of the fiscal year following the fifth anniversary of this offering;

•

the last day of the fiscal year in which we have more than $1 billion in annual revenue;

•

the date on which we issue more than $1 billion in non-convertible debt securities over a three-year period; or

•

as of the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

For more information, please see “Risk Factors—For so long as we are an “emerging growth company” we will not be required to comply with certain disclosure requirements that are applicable to other public companies and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.”

Our Offices

Our principal executive offices are located at 16243 Highway 216, Brookwood, Alabama 35444, and our telephone number at that address is (205) 554-6150. Our website address is www.warriormetcoal.com. Information contained on our website is not incorporated by reference herein and does not constitute part of this prospectus.

The Offering

Common stock to be sold in this

offering

shares ( percent of shares outstanding)

Total common stock outstanding

before and after this offering

Over-allotment option

The underwriters have an option to acquire a maximum of additional shares from the selling stockholders as described in “Underwriting” to cover over-allotments of shares. We will not receive any of the proceeds from the shares of common stock sold pursuant to the over-allotment option.

Use of proceeds

We will not receive any proceeds from the sale of our common stock in this offering. All of the proceeds from this offering will be received by the selling stockholders. See “Use of Proceeds.”

Dividend policy

While we have not made any cash distribution since our inception, we may make a special distribution to the holders of our Class A Units and Class B Units (the “Special Distribution”) prior to the corporate conversion and this offering. The Special Distribution will not apply to the shares of our common stock to be sold in this offering. See “Dividend Policy.”

After completion of this offering, we may pay cash dividends on our common stock, subject to our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements and in any preferred stock, business prospects and other factors that our board of directors may deem relevant. Our ability to pay dividends on our common stock is limited by covenants in our Asset-Based Revolving Credit Agreement, dated as of April 1, 2016, by and among the Company and certain of its subsidiaries, as borrowers, the guarantors party thereto, Citibank, N.A., as administrative agent, and the other lenders party thereto (as amended, the “ABL Facility”), and may be further restricted by the terms of any future debt or preferred securities. See “Dividend Policy” and “Description of Certain Indebtedness.”

NYSE listing symbol

We intend to apply for listing of our shares of common stock (including the related preferred stock purchase right (the “Right”) described herein) on the New York Stock Exchange (the “NYSE“) under the symbol “HCC.”

Risk factors

You should carefully read and consider the information beginning on page 18 of this prospectus set forth under the heading “Risk Factors” and all other information set forth in this prospectus before deciding to invest in our common stock.

Unless otherwise indicated, all references to the number and percentage of shares of common stock outstanding and percentage ownership information are based on the shares of common stock to be outstanding following the corporate conversion assuming the following:

•

the conversion of Warrior Met Coal, LLC from a Delaware limited liability company to a Delaware corporation prior to the effective date of the registration statement of which this prospectus forms a part and, in connection therewith, the automatic conversion of Class B Units of Warrior Met Coal, LLC into Class A Units of Warrior Met Coal, LLC upon termination of the additional capital commitment, as discussed under “Corporate Conversion,” followed by the conversion of the then outstanding Class A Units and Class C Units of Warrior Met Coal, LLC into an aggregate of shares of common stock of Warrior Met Coal, Inc., assuming the corporate conversion occurred on , 2017;

•

there is no exercise of the underwriters’ option to purchase up to additional shares of our common stock to cover over-allotments, if any; and

•

the number of shares of common stock excludes approximately shares of our common stock reserved for issuance under our equity award plan for our employees and directors.

Summary Consolidated and Combined Historical and Pro Forma Financial Data

The following tables set forth our summary consolidated and combined historical and pro forma financial data as of and for each of the periods indicated. The summary consolidated historical financial data as of December 31, 2016 and for the nine months ended December 31, 2016 is derived from the audited consolidated financial statements of the Successor included elsewhere in this prospectus. The summary combined historical financial data as of December 31, 2015 and for the three months ended March 31, 2016 and the year ended December 31, 2015 is derived from the audited combined financial statements of our Predecessor included elsewhere in this prospectus. The term “Successor” refers to (1) Warrior Met Coal, LLC and its subsidiaries for periods beginning as of April 1, 2016 and ending immediately before the completion of our corporate conversion and (2) Warrior Met Coal, Inc. and its subsidiaries for periods beginning with the completion of our corporate conversion and thereafter . The term “Predecessor” refers to the assets acquired and liabilities assumed by Warrior Met Coal, LLC from Walter Energy in the Asset Acquisition on March 31, 2016. The Predecessor periods included in this prospectus begin as of January 1, 2015 and end as of March 31, 2016.

The summary unaudited pro forma statement of operations data for the year ended December 31, 2016 is derived from the unaudited pro forma condensed combined statement of operations included elsewhere in this prospectus. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2016 assumes that the Asset Acquisition, this offering and the Special Distribution (collectively, the “Transactions”) occurred as of January 1, 2015. The summary unaudited pro forma balance sheet data as of December 31, 2016 assumes that the payment of the Special Distribution occurred as of December 31, 2016. The summary unaudited pro forma financial data is based upon available information and certain assumptions that management believes are factually supportable, are reasonable under the circumstances and are directly related to the Transactions. The summary unaudited pro forma financial data is provided for informational purposes only and does not purport to represent what our results of operations or financial position actually would have been if these transactions had occurred at any other date, and such data does not purport to project our results of operations for any future period.

You should read this summary consolidated and combined historical and pro forma financial data together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Selected Consolidated and Combined Historical and Pro Forma Financial Data,” the unaudited pro forma condensed combined statements of operations and the audited financial statements and related notes thereto included elsewhere in this prospectus. Our historical results are not necessarily indicative of our future results of operations, financial position and cash flows.


	Historical									Pro Forma
	Successor			Predecessor						Predecessor/ Successor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015			For the year ended December 31, 2016
				(in thousands, except per unit and per metric ton data)
Statements of Operations Data:
Revenues:
Sales	$	276,560		$	65,154		$	514,334		$	341,714
Other revenues		21,074			6,229			30,399			27,303

Total revenues		297,634			71,383			544,733			369,017

Costs and expenses:
Cost of sales (exclusive of items shown separately below)		244,723			72,297			601,545			315,563
Cost of other revenues (exclusive of items shown separately below)		19,367			4,698			27,442			24,065
Depreciation and depletion		47,413			28,958			123,633			58,950
Selling, general and administrative		20,507			9,008			38,922			29,515
Other postretirement benefits		—			6,160			30,899			—
Restructuring costs		—			3,418			13,832			3,418
Asset impairment charges		—			—			27,986			—
Transaction and other costs		13,568			—			—			—

Total costs and expenses		345,578			124,539			864,259			431,511

Operating loss		(47,944	)		(53,156	)		(319,526	)		(62,494	)
Interest expense, net		(1,711	)		(16,562	)		(51,077	)		(2,243	)
Gain on extinguishment of debt		—			—			26,968			—
Reorganization items, net		—			7,920			(7,735	)		—

Loss before income taxes		(49,655	)		(61,798	)		(351,370	)		(64,737	)
Income tax expense (benefit)		18			18			(40,789	)		36

Net loss	$	(49,673	)	$	(61,816	)	$	(310,581	)	$	(64,773	)

Net loss per unit—basic and diluted	$	(13.15	)
Weighted average units outstanding—basic and diluted		3,777
Supplemental pro forma net loss per share—basic and diluted ⁽¹⁾	$
Supplemental pro forma weighted average shares outstanding—basic and diluted ⁽¹⁾

Statements of Cash Flow Data:
Cash provided by (used in):
Operating activities	$	(9,187	)	$	(40,698	)	$	(131,818	)
Investing activities	$	(30,884	)	$	(5,422	)	$	(64,249	)
Financing activities	$	192,727		$	(6,240	)	$	(147,145	)

Other Financial Data:
Depreciation and depletion	$	47,413		$	28,958		$	123,633		$	58,950
Capital expenditures ⁽²⁾	$	11,531		$	5,422		$	64,971
Adjusted EBITDA ⁽³⁾	$	50,089		$	(9,048	)	$	(145,805	)	$	48,428

Sales Data:
Metric tons sold		2,391			777			5,121			3,168
Average selling price per metric ton	$	115.67		$	83.85		$	100.44		$	107.86
Cash cost of sales per metric ton ⁽⁴⁾	$	82.84		$	69.74		$	112.96		$	79.17


	Pro Forma ⁽⁵⁾	Historical
	Successor	Successor		Predecessor
	December 31, 2016	December 31, 2016		December 31, 2015
		(in thousands)
Balance Sheet Data:
Cash and cash equivalents	$	$	150,045	$	79,762
Working capital ⁽⁶⁾	$	$	226,137	$	129,558
Mineral interests, net	$	$	143,231	$	5,295
Property, plant and equipment, net	$	$	496,959	$	567,594
Total assets	$	$	947,631	$	802,137
Long-term debt ⁽⁷⁾	$	$	3,725	$	—
Total liabilities not subject to compromise	$	$	194,664	$	126,720
Total members’ equity and parent net investment	$	$	752,967	$	(820,861	)

(1)

We present certain per share data on a supplemental pro forma basis to the extent that the proceeds from this offering will be deemed to be used to fund the Special Distribution of $ million. For further information on the supplemental pro forma per share data, see Note 26 to our audited financial statements included elsewhere in this prospectus.

(2)	Capital expenditures consist of the purchases of property, plant and equipment.

(3)	Adjusted EBITDA is a non-GAAP financial measure. For a definition of Adjusted EBITDA and a reconciliation to our most directly comparable financial measure calculated and presented in accordance with GAAP, please read “—Non-GAAP Financial Measures—Adjusted EBITDA.”

(4)	Cash cost of sales is a non-GAAP financial measure. For a definition of cash cost of sales and a reconciliation to our most directly comparable financial measure calculated and presented in accordance with GAAP, please read “—Non-GAAP Financial Measures—Cash Cost of Sales.”

(5)	Reflects the payment of the Special Distribution. See Note 26 to our audited financial statements appearing elsewhere in this prospectus for information regarding this unaudited pro forma balance sheet data.

(6)	Working capital consists of current assets less current liabilities.

(7)

Represents a security agreement and the long-term portion of a promissory note assumed in the Asset Acquisition. The agreement was entered into for the purchase of underground mining equipment. The promissory note matures on March 31, 2019, has a fixed interest rate of 4.00% per annum and is secured by the underground mining equipment it was used to purchase.

Non-GAAP Financial Measures

Cash Cost of Sales

Cash cost of sales is based on reported cost of sales and includes items such as freight, royalties, manpower, fuel and other similar production and sales cost items, and may be adjusted for other items that, pursuant to accounting principles generally accepted in the United States (“GAAP”), are classified in the Statements of Operations as costs other than cost of sales, but relate directly to the costs incurred to produce met coal. Our cash cost of sales per metric ton is calculated as the cash cost of metric tons sold divided by the metric tons sold.

Cash costs of sales is a financial measure that is not calculated in conformity with GAAP and should be considered supplemental to, and not as a substitute or superior to, financial measures calculated in conformity with GAAP. We believe that this non-GAAP financial measure provides additional insight into our operating performance, and reflects how management analyzes our operating performance and compares that performance against other companies on a consistent basis for purposes of business decision making by excluding the impact of certain items that management does not believe are indicative of our core operating performance. We believe that cash costs of sales presents a useful measure of our controllable costs and our operational results by including all costs incurred to produce met coal. Period-to-period comparisons of cash cost of sales are intended to help our management identify and assess additional trends potentially impacting our Company that may not be shown solely by period-to-period comparisons of cost of sales. In addition, we believe that cash costs of sales is a useful measure as some investors and analysts use it to compare us against other companies. However, cash cost of sales may not be comparable to similarly titled measures used by other entities.

The following table presents a reconciliation of cost of sales to cash costs of sales (in thousands):


	Historical									Pro Forma
	Successor			Predecessor						Predecessor/ Successor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015			For the year ended December 31, 2016
Cost of sales	$	244,723		$	72,297		$	601,545		$	315,563
Mine No. 4 idle costs ⁽¹⁾		(8,726	)		(10,173	)		—			(18,899	)
VEBA contribution ⁽²⁾		(25,000	)		—			—			(25,000	)
Other (operating overhead, etc.)		(12,922	)		(7,936	)		(23,077	)		(20,858	)

Cash cost of sales	$	198,075		$	54,188		$	578,468		$	250,806

(1)	Represents idle costs incurred, such as electricity, insurance and maintenance labor. This mine was idled in early 2016.

(2)	We entered into a new initial CBA with the UMWA pursuant to which we agreed to contribute $25.0 million to a Voluntary Employees’ Beneficiary Association (“VEBA”) trust formed and administered by the UMWA.

Adjusted EBITDA

Adjusted EBITDA is defined as net loss before net interest expense, income tax expense (benefit), depreciation and depletion, net reorganization items, gain on extinguishment of debt, restructuring costs, asset impairment charges, transaction and other costs, Mine No. 4 idle costs, VEBA contributions, non-cash stock compensation expense and non-cash asset retirement obligation accretion.

Adjusted EBITDA is a financial measure that is not calculated in conformity with GAAP and should be considered supplemental to, and not as a substitute or superior to, financial measures calculated in conformity with GAAP. We believe that this non-GAAP financial measure provides additional insights into our operating performance, and it reflects how management analyzes our operating performance and compares that performance against other companies on a consistent basis for purposes of business decision making by excluding the impact of certain items that management does not believe are indicative of our core operating performance. We believe Adjusted EBITDA assists management in comparing performance across periods, planning and forecasting future business operations and helping determine levels of operating and capital investments. Period-to-period comparisons of Adjusted EBITDA are intended to help our management identify and assess additional trends potentially impacting our Company that may not be shown solely by period-to-period comparisons of net loss. We also utilize Adjusted EBITDA in certain calculations under our ABL Facility and for purposes of determining executive compensation. In addition, we believe that Adjusted EBITDA is a useful measure as some investors and analysts use Adjusted EBITDA to compare us against other companies. However, Adjusted EBITDA may not be comparable to similarly titled measures used by other entities.

The following table presents a reconciliation of net loss to Adjusted EBITDA (in thousands):


	Historical									Pro Forma
	Successor			Predecessor						Predecessor/ Successor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015			For the year ended December 31, 2016
Net loss	$	(49,673	)	$	(61,816	)	$	(310,581	)	$	(64,773	)
Interest expense, net		1,711			16,562			51,077			2,243
Income tax expense (benefit)		18			18			(40,789	)		36
Depreciation and depletion		47,413			28,958			123,633			58,950
Reorganization items, net ⁽¹⁾		—			(7,920	)		7,735			—
Gain on extinguishment of debt ⁽²⁾		—			—			(26,968	)		—
Restructuring costs ⁽³⁾		—			3,418			13,832			3,418
Asset impairment charges ⁽⁴⁾		—			—			27,986			—
Transaction and other costs ⁽⁵⁾		13,568			—			—			—
Mine No. 4 idle costs ⁽⁶⁾		8,726			10,173			—			18,899
VEBA contribution ⁽⁷⁾		25,000			—			—			25,000
Stock compensation expense ⁽⁸⁾		509			390			4,034			899
Asset retirement obligation accretion ⁽⁹⁾		2,817			1,169			4,236			3,756

Adjusted EBITDA	$	50,089		$	(9,048	)	$	(145,805	)	$	48,428

(1)	Represents expenses and income directly associated with the Predecessor’s Chapter 11 Cases (as defined in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”).

(2)	Represents a portion of the gain on extinguishment of debt that was attributed to the Predecessor.

(3)	Represents cost and expenses in connection with workforce reductions at Mine No. 4 and Mine No. 7 and corporate headquarters.

(4)	Represents asset impairment charges associated with the Blue Creek Energy Mine, which was impaired during the fourth quarter of 2015.

(5)	Represents costs incurred by the Company in connection with the Asset Acquisition and this offering.

(6)	Represents idle costs incurred, such as electricity, insurance and maintenance labor. This mine was idled in early 2016.

(7)	We entered into a new initial CBA with the UMWA pursuant to which we agreed to contribute $25.0 million to a VEBA trust formed and administered by the UMWA.

(8)	Represents non-cash stock compensation expense associated with equity awards.

(9)	Represents non-cash accretion expense associated with our asset retirement obligations.

RISK FACTORS

Investing in our common stock involves substantial risks. You should carefully consider each of the following risks and all of the other information set forth in this prospectus before making an investment decision regarding our common stock. Any of the risk factors described herein could significantly and adversely affect our business prospects, financial condition and results of operations. As a result, the trading price of our common stock could decline, and you could lose all or part of your investment. Additional risks and uncertainties not presently known to us or not believed by us to be material may also negatively impact us.

Risks Related to Our Business

We were formed for the purpose of purchasing and operating the core assets of Walter Energy’s Alabama mining operations pursuant to section 363 of the U.S. Bankruptcy Code and an order by the Bankruptcy Court and have a limited operating history.

The Asset Acquisition was consummated on March 31, 2016. Therefore, we have a limited performance record and operating history on a standalone basis, and, as a result, limited historical financial information upon which you can evaluate our operating performance, ability to implement and achieve our business strategy or ability to pay dividends, if any, in the future. We cannot assure you that we will be successful in implementing our business strategies or achieving our business objective.

Deterioration in global economic conditions as they relate to the steelmaking industry, as well as generally unfavorable global economic, financial and business conditions, may adversely affect our business, results of operations and cash flows.

Demand for met coal depends on domestic and foreign steel demand. As a result, if economic conditions in the global steelmaking industry deteriorate as they have in past years, the demand for met coal may decrease. In addition, the global financial markets have been experiencing volatility and disruption over the last several years. These markets have experienced, among other things, volatility in security prices, commodities and currencies, diminished liquidity and credit availability, rating downgrades and declining valuations of certain investments. Weaknesses in global economic conditions have had an adverse effect and could have a material adverse effect on the demand for our met coal and, in turn, on our sales, pricing and profitability.

If met coal prices drop to or below levels experienced in 2015 and the first half of 2016 for a prolonged period or if there are further downturns in economic conditions, particularly in developing countries such as China and India, our business, financial condition or results of operations could be adversely affected. While we are focused on cost control and operational efficiencies, there can be no assurance that these actions, or any others we may take, will be sufficient in response to challenging economic and financial conditions. In addition, the recent increase in met coal prices may not be sustainable.

Our business may suffer as a result of a substantial or extended decline in met coal pricing or the failure of any recovery or stabilization of met coal prices to endure, as well as any substantial or extended decline in the demand for met coal and other factors beyond our control, which could negatively affect our operating results and cash flows.

Our profitability depends on the prices at which we sell our met coal, which are largely dependent on prevailing market prices. Market prices for met coal have been low in recent periods and the failure of any price recovery or stabilization to endure will negatively affect our operating cash flows. We have experienced significant price fluctuations in our met coal business, and we expect that such fluctuations will continue. For example, in the first quarter of 2016, the benchmark HCC settlement price fell to $81 per metric ton, while in late 2016 spot market prices passed $300 per metric ton with a first quarter 2017 benchmark HCC settlement price of $285 per metric ton. More recently, the spot market price as of March 1, 2017 was $161.60. Pricing in the global seaborne market is typically negotiated quarterly; however, increasingly the market is moving towards shorter

term pricing models, including index-based pricing. Demand for, and therefore the price of, met coal is driven by a variety of factors, including, but not limited to, the following:

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the domestic and foreign supply and demand for met coal;

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the quantity and quality of met coal available from competitors;

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the demand for and price of steel;

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adverse weather, climatic and other natural conditions, including natural disasters;

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domestic and foreign economic conditions, including slowdowns in domestic and foreign economies and financial markets;

•

global and regional political events;

•

domestic and foreign legislative, regulatory and judicial developments, environmental regulatory changes and changes in energy policy and energy conservation measures that could adversely affect the met coal industry; and

•

capacity, reliability, availability and cost of transportation and port facilities, and the proximity of available met coal to such transportation and port facilities.

The met coal industry also faces concerns with respect to oversupply from time to time, which could materially adversely affect our financial condition and results of operations. In addition, reductions in the demand for met coal caused by reduced steel production by our customers, increases in the use of substitutes for steel (such as aluminum, composites or plastics) or less expensive substitutes for met coal and the use of steelmaking technologies that use less or no met coal can significantly adversely affect our financial results and impede growth. Our natural gas business is also subject to adverse changes in pricing due to, among other factors, changes in demand and competition from alternative energy sources.

Our customers are continually evaluating alternative steel production technologies which may reduce demand for our product.

Our product is primarily used as HCC for blast furnace steel producers. High-quality HCC commands a significant price premium over other forms of coal because of its value in use in blast furnaces for steel production. High-quality HCC is a scarce commodity and has specific physical and chemical properties which are necessary for efficient blast furnace operation. Alternative technologies are continually being investigated and developed with a view to reducing production costs or for other reasons, such as minimizing environmental or social impact. If competitive technologies emerge or are increasingly utilized that use other materials in place of our product or that diminish the required amount of our product, such as electric arc furnaces or pulverized coal injection processes, demand and price for our met coal might fall. Many of these alternative technologies are designed to use lower quality coals or other sources of carbon instead of higher cost high-quality HCC. While conventional blast furnace technology has been the most economic large-scale steel production technology for a number of years, and while emergent technologies typically take many years to commercialize, there can be no assurance that over the longer term competitive technologies not reliant on HCC could emerge which could reduce demand and price premiums for HCC.

The failure of our customers to honor or renew contracts could adversely affect our business.

A significant portion of the sales of our met coal is to customers with whom we have had a relationship for a long period of time. Typically, our customer contracts are for an annual term or evergreen in nature. The success of our business depends on our ability to retain our current customers, renew our existing customer contracts and solicit new customers. Our ability to do so generally depends on a variety of factors, including the quality and price of our products, our ability to market these products effectively, our ability to deliver on a timely basis and the level of competition that we face. If our customers do not honor contract commitments, or if they terminate agreements or exercise force majeure provisions allowing for the temporary suspension of performance and we are unable to

replace the contract, our revenues will be materially and adversely affected. Changes in the met coal industry may cause some of our customers not to renew, extend or enter into new met coal supply agreements or to enter into agreements to purchase fewer metric tons of met coal or on different terms than in the past.

Our met coal supply agreements typically contain force majeure provisions allowing the parties to temporarily suspend performance during specified events beyond their control. Most of our met coal supply agreements also contain provisions requiring us to deliver met coal that satisfies certain quality specifications, such as volatile content, sulfur content, ash content and moisture levels. In addition, many of our met coal supply agreements provide that we price our product on a quarterly basis. These quarterly price agreements are based upon the prevailing benchmark pricing at the time. Some of our annual met coal contracts have shifted to be indexed priced, where prices are determined on or before shipment by averaging the leading spot indexes reported in the market. A significantly lower price could adversely affect our profitability.

Our ability to collect payments from our customers could be impaired and, as a result, our financial position could be materially and adversely affected if their creditworthiness deteriorates, if they declare bankruptcy, or if they fail to honor their contracts with us.

Our ability to receive payment for met coal sold and delivered depends on the continued creditworthiness and financial stability of our customers. If we determine that a customer is not creditworthy or if a customer declares bankruptcy, we may not be required to deliver met coal sold under the customer’s sales contract. If this occurs, we may decide to sell the customer’s met coal on the spot market, which may be at prices lower than the contracted price, or we may be unable to sell the met coal at all. In addition, if customers refuse to accept shipments of our met coal for which they have an existing contractual obligation, our revenues will decrease and we may have to reduce production at our mines until our customers’ contractual obligations are honored. Further, competition with other met coal suppliers could cause us to extend credit to customers on terms that could increase the risk of payment default. Our inability to collect payment from counterparties to our sales contracts may materially adversely affect our business, financial condition, results of operations and cash flows.

A significant reduction of, or loss of, purchases by our largest customers could materially adversely affect our profitability.

For the nine months ended December 31, 2016, we derived approximately 58% of our total sales revenues from our five largest customers. There are inherent risks whenever a significant percentage of total revenues are concentrated with a limited number of customers, and it is not possible for us to predict the future level of demand for our met coal that will be generated by our largest customers. We expect to renew, extend or enter into new supply agreements with these and other customers; however, we may be unsuccessful in obtaining such agreements with these customers and these customers may discontinue purchasing met coal from us, reduce the quantity of met coal that they have historically purchased from us or pressure us to reduce the prices that we charge for our met coal due to market, economic or competitive conditions. If any of our major customers were to significantly reduce the quantities of met coal they purchase from us and we are unable to replace these customers with new customers (or we fail to obtain new, additional customers), or if we are otherwise unable to sell met coal to those customers on terms as favorable to us as the terms under our current agreements, our profitability could suffer significantly.

Substantially all of our revenues are derived from the sale of met coal. This lack of diversification of our business could adversely affect our financial condition, results of operations and cash flows.

We rely on the met coal production from our two active met coal mines for substantially all of our revenues. For the nine months ended December 31, 2016 and the year ended December 31, 2015, revenues from the sale of met coal accounted for approximately 92.9% and 94.4%, respectively, of our total revenues. As noted above, demand for met coal depends on domestic and foreign steel demand. At times, the pricing and availability of steel can be volatile due to numerous factors beyond our control. When steel prices are lower, the prices that we charge steelmaking customers for our met coal may decline, which could adversely affect our financial condition,

results of operations and cash flows. Since we are heavily dependent on the steelmaking industry, adverse economic conditions in this industry, even in the presence of otherwise favorable economic conditions in the broader coal industry, could have a significantly greater impact on our financial condition and results of operations than if our business were more diversified. In addition, our lack of diversification may make us more susceptible to such adverse economic conditions than our competitors with more diversified operations and/or asset portfolios, such as those that produce thermal coal in addition to met coal.

All of our mining operations are located in Alabama, making us vulnerable to risks associated with having our production concentrated in one geographic area.

All of our mining operations are geographically concentrated in Alabama. As a result of this concentration, we may be disproportionately exposed to the impact of delays or interruptions in production caused by significant governmental regulation, transportation capacity constraints, constraints on the availability of required equipment, facilities, personnel or services, curtailment of production, extreme weather conditions, natural disasters or interruption of transportation or other events that impact Alabama or its surrounding areas. If any of these factors were to impact Alabama more than other met coal producing regions, our business, financial condition, results of operations and cash flows will be adversely affected relative to other mining companies with operations in unaffected regions or that have a more geographically diversified asset portfolio.

Met coal mining involves many hazards and operating risks, and is dependent upon many factors and conditions beyond our control, which may cause our profitability and financial position to decline.

Our mining operations, including our preparation and transportation infrastructure, are subject to inherent hazards and operating risks that could disrupt operations, decrease production and increase the cost of mining for varying lengths of time. Specifically, underground mining and related processing activities present risks of injury to persons and damage to property and equipment. In addition, met coal mining is dependent upon a number of conditions beyond our control that can disrupt operations and/or affect our costs and production schedules at particular mines. These risks, hazards and conditions include, but are not limited to:

•

variations in geological conditions, such as the thickness of the met coal seam and amount of rock embedded in the met coal deposit and variations in rock and other natural materials overlying the met coal deposit, that could affect the stability of the roof and the side walls of the mine;

•

mining, process and equipment or mechanical failures, unexpected maintenance problems and delays in moving longwall equipment;

•

adverse weather and natural disasters, such as heavy rains or snow, forest fires, flooding and other natural events, including seismic activities, ground failures, rock bursts or structural cave-ins or slides, affecting our operations or transportation to our customers;

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railroad delays or derailments;

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environmental hazards, such as subsidence and excess water ingress;

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delays and difficulties in acquiring, maintaining or renewing necessary permits or mining rights;

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availability of adequate skilled employees and other labor relations matters;

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security breaches or terroristic acts;

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unexpected mine accidents, including rock-falls and explosions caused by the ignition of met coal dust, natural gas or other explosive sources at our mine sites or fires caused by the spontaneous combustion of met coal or similar mining accidents;

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competition and/or conflicts with other natural resource extraction activities and production within our operating areas, such as natural gas extraction or oil and gas development; and

•

other hazards that could also result in personal injury and loss of life, pollution and suspension of operations.

These risks and conditions could result in damage to or the destruction of our mineral properties, equipment or production facilities, personal injury or death, environmental damage, delays in mining, regulatory investigations, actions and penalties, repair and remediation costs, monetary losses and legal liability. In addition, a significant mine accident could potentially cause a suspension of operations or a complete mine shutdown. Our insurance coverage may not be available or sufficient to fully cover claims that may arise from these risks and conditions.

We have also seen adverse geological conditions in the mines, such as variations in met coal seam thickness, variations in the competency and make-up of the roof strata, fault-related discontinuities in the met coal seam and the potential for ingress of excessive amounts of natural gas or water. Such adverse conditions may increase our cost of sales and reduce our profitability, and may cause us to decide to close a mine. Any of these risks or conditions could have a negative impact on our financial condition, results of operations and cash flows.

In addition, if any of the foregoing changes, conditions or events occurs and is not excusable as a force majeure event, any resulting failure on our part to deliver met coal to the purchaser under our contracts could result in economic penalties, suspension or cancellation of shipments or ultimately termination of the agreement, any of which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The historical and pro forma financial information that we have included in this prospectus may not be representative of the results we would have achieved as a stand-alone public company and may not be a reliable indicator of our future results.

The combined financial statements of our Predecessor and unaudited pro forma financial information that we have included in this prospectus have been presented, in part, on a combined basis and include the historical accounts of the acquired assets and liabilities assumed which were carved out from Walter Energy’s consolidated financial statements using the historical results of operations, cash flows, assets and liabilities of the Predecessor and include allocations of expenses on the basis of the Predecessor’s relative headcount and total assets to that of Walter Energy. As a result, our historical and pro forma financial statements may not necessarily reflect what our financial condition, results of operations or cash flows would have been had we been an independent, stand-alone entity during the periods presented or those that we will achieve in the future.

We have made certain assumptions with respect to the preparation of the pro forma financial information. Such assumptions may not prove to be accurate and, accordingly, the Company’s pro forma financial information may not be indicative of what its results of operations or financial condition actually would have been as an independent public company nor be a reliable indicator of what its results of operations and financial condition actually may be in the future. We urge you to carefully consider the basis on which the historical and pro forma financial information included herein was prepared and presented. For additional information, see “Selected Consolidated and Combined Historical and Pro Forma Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the audited financial statements and related notes thereto included elsewhere in this prospectus.

If we fail to implement our business strategies successfully, our financial performance could be harmed.

Our future financial performance and success are dependent in large part upon our ability to successfully implement our business strategies described in “Prospectus Summary—Our Business Strategies.” We may not be able to implement our business strategies successfully or achieve the anticipated benefits. If we are unable to do so, our long-term growth, profitability and ability to service any debt we incur in the future may be materially adversely affected. Even if we are able to implement some or all of the key elements of our business plan successfully, our operating results may not improve to the extent we anticipate, or at all. Implementation of our business strategies, including any decision to develop our Blue Creek Energy Mine (as defined below), could

also be affected by a number of factors beyond our control, such as global economic conditions, met coal prices, domestic and foreign steel demand, and environmental, health and safety laws and regulations.

A key element of our business strategy involves increasing production at our existing mines and the potential expansion into our Blue Creek Energy Mine recoverable reserves in a cost efficient manner should market conditions warrant such expansion. As we expand our business activities, there will be additional demands on our financial, technical, operational and management resources. These aspects of our strategy are subject to numerous risks and uncertainties, including:

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an inability to retain or hire experienced crews and other personnel and other labor relations matters;

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a lack of customer demand for our mined met coal;

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an inability to secure necessary equipment, raw materials or engineering in a timely manner to successfully execute our expansion plans;

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unanticipated delays that could limit or defer the production or expansion of our mining activities and jeopardize our long term relationships with our existing customers and adversely affect our ability to obtain new customers for our mined met coal; and

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a lack of available cash or access to sufficient debt or equity financing for investment in our expansion.

We may not achieve our targeted operating metrics.

As discussed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Selected 2017 Targeted Operating Metrics” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capital Expenditures,” a number of our targeted operating metrics for 2017 are higher than our 2016 results, including with regard to metric tons sold, cash cost of sales per metric ton and capital expenditures. These targeted operating metrics represent our targets and are not projections or forecasts of our performance for the year ending December 31, 2017, any quarterly period in the year ending December 31, 2017 or any other future period and should not be relied upon as any indication or representation that such targeted operating metrics can be or will be achieved by us in any future period. In addition, we also present illustrative run rate cash cost of sales under various pricing scenarios. The targeted operating metrics are forward-looking and, along with our run rate cash cost of sales, subject to significant uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control and are based upon assumptions with respect to future decisions and circumstances, including, for example, management’s assumptions with respect to commodity price fluctuations, which are subject to change. Actual results may vary from these metrics and such variations may be material. See “Cautionary Note Regarding Forward-Looking Statements.”

Our business is subject to inherent risks, some for which we maintain third party insurance. We may incur losses and be subject to liability claims that could have a material adverse effect on our financial condition, results of operations or cash flows.

We maintain insurance policies that provide limited coverage for some, but not all, potential risks and liabilities associated with our business. We may not obtain insurance if we believe the cost of available insurance is excessive relative to the risks presented. As a result of market conditions, premiums and deductibles for certain insurance policies can increase substantially, and in some instances, certain insurance may become unavailable or available only for reduced amounts of coverage. As a result, we may not be able to renew our existing insurance policies or procure other desirable insurance on commercially reasonable terms, if at all. In addition, certain environmental, contamination and pollution risks generally are not fully insurable. Even where insurance coverage applies, insurers may contest their obligations to make payments. Our financial condition, results of operations and cash flows could be materially and adversely affected by losses and liabilities from uninsured or under-insured events, as well as by delays in the payment of insurance proceeds, or the failure by insurers to make payments.

We also may incur costs and liabilities resulting from claims for damages to property or injury to persons arising from our operations. We must compensate employees for work-related injuries. If we do not make adequate provision for our workers’ compensation and black lung liabilities, or we are pursued for applicable sanctions, costs and liabilities, our operations and profitability could be adversely affected. Certain of our subsidiaries are responsible for medical and disability benefits for black lung disease under federal law and are insured beginning April 1, 2016 for claims made by or on behalf of any of our employees. As a result of our limited operating history as a stand-alone company, the Department of Labor required us to provide insurance coverage rather than be self-insured for these obligations for a minimum of three years from March 31, 2016.

We are responsible for medical and disability benefits for black lung disease under federal law. We assumed certain historical self-insured back lung liabilities of Walter Energy and its subsidiaries incurred prior to April 1, 2016 in connection with the Asset Acquisition. We are self-insured for these black lung liabilities and have posted certain collateral with Department of Labor as described below. Changes in the estimated claims to be paid or changes in the amount of collateral required by the Department of Labor may have a greater impact on our profitability and cash flows in the future.

We are responsible for medical and disability benefits for black lung disease under the Federal Coal Mine Health and Safety Act of 1969, the Federal Mine Safety and Health Act of 1977 (the “Mine Act”) and the Black Lung Benefits Revenue Act of 1977 and the Black Lung Benefits Reform Act of 1977 (together, the “Black Lung Benefits Act”), each as amended, and are self-insured for black lung related claims asserted by or on behalf of former employees of Walter Energy and its subsidiaries as assumed in the Asset Acquisition for the period prior to April 1, 2016. We perform an annual actuarial evaluation of the overall black lung liabilities as of each December 31 ^st . The calculation is performed using assumptions regarding rates of successful claims, discount factors, benefit increases and mortality rates, among others. If the number of or severity of successful claims increases, or we are required to accrue or pay additional amounts because the successful claims prove to be more severe than our original assessment, our operating results and cash flows could be negatively impacted. Our self-insurance program for these legacy liabilities is unique to the industry and was specifically negotiated with the Department of Labor requiring us to post $17.5 million in Treasury bills as collateral in addition to maintaining a black lung trust of $4.3 million that was acquired in the Asset Acquisition. For additional information see “Business—Environmental and Regulatory Matters—Workers’ Compensation and Black Lung.” Our estimated total black lung liabilities as of December 31, 2016 were $28.7 million. In future years, the Department of Labor could require us to increase the amount of the collateral which could negatively impact our cash flows.

Defects in title of any real property or leasehold interests in our properties or associated met coal reserves could limit our ability to mine or develop these properties or result in significant unanticipated costs.

All of our mining operations are conducted on properties owned or leased by us. Our right to mine our met coal reserves may be materially adversely affected by defects in title or boundaries or if our property interests are subject to superior property rights of third parties. We do not have title insurance for any of our real property or leasehold interests and, as part of the Asset Acquisition, we did not independently verify title to our leased properties or associated met coal reserves. Any challenge to our title or leasehold interests could delay the mining of the property, result in the loss of some or all of our interest in the property or met coal reserves and increase our costs. In order to conduct our mining operations on properties where these defects exist, we may incur unanticipated costs perfecting title. In addition, if we mine or conduct our operations on property that we do not own or lease, we could incur civil damages or liabilities for such mining operations and be subject to conversion, negligence, trespass, regulatory sanction and penalties. Some leases have minimum production requirements or require us to commence mining operations in a specified term to retain the lease. Failure to meet those requirements could result in losses of prepaid royalties and, in some rare cases, could result in a loss of the lease itself.

We face uncertainties in estimating our proven and probable met coal reserves, and inaccuracies in our estimates of our met coal reserves could result in decreased profitability from lower than expected revenues or higher than expected costs.

Our future performance depends on, among other things, the accuracy of our estimates of our proven and probable met coal reserves. Reserve estimates are based on a number of sources of information, including engineering, geological, mining and property control maps and data, our operational experience of historical production from similar areas with similar conditions and assumptions governing future pricing and operational costs. We update our estimates of the quantity and quality of proven and probable met coal reserves at least annually to reflect the production of met coal from the reserves, updated geological models and mining recovery data, the tonnage contained in new lease areas acquired and estimated costs of production and sales prices. There are numerous factors and assumptions inherent in estimating met coal quantities, qualities and costs to mine, including many factors beyond our control, such as the following:

•

geological and mining conditions, including faults in the met coal seam;

•

historical production from the area compared with production from other producing areas;

•

the percentage of met coal ultimately recoverable;

•

the assumed effects of regulations and taxes and other payments to governmental agencies;

•

our ability to obtain, maintain and renew all required permits;

•

future improvements in mining technology;

•

assumptions concerning the timing of the development of the reserves; and

•

assumptions concerning equipment and operational productivity, future met coal prices, operating costs, including those for critical supplies such as fuel, tires and explosives, capital expenditures and development and reclamation costs.

Each of these factors may vary considerably from the assumptions used in estimating the reserves. As a result, estimates of the quantities and qualities of economically recoverable met coal attributable to any particular group of properties, classifications of reserves based on risk of recovery, estimated cost of production, and estimates of future net cash flows expected from these properties as prepared by different engineers or by the same engineers at different times may vary materially due to changes in the above factors and assumptions. Actual production recovered from identified reserve areas and properties, and revenues and expenditures associated with our mining operations may vary materially from estimates. Any inaccuracy in our estimates related to our reserves could result in decreased profitability from lower than expected revenues and/or higher than expected costs.

Our inability to develop met coal reserves in an economically feasible manner or our inability to acquire additional met coal reserves that are economically recoverable may adversely affect our business.

Our long-term profitability depends in part on our ability to cost-effectively mine and process met coal reserves that possess the quality characteristics desired by our customers. As we mine, our met coal reserves decline. As a result, our future success depends upon our ability to develop or acquire additional met coal reserves that are economically recoverable to replace the reserves that we produce. Coal is economically recoverable when the price at which our met coal can be sold exceeds the costs and expenses of mining and selling such met coal. We may not be able to obtain adequate economically recoverable replacement reserves when we require them and, even if available, such reserves may not be at favorable prices or we may not be capable of mining those reserves at costs that are comparable to our existing met coal reserves. Our ability to develop or acquire met coal reserves in the future may also be limited by the availability of cash from our operations or financing under our existing or future financing arrangements, as well as certain restrictions under such arrangements. If we are unable to develop or acquire replacement reserves, our future production may decrease significantly as existing reserves are depleted and this may have a material adverse impact on our cash flows, financial position and results of operations.

We may be unsuccessful in integrating the operations of any future acquisitions, including acquisitions involving new lines of business, with our existing operations, and in realizing all or any part of the anticipated benefits of any such acquisitions.

From time to time, we may evaluate and acquire assets and businesses that we believe complement our existing assets and business. The assets and businesses we acquire may be dissimilar from our existing lines of business. Acquisitions may require substantial capital or the incurrence of substantial indebtedness. Our capitalization and results of operations may change significantly as a result of future acquisitions. Acquisitions and business expansions involve numerous risks, including the following:

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difficulties in the integration of the assets and operations of the acquired businesses;

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inefficiencies and difficulties that arise because of unfamiliarity with new assets and the businesses associated with them and new geographic areas;

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the possibility that we have insufficient expertise to engage in such activities profitably or without incurring inappropriate amounts of risk; and

•

the diversion of management’s attention from other operations.

Further, unexpected costs and challenges may arise whenever businesses with different operations or management are combined, and we may experience unanticipated delays in realizing the benefits of an acquisition. Entry into certain lines of business may subject us to new laws and regulations with which we are not familiar, and may lead to increased litigation and regulatory risk. Also, following an acquisition, we may discover previously unknown liabilities associated with the acquired business or assets for which we have no recourse under applicable indemnification provisions. If a new business generates insufficient revenue or if we are unable to efficiently manage our expanded operations, our results of operations may be adversely affected.

Our failure to obtain and renew permits necessary for our mining operations could negatively affect our business.

Mining companies must obtain numerous permits that impose strict regulations on various environmental and operational matters in connection with met coal mining. These include permits issued by various federal, state and local agencies and regulatory bodies. The permitting rules, and the interpretations of these rules, are complex, change frequently and are often subject to discretionary interpretations by the regulators, all of which may make compliance more difficult or impractical, and may possibly preclude the continuance of ongoing operations or the development of future mining operations. The public, including non-governmental organizations, anti-mining groups and individuals, have certain statutory rights to comment upon and submit objections to requested permits and environmental impact statements prepared in connection with applicable regulatory processes, and otherwise engage in the permitting process, including bringing citizens’ lawsuits to challenge the issuance of permits, the validity of environmental impact statements or performance of mining activities. Accordingly, required permits may not be issued or renewed in a timely fashion or at all, or permits issued or renewed may be conditioned in a manner that may restrict our ability to efficiently and economically conduct our mining activities, any of which would materially reduce our production, cash flow and profitability.

If transportation for our met coal is disrupted, unavailable or more expensive for our customers, our ability to sell met coal could suffer.

Transportation costs represent a significant portion of the total cost of met coal to be delivered to our customers and, as a result, the cost of delivery is a factor in a customer’s purchasing decision. Overall price increases in our transportation costs could make our met coal less competitive with the same or alternative products from competitors with lower transportation costs. We typically depend upon overland conveyor, trucks, rail or barges to transport our products. Disruption or delays of any of these transportation services due to weather related problems, which are variable and unpredictable, strikes or lock-outs, accidents, infrastructure damage, governmental regulation, third-party actions, lack of capacity or other events beyond our control could

impair our ability to supply our products to our customers and result in lost sales and reduced profitability. In addition, increases in transportation costs resulting from emission control requirements and fluctuations in the price of gasoline and diesel fuel, could make met coal produced in one region of the United States less competitive than met coal produced in other regions of the United States or abroad.

All of our met coal mines are served by only one rail carrier, which increases our vulnerability to these risks, although our access to barge transportation partially mitigates that risk. In addition, the majority of the met coal produced by our underground mining operations is sold to met coal customers who typically arrange and pay for transportation from the state-run docks at the Port of Mobile, Alabama to the point of use. As a result, disruption at the docks, port congestion and delayed met coal shipments may result in demurrage fees to us. If this disruption were to persist over an extended period of time, demurrage costs could significantly impact our profits. In addition, there are limited cost effective alternatives to the port. The cost of securing additional facilities and services of this nature could significantly increase transportation and other costs. An interruption of rail or port services could significantly limit our ability to operate and, to the extent that alternate sources of port and rail services are unavailable or not available on commercially reasonable terms, could increase transportation and port costs significantly. Further, delays of ocean vessels could affect our revenues, costs and relative competitiveness compared to the supply of met coal and other products from our competitors.

Any significant downtime of our major pieces of mining equipment could impair our ability to supply met coal to our customers and materially and adversely affect our results of operations and cash flows.

We depend on several major pieces of mining equipment to produce and transport our met coal, including, but not limited to, longwall mining systems, continuous mining units, our preparation plant and blending facilities, and conveyors. Obtaining or repairing these major pieces of mining equipment often involves long lead times. If any of these pieces of equipment or facilities suffer major damage or are destroyed by fire, abnormal wear, flooding, incorrect operation or otherwise, we may be unable to replace or repair them in a timely manner or at a reasonable cost, which would impact our ability to produce and transport met coal and materially and adversely affect our business, results of operations, financial condition and cash flows. Moreover, MSHA and other regulatory agencies sometimes make changes with regards to requirements for pieces of equipment. For example, in 2015, MSHA promulgated a new regulation requiring the implementation of proximity detection devices on all continuous mining machines. Such changes could cause delays if manufacturers and suppliers are unable to make the required changes in compliance with mandated deadlines.

If either our preparation plant or river barge load-out facilities, or those of a third party processing or loading our met coal, suffer extended downtime, including major damage, or are destroyed, our ability to process and deliver met coal to prospective customers would be materially impacted, which would materially adversely affect our business, results of operations, financial condition and cash flows.

Our business is subject to the risk of increases or fluctuations in the cost, and delay in the delivery, of raw materials, mining equipment and purchased components.

Met coal mining consumes large quantities of commodities including steel, copper, rubber products and liquid fuels and requires the use of capital equipment. Some commodities, such as steel, are needed to comply with roof control plans required by regulation. The prices we pay for commodities and capital equipment are strongly impacted by the global market. A rapid or significant increase in the costs of commodities or capital equipment we use in our operations could impact our mining operations costs because we may have a limited ability to negotiate lower prices and, in some cases, may not have a ready substitute.

We use equipment in our met coal mining and transportation operations such as continuous mining units, conveyors, shuttle cars, rail cars, locomotives, roof bolters, shearers and shields. We procure some of this equipment from a concentrated group of suppliers, and obtaining this equipment often involves long lead times. Occasionally, demand for such equipment by mining companies can be high and some types of equipment may be in short supply. Delays in receiving or shortages of this equipment, as well as the raw materials used in the

manufacturing of supplies and mining equipment, which, in some cases, do not have ready substitutes, or the cancellation of our supply contracts under which we obtain equipment and other consumables, could limit our ability to obtain these supplies or equipment. In addition, if any of our suppliers experiences an adverse event, or decides to no longer do business with us, we may be unable to obtain sufficient equipment and raw materials in a timely manner or at a reasonable price to allow us to meet our production goals and our revenues may be materially adversely impacted.

We use considerable quantities of steel in the mining process. If the price of steel or other materials increases substantially or if the value of the U.S. dollar declines relative to foreign currencies with respect to certain imported supplies or other products, our operating expenses could increase. Any of the foregoing events could materially and adversely impact our business, financial condition, results of operations and cash flows.

Our business may require substantial ongoing capital expenditures, and we may not have access to the capital required to reach full productive capacity at our mines.

Maintaining and expanding mines and related infrastructure is capital intensive. Specifically, the exploration, permitting and development of met coal reserves, mining costs, the maintenance of machinery, facilities and equipment and compliance with applicable laws and regulations require ongoing capital expenditures. While a significant amount of the capital expenditures required at our mines has been spent, we must continue to invest capital to maintain our production. In addition, any decisions to increase production at our existing mines or to develop the high-quality met coal recoverable reserves at our Blue Creek Energy Mine in the future could also affect our capital needs or cause future capital expenditures to be higher than in the past and/or higher than our estimates. We cannot assure you that we will be able to maintain our production levels or generate sufficient cash flow, or that we will have access to sufficient financing to continue our production, exploration, permitting and development activities at or above our present levels and on our current or projected timelines, and we may be required to defer all or a portion of our capital expenditures. Our results of operations, business and financial condition may be materially adversely affected if we cannot make such capital expenditures.

To fund our capital expenditures, we will be required to use cash from our operations, incur debt or sell equity securities. Using cash from operations will reduce cash available for maintaining or increasing our operations activities. Our ability to obtain bank financing or our ability to access the capital markets for future equity or debt offerings, on the other hand, may be limited by our financial condition at the time of any such financing or offering and the covenants in our existing debt agreements, as well as by general economic conditions, contingencies and uncertainties that are beyond our control. If cash flow generated by our operations or available borrowings under our bank financing arrangements are insufficient to meet our capital requirements and we are unable to access the capital markets on acceptable terms or at all, we could be forced to curtail the expansion of our existing mines and the development of our properties, which, in turn, could lead to a decline in our production and could materially and adversely affect our business, financial condition and results of operations.

Work stoppages, labor shortages and other labor relations matters may harm our business. Union-represented labor creates an increased risk of work stoppages and higher labor costs.

If we fail to maintain satisfactory labor relations, disputes with the unionized portion of our workforce could affect us adversely. Union-represented labor creates an increased risk of work stoppages and higher labor costs. As of December 31, 2016, 68% of our employees were represented by the UMWA. In connection with the Asset Acquisition, we negotiated a new initial CBA with the UMWA (the “UMWA CBA”), which was ratified by UMWA’s members on February 16, 2016 and has a five-year term. If we are unable to negotiate the renewal of the UMWA CBA before its expiration date, our operations and our profitability could be adversely affected. Future work stoppages, labor union issues or labor disruptions at our mining operations, as well as at the operations of key customers or service providers, could impede our ability to produce and deliver our products,

to receive critical equipment and supplies or to collect payment. This may increase our costs or impede our ability to operate one or more of our operations.

We require a skilled workforce to run our business. If we cannot hire qualified people to meet replacement or expansion needs, we may not be able to achieve planned results.

Efficient met coal mining using modern techniques and equipment requires skilled laborers with mining experience and proficiency as well as qualified managers and supervisors. The demand for skilled employees sometimes causes a significant constriction of the labor supply resulting in higher labor costs. When met coal producers compete for skilled miners, recruiting challenges can occur and employee turnover rates can increase, which negatively affect operating efficiency and costs. If a shortage of skilled workers exists and we are unable to train or retain the necessary number of miners, it could adversely affect our productivity, costs and ability to expand production.

Our executive officers and other key personnel are important to our success and the loss of one or more of these individuals could harm our business.

Our executive officers and other key personnel have significant experience in the met coal or other commodity businesses and the loss of certain of these individuals could harm our business. Moreover, there may be a limited number of persons with the requisite experience and skills to serve in our senior management positions. Although we have been successful in attracting qualified individuals for key management and corporate positions in the past, there can be no assurance that we will continue to be successful in attracting and retaining a sufficient number of qualified personnel in the future or that we will be able to do so on acceptable terms. The loss of key management personnel could harm our ability to successfully manage our business functions, prevent us from executing our business strategy and have a material adverse effect on our results of operations and cash flows.

Significant competition, as well as changes in foreign markets or economies, could harm our sales, profitability and cash flows.

We compete with other producers primarily on the basis of price, met coal quality, transportation costs and reliability of delivery. The consolidation of the global met coal industry over the last several years has contributed to increased competition among met coal producers and we cannot assure you that the result of current or further consolidation will not adversely affect us. In addition, some of our global competitors have significantly greater financial resources and/or a broader portfolio of coals than we do, and a number of our competitors have idled production over the last year in light of lower met coal prices in 2015 and the first half of 2016. The production that was idled by our competitors may restart and may affect domestic and foreign met coal supply into the seaborne market and associated prices and impact our ability to retain or attract met coal customers.

Further, potential changes to international trade agreements, trade concessions, foreign currency fluctuations or other political and economic arrangements may benefit met coal producers operating in countries other than the United States. We may be adversely impacted on the basis of price or other factors with companies that in the future may benefit from favorable foreign trade policies or other arrangements. In addition, increases in met coal prices could encourage existing producers to expand capacity or could encourage new producers to enter the market. Overcapacity and increased production within the met coal industry, both domestically and internationally, could materially reduce met coal demand and prices and therefore materially reduce our revenues and profitability. In addition, our ability to ship our met coal to international customers depends on port and transportation capacity. Increased competition within the domestic met coal industry for international sales could result in us not being able to obtain throughput capacity at port facilities, as well as transport capacity, could cause the rates for such services to increase to a point where it is not economically feasible to export our met coal.

The general economic conditions in foreign markets and changes in currency exchange rates are factors outside of our control that may affect international met coal prices. If our competitors’ currencies decline against the U.S. dollar or against our customers’ currencies, those competitors may be able to offer lower prices to our customers. Furthermore, if the currencies of our overseas customers were to significantly decline in value in comparison to the U.S. dollar, on which our sales contracts are based, those customers may seek decreased prices for the met coal that we sell to them. These factors, in addition to adversely affecting the competitiveness of our met coal in international markets, may also negatively impact our collection of trade receivables from our customers and could reduce our profitability or result in lower met coal sales.

Our sales in foreign jurisdictions are subject to risks and uncertainties that may have a negative impact on our profitability.

Substantially all of our met coal sales consist of sales to international customers and we expect that international sales will continue to account for a substantial portion of our revenue. A number of foreign countries in which we sell our met coal implicate additional risks and uncertainties due to the different economic, cultural and political environments. Such risks and uncertainties include, but are not limited to:

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longer sales-cycles and time to collection;

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tariffs, international trade barriers and export license requirements;

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fewer or less certain legal protections for contract rights;

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different and changing legal and regulatory requirements;

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potential liability under the U.S. Foreign Corrupt Practices Act of 1977, as amended, or comparable foreign regulations;

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government currency controls;

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fluctuations in foreign currency exchange and interest rates; and

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political and economic instability, changes, hostilities and other disruptions, as well as unexpected changes in diplomatic and trade relationships.

Negative developments in any of these factors in the foreign markets into which we sell our met coal could result in a reduction in demand for met coal, the cancellation or delay of orders already placed, difficulty in collecting receivables, higher costs of doing business and/or non-compliance with legal and regulatory requirements, each or any of which could materially adversely impact our cash flows, results of operations and profitability.

In addition, access to international markets may be subject to ongoing interruptions and trade barriers due to policies and tariffs of individual countries, and the actions of certain interest groups to restrict the import or export of certain commodities. Although there are currently no significant trade barriers existing or impending of which we are aware that do, or could, materially affect our access to certain markets, there can be no assurance that our access to these markets will not be restricted in the future. An inability for U.S. met coal suppliers to access international markets would likely result in an oversupply of met coal in the domestic market, resulting in a decrease in prices.

Our businesses are subject to numerous federal, state and local laws and regulations with respect to matters such as:

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permitting and licensing requirements;

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employee health and safety, including occupational and mine health and safety;

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workers’ compensation;

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black lung disease;

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reclamation and restoration of property; and

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environmental laws and regulations, including those related to greenhouse gases and climate change, air quality, water quality, stream and surface water quality and protection, management of materials generated by mining operations, the storage, treatment and disposal of wastes, protection of plant and wildlife such as endangered species, protection of wetlands and remediation of contaminated soil and groundwater.

In addition, the coal industry in the U.S. is affected by significant legislation mandating certain benefits for current and retired coal miners. Compliance with these requirements imposes significant costs on us and can result in reduced productivity. Moreover, the possibility exists that new health and safety legislation and/or regulations may be adopted and/or orders may be entered that may materially and adversely affect our mining operations. We must compensate employees for work-related injuries. If we do not make adequate provisions for our workers’ compensation liabilities, it could harm our future operating results. In addition, the erosion through tort liability of the protections we are currently provided by workers’ compensation laws could increase our liability for work-related injuries and materially and adversely affect our operating results.

Compliance with applicable federal, state and local laws and regulations may be costly and time-consuming and may delay commencement or interrupt continuation of exploration or production at one or more of our operations. These laws are constantly evolving and may become increasingly stringent. The ultimate impact of complying with existing laws and regulations is not always clearly known or determinable due in part to the fact that certain implementing regulations for these laws have not yet been promulgated and in certain instances are undergoing revision. These laws and regulations, particularly new legislative or administrative proposals (or judicial interpretations of existing laws and regulations), could result in substantially increased capital, operating and compliance costs and could have a material adverse effect on our operations and/or, along with analogous foreign laws and regulations, our customers’ ability to use our products.

Due in part to the extensive and comprehensive regulatory requirements, along with changing interpretations of these requirements, violations of applicable federal, state and local laws and regulations occur from time to time in our industry and at our operations. Changes in the law may require an unprecedented compliance effort on our part, could divert management’s attention, and may require significant expenditures. To the extent that these expenditures, as with all costs, are not ultimately reflected in the prices of our products and services, operating results will be detrimentally impacted. We believe that our major North American competitors are confronted by substantially similar conditions and thus do not believe that our relative position with regard to such competitors is materially affected by the impact of safety and environmental laws and regulations. However, the costs and operating restrictions necessary for compliance with safety and environmental laws and regulations, which is a major cost consideration for our operations, may have an adverse effect on our competitive position with regard to foreign producers and operators who may not be required to undertake equivalent costs in their operations. In addition, the specific impact on each competitor may vary depending on a number of factors, including the age and location of its operating facilities, applicable state legislation and its production methods.

Our mines are subject to stringent federal and state safety regulations that increase our cost of doing business at active operations and may place restrictions on our methods of operation. In addition, federal, state or local regulatory agencies have the authority to order certain of our mines to be temporarily or permanently closed under certain circumstances, which could materially and adversely affect our ability to meet our customers’ demands.

The Mine Act and the Mine Improvement and New Emergency Response Act of 2006 (the “MINER Act”) impose stringent health and safety standards on mining operations. Regulations that have been adopted under the

Mine Act and MINER Act are comprehensive and affect numerous aspects of mining operations, including training of mining personnel, mining procedure, the equipment used in emergency procedures, and other matters. Alabama has a similar program for mine safety and health regulation and enforcement. The various requirements mandated by law or regulation can place restrictions on our methods of operations, and potentially lead to fees and civil penalties for the violation of such requirements, creating a significant effect on operating costs and productivity.

In addition, federal, state or local regulatory agencies have the authority under certain circumstances following significant health and safety incidents, such as fatalities, to order a mine to be temporarily or permanently closed. If this occurred, we may be required to incur capital expenditures to re-open the mine. In the event that these agencies order the closing of our mines, our met coal sales contracts generally permit us to issue force majeure notices, which suspend our obligations to deliver met coal under these contracts; however, our customers may challenge our issuances of force majeure notices. If these challenges are successful, we may have to purchase met coal from third-party sources, if available, to fulfill these obligations or incur capital expenditures to re-open the mines and/or negotiate settlements with the customers, which may include price reductions, the reduction of commitments, and the extension of time for delivery or terminate customers’ contracts. Any of these actions could have a material adverse effect on our business and results of operations.

Increased focus by regulatory authorities on the effects of coal mining on the environment and recent regulatory developments related to coal mining operations could make it more difficult or increase our costs to receive new permits or to comply with our existing permits to mine met coal or otherwise adversely affect us.

Regulatory agencies are increasingly focused on the effects of coal mining on the environment, particularly relating to water quality, which has resulted in more rigorous permitting requirements and enforcement efforts. See “Business—Environmental and Regulatory Matters—Clean Water Act” for a detailed discussion of these regulations and programs.

The Surface Mining Control and Reclamation Act of 1977 (“SMCRA”) requires that comprehensive environmental protection and reclamation standards be met during the course of and following completion of mining activities. Among other requirements, the SMCRA provides that the applicable regulatory authority may not issue a permit unless the operation has been designed to prevent material damage to the hydrologic balance outside the permit area. In 1983, the Office of Surface Mining Reclamation and Enforcement (“OSM”) issued rules providing that no land within 100 feet of a stream shall be disturbed by surface mining activities, unless specifically authorized by the regulatory authority. On December 20, 2016, the OSM published a new, finalized “Stream Protection Rule,” setting standards for “material damage to the hydrologic balance outside the permit area” that are applicable to surface and underground mining operations. However, on February 17, 2017, President Trump signed a joint congressional resolution disapproving the Stream Protection Rule pursuant to the Congressional Review Act. Accordingly, the regulations in effect prior to the Stream Protection Rule now apply, including OSM’s 1983 rule. It remains unclear whether and how the results of the 2016 U.S. election could further impact regulatory or enforcement activities pursuant to the SMCRA.

Section 404 of the Clean Water Act (“CWA”) requires mining companies to obtain U.S. Army Corps of Engineers (“USACE”) permits to place material in streams for the purpose of creating slurry ponds, water impoundments, refuse areas, valley fills or other mining activities. As is the case with other met coal mining companies, our construction and mining activities require Section 404 permits. The issuance of permits to construct valley fills and refuse impoundments under Section 404 of the CWA has been the subject of many court cases and increased regulatory oversight, resulting in additional permitting requirements that are expected to delay or even prevent the opening of new mines. Stringent water quality standards for materials such as selenium have recently been issued. We have begun to incorporate these new requirements into our current permit applications; however, there can be no guarantee that we will be able to meet these or any other new standards with respect to our permit applications.

Additionally, in January 2011, the EPA rescinded a federal CWA permit held by another coal mining company for a surface mine in Appalachia citing associated environmental damage and degradation. On April 23,

2013, the D.C. Circuit ruled that the EPA has the power under the CWA to retroactively veto a section 404 dredge and fill permit “whenever” it makes a determination about certain adverse effects, even years after the USACE has granted the permit to an applicant. On March 24, 2014, the U.S. Supreme Court denied petitions for review. Subsequently, on July 19, 2016, the D.C. Circuit affirmed the district court’s further ruling that the EPA’s decision to withdraw approval for disposal sites satisfied administrative requirements. The D.C. Circuit held that the EPA’s ex post withdrawal was a product of its broad veto authority under the CWA, not a procedural defect. While our operations are not directly impacted by this ruling, it could be an indication that other surface mining water permits could be subject to more substantial review in the future.

Recent regulatory actions and court decisions have created some uncertainty over the scope of CWA jurisdiction. On June 29, 2015, the EPA and the USACE jointly promulgated final rules redefining the scope of waters protected under the CWA, revising regulations that had been in place for more than 25 years. The new rules may expand the scope of CWA jurisdiction, making more waters subject to the act’s permitting and other requirements in the case of discharges. Following its promulgation, numerous industry groups, states, and environmental groups challenged the rule and on October 9, 2015, a federal court stayed the rule’s implementation nationwide, pending further action in court. In response to this decision, the EPA and the USACE have resumed nationwide use of the agencies’ prior regulations defining the term “waters of the United States.” Further, on February 28, 2017, President Trump signed an executive order directing the relevant executive agencies to review the rules and to conduct notice and comment rulemaking to rescind or revise them, as appropriate under the stated policies of protecting navigable waters from pollution while promoting economic growth, reducing uncertainty, and showing due regard for Congress and the states. It remains unclear whether and how the results of the 2016 U.S. election could further impact regulatory developments in this area.

It is unknown what future changes will be implemented to the permitting review and issuance process or to other aspects of mining operations, but increased regulatory focus, future laws and judicial decisions could materially and adversely affect all coal mining companies. In addition, the public, including non-governmental organizations, anti-mining groups and individuals, have certain statutory rights to comment upon and submit objections to requested permits and environmental impact statements prepared in connection with applicable regulatory processes, and otherwise engage in the permitting process, including bringing citizens’ lawsuits to challenge the issuance of permits, the validity of environmental impact statements or performance of mining activities.

In each jurisdiction in which we operate, we could incur additional permitting and operating costs, may be unable to obtain new permits or maintain existing permits and could incur fines, penalties and other costs, any of which could materially adversely affect our business. If met coal mining methods are limited or prohibited, it could significantly increase our operational costs and make it more difficult to economically recover a significant portion of our reserves. In the event that we cannot increase the price we charge for met coal to cover the higher production costs without reducing customer demand for our met coal, there could be a material adverse effect on our financial condition and results of operations. In addition, increased public focus on the environmental, health and aesthetic impacts of coal mining could harm our reputation and reduce demand for met coal.

Regulation of greenhouse gas emissions could increase our operating costs and impact the demand for, price of and value of our products.

Climate change continues to attract public and scientific attention, and increasing attention by government as well as private businesses is being paid to reducing greenhouse gas (“GHG”) emissions. There are three primary sources of GHGs associated with the met coal industry. First, the end use of our met coal by our customers in steelmaking is a source of GHGs. Second, combustion of fuel by equipment used in met coal production and to transport our met coal to our customers is a source of GHGs. Third, met coal mining itself can release methane, which is considered to be a more potent GHG than CO ₂ , directly into the atmosphere. These emissions from met coal consumption, transportation and production are subject to pending and proposed regulation as part of initiatives to address global climate.

There are many legal and regulatory approaches currently in effect or being considered to address GHGs, including international treaty commitments, new foreign, federal and state legislation that may impose a carbon emissions tax or establish a “cap and trade” program, and regulation by the EPA. See “Business—Environmental and Regulatory Matters—Climate Change” for a detailed discussion of these regulations and programs.

The existing laws and regulations or other current and future efforts to stabilize or reduce GHG emissions could adversely impact the demand for, price of and value of our products and reserves. As our operations also emit GHGs directly, current or future laws or regulations limiting GHG emissions could increase our own costs. For example, methane must be expelled from our underground met coal mines for mining safety reasons. Methane has a greater GHG effect than carbon dioxide. Although our natural gas operations capture methane from our underground met coal mines, some methane is vented into the atmosphere when the met coal is mined. In June 2010, Earthjustice petitioned the EPA to make a finding that emissions from coal mines may reasonably be anticipated to endanger public health and welfare, and to list them as a stationary source subject to further regulation of emissions. On April 30, 2013, the EPA denied the petition. Judicial challenges seeking to force the EPA to list coal mines as stationary sources have likewise been unsuccessful to date. If the EPA were to make an endangerment finding in the future, we may have to further reduce our methane emissions, install additional air pollution controls, pay certain taxes or fees for our emissions, incur costs to purchase credits that permit us to continue operations as they now exist at our underground met coal mines or perhaps curtail met coal production. Although the potential impacts on us of additional climate change regulation are difficult to reliably quantify, they could be material. It also remains unclear whether and how the results of the 2016 U.S. election could impact the regulation of GHG emissions at the federal and state level.

In addition, there have also been efforts in recent years to influence the investment community, including investment advisors and certain sovereign wealth, pension and endowment funds promoting divestment of fossil fuel equities and pressuring lenders to limit funding to companies engaged in the extraction of fossil fuel reserves. Such environmental activism and initiatives aimed at limiting climate change and reducing air pollution could interfere with our business activities, operations and ability to access capital.

Further, climate change may cause more extreme weather conditions such as more intense hurricanes, thunderstorms, tornadoes and snow or ice storms, as well as rising sea levels and increased volatility in seasonal temperatures. Extreme weather conditions can interfere with our services and increase our costs, and damage resulting from extreme weather may not be fully insured. However, at this time, we are unable to determine the extent to which climate change may lead to increased storm or weather hazards affecting our operations.

The results of the 2016 U.S. presidential and congressional elections may create a period of additional regulatory uncertainty for the coal mining industry.

The results of the 2016 U.S. presidential and congressional elections may create a period of additional regulatory uncertainty in the coal mining industry. Specifically, the extent to which any new legislation or regulations, any repeal of existing legislation or regulations, or any changes to governmental enforcement priorities or international trade agreements may affect coal mining claims or operations or the market for our products is uncertain, and therefore the impact, if any, on our business or operations cannot be determined at this time.

Our operations may impact the environment or cause exposure to hazardous substances and our properties may have environmental contamination, which could result in material liabilities to us.

Our operations currently use hazardous materials from time to time. We could become subject to claims for toxic torts, natural resource damages and other damages as well as for the investigation and cleanup of soil, surface water, groundwater and other media. Such claims may arise, for example, out of conditions at sites that we currently own or operate, as well as at sites that we previously owned or operated, or may acquire. Our liability for such claims may be joint and several, so that we may be held responsible for more than our share of the contamination or other damages, or even for the entire amount of damages assessed.

We maintain extensive met coal refuse areas and slurry impoundments at our mining complexes. Such areas and impoundments are subject to comprehensive regulation. Slurry impoundments have been known to fail, releasing large volumes of met coal slurry into the surrounding environment. Structural failure of an impoundment can result in extensive damage to the environment and natural resources, such as bodies of water that the met coal slurry reaches, as well as create liability for related personal injuries, property damages and injuries to wildlife. Some of our impoundments overlie mined out areas, which can pose a heightened risk of failure and the assessment of damages arising out of such failure. If one of our impoundments were to fail, we could be subject to substantial claims for the resulting environmental contamination and associated liability, as well as for related fines and penalties.

Drainage flowing from or caused by mining activities can be acidic with elevated levels of dissolved metals, a condition referred to as “acid mine drainage” (“AMD”). Treatment of AMD can be costly. Although we do not currently face material costs associated with AMD, it is possible that we could incur significant costs in the future.

These and other similar unforeseen impacts that our operations may have on the environment, as well as exposures to hazardous substances or wastes associated with our operations, could result in costs and liabilities that could materially and adversely affect us. See also “Business—Environmental and Regulatory Matters.”

Failure to obtain or renew surety bonds on acceptable terms could affect our ability to secure reclamation and coal lease obligations and, therefore, our ability to mine or lease met coal.

Federal and state laws require us to obtain surety bonds or post other financial security to secure performance or payment of certain long-term obligations, such as mine closure or reclamation costs, federal and state workers’ compensation and black lung benefits costs, coal leases and other obligations. The amount of security required to be obtained can change as the result of new federal or state laws, as well as changes to the factors used to calculate the bonding or security amounts. We may have difficulty procuring or maintaining our surety bonds. Our bond issuers may demand higher fees or additional collateral, including letters of credit or other terms less favorable to us upon those renewals. Because we are required by state and federal law to have these bonds or other acceptable security in place before mining can commence or continue, our failure to maintain surety bonds, letters of credit or other guarantees or security arrangements would materially and adversely affect our ability to mine or lease met coal. That failure could result from a variety of factors, including lack of availability, higher expense or unfavorable market terms, the exercise by third-party surety bond issuers of their right to refuse to renew the surety and restrictions on availability of collateral for current and future third-party surety bond issuers under the terms of our financing arrangements.

We have reclamation and mine closing obligations. If the assumptions underlying our accruals are inaccurate, we could be required to expend greater amounts than anticipated.

The SMCRA establishes operational, reclamation and closure standards for our mining operations. Alabama has a state law counterpart to SMCRA. We accrue for the costs of current mine disturbance and of final mine closure, including the cost of treating mine water discharge where necessary. The amounts recorded are dependent upon a number of variables, including the estimated future closure costs, estimated proven reserves, assumptions involving profit margins, inflation rates and the assumed credit-adjusted risk-free interest rates. If these accruals are insufficient or our liability in a particular year is greater than currently anticipated, our future operating results could be materially adversely affected. We are also required to post bonds for the cost of coal mine reclamation.

We and our owners and controllers are subject to the Applicant Violator System.

Under SMCRA and its state law counterparts, all coal mining applications must include mandatory “ownership and control” information, which generally includes listing the names of our officers and directors, and our principal stockholders owning 10% or more of our voting shares, among others. Ownership and control reporting requirements are designed to allow regulatory review of any entities or persons deemed to have

ownership or control of a coal mine, and bars the granting of a coal mining permit to any applicant who, or whose owner or controller, has unabated or uncorrected violations.

A federal database, known as the Applicant Violator System, is maintained for this purpose. Certain relationships are presumed to constitute ownership or control, including the following: being an officer or director of an entity; being the operator of the coal mining operation; having the ability to commit the financial or real property assets or working resources of the permittee or operator; based on the instruments of ownership or the voting securities of a corporate entity, owning of record 10% or more of the mining operator, among others. This presumption, in most cases, can be rebutted where the person or entity can demonstrate that it in fact does not or did not have authority directly or indirectly to determine the manner in which the relevant coal mining operation is conducted. An ownership and control notice must be filed by us each time an entity obtains a 10% or greater interest in us. If we have unabated violations of SMCRA or its state law counterparts, have a coal mining permit suspended or revoked, or forfeit a reclamation bond, we and our “owners and controllers,” as discussed above, may be prohibited from obtaining new coal mining permits, or amendments to existing permits, until such violations of law are corrected. This is known as being “permit-blocked.” Additionally, if an “owner or controller” of us is an “owner or controller” of another mining company, then, as such, we could be permit-blocked based upon the violations of or permit-blocked status of such an “owner or controller” of us.

We may be subject to litigation, the disposition of which could negatively affect our profitability and cash flow in a particular period, or have a material adverse effect on our business, financial condition and results of operations.

Our profitability or cash flow in a particular period could be affected by an adverse ruling in any litigation that may be filed against us in the future. In addition, such litigation could have a material adverse effect on our business, financial condition and results of operations. See “Business—Legal Proceedings.”

We are a holding company and rely on dividends and other payments, advances and transfers of funds from our subsidiaries to meet any dividend and other obligations.

We are a holding company with no direct operations and no material assets other than our direct ownership of 100% of the equity interests of Warrior Met Coal Intermediate Holdco, LLC, our wholly owned holding company, through which we indirectly hold our operating subsidiaries. As a result of this structure, our cash flow and ability to meet our obligations or to pay any dividends on our common stock depend on the cash flows of our subsidiaries and the payment of funds by our subsidiaries to us in the form of dividends, loans and other payments. The ability of our subsidiaries to make such payments or loans to us, however, depends on their earnings and available assets, the terms of our ABL Facility and of any future agreements that may govern the indebtedness of our subsidiaries, and legal restrictions applicable to our subsidiaries, and could be affected by a claim or other action by a third party, including a creditor. To the extent we need funds and any of our subsidiaries are restricted from making such distributions under applicable law or regulation or under the terms of their financing arrangements, or they are otherwise unable to provide such funds, our liquidity and financial condition could be materially adversely affected.

Our ABL Facility contains restrictions that limit our flexibility in operating our business.

Our ABL Facility contains various covenants that limit our ability to engage in specified types of transactions. These covenants contain restrictions on, among other things, liens, indebtedness, investments, including loans, advances and acquisitions, mergers and other fundamental changes, dispositions of assets, restricted payments, changes in the nature of business and transactions with affiliates, subject to certain customary exceptions, baskets, thresholds and other qualifications. A breach of any of these covenants could result in a default under our ABL Facility. Upon our failure to maintain compliance with these covenants beyond any applicable grace periods, the lenders could elect to declare all amounts outstanding thereunder to be immediately due and payable and terminate all commitments to extend further credit thereunder. If the lenders under our ABL Facility accelerate the repayment of borrowings, we cannot assure you that we will have

sufficient assets to repay those borrowings. We pledged a significant portion of our assets as collateral under our ABL Facility. If we were unable to repay those amounts, the lenders under our ABL Facility could proceed against the collateral granted to them to secure that indebtedness. Additionally, if availability under the ABL Facility is less than a certain amount, the facility will be subject to the satisfaction of a specified financial ratio. Our ability to meet this financial ratio can be affected by events beyond our control, and we cannot assure you that we will meet this ratio and other covenants.

We may incur substantially more debt in the future than we currently have. This could exacerbate the risks to our financial condition and business described above.

We may incur significant additional indebtedness in the future. Although our ABL Facility contains restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and the additional indebtedness incurred in compliance with these restrictions could be substantial. These restrictions also do not prevent us from incurring obligations that do not constitute indebtedness. If our current debt level increases, the related risks we face could intensify. Specifically, a high level of debt could have important consequences, including:

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limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements;

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requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for the payment of dividends, working capital, capital expenditures, acquisitions and other general corporate purposes;

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increasing our vulnerability to general adverse economic and industry conditions;

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exposing us to the risk of increased interest rates with respect to borrowings subject to variable rates of interest;

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limiting our flexibility in planning for and reacting to changes in the industry in which we compete;

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placing us at a competitive disadvantage to other, less leveraged competitors; and

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increasing our cost of borrowing.

Our ability to service our debt will depend upon, among other things, our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory and other factors, some of which are beyond our control. If our operating results are not sufficient to service any future indebtedness, we will be forced to take action, such as reducing or delaying our business activities and capital expenditures, selling assets or issuing equity. We may not be able to effect any of these actions on satisfactory terms or at all.

Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase.

Borrowings under our ABL Facility are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even though the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.

We may be unable to generate sufficient taxable income from future operations, or other circumstances could arise, which may limit or eliminate our ability to utilize our significant tax NOLs or maintain our deferred tax assets.

In connection with the Asset Acquisition consummated on March 31, 2016, we acquired deferred tax assets primarily associated with NOLs attributable to Walter Energy’s write-off of its investment in Walter Energy Canada

Holdings, Inc. As a result of our history of losses and other factors, a valuation allowance has been recorded against our deferred tax assets, including our NOLs. A valuation allowance was established on our opening balance sheet at April 1, 2016 because it was more likely than not that a portion of the acquired deferred tax assets would not be realized in the future. Our NOLs are currently subject to an annual use limitation under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), as described below. Certain factors could change or circumstances could arise that could further limit the amount of the available NOLs to the Company, such as an ownership change or an adjustment by a tax authority, and could necessitate a change in our valuation allowance or our liability for income taxes. In addition, we have a limited operating history as a new standalone company, have incurred operating losses since the Asset Acquisition and have recorded additional deferred tax assets. Also, certain circumstances, including our failing to generate sufficient future taxable income from operations could limit our ability to fully utilize our deferred tax assets. At December 31, 2016, we recorded a valuation allowance of $767.3 million against all federal and state NOLs and gross deferred tax assets not expected to provide future tax benefits.

Under the Code, a company is generally allowed a deduction for NOLs against its federal taxable income. As of December 31, 2016, we have federal NOLs of approximately $2.2 billion, which expire predominantly in 2034 through 2036 and state NOLs of approximately $2.5 billion, which expire predominantly in 2029 through 2031 for income tax purposes. These NOLs and our other gross deferred tax assets collectively represent a deferred tax asset of $949.7 million at December 31, 2016, before reduction for the valuation allowance described above. Our NOLs are subject to adjustment on audit by the Internal Revenue Services (“IRS”) and state authorities. The IRS has not audited any of the tax returns for any of the years in which the losses giving rise to the NOLs were generated. We cannot assure you that we would prevail if the IRS were to challenge the availability of the NOLs. If the IRS were successful in challenging our NOLs, all or a portion of our NOLs would not be available to offset any future consolidated taxable income, which could have a significant negative impact on our financial condition, results of operations and cash flows.

A company’s ability to deduct its NOLs and utilize certain other available tax attributes can be substantially constrained under the general annual limitation rules of Section 382 of the Code if it undergoes an “ownership change” as defined in Section 382 or if similar provisions of state law apply. We experienced an ownership change in connection with the Asset Acquisition and our financial statements have been prepared on this basis, as reflected by the valuation allowance described above. A subsequent ownership change could severely limit or eliminate our ability to utilize our NOLs and other tax attributes. Furthermore, while an ownership change has not occurred since April 1, 2016, because the rules under Section 382 are highly complex and actions of our stockholders which are beyond our control or knowledge could impact our ownership, we cannot give you any assurance that another Section 382 ownership change will not occur in the future.

In connection with the corporate conversion, we intend to enter into a NOL rights plan (the “Rights Plan”) designed to preserve the value of our deferred tax assets and our ability to utilize our NOLs. However, there can be no assurance that the Rights Plan will be effective in preserving the value of our deferred tax assets or protecting our ability to utilize our NOLs. See “—Risks Related to this Offering and the Ownership of our Common Stock—We intend to adopt the Rights Plan, which may discourage the acquisition and sale of large blocks of our common stock and may result in significant dilution for certain stockholders.”

Terrorist attacks and cyber-attacks or other security breaches may negatively affect our business, financial condition and results of operations and cash flows.

Our business is affected by general economic conditions, fluctuations in consumer confidence and spending, and market liquidity, all of which can decline as a result of numerous factors outside of our control, such as terrorist attacks and acts of war. Future terrorist attacks against U.S. targets, rumors or threats of war, actual conflicts involving the United States or its allies, or military or trade disruptions affecting our customers could cause delays or losses in transportation and deliveries of met coal to our customers, decreased sales of our met coal and extension of time for payment of accounts receivable from our customers. Strategic targets such as energy-related assets may be at greater risk of future terrorist attacks than other targets in the United States. It is

possible that any, or a combination, of these occurrences could have a material adverse effect on our business, financial condition and results of operations.

In addition, we have become increasingly dependent upon digital technologies, including information systems, infrastructure and cloud applications and services, to operate our businesses, process and record financial and operating data, communicate with our employees and business partners, analyze seismic and drilling information, estimate quantities of met coal reserves, as well as other activities related to our businesses. To that end, we have implemented security protocols and systems with the intent of maintaining the physical security of our operations and protecting our and our counterparties’ confidential information and information related to identifiable individuals against unauthorized access. Despite such efforts, we may be subject to security breaches, which could result in unauthorized access to our facilities or the information that we are trying to protect. Unauthorized physical access to one of our facilities or electronic access to our information systems could result in, among other things, unfavorable publicity, litigation by affected parties, damage to sources of competitive advantage, disruptions to our operations, loss of customers, financial obligations for damages related to the theft or misuse of such information and costs to remediate such security vulnerabilities, any of which could have a substantial impact on our results of operations, financial condition or cash flows. Our insurance may not protect us against such occurrences. Further, as cyber incidents continue to evolve, we may be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerability to cyber incidents.

Risks Related to this Offering and the Ownership of our Common Stock

An active trading market for our common stock may not develop, and you may not be able to sell your common stock at or above the initial public offering price.

Prior to this offering, there has been no public market for our common stock. An active trading market for shares of our common stock may never develop or be sustained following this offering. If an active trading market does not develop, you may have difficulty selling your shares of common stock at an attractive price, or at all. The price for our common stock in this offering will be determined by negotiations among us and the underwriters, and it may not be indicative of prices that will prevail in the open market following this offering. We cannot predict the prices at which shares of our common stock may trade after this offering. Consequently, you may not be able to sell your common stock at or above the initial public offering price or at any other price or at the time that you would like to sell. An inactive market may also impair our ability to raise capital by selling our common stock, and it may impair our ability to motivate our employees and sales representatives through equity incentive awards and our ability to consummate acquisitions using our common stock as consideration.

The market price of our common stock may fluctuate significantly and you could lose all or part of your investment.

The market price of our common stock could fluctuate significantly due to a number of factors, including:

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our quarterly or annual earnings, or those of other companies in our industry;

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actual or anticipated fluctuations in our operating and financial results, including reserve estimates;

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changes in accounting standards, policies, guidance, interpretations or principles;

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the public reaction to our press releases, our other public announcements and our filings with the SEC;

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announcements by us or our competitors of significant acquisitions, dispositions or innovations;

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changes in financial estimates and recommendations by securities analysts following our stock, or the failure of securities analysts to cover our common stock after this offering;

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changes in earnings estimates by securities analysts or our ability to meet those estimates;

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the operating and stock price performance of other comparable companies;

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declaration of bankruptcy by any of our customers or competitors;

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general economic conditions and overall market fluctuations, including changes in the price of met coal, steel or other commodities;

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additions or departures of key management personnel;

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actions by our stockholders;

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the trading volume of our common stock;

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sales of our common stock by us or the selling stockholders or the perception that such sales may occur; and

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changes in business, legal or regulatory conditions, or other developments affecting participants in, and publicity regarding, the met coal mining business, the domestic steel industry or any of our significant customers.

In particular, the realization of any of the risks described in these “Risk Factors” could have a material and adverse impact on the market price of our common stock in the future and cause the value of your investment to decline. In addition, the stock market in general has experienced extreme volatility that has often been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock, regardless of our actual performance. If the market price of our common stock reaches an elevated level following this offering, it may materially and rapidly decline. In the past, following periods of volatility in the market price of a company’s securities, stockholders have often instituted securities class action litigation against the company. If we were to be involved in a class action lawsuit, it could divert the attention of senior management, and, if adversely determined, have a material adverse effect on our business, results of operations and financial condition.

If securities or industry analysts adversely change their recommendations regarding our stock or if our operating results do not meet their expectations, our stock price could decline.

The trading market for our common stock could be influenced by the research and reports that industry or securities analysts may publish about us or our business. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. Moreover, if one or more of the analysts who cover our company downgrade our stock or if our operating results do not meet their expectations, our stock price could decline.

We cannot assure you that we will pay dividends on our common stock, and restrictions on our ability to receive funds from our subsidiaries could limit our ability to pay dividends on our common stock.

While we have not made any cash distributions since our inception, we may make the Special Distribution to the holders of our Class A Units and Class B Units. However, the Special Distribution will not apply to the shares of our common stock to be sold in this offering. In addition, if paid, the Special Distribution is expected to be funded with cash and cash equivalents, thereby reducing our liquidity.

After completion of this offering, we may pay cash dividends on our common stock, subject to our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, any restrictions in our ABL Facility and in any preferred stock, business prospects and other factors that our board of directors may deem relevant. In addition, our business is conducted through our subsidiaries. Dividends, distributions and other payments from, and cash generated by, our subsidiaries are our principal sources of cash to repay indebtedness, fund operations and pay dividends. Therefore, any restrictions on our ability to receive funds from our subsidiaries could limit our ability to pay dividends. See “—Risks Related to Our Business—We are a holding company and rely on dividends and other payments, advances and transfers of funds from our subsidiaries to

meet any dividend and other obligations.” There can be no assurance that we will pay a dividend in the future or continue to pay any dividend if we do commence paying dividends. For more information, see “Dividend Policy.”

As a public company, we will become subject to additional financial and other reporting and corporate governance requirements that may be difficult for us to satisfy, strain our resources, increase our costs and divert management’s attention from our business, and we may be unable to comply with these new requirements in a timely or cost-effective manner.

As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. We will incur costs associated with our public company reporting requirements pursuant to the Exchange Act. We will be required to ensure that we have the ability to prepare financial statements that comply with SEC reporting requirements on a timely basis. We will also be subject to other reporting and corporate governance requirements, including the NYSE listing standards and certain provisions of the Sarbanes-Oxley Act and the regulations promulgated thereunder, which impose significant compliance obligations upon us. We expect these rules and regulations to increase our legal and financial compliance costs and to make some activities more time-consuming and costly, particularly after we are no longer an “emerging growth company,” as defined in the JOBS Act.

Specifically, we will be required to:

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prepare and distribute periodic reports and other stockholder communications in compliance with our obligations under the federal securities laws and NYSE rules;

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create or expand the roles and duties of our board of directors and committees of the board;

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institute compliance and internal audit functions that are more comprehensive;

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evaluate and maintain our system of internal control over financial reporting, and report on management’s assessment thereof, in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act and the related rules and regulations of the SEC and the PCAOB;

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enhance our investor relations function;

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establish or amend internal policies, including those relating to disclosure controls and procedures as well as insider trading; and

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involve and retain outside legal counsel and accountants in connection with the activities listed above.

As a public company, we will be required to commit significant resources and board and management oversight to the above-listed requirements, which will cause us to incur significant costs and which will place a strain on our systems and resources. As a result, the attention of our board of directors and management might be diverted from other business concerns. In addition, we might not be successful in implementing these requirements. In addition, we also expect these rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers.

However, for as long as we remain an “emerging growth company” as defined in the JOBS Act, we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company.

We are currently evaluating these rules, and we cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. We will remain an emerging growth company for up to five years. After we are no longer an “emerging growth company,” we expect to incur significant additional expenses and devote substantial management effort toward ensuring compliance with those requirements applicable to companies that are not “emerging growth companies,” including Section 404 of the Sarbanes-Oxley Act. We cannot assure you that we will be able to comply with such requirements in a timely or cost-effective manner. See “Prospectus Summary—Implications of Being an Emerging Growth Company” and “—We will be subject to certain requirements of Section 404 of the Sarbanes-Oxley Act. If we are unable to timely comply with Section 404 or if the costs related to developing and maintaining internal controls over financial reporting are significant, our profitability, stock price, results of operations and financial condition could be materially adversely affected.”

For so long as we are an “emerging growth company” we will not be required to comply with certain disclosure requirements that are applicable to other public companies and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

We are classified as an “emerging growth company” under the JOBS Act. For as long as we are an emerging growth company, unlike other public companies, we will not be required to, among other things: (i) provide an auditor’s attestation report on management’s assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; (ii) comply with any new requirements adopted by the PCAOB requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer; (iii) provide certain disclosure regarding executive compensation required of larger public companies; or (iv) hold nonbinding advisory votes on executive compensation. We will remain an emerging growth company for up to five years, although we will lose that status sooner if we have more than $1.0 billion of revenues in a fiscal year, have more than $700.0 million in market value of our common stock held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period.

To the extent that we rely on any of the exemptions available to emerging growth companies, you will receive less information about our executive compensation and internal control over financial reporting than issuers that are not emerging growth companies. If some investors find our common stock to be less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. Prior to the completion of this offering, we intend to irrevocably elect not to avail ourselves to this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

We have material weaknesses in our internal control over financial reporting. If our remediation of these material weaknesses is not effective, or if we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to accurately or timely report our financial condition or results of operations, which could cause investors to lose confidence in our financial reporting and, as a result, materially adversely affect the trading price of our common stock.

We are not currently required to comply with SEC rules implementing Section 404 of the Sarbanes-Oxley Act regarding internal control over financial reporting and are therefore not required to make a formal assessment of the effectiveness of our internal control over financial reporting for that purpose. As a public company, we will be required to comply with certain provisions of Section 404 of the Sarbanes-Oxley Act. See “—We will be subject to certain requirements of Section 404 of the Sarbanes-Oxley Act. If we are unable to timely comply with Section 404 or if the costs related to developing and maintaining internal controls over financial reporting are

significant, our profitability, stock price, results of operations and financial condition could be materially adversely affected.”

In connection with the audit of the financial statements of our Predecessor, our independent registered public accounting firm identified two material weaknesses as of March 31, 2016, one of which related to the Predecessor’s financial close process and the other related to the Predecessor’s calculation of its asset retirement obligation. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. These two identified material weaknesses could, among other things, adversely impact our ability to provide timely and accurate financial information or result in a misstatement of the account balances or disclosures that could result in a material misstatement to our annual or interim financial statements that would not be prevented or detected. For additional information regarding these material weaknesses, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Material Weaknesses in Internal Control Over Financial Reporting.”

We are currently in the process of remediating the above-noted material weaknesses. Following the closing of the Asset Acquisition on March 31, 2016, our management took numerous steps to enhance our internal control environment to address the underlying causes of the material weaknesses, including, but not limited to, implementing a new enterprise resource planning (“ERP”) system, reassigning existing personnel and hiring new personnel, which includes a Chief Financial Officer effective January 1, 2017, who are charged with the responsibility of developing and maintaining an appropriate accounting process and system of internal control over financial reporting, including performing augmented reviews of the processes impacted by the material weaknesses.

As we continue to evaluate and work to improve our internal control over financial reporting, management may determine to take additional measures, modify the remediation plan described above or identify additional material weaknesses. We cannot assure you that our remedial measures will be sufficient to remediate the material weaknesses described above or prevent future material weaknesses or control deficiencies from occurring. There is no assurance that we will not identify additional material weaknesses in our internal control over financial reporting in the future.

If we fail to effectively remediate the material weaknesses in our control environment, if we identify future material weaknesses in our internal control over financial reporting or if we are unable to comply with the demands that will be placed upon us as a public company, including the requirements of Section 404 of the Sarbanes-Oxley Act, in a timely manner, we may be unable to accurately report our financial results, or report them within the timeframes required by the SEC. The material weaknesses described above or any newly identified material weakness could result in a misstatement of our accounts or disclosures that could result in a material misstatement to our annual or interim financial statements that would not be prevented or detected. We also could become subject to sanctions or investigations by the NYSE, the SEC or other regulatory authorities. In addition, if we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, when required, investors may lose confidence in the accuracy and completeness of our financial reports, we may face restricted access to the capital markets and our stock price may be materially adversely affected.

We will be subject to certain requirements of Section 404 of the Sarbanes-Oxley Act. If we are unable to timely comply with Section 404 or if the costs related to developing and maintaining internal controls over financial reporting are significant, our profitability, stock price, results of operations and financial condition could be materially adversely affected.

We will be required to comply with certain provisions of Section 404 of the Sarbanes-Oxley Act. Beginning with our annual report on Form 10-K for the year ending December 31, 2018 (subject to any change in applicable

SEC rules), Section 404 will require that we include management’s assessment of our internal control over financial reporting in our annual reports. In addition, Section 404 will require that our independent registered public accounting firm attest to our internal controls upon us ceasing to qualify for an exemption from the requirement to provide an auditor’s attestation on internal controls afforded to emerging growth companies under the JOBS Act. We are currently evaluating our existing controls against the criteria established by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). During the course of our ongoing evaluation and implementation of the internal control over financial reporting, we may identify areas requiring improvement, and we may have to design enhanced processes and controls to address issues identified through this review. For example, we anticipate the need to hire additional administrative and accounting personnel to conduct our financial reporting. We believe that the out-of-pocket costs, the diversion of management’s attention from running the day-to-day operations and operational changes caused by the need to comply with the requirements of Section 404 of the Sarbanes-Oxley Act could be significant. The time and costs associated with such compliance could exceed our current expectations and our results of operations could be adversely affected.

We cannot be certain at this time that we will be able to successfully implement the procedures, certification and attestation requirements of Section 404 when required or that we or our auditors will not identify further material weaknesses in internal control over financial reporting. As noted above, our independent registered public accounting firm identified two material weaknesses as of March 31, 2016. If we fail to comply with the requirements of Section 404, or if at any time after becoming public we or our auditors identify and report any material weaknesses in internal control over financial reporting, the accuracy and timeliness of the filing of our annual and quarterly reports may be materially adversely affected (which, in some cases, could result in a restatement of our financial statements) and could cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock. In addition, a material weakness in the effectiveness of our internal control over financial reporting could result in an increased chance of fraud, reputational harm and the loss of customers, reduce our ability to obtain financing, subject us to investigations by the NYSE, the SEC or other regulatory authorities and require additional expenditures and management attention to address these matters, each of which could have a material adverse effect on our business, results of operations, financial condition and trading price of our common stock.

The market price of our common stock could decline as a result of the sale or distribution of a large number of shares of our common stock in the market after this offering or the perception that a sale or distribution could occur. These factors also could make it more difficult for us to raise funds through future offerings of our common stock.

Sales of substantial amounts of our common stock in the public market, or the perception that those sales might occur, could materially adversely affect the market price of our common stock. Upon completion of this offering, the Principal Shareholders will beneficially own shares of our common stock, or approximately % of our outstanding common stock. The Principal Shareholders have no contractual obligation to retain any of our common stock, except for a limited period, as described under “Underwriting,” during which they agreed not to sell any of our common stock without the consent of Credit Suisse Securities (USA) LLC (“Credit Suisse”) until 180 days after the date of this prospectus. Subject to applicable securities laws, after the expiration of this 180-day lock-up period, or before, with consent of Credit Suisse, the Principal Shareholders may sell any or all of our common stock that they beneficially own. Any disposition by the Principal Shareholders of our common stock in the public market, or the perception that such dispositions could occur, could adversely affect prevailing market prices for our common stock.

The shares of our common stock sold in this offering will be freely tradable without restriction, except for any shares acquired by an affiliate of our company which can be sold under Rule 144 under the Securities Act, subject to various volume and other limitations. Subject to certain limited exceptions, we, our executive officers, directors, the selling stockholders and holders of substantially all of our stock have agreed with the underwriters, not to sell, dispose of or hedge any of our common stock or securities convertible into or exchangeable for shares of common stock, without the prior written consent of Credit Suisse, for the period ending 180 days after the date

of this prospectus. After the expiration of the 180-day period, our executive officers, directors and such stockholders could dispose of all or any part of its shares of our common stock through a public offering, sales under Rule 144, or other transaction.

In the future, we may also issue common stock for a number of reasons, including to finance our operations and business strategy, to adjust our ratio of debt to equity, or to provide incentives pursuant to certain executive compensation arrangements. Such future issuances of equity securities, or the expectation that they will occur, could cause the market price for our common stock to decline. The price of our common stock also could be affected by hedging or arbitrage trading activity that may exist or develop involving our common stock.

Your percentage ownership in us may be diluted by future issuances of capital stock or securities or instruments that are convertible into our capital stock, which could reduce your influence over matters on which stockholders vote.

Our board of directors has the authority, without action or vote of our stockholders, to issue all or any part of our authorized but unissued shares of common stock, including shares issuable upon the exercise of options, shares that may be issued to satisfy our obligations under our incentive plans, shares of our authorized but unissued preferred stock and securities and instruments that are convertible into our common stock. In addition, to the extent certain letters of credit arising under the first lien debt of the Walter Energy Debtors are drawn, including following the closing of this offering, the revolving lenders are entitled to an additional distribution of our equity interests, up to a maximum amount of equity that could be distributed on account of such outstanding, but undrawn, letters of credit of less than 0.1% of our outstanding equity before giving effect to this offering. These letters of credit will expire by July 10, 2017. Issuances of common stock or voting preferred stock would reduce your influence over matters on which our stockholders vote and, in the case of issuances of preferred stock, likely would result in your interest in us being subject to the prior rights of holders of that preferred stock.

Investors in this offering will experience immediate and substantial dilution of $ per share.

Based on an assumed initial public offering price of $ per share (the midpoint of the range set forth on the cover of this prospectus), purchasers of our common stock in this offering will experience an immediate and substantial dilution of $ per share in the net tangible book value per share of common stock from the initial public offering price, and our historical and pro forma net tangible book value as of would be $ per share. See “Dilution.”

We may issue preferred stock whose terms could adversely affect the voting power or value of our common stock.

Our certificate of incorporation will authorize us to issue, without the approval of our stockholders, one or more classes or series of preferred stock having such designations, preferences, limitations and relative rights, including preferences over our common stock respecting dividends and distributions, as our board of directors may determine. The terms of one or more classes or series of preferred stock could adversely impact the voting power or value of our common stock. In addition, the issuance of such preferred stock could make it more difficult for a third party to acquire us. For example, we might grant holders of preferred stock the right to elect some number of our directors in all events or on the happening of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of the common stock. See “Description of Our Capital Stock.”

We intend to adopt the Rights Plan, which may discourage the acquisition and sale of large blocks of our common stock and may result in significant dilution for certain stockholders.

In connection with the corporate conversion, we intend to enter into the Rights Plan designed to preserve the value of our deferred tax assets and our ability to utilize our NOLs by acting as a deterrent to any person acquiring beneficial ownership of 4.99% or more of our outstanding common stock without the approval of our

board of directors. The Rights Plan may discourage existing 5% common stockholders from selling their interest in a single block, which may impact the liquidity of our common stock, may deter institutional investors from investing in our common stock and may deter potential acquirers from making premium offers to acquire us, factors which may depress the market price of our common stock. We can make no assurances that the Rights Plan will be effective in meeting its intended objectives, including to deter an “ownership change” within the meaning of Section 382 of the Code and thereby protect our ability to utilize our NOLs. See “—Risks Related to Our Business—We may be unable to generate sufficient taxable income from future operations, or other circumstances could arise, which may limit or eliminate our ability to utilize our significant tax NOLs or maintain our deferred tax assets.”

Provisions in our certificate of incorporation and bylaws, the Rights Plan and Delaware law will make it more difficult to effect a change in control of the company, which could adversely affect the price of our common stock.

The existence of some provisions in our certificate of incorporation and bylaws, the Rights Plan and Delaware corporate law could delay or prevent a change in control of our company, even if that change would be beneficial to our stockholders. Our certificate of incorporation and bylaws will contain provisions that may make acquiring control of our company difficult, including:

•

our board of directors’ ability to issue, from time to time, one or more classes of preferred stock and, with respect to each such class, to fix the terms thereof by resolution;

•

provisions relating to the appointment of directors upon an increase in the number of directors or vacancy on our board of directors;

•

provisions requiring stockholders to hold at least 50.1% of our outstanding common stock in the aggregate to request special meetings;

•

provisions that provide that the doctrine of “corporate opportunity” will not apply with respect to the Company, to any of our stockholders or directors, other than any stockholder or director that is an employee, consultant or officer of ours; and

•

provisions that set forth advance notice procedures for stockholders’ nominations of directors and proposals for consideration at meetings of stockholders.

In addition, we will elect to opt out of Section 203 of the Delaware General Corporation Law (“DGCL”), which, subject to some exceptions, prohibits business combinations between a Delaware corporation and an interested stockholder, which is generally defined as a stockholder who becomes a beneficial owner of 15% or more of a Delaware corporation’s voting stock for a three-year period following the date that the stockholder became an interested stockholder. At some time in the future, we may be governed by DGCL Section 203. DGCL Section 203 could have the effect of delaying, deferring or preventing a change in control that our stockholders might consider to be in their best interests. See “Description of Our Capital Stock.”

Furthermore, in connection with the corporate conversion, we intend to enter into the Rights Plan which is designed to preserve stockholder value and the value of our NOLs by acting as a deterrent to any person acquiring beneficial ownership of 4.99% or more of our outstanding common stock without the approval of our board of directors. Although not intended for this purpose, the Rights Plan would have an anti-takeover effect. For more information on possible risks associated with the Rights Plan, please see “—We intend to adopt the Rights Plan, which may discourage the acquisition and sale of large blocks of our common stock and may result in significant dilution for certain stockholders.”

These provisions also could discourage proxy contests and make it more difficult for you and other stockholders to elect directors and take other corporate actions. As a result, these provisions could make it more difficult for a third party to acquire us, even if doing so would benefit our stockholders, which may limit the price that investors are willing to pay in the future for shares of our common stock.

Our certificate of incorporation will designate courts in the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.

Our certificate of incorporation will provide that, subject to limited exceptions, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for:

•

any derivative action or proceeding brought on our behalf;

•

any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders;

•

any action asserting a claim against us arising pursuant to any provision of the Delaware General Corporation Law; or

•

any other action asserting a claim against us that is governed by the internal affairs doctrine.

In addition, our certificate of incorporation will provide that if any action specified above (each is referred to herein as a “covered proceeding”), is filed in a court other than the specified Delaware courts without the approval of our board of directors (each is referred to herein as a foreign action), the claiming party will be deemed to have consented to (i) the personal jurisdiction of the specified Delaware courts in connection with any action brought in any such courts to enforce the exclusive forum provision described above and (ii) having service of process made upon such claiming party in any such enforcement action by service upon such claiming party’s counsel in the foreign action as agent for such claiming party.

These provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and employees. Alternatively, if a court were to find these provisions of our certificate of incorporation inapplicable to, or unenforceable in respect of, one or more of the covered proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business and financial condition.

Our four largest stockholders control a significant percentage of our common stock, and their interests may conflict with those of our other stockholders.

Immediately prior to the completion of this offering, the Apollo Funds, the GSO Funds, the KKR Funds and the Franklin Funds beneficially own 30.5%, 19.7%, 12.3% and 14.0%, respectively, of our equity interests. Upon completion of this offering, the Apollo Funds, the GSO Funds, the KKR Funds and the Franklin Funds will beneficially own approximately %, %, % and %, respectively, of our common stock, or approximately %, %, % and %, respectively, if the underwriters exercise their option to purchase additional shares in full. See “Principal and Selling Stockholders.” As a result, each of the Principal Shareholders may be able to exercise significant influence over matters requiring stockholder approval, including the election of directors, changes to our organizational documents and significant corporate transactions. Further, we anticipate that several individuals who will serve as directors upon completion of this offering will be affiliates of each of the Principal Shareholders. This concentration of ownership and relationships with the Principal Shareholders make it unlikely that any other holder or group of holders of our common stock will be able to affect the way we are managed or the direction of our business. The interests of the Principal Shareholders and of our directors who are affiliates of any of the Principal Shareholders with respect to matters potentially or actually involving or affecting us, such as future acquisitions, financings and other corporate opportunities, and attempts to acquire us, may conflict with the interests of our other stockholders, and the resolution of these conflicts may not always be in your best interest. This continued concentrated ownership will make it impossible for another company to acquire us and for you to receive any related takeover premium for your shares unless each of these stockholders approves the acquisition. In addition, the Principal Shareholders’ concentration of stock ownership may also adversely affect the trading price of our common stock to the extent investors perceive a disadvantage in owning stock of a company with significant stockholders.

The corporate opportunity provisions in our certificate of incorporation could enable any of our officers, directors or stockholders to benefit from corporate opportunities that might otherwise be available to us.

Subject to the limitations of applicable law, our certificate of incorporation, among other things:

•

will permit us to enter into transactions with entities in which one or more of our officers or directors are financially or otherwise interested;

•

will permit any of our stockholders, officers or directors to conduct business that competes with us and to make investments in any kind of property in which we may make investments; and

•

will provide that if any director or officer of one of our affiliates who is also one of our officers or directors becomes aware of a potential business opportunity, transaction or other matter (other than one expressly offered to that director or officer in writing solely in his or her capacity as our director or officer), that director or officer will have no duty to communicate or offer that opportunity to us, and will be permitted to communicate or offer that opportunity to such affiliates and that director or officer will not be deemed to have (i) acted in a manner inconsistent with his or her fiduciary or other duties to us regarding the opportunity or (ii) acted in bad faith or in a manner inconsistent with our best interests.

These provisions create the possibility that a corporate opportunity that would otherwise be available to us may be used for the benefit of our officers, directors, stockholders or their respective affiliates.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus includes statements of our expectations, intentions, plans and beliefs that constitute forward-looking statements. These statements, which involve risks and uncertainties, relate to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable and may also relate to our future prospects, developments and business strategies. We have used the words “anticipate,” “approximately,” “assume,” “believe,” “could,” “contemplate,” “continue,” “estimate,” “expect,” “target,” “future,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should” and similar terms and phrases, including in references to assumptions, in this prospectus to identify forward looking statements. These forward-looking statements are made based on expectations and beliefs concerning future events affecting us and are subject to uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed in or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to:

•

our ability to consummate this offering;

•

successful implementation of our business strategies;

•

a substantial or extended decline in pricing or demand for met coal;

•

global steel demand and the downstream impact on met coal prices;

•

inherent difficulties and challenges in the coal mining industry that are beyond our control;

•

geologic, equipment, permitting, site access, operational risks and new technologies related to mining;

•

impact of weather and natural disasters on demand and production;

•

our relationships with, and other conditions affecting, our customers;

•

unavailability of, or price increases in, the transportation of our met coal;

•

competition and foreign currency fluctuations;

•

our ability to comply with covenants in our ABL Facility;

•

significant cost increases and fluctuations, and delay in the delivery of raw materials, mining equipment and purchased components;

•

work stoppages, negotiation of labor contracts, employee relations and workforce availability;

•

adequate liquidity and the cost, availability and access to capital and financial markets;

•

our obligations surrounding reclamation and mine closure;

•

inaccuracies in our estimates of our met coal reserves;

•

our ability to develop or acquire met coal reserves in an economically feasible manner;

•

challenges to our licenses, permits and other authorizations;

•

challenges associated with environmental, health and safety laws and regulations;

•

regulatory requirements associated with federal, state and local regulatory agencies, and such agencies’ authority to order temporary or permanent closure of our mines;

•

climate change concerns and our operations’ impact on the environment;

•

failure to obtain or renew surety bonds on acceptable terms, which could affect our ability to secure reclamation and coal lease obligations;

•

costs associated with our pension and benefits, including post-retirement benefits;

•

costs associated with our workers’ compensation benefits;

•

litigation, including claims not yet asserted;

•

terrorist attacks or security threats, including cybersecurity threats; and

•

other factors, including the other factors discussed in “Risk Factors.”

The forward-looking statements contained in this prospectus are based on historical performance and management’s current plans, estimates and expectations in light of information currently available to us and are subject to uncertainty and changes in circumstances. You should not place undue reliance on our forward-looking statements. Although forward-looking statements reflect our good faith beliefs at the time they are made, forward-looking statements involve known and unknown risks, uncertainties and other factors, including the factors described under “Risk Factors,” which may cause our actual results, performance or achievements to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements. When considering forward-looking statements made by us in this prospectus, such statements speak only as of the date on which we make them. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. We have no duty to, and do not intend to, update or revise the forward-looking statements herein after the date of this prospectus, except as may be required by law. In light of these risks and uncertainties, stockholders should keep in mind that any forward-looking statement made in this prospectus might not occur.

USE OF PROCEEDS

We estimate that the net proceeds to the selling stockholders from the sale of our common stock will be approximately $ million based upon an assumed initial public offering price of $ , the midpoint of the range set forth on the cover of this prospectus, and after deducting estimated underwriting discounts and commissions. We will not receive any proceeds from the sale of our common stock in this offering. All of the net proceeds from this offering will be received by the selling stockholders. See “Underwriting.”

DIVIDEND POLICY

While we have not made any cash distributions since our inception, we may make the Special Distribution to the holders of our Class A Units and Class B Units. The specific amount of the Special Distribution, if any, has not yet been determined and there can be no assurance that such Special Distribution will be declared and paid. Whether to pay the Special Distribution and the amount thereof is subject to consideration of various factors by our board of managers, including, among other things, our financial position. The Special Distribution, if any, will be made prior to the corporate conversion and this offering. Accordingly, the Special Distribution will not apply to the shares of our common stock to be sold in this offering.

After completion of this offering, we may pay cash dividends on our common stock, subject to our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements and in any preferred stock, business prospects and other factors that our board of directors may deem relevant. Our ability to pay dividends on our common stock is limited by covenants in the ABL Facility and may be further restricted by the terms of any future debt or preferred securities. See “Risk Factors—Risks Related to this Offering and the Ownership of our Common Stock—We cannot assure you that we will pay dividends on our common stock, and restrictions on our ability to receive funds from our subsidiaries could limit our ability to pay dividends on our common stock” and “Description of Certain Indebtedness.”

CORPORATE CONVERSION

Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will convert Warrior Met Coal, LLC from a Delaware limited liability company to Warrior Met Coal, Inc., a Delaware corporation. In order to consummate the corporate conversion, a certificate of conversion will be filed with the Secretary of State of the State of Delaware. As part of the corporate conversion:

•

the additional capital commitment under the Warrior Met Coal, LLC Amended and Restated Limited Liability Company Agreement (the “LLC Agreement”) will be terminated in accordance with the terms of the LLC Agreement and all outstanding Class B Units of Warrior Met Coal, LLC will automatically be converted into Class A Units (the “Additional Capital Commitment Termination”); and

•

following the Additional Capital Commitment Termination, each Class A Unit and Class C Unit of Warrior Met Coal, LLC will be converted into shares of common stock, par value $0.01 per share, of Warrior Met Coal, Inc. on the effective date of the conversion of Warrior Met Coal, LLC to Warrior Met Coal, Inc.

For additional information regarding the additional capital commitment under the LLC Agreement, see “Certain Relationships and Related Party Transactions—Additional Capital Commitment under the LLC Agreement.” Assuming the effectiveness of the corporate conversion as of , 2017:

•

outstanding Class B Units of Warrior Met Coal, LLC will convert into an aggregate of Class A Units of Warrior Met Coal, LLC pursuant to the Additional Capital Commitment Termination; and

•

Class A Units of Warrior Met Coal, LLC issued and outstanding following the Additional Capital Commitment Termination and Class C Units of Warrior Met Coal, LLC will convert into an aggregate of shares of our common stock.

In connection with the corporate conversion, Warrior Met Coal, Inc. will continue to hold all assets of Warrior Met Coal, LLC and will assume all of the debts and obligations of Warrior Met Coal, LLC. Warrior Met Coal, Inc. will be governed by a certificate of incorporation filed with the Delaware Secretary of State and bylaws, the material portions of each of which are described in “Description of Our Capital Stock.” On the effective date of the corporate conversion, the members of the board of managers of Warrior Met Coal, LLC will become the members of the board of directors of Warrior Met Coal, Inc. and the officers of Warrior Met Coal, LLC will become the officers of Warrior Met Coal, Inc.

Except as otherwise disclosed, the audited financial statements and related notes thereto and selected consolidated and combined historical and pro forma financial data and other financial information included in this prospectus are those of Warrior Met Coal, LLC and its subsidiaries and its predecessor and do not give effect to the corporate conversion.

CAPITALIZATION

The following table sets forth our cash and cash equivalents and capitalization as of December 31, 2016 on an actual basis and on a pro forma basis giving effect to (i) the corporate conversion, which will occur prior to the effectiveness of the registration statement of which this prospectus forms a part and (ii) the payment of the Special Distribution, which may occur prior to the effectiveness of the registration statement of which this prospectus forms a part. For more information regarding the corporate conversion, see “Corporate Conversion.”

The information below is not necessarily indicative of our future cash and cash equivalents and capitalization. This table is derived from, and is qualified in its entirety by reference to, our audited financial statements and related notes thereto included elsewhere in this prospectus, and should be read in conjunction with “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data,” “Selected Consolidated and Combined Historical and Pro Forma Financial Data,” “Use of Proceeds” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”


	As of December 31, 2016
	Actual			Pro Forma
	(in thousands, except number of shares and par value)

Cash and cash equivalents ⁽¹⁾	$	150,045		$

Debt
Long-term debt, including current portion ⁽²⁾		6,574
Equity
Members’ equity contributions		802,640
Common stock, $0.01 par value per share (no shares authorized, issued and outstanding, actual; shares authorized; shares issued and outstanding, pro forma)		—
Preferred stock, $0.01 par value per share (no shares authorized, issued and outstanding, actual; shares authorized, shares of Series A Junior Participating Preferred Stock issued and outstanding, pro forma)
Additional paid in capital		—
Accumulated deficit		(49,673	)

Total equity		752,967

Total capitalization	$	759,541		$

(1)	Cash on hand in the amount of $ may be used to pay the Special Distribution.

(2)

Represents a security agreement and promissory note assumed in the Asset Acquisition. The agreement was entered into for the purchase of underground mining equipment. The promissory note matures on March 31, 2019, has a fixed interest rate of 4.00% per annum and is secured by the underground mining equipment it was used to purchase.

DILUTION

Dilution is the amount by which the offering price paid by the purchasers of shares of common stock sold in this offering will exceed the net tangible book value per share of common stock after this offering. On a pro forma basis as of , our net tangible book value would have been approximately $ million, or $ per share of common stock, or $ million, or $ per share of common stock, after giving effect to the payment of the Special Distribution. This remains unchanged when adjusted for the corporate conversion and for the sale by the selling stockholders of shares of common stock in this offering. Purchasers of shares of our common stock in this offering will experience substantial and immediate dilution in net tangible book value per share of common stock for financial accounting purposes, based on the assumed initial public offering price of $ per share (the midpoint of the range set forth on the cover of this prospectus), as illustrated in the following table.


Initial public offering price per share		$
Pro forma net tangible book value per share before and after this offering

Immediate dilution per share to purchasers in this offering ⁽¹⁾		$

(1)

Because the total number of shares outstanding following this offering will not be impacted by any exercise of the underwriters’ option to purchase additional shares of common stock from the selling stockholders and we will not receive any net proceeds from such exercise, there will be no change to the dilution in net tangible book value per share of common stock to purchasers in this offering due to any such exercise of the option.

The following table sets forth the total number of shares issued and outstanding, as of , after giving pro forma effect to the corporate conversion and the sale by the selling stockholders of shares of common stock in this offering at the assumed initial public offering price of $ per share (the midpoint of the range set forth on the cover of this prospectus), together with the total consideration paid and average price per share paid for such shares, before deducting underwriting discounts and commissions and estimated offering expenses.

Common Shares
Purchased

Total Consideration

Average
Price

Number

Percent

Amount

Percent

Per Share

Existing stockholders

New investors

Total

If the underwriters’ option to purchase additional shares is exercised in full, the number of shares held by new investors will be increased to , or approximately % of the total number of shares of common stock issued and outstanding immediately following this offering.

The data in the table above excludes approximately shares of our common stock reserved for issuance under benefit plans for our employees and directors.

SELECTED CONSOLIDATED AND COMBINED HISTORICAL AND PRO FORMA FINANCIAL DATA

The following tables set forth our selected consolidated and combined historical and pro forma financial data as of and for each of the periods indicated. The selected consolidated historical financial data as of December 31, 2016 and for the nine months ended December 31, 2016 is derived from the audited consolidated financial statements of the Successor included elsewhere in this prospectus. The selected combined historical financial data as of December 31, 2015 and for the three months ended March 31, 2016 and the year ended December 31, 2015 is derived from the audited combined financial statements of our Predecessor included elsewhere in this prospectus. The term “Successor” refers to (1) Warrior Met Coal, LLC and its subsidiaries for periods beginning as of April 1, 2016 and ending immediately before the completion of our corporate conversion and (2) Warrior Met Coal, Inc. and its subsidiaries for periods beginning with the completion of our corporate conversion and thereafter. The term “Predecessor” refers to the assets acquired and liabilities assumed by Warrior Met Coal, LLC from Walter Energy in the Asset Acquisition on March 31, 2016. The Predecessor periods included in this prospectus begin as of January 1, 2015 and end as of March 31, 2016.

The selected unaudited pro forma statement of operations data for the year ended December 31, 2016 is derived from the unaudited pro forma condensed combined statement of operations included elsewhere in this prospectus. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2016 assumes that the Transactions occurred as of January 1, 2015. The selected unaudited pro forma balance sheet data as of December 31, 2016 assumes that the payment of the Special Distribution occurred as of December 31, 2016. The selected unaudited pro forma financial data is based upon available information and certain assumptions that management believes are factually supportable, are reasonable under the circumstances and are directly related to the Transactions. The selected unaudited pro forma financial data is provided for informational purposes only and does not purport to represent what our results of operations or financial position actually would have been if these transactions had occurred at any other date, and such data does not purport to project our results of operations for any future period.

You should read this selected consolidated and combined historical and pro forma financial data together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data,” the unaudited pro forma condensed combined statements of operations and the audited financial statements and related notes thereto included elsewhere in this prospectus. Our historical results are not necessarily indicative of our future results of operations, financial position and cash flows.


	Historical									Pro Forma
	Successor			Predecessor						Predecessor/ Successor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015			For the year ended December 31, 2016
				(in thousands, except per unit and per metric ton data)
Statements of Operations Data:
Revenues:
Sales	$	276,560		$	65,154		$	514,334		$	341,714
Other revenues		21,074			6,229			30,399			27,303

Total revenues		297,634			71,383			544,733			369,017

Costs and expenses:
Cost of sales (exclusive of items shown separately below)		244,723			72,297			601,545			315,563
Cost of other revenues (exclusive of items shown separately below)		19,367			4,698			27,442			24,065
Depreciation and depletion		47,413			28,958			123,633			58,950
Selling, general and administrative		20,507			9,008			38,922			29,515
Other postretirement benefits		—			6,160			30,899			—
Restructuring costs		—			3,418			13,832			3,418
Asset impairment charges		—			—			27,986			—
Transaction and other costs		13,568			—			—			—

Total costs and expenses		345,578			124,539			864,259			431,511

Operating loss		(47,944	)		(53,156	)		(319,526	)		(62,494	)
Interest expense, net		(1,711	)		(16,562	)		(51,077	)		(2,243	)
Gain on extinguishment of debt		—			—			26,968			—
Reorganization items, net		—			7,920			(7,735	)		—

Loss before income taxes		(49,655	)		(61,798	)		(351,370	)		(64,737	)
Income tax expense (benefit)		18			18			(40,789	)		36

Net loss	$	(49,673	)	$	(61,816	)	$	(310,581	)	$	(64,773	)

Net loss per unit—basic and diluted	$	(13.15	)
Weighted average units outstanding—basic and diluted		3,777
Supplemental pro forma net loss per share—basic and diluted ⁽¹⁾	$
Supplemental pro forma weighted average shares outstanding—basic and diluted ⁽¹⁾

Statements of Cash Flow Data:
Cash provided by (used in):
Operating activities	$	(9,187	)	$	(40,698	)	$	(131,818	)
Investing activities	$	(30,884	)	$	(5,422	)	$	(64,249	)
Financing activities	$	(192,727	)	$	(6,240	)	$	(147,145	)

Other Financial Data:
Depreciation and depletion	$	47,413		$	28,958		$	123,633		$	58,950
Capital expenditures ⁽²⁾	$	11,531		$	5,422		$	64,971
Adjusted EBITDA ⁽³⁾	$	50,089		$	(9,048	)	$	(145,805	)	$	48,428

Sales Data:
Metric tons sold		2,391			777			5,121			3,168
Average selling price per metric ton	$	115.67		$	83.85		$	100.44		$	107.86
Cash cost of sales per metric ton ⁽⁴⁾	$	82.84		$	69.74		$	112.96		$	79.17


	Pro Forma ⁽⁵⁾	Historical
	Successor	Successor		Predecessor
	December 31, 2016	December 31, 2016		December 31, 2015
		(in thousands)
Balance Sheet Data:
Cash and cash equivalents	$	$	150,045	$	79,762
Working capital ⁽⁶⁾	$	$	226,137	$	129,558
Mineral interests, net	$	$	143,231	$	5,295
Property, plant and equipment, net	$	$	496,959	$	567,594
Total assets	$	$	947,631	$	802,137
Long-term debt ⁽⁷⁾	$	$	3,725	$	—
Total liabilities not subject to compromise	$	$	194,664	$	126,720
Total members’ equity and parent net investment	$	$	752,967	$	(820,861	)

(1)

(2)	Capital expenditures consist of the purchases of property, plant and equipment.

(3)

Adjusted EBITDA is a non-GAAP financial measure. For a definition of Adjusted EBITDA and a reconciliation to our most directly comparable financial measure calculated and presented in accordance with GAAP, please read “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data—Non-GAAP Financial Measures—Adjusted EBITDA.”

(4)

Cash cost of sales is a non-GAAP financial measure. For a definition of cash cost of sales and a reconciliation to our most directly comparable financial measure calculated and presented in accordance with GAAP, please read “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data—Non-GAAP Financial Measures—Cash Cost of Sales.”

(5)	Reflects the payment of the Special Distribution. See Note 26 to our audited financial statements appearing elsewhere in this prospectus for information regarding this unaudited pro forma balance sheet data.

(6)	Working capital consists of current assets less current liabilities.

(7)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

The following discussion and analysis provides a narrative of our results of operations and financial condition for the nine months ended December 31, 2016 (Successor), the three months ended March 31, 2016 (Predecessor), the year ended December 31, 2015 (Predecessor) and pro forma results of operations for the year ended December 31, 2016 compared to the year ended December 31, 2015. You should read the following discussion of our results of operations and financial condition in conjunction with the accompanying audited Predecessor combined financial statements and Successor consolidated financial statements and the related notes, our unaudited pro forma condensed combined statements of operations and the related notes, and “Selected Consolidated and Combined Historical and Pro Forma Financial Data” each included elsewhere in this prospectus.

This discussion contains forward-looking statements that involve risks, uncertainties and assumptions, including but not limited to, those described in “Risk Factors.” Actual results may differ materially from those contained in any forward looking statements. See “Cautionary Note Regarding Forward-Looking Statements” for a discussion of the risks, uncertainties and assumptions associated with those statements. In this discussion, we use financial measures that are considered non-GAAP financial measures under SEC rules. These rules require, among other things, supplemental explanation and reconciliation to the most directly comparable GAAP financial measures, which are included in “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data—Non-GAAP Financial Measures.” Investors should not consider non-GAAP financial measures in isolation from, or in substitution for, financial information presented in compliance with GAAP.

Overview

We are a large scale, low cost U.S.-based producer and exporter of premium met coal operating two highly productive underground mines in Alabama.

As of December 31, 2016, based on a reserve report prepared by Marshall Miller, Mine No. 4 and Mine No. 7, our two operating mines, had approximately 107.8 million metric tons of recoverable reserves and, based on a reserve report by Norwest, our undeveloped Blue Creek Energy Mine contained 103.0 million metric tons of recoverable reserves. The HCC we produce is of a similar quality to coal referred to as the “benchmark HCC” produced in Australia, which is used to set quarterly pricing for the met coal industry. Our HCC, mined from the Southern Appalachian portion of the Blue Creek coal seam, is characterized by low sulfur, low-to-medium ash, and low-to-medium volatility. These qualities make our coal ideally suited as a coking coal for the manufacture of steel.

We sell our met coal to a diversified customer base of blast furnace steel producers, primarily located in Europe and South America. Approximately 97% of our total revenues from coal sales for the nine months ended December 31, 2016 (Successor) were from customers outside of the United States, primarily in Germany, Austria, Brazil, and Turkey.

For the nine months ended December 31, 2016, our Mine No. 4 and one of the longwalls at our Mine No. 7 operated at reduced levels in response to the historically weak met coal market conditions. We produced a total of 2.3 million metric tons of met coal for the nine months ended December 31, 2016 and sold 2.4 million metric tons of met coal for the same period at an average selling price of $115.67 per metric ton.

Industry Overview and Outlook

Met coal, which is converted to coke, is a critical input in the steel production process. Met coal is both consumed domestically in the countries where it is produced and exported by several of the largest producing

countries, such as China, Australia, the United States, Canada and Russia. According to Wood Mackenzie, in 2016, Australia, the United States, Canada and Russia are expected to account for 96.3% of total seaborne exports, with Australia being the largest player, responsible for 66.6% of total seaborne exports. In 2016, the largest importers of seaborne met coal are expected to be Japan, China, India and Europe, accounting for 73.6% of total seaborne met coal imports. Met coal is predominately sold in three forms, HCC, SSCC and PCI, with HCC being the most valuable. The benchmark product is premium HCC sold free-on-board (“FOB”) from ports on the east coast of Australia and is similar to the coal that we produce at our two mines. Benchmark HCC prices have strengthened significantly since the beginning of 2016. For example, the first quarter 2017 benchmark HCC settlement price of $285 per metric ton represents a 252% increase compared to the first quarter 2016 benchmark HCC settlement price of $81 per metric ton.

We believe there are a number of structural developments in the industry, both on the supply and demand sides which suggest prices are unlikely to decrease to levels seen in the first quarter of 2016 in the near-term. Despite the increase in benchmark HCC prices since this period, Wood Mackenzie forecasts a relatively limited compound annual growth rate (“CAGR”) in global seaborne exports of 1.0% per annum from 2016 to 2020. Consistent with Wood Mackenzie’s outlook for supply, we believe that much of the decrease in met coal production is likely to persist despite currently elevated prices, and reflects an extended period of underinvestment in the industry, mine-life extension and infrastructure constraints in Australia and Canada, as well as the permanent closure of higher cost mines globally. While met coal supply remains largely capacity constrained, demand for met coal is expected to be stable in the coming years. Wood Mackenzie expects demand from blast furnace steel producers to stabilize in 2016 compared to 2015, following a 2.5% decline from 2014 to 2015, which was the first year-over-year decline since 2009. While China was the primary driver of growth in global steel production in the recent past, going forward, Wood Mackenzie expects global steel growth to be driven in large part by India and non-Japan Asia, netting a forecasted CAGR for global steel production of 0.9% from 2016 to 2020.

We sell substantially all of our met coal production to steel producers. Therefore, demand for our coal will be highly correlated to conditions in the global steelmaking industry. The steelmaking industry’s demand for met coal is affected by a number of factors, including the cyclical nature of that industry’s business, technological developments in the steelmaking process and the availability of substitutes for steel such as aluminum, composites and plastics. A significant reduction in the demand for steel products would reduce the demand for met coal, which would have a material adverse effect upon our business. Similarly, if alternative ingredients are used in substitution for met coal in the integrated steel mill process, the demand for met coal would materially decrease, which could also materially adversely affect demand for our met coal.

Formation

On July 15, 2015, the Walter Energy Debtors filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code (the “Chapter 11 Cases”) in the Northern District of Alabama, Southern Division.

We were formed on September 3, 2015 by Walter Energy’s First Lien Lenders in connection with the Asset Acquisition.

On November 5, 2015, we and the Walter Energy Debtors entered into an asset purchase agreement, pursuant to which we agreed, on behalf of Walter Energy’s First Lien Lenders, to credit bid the first lien debt obligations held by Walter Energy’s First Lien Lenders, to release the liens on the assets being sold as part of the Asset Acquisition, to assume certain liabilities of the Walter Energy Debtors and to pay certain cash consideration in connection with the Asset Acquisition. On January 8, 2016, the Bankruptcy Court approved the Asset Acquisition, which closed on March 31, 2016. Prior to the closing of the Asset Acquisition, the Company had no operations and nominal assets.

Basis of Presentation

Our results on a “Predecessor” basis relate to the assets acquired and liabilities assumed by Warrior Met Coal, LLC from Walter Energy in the Asset Acquisition and the related periods ending on or prior to March 31, 2016. Our results on a “Successor” basis relate to Warrior Met Coal, LLC and its subsidiaries for periods beginning as of April 1, 2016. Our results have been separated by a vertical line to identify these different bases of accounting.

The historical costs and expenses reflected in the Predecessor combined results of operations include an allocation for certain corporate functions historically provided by Walter Energy. Substantially all of the Predecessor’s senior management were employed by Walter Energy and certain functions critical to the Predecessor’s operations were centralized and managed by Walter Energy. Historically, the centralized functions have included executive senior management, financial reporting, financial planning and analysis, accounting, shared services, information technology, tax, risk management, treasury, legal, human resources, and strategy and development. The costs of each of these services has been allocated to the Predecessor on the basis of the Predecessor’s relative headcount, revenue and total assets to that of Walter Energy.

The combined financial statements of our Predecessor included elsewhere in this prospectus and the other historical Predecessor combined financial information presented and discussed in this discussion and analysis may not be indicative of what our financial condition, results of operations and cash flows would actually have been had we been a separate stand-alone entity, nor are they indicative of what our financial position, results of operations and cash flows may be in the future.

Factors Affecting the Comparability of our Financial Statements

Asset Acquisition

On March 31, 2016, we consummated the acquisition of the Predecessor on a debt free basis with minimum legacy liabilities. The Asset Acquisition included Mine No. 4 and Mine No. 7, which management believes to be two of the highest quality and lowest cost met coal mines in the United States. Prior to the Asset Acquisition, the Company had no operations and nominal assets. We acquired the Predecessor for an aggregate cash consideration of $50.8 million and the release of claims associated with the 2011 Credit Agreement and Walter Energy’s 9.50% Senior Secured Notes due 2019. In connection with the closing of the Asset Acquisition and in exchange for a portion of the outstanding first lien debt, Walter Energy’s First Lien Lenders were entitled to receive, on a pro rata basis, a distribution of our Class A Units. We accounted for the Asset Acquisition as a business combination under Accounting Standard Codification (“ASC”) Topic 805, Business Combinations .

As part of the Asset Acquisition, we incurred transaction costs related to professional fees in the amount of $10.5 million for the nine months ended December 31, 2016 (Successor), which is recorded in transaction and other costs on the Statement of Operations.

Rights Offerings

As part of the Asset Acquisition, we also conducted the Rights Offerings. The Rights Offerings gave Walter Energy’s First Lien Lenders and certain qualified unsecured creditors the option to purchase an aggregate 2,500,004 Class B Units for $80.00 per unit and irrevocably commit to purchase, on the same pro rata basis, Class A Units in one or more capital raising transactions at such later date and on such terms and subject to such conditions as determined by a supermajority vote of our board of managers. The $200.0 million raised from the Rights Offerings was used to pay cash consideration of $50.8 million for the Asset Acquisition, including repayment of certain debtor-in-possession credit agreements of Walter Energy, to sustain our coal mining operations following consummation of the Asset Acquisition and for general corporate purposes.

How We Evaluate Our Operations

Our primary business, the mining and exporting of met coal for the steel industry, is conducted in one business segment: Mining. All other operations and results are reported under the “All Other” category as a reconciling item to consolidated amounts, which includes the business results from our sale of natural gas extracted as a byproduct from our underground coal mines and royalties from our leased properties. Our natural gas and royalty businesses do not meet the criteria in ASC 280, Segment Reporting , to be considered as operating or reportable segments.

Our management uses a variety of financial and operating metrics to analyze our performance. These metrics are significant factors in assessing our operating results and profitability and include: (i) Segment Adjusted EBITDA; (ii) sales volumes and average selling price, which drive coal sales revenue; (iii) cash cost of sales, a non-GAAP financial measure; and (iv) Adjusted EBITDA, a non-GAAP financial measure.


	Successor		Predecessor
	For the nine months ended December 31, 2016		For the three months ended March 31, 2016			For the year ended December 31, 2015
(in thousands)
Segment Adjusted EBITDA	$	31,837	$	(7,143	)	$	(115,197	)
Metric tons sold		2,391		777			5,121
Average selling price per metric ton	$	115.67	$	83.85		$	100.44
Cash cost of sales per metric ton	$	82.84	$	69.74		$	112.96
Adjusted EBITDA	$	50,089	$	(9,048	)	$	(145,805	)

Segment Adjusted EBITDA

We define Segment Adjusted EBITDA as net income adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative, and certain transactions or adjustments that the CEO, our Chief Operating Decision Maker does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

•

our operating performance as compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis or capital structure;

•

the ability of our assets to generate sufficient cash flow to pay distributions;

•

our ability to incur and service debt and fund capital expenditures; and

•

the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

Sales Volumes and Average Selling Price

We evaluate our operations based on the volume of coal we can safely produce and sell in compliance with regulatory standards, and the prices we receive for our coal. Our sales volume and sales prices are largely dependent upon the terms of our annual coal sales contracts, for which prices generally are set on a quarterly basis. The volume of coal we sell is also a function of the pricing environment in the domestic and international met coal markets. We evaluate the price we receive for our coal on an average sales price per metric ton basis. Our average sales price per metric ton represents our coal sales revenue divided by total metric tons of coal sold.

Cash Cost of Sales

We evaluate our cash cost of sales on a cost per metric ton basis. Cash cost of sales is based on reported cost of sales and includes items such as freight, royalties, manpower, fuel and other similar production and sales cost

items, and may be adjusted for other items that, pursuant to GAAP, are classified in the Statements of Operations as costs other than cost of sales, but relate directly to the costs incurred to produce met coal. Our cash cost of sales per metric ton is calculated as the cash cost of metric tons sold divided by the metric tons sold. Cash cost of sales is used as a supplemental financial measure by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

•

our operating performance as compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis or capital structure; and

•

the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

We believe that the presentation of cash cost of sales in this prospectus provides information useful to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to cash cost of sales is cost of sales. Cash cost of sales should not be considered an alternative to cost of sales or any other measure of financial performance or liquidity presented in accordance with GAAP. Cash cost of sales excludes some, but not all, items that affect cost of sales, and our presentation may vary from the presentations of other companies. As a result, cash cost of sales as presented below may not be comparable to similarly titled measures of other companies. For a reconciliation of cash cost of sales to total cost of sales, the most directly comparable GAAP financial measure, on a historical basis and pro forma basis, please read “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data—Non-GAAP Financial Measures—Cash Cost of Sales.”

Adjusted EBITDA

We define Adjusted EBITDA as net loss before net interest expense, income tax expense (benefit), depreciation and depletion, net reorganization items, gain on extinguishment of debt, restructuring costs, asset impairment charges, transaction and other costs, Mine No. 4 idle costs, VEBA contributions, non-cash stock compensation expense and non-cash asset retirement obligation accretion. Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

•

our operating performance as compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis or capital structure; and

•

the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

We believe that the presentation of Adjusted EBITDA in this prospectus provides information useful to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to Adjusted EBITDA is net loss. Adjusted EBITDA should not be considered an alternative to net income or loss or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjustments excludes some, but not all, items that affect net loss and our presentation of Adjusted EBITDA may vary from that presented by other companies. For a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure, on a historical basis and pro forma basis, please read “Prospectus Summary—Summary Consolidated and Combined Historical and Pro Forma Financial Data—Non-GAAP Financial Measures—Adjusted EBITDA.”

Results of Operations

The results of operations, cash flows and financial condition for the Predecessor and Successor periods reflect different bases of accounting due to the impact of the Asset Acquisition on the financial statements.

To aid the reader in understanding the results of operations of each of these distinctive periods, we have provided the following discussion of our historical results for the nine months ended December 31, 2016

(Successor), the three months ended March 31, 2016 (Predecessor), and the year ended December 31, 2015 (Predecessor).

We have supplemented our discussion of historical results with an analysis of the results of operations for the year ended December 31, 2016 and the year ended December 31, 2015 on a pro forma basis, reflecting the pro forma assumptions and adjustments described in the unaudited pro forma condensed combined statements of operations and the notes thereto included elsewhere in this prospectus as if the Asset Acquisition had occurred on January 1, 2015. We believe presenting this supplemental pro forma information is beneficial to the reader because the Asset Acquisition affects the comparability of the financial information for the historical periods presented. We believe this supplemental pro forma presentation provides the reader with additional information to analyze our financial results.

Nine Months Ended December 31, 2016 (Successor)

The following table summarizes certain financial information relating to our operating results that have been derived from our audited financial statements for the nine months ended December 31, 2016 (Successor).


	Successor			% of Total Revenues
(in thousands)	For the nine months ended December 31, 2016			% of Total Revenues
Revenues:
Sales	$	276,560			92.9	%
Other revenues		21,074			7.1	%

Total revenues		297,634			100.0	%
Costs and expenses:
Cost of sales (exclusive of items shown separately below)		244,723			82.2	%
Cost of other revenues (exclusive of items shown separately below)		19,367			6.5	%
Depreciation and depletion		47,413			15.9	%
Selling, general and administrative		20,507			6.9	%
Transaction and other costs		13,568			4.6	%

Total costs and expenses		345,578			116.1	%

Operating loss		(47,944	)		(16.1	)%
Interest expense, net		(1,711	)		(0.6	)%

Loss before income taxes		(49,655	)		(16.7	)%
Income tax benefit		18			—	%

Net loss	$	(49,673	)		(16.7	)%

Sales and cost of sales components on a per unit basis for the nine months ended December 31, 2016 (Successor) were as follows:


	Successor
	For the nine months ended December 31, 2016
Met Coal
Metric tons sold (metric tons in thousands)		2,391
Average selling price per metric ton	$	115.67
Cash cost of sales per metric ton	$	82.84

Total revenues were $297.6 million for the nine months ended December 31, 2016.

Sales were $276.6 million for the nine months ended December 31, 2016, and were comprised of met coal sales of 2.4 million metric tons at an average selling price of $115.67 per metric ton. Substantially all of these sales came from Mine No. 7 as Mine No. 4 was idled in early 2016 and reinitiated operations in August of 2016. Also, we restarted a second longwall in Mine No. 7 in October 2016. Our sales were negatively impacted by roof instability issues experienced at Mine No. 7. Beginning in October of 2016, we completed mining on the longwall panel where we experienced the roof instability issues and began production on a new longwall panel.

Other revenues were $21.1 million, and were comprised of revenue derived from our natural gas operations, as well as earned royalty revenue. Cost of other revenues was $19.4 million, representing 6.5% of total revenues and 84.7% of other revenues.

Cost of sales (exclusive of items shown separately below) was $244.7 million, or 82.2% of total revenues, and was primarily comprised of met coal sales of 2.4 million metric tons at an average cash cost of sales of $82.84 per metric ton. Our cash cost of sales was negatively impacted by the previously mentioned roof instability issues at Mine No. 7, carrying costs of $8.7 million for the idled Mine No. 4, the $25.0 million VEBA contribution and an increase in royalty expenses due to an increase in our realized sales price.

Depreciation and depletion was $47.4 million, or 15.9% of total revenues, and was primarily related to depreciation of machinery and equipment and depletion of mineral interests.

Selling, general and administrative expenses were $20.5 million, or 6.9% of total revenues, reflecting the benefits of a restructured business without the legacy costs and liabilities which were not assumed in the Asset Acquisition.

Transaction and other costs associated with the Asset Acquisition and this offering were $13.6 million, or 4.6% of total revenues, of which $10.5 million was comprised of professional fees incurred in connection with the Asset Acquisition and $3.1 million was comprised of professional fees incurred in connection with this offering.

Interest expense of $1.7 million, or 0.6% of total revenues, is comprised of interest on our security agreement and promissory note, and amortization of our ABL Facility origination fees.

Three Months Ended March 31, 2016 (Predecessor)

The following table summarizes certain financial information relating to the Predecessor’s operating results that have been derived from our audited financial statements for the three months ended March 31, 2016 (Predecessor).


	Predecessor
(in thousands)	For the three months ended March 31, 2016			% of Total Revenues
Revenues:
Sales	$	65,154			91.3	%
Other revenues		6,229			8.7	%

Total revenues		71,383			100.0	%
Costs and expenses:
Cost of sales (exclusive of items shown separately below)		72,297			101.3	%
Cost of other revenues (exclusive of items shown separately below)		4,698			6.6	%
Depreciation and depletion		28,958			40.6	%
Selling, general and administrative		9,008			12.6	%
Other postretirement benefits		6,160			8.6	%
Restructuring cost		3,418			4.8	%

Total costs and expenses		124,539			174.5	%

Operating loss		(53,156	)		(74.5	)%
Interest expense, net		(16,562	)		(23.2	)%
Reorganization items, net		7,920			11.1	%

Loss before income taxes		(61,798	)		(86.6	)%
Income tax expense		18			—	%

Net loss	$	(61,816	)		(86.6	)%

Sales and cost of sales components on a per unit basis for the three months ended March 31, 2016 (Predecessor) were as follows:


	Predecessor
	For the three months ended March 31, 2016
Met Coal
Metric tons sold (metric tons in thousands)		777
Average selling price per metric ton	$	83.85
Cash cost of sales per metric ton	$	69.74

Total revenues were $71.4 million for the three months ended March 31, 2016.

Sales were $65.2 million for the three months ended March 31, 2016, and were comprised of met coal sales of 0.8 million metric tons at an average selling price of $83.85 per metric ton.

Other revenues were $6.2 million, and were comprised of revenue derived from our natural gas operations, as well as earned royalty revenue. Cost of other revenues was $4.7 million, representing 6.6% of total revenues and 75.4% of other revenues.

Cost of sales (exclusive of items shown separately below), was $72.3 million, or 101.3% of total revenues, and was primarily comprised of met coal sales of 0.8 million metric tons at an average cash cost of sales of $69.74 per metric ton. Our cost of sales were negatively impacted by carrying costs of $10.2 million for the idled Mine No. 4.

Depreciation and depletion expense was $29.0 million, or 40.6% of total revenues, and was primarily related to depreciation of machinery and equipment and mine development costs.

Selling, general and administrative expenses were $9.0 million, or 12.6% of total revenues, and were primarily comprised of employee salaries and benefits.

Other postretirement benefits were $6.2 million, or 8.6% of total revenues, and represent postretirement healthcare benefits of the Predecessor.

Restructuring cost of $3.4 million, or 4.8% of total revenues, resulted from the Predecessor idling Mine No. 4 and workforce reductions at both Mine No. 4 and Mine No. 7 and corporate headquarters due to the continued decline in met coal prices.

Interest expense of $16.6 million, or 23.2% of total revenues, represents interest on liabilities subject to compromise, which were attributed to the Predecessor.

Reorganization items, net, was $7.9 million, or 11.1% of total revenues, and was comprised of an allocation of corporate professional fees incurred by the Predecessor in relation to the Chapter 11 Cases of $11.0 million offset by rejected executory contracts and leases of $18.9 million.

An income tax expense of $18.0 thousand was recognized for the three months ended March 31, 2016 as a result of the recognition of a full valuation allowance.

Year Ended December 31, 2015 (Predecessor)

The following table summarizes certain financial information relating to the Predecessor’s operating results that have been derived from our audited combined financial statements for the year ended December 31, 2015 (Predecessor).


	Predecessor
(in thousands)	For the year ended December 31, 2015			% of Total Revenues
Revenues:
Sales	$	514,334			94.4	%
Other revenues		30,399			5.6	%

Total revenues		544,733			100.0	%
Costs and expenses:
Cost of sales (exclusive of items shown separately below)		601,545			110.4	%
Cost of other revenues (exclusive of items shown separately below)		27,442			5.0	%
Depreciation and depletion		123,633			22.7	%
Selling, general and administrative		38,922			7.1	%
Other postretirement benefits		30,899			5.7	%
Restructuring costs		13,832			2.5	%
Asset impairment charges		27,986			5.1	%

Total costs and expenses		864,259			158.7	%

Operating loss		(319,526	)		(58.7	)%
Interest expense, net		(51,077	)		(9.4	)%
Gain on extinguishment of debt		26,968			5.0	%
Reorganization items, net		(7,735	)		(1.4	)%

Loss before income taxes		(351,370	)		(64.5	)%
Income tax expense (benefit)		(40,789	)		(7.5	)%

Net loss	$	(310,581	)		(57.0	)%

Sales and cost of sales components on a per unit basis for the year ended December 31, 2015 (Predecessor) were as follows:


	Predecessor
	For the year ended December 31, 2015
Met Coal
Metric tons sold (metric tons in thousands)		5,121
Average selling price per metric ton	$	100.44
Cash cost of sales per metric ton	$	112.96

Total revenues were $544.7 million for the year ended December 31, 2015.

Sales were $514.3 million for the year ended December 31, 2015, and were comprised of met coal sales of 5.1 million metric tons at an average selling price of $100.44 per metric ton.

Other revenues were $30.4 million, and were comprised of revenue derived from our natural gas operations, as well as earned royalty revenue. Cost of other revenues was $27.4 million, representing 5.0% of total revenues and 90.3% of other revenues.

Cost of sales (exclusive of items shown separately below) was $601.5 million, or 110.4% of revenues, and was primarily comprised of met coal sales of 5.1 million metric tons at an average cash cost of sales of $112.96 per metric ton.

Depreciation and depletion expense was $123.6 million, or 22.7% of total revenues, and was primarily related to depreciation of machinery and equipment and mine development costs.

Selling, general and administrative expenses were $38.9 million, or 7.1% of total revenues, and were primarily comprised of employee salaries and benefits and professional fees incurred in connection with the Chapter 11 Cases.

Other postretirement benefits were $30.9 million, or 5.7% of total revenues, and represent postretirement healthcare benefits of the Predecessor.

Restructuring costs of $13.8 million, or 2.5% of total revenues, resulting from the Predecessor idling Mine No. 4 and workforce reductions at both Mine No. 4 and Mine No. 7 as well as corporate headquarters due to the continued decline in in met coal prices.

Asset impairment charges of $28.0 million, or 5.1% of total revenues, represent an asset impairment recognized in the fourth quarter of 2015 associated with the Blue Creek Energy Mine as a result of management’s recoverability analysis.

Interest expense of $51.1 million, or 9.4% of total revenues, represents interest on liabilities subject to compromise which were attributed to the Predecessor.

On March 6, 2015, Walter Energy issued an aggregate of 8.65 million shares of its common stock in exchange for $66.7 million of its 8.50% Senior Notes due 2021 and recognized a net gain on extinguishment of debt of $58.6 million, of which $27.0 million, or 5.0% of total revenues, has been allocated to the Predecessor.

Reorganization items, net, was $7.7 million, or 1.4% of total revenues, and was comprised of an impairment of an intercompany receivable from Walter Energy Canada Holdings, Inc. of $13.6 million, which was acquired in the Asset Acquisition and an allocation of $19.3 million for corporate professional fees incurred in relation to the Chapter 11 Cases offset by rejected workers’ compensation liabilities of $22.2 million and executory contracts of $2.8 million.

An income tax benefit of $40.8 million was recognized for the year ended December 31, 2015.

Pro Forma Year Ended December 31, 2016 Compared to Pro Forma Year Ended December 31, 2015

Pro Forma Total Company

The following table summarizes certain supplemental pro forma financial information derived from our unaudited pro forma condensed combined statements of operations for the year ended December 31, 2016 and 2015 included elsewhere in this prospectus. The unaudited supplemental pro forma financial information below is presented because management believes it provides a meaningful comparison of operating results, however is should not be viewed as a substitute for the historical financial results of the Predecessor and the Successor presented in accordance with GAAP.


	Pro Forma
	Predecessor/ Successor						Predecessor
	For the year ended December 31, 2016			% of pro forma total revenues			For the year ended December 31, 2015			% of pro forma total revenues			$ Change			% Change
	(in thousands)
Revenues:
Sales	$	341,714			92.6	%	$	514,334			94.4	%	$	(172,620	)		(33.6	)%
Other revenues		27,303			7.4	%		30,399			5.6	%		(3,096	)		(10.2	)%

Total revenues		369,017			100.0	%		544,733			100.0	%		(175,716	)		(32.3	)%

Costs and expenses:
Cost of sales (exclusive of items shown separately below)		315,563			85.5	%		582,441			106.9	%		(266,878	)		(45.8	)%
Cost of other revenues (exclusive of items shown separately below)		24,065			6.5	%		27,442			5.0	%		(3,377	)		(12.3	)%
Depreciation and depletion		58,950			16.0	%		66,028			12.1	%		(7,078	)		(10.7	)%
Selling, general and administrative		29,515			8.0	%		38,922			7.1	%		(9,407	)		(24.2	)%
Restructuring costs		3,418			0.9	%		13,832			2.5	%		(10,414	)		(75.3	)%
Asset impairment charges		—			—	%		27,986			5.1	%		(27,986	)		(100.0	)%

Total costs and expenses		431,511			116.9	%		756,651			138.9	%		(325,140	)		(43.0	)%

Operating loss		(62,494	)		(16.9	)%		(211,918	)		(38.9	)%		149,424			(70.5	)%
Interest expense, net		(2,243	)		(0.6	)%		(2,243	)		(0.4	)%		—			—	%

Loss before income taxes		(64,737	)		(17.5	)%		(214,161	)		(39.3	)%		149,424			(69.8	)%
Income tax expense		36			—	%		(40,789	)		(7.5	)%		40,825			(100.1	)%

Net loss	$	(64,773	)		(17.6	)%	$	(173,372	)		(31.8	)%	$	108,599			(62.6	)%

Pro forma sales and cost of sales components on a per unit basis for the year ended December 31, 2016 and 2015, were as follows:


	Pro Forma
	Predecessor/ Successor		Predecessor
	For the year ended December 31, 2016		For the year ended December 31, 2015
Met Coal
Metric tons sold (metric tons in thousands)		3,168		5,121
Average selling price per metric ton	$	107.86	$	100.44
Cash cost of sales per metric ton	$	79.17	$	109.23

Pro forma total revenues decreased by $175.7 million, or 32.3%, to $369.0 million for the year ended December 31, 2016 compared to $544.7 million for the year ended December 31, 2015. The decrease is primarily attributable to a decrease in metric tons of coal sold due to a reduction in metric tons of coal produced as a result of the idling of Mine No. 4, which reinitiated operations in August of 2016.

Pro forma sales decreased by $172.6 million, or 33.6%, to $341.7 million for the year ended December 31, 2016 compared to $514.3 million for the year ended December 31, 2015. The decrease is primarily attributable to a decrease in metric tons of coal sold due to a reduction in metric tons of coal produced as a result of the idling of Mine No. 4. Our pro forma sales for the year ended December 31, 2016 were comprised of met coal sales of 3.2 million metric tons at an average selling price of $107.86 per metric ton compared to met coal sales of 5.1 million metric tons at an average selling price of $100.44 per metric ton for the year ended December 31, 2015.

Pro forma other revenues decreased by $3.1 million, or 10.2%, to $27.3 million for the year ended December 31, 2016 compared to $30.4 million for the year ended December 31, 2015. The decrease is primarily due to a loss recognized in the fair value adjustment of our gas derivative instrument, and to a lesser extent, lower sales prices of natural gas extracted as a byproduct from our underground coal mines.

Pro forma cost of sales (exclusive of items shown separately below) decreased by $266.9 million, or 45.8%, to $315.6 million for the year ended December 31, 2016 compared to $582.4 million for the year ended December 31, 2015. The decrease is attributable to a reduction in metric tons of coal produced as a result of the idling of Mine No. 4 and a reduction in our average cash cost of sales per metric ton in connection with our cost containment initiatives. Our pro forma cost of sales for the year ended December 31, 2016 were comprised of met coal sales of 3.2 million metric tons at an average cash cost of sales of $79.17 per metric ton compared to met coal sales of 5.1 million metric tons at an average cash cost of sales of $109.23 per metric ton for the year ended December 31, 2015. The significant decrease in average cash cost of sales is primarily due to cost savings achieved as a result of our new initial CBA, as well as our new flexible mine plan and reduced rail, barge and port costs and our royalty structure.

Pro forma cost of other revenues (exclusive of items shown separately below) decreased by $3.4 million, or 12.3%, to $24.1 million for the year ended December 31, 2016 compared to $27.4 million for the year ended December 31, 2015 primarily due to cost savings achieved through the Asset Acquisition.

Pro forma depreciation and depletion expense decreased by $7.1 million, or 10.7%, to $58.9 million for the year ended December 31, 2016 compared to $66.0 million for the year ended December 31, 2015 primarily due to depreciation expense associated with assets that had a one year useful life as a result of the valuation performed in connection with the Asset Acquisition ($6.5 million) and a $0.6 million decrease in depletion expense due to decreased production in 2016 compared to 2015.

Pro forma selling, general and administrative expenses decreased by $9.4 million, or 24.2%, to $29.5 million for the year ended December 31, 2016 compared to $38.9 million for the year ended December 31, 2015. The decrease of $9.4 million is attributable to the closure of our corporate offices located in Hoover, Alabama as well as significant reductions in corporate salaried employees.

Pro forma restructuring costs decreased by $10.4 million, or 75.3%, to $3.4 million for the year ended December 31, 2016 compared to costs of $13.8 million for the year ended December 31, 2015. The decrease is primarily attributable to a reduction in severance costs.

Pro forma asset impairment charges were $28.0 million for the year ended December 31, 2015, due to an impairment recognized in the fourth quarter of 2015 associated with the Blue Creek Energy Mine as a result of management’s recoverability analysis. There were no impairments recorded in 2016.

Pro forma interest expense was $2.2 million for the year ended December 31, 2016 compared to $2.2 million for the year ended December 31, 2015.

Pro forma income tax increased by $40.8 million for the year ended December 31, 2015. The increase is attributable to the recognition of a full valuation allowance for the year ended December 31, 2016.

Liquidity and Capital Resources

Overview

Our sources of cash have been coal and natural gas sales to customers, proceeds received from the Rights Offerings and access to our ABL Facility. Our primary uses of cash have been for funding the operations of our coal and natural gas production operations, our capital expenditures, our reclamation obligations, professional fees and other costs incurred in connection with the Asset Acquisition. In addition, we may use cash to pay the Special Distribution, which will reduce cash and cash equivalents.

Going forward, we may need cash to fund operating activities, working capital, capital expenditures, and strategic investments. Our ability to fund our capital needs going forward will depend on our ongoing ability to generate cash from operations and borrowing availability under the ABL Facility, and, in the case of any future strategic investments or capital expenditures, our ability to access the debt and equity markets to raise additional capital. We believe that our future cash flow from operations, together with cash on our balance sheet after any Special Distribution and borrowing availability under our ABL Facility, will provide adequate resources to fund our planned operating and capital expenditure needs for at least the next twelve months.

If our cash flows from operations are less than we require, we may need to incur additional debt or issue additional equity. From time to time we may need to access the long-term and short-term capital markets to obtain financing. Although we believe we can currently finance our operations on acceptable terms and conditions, our access to, and the availability of, financing on acceptable terms and conditions in the future will be affected by many factors, including: (i) our credit ratings, (ii) the liquidity of the overall capital markets, (iii) the current state of the global economy and (iv) restrictions in our ABL Facility and any other existing or future debt agreements. There can be no assurance that we will have or continue to have access to the capital markets on terms acceptable to us. See “Risk Factors” included elsewhere in this prospectus for further discussion.

Our available liquidity as of December 31, 2016 was $192.3 million, consisting of cash and cash equivalents of $150.0 million and $42.3 million available under our ABL Facility. We currently do not have any outstanding borrowings under the ABL Facility. For the nine months ended December 31, 2016, cash flows used in operating activities were $9.2 million, cash flows used in investing activities were $30.9 million and cash flows provided by financing activities were $192.7 million.

Statements of Cash Flows

Cash balances were $150.0 million and $79.8 million at December 31, 2016 and December 31, 2015, respectively.

The following table sets forth, a summary of the net cash provided by (used in) operating, investing and financing activities for the period (in thousands):


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
Net cash used in operating activities	$	(9,187	)	$	(40,698	)	$	(131,818	)
Net cash used in investing activities		(30,884	)		(5,422	)		(64,249	)
Net cash provided by (used in) financing activities		192,727			(6,240	)		(147,145	)

Net increase (decrease) in cash and cash equivalents and restricted cash	$	152,656		$	(52,360	)	$	(343,212	)

Operating Activities

Net cash flows from operating activities consist of net income (loss) adjusted for noncash items, such as depreciation and depletion of property, plant and equipment and mineral interests, deferred income tax expense (benefit), stock-based compensation, non-cash reorganization items, amortization of debt issuance costs and debt discount, gain on extinguishment of debt, asset impairment charges, accretion of asset retirement obligations and changes in net working capital. The timing between the conversion of our billed and unbilled receivables into cash from our customers and disbursements to our vendors is the primary driver of changes in our working capital.

Net cash used in operating activities was $9.2 million for the nine months ended December 31, 2016, and was primarily attributed to a net loss of $49.7 million adjusted for depreciation and depletion expense of $47.4 million, amortization of debt issuance costs and debt discount of $1.2 million and accretion of asset retirement obligations of $2.8 million, offset by a net decrease in our working capital of $17.7 million. The decrease in our working capital was primarily driven by effects of the Asset Acquisition, an increase in trade accounts receivable offset by an increase in accrued expenses and other current liabilities as a result of an increase in sales and an increase in operating costs associated with the reinitiation of Mine No. 4 operations in August of 2016.

Net cash used in operating activities was $40.7 million for the three months ended March 31, 2016, and was primarily attributed to a net loss of $61.8 million adjusted for depreciation and depletion expense of $29.0 million, non-cash reorganization items of $18.9 million, amortization of debt issuance costs and debt discount of $10.2 million and accretion of asset retirement obligations of $1.2 million, offset partially by a net decrease in our working capital of $1.6 million. The net decrease in our working capital was primarily driven by higher disbursements for accounts payable and accrued expenses and other current liabilities in the period associated with our purchases from vendors, partially offset by a decrease in trade accounts receivable.

Net cash used in operating activities was $131.8 million for the year ended December 31, 2015, and was primarily attributed to a net loss of $310.6 million adjusted for depreciation and depletion expense of $123.6 million, deferred income tax benefit of $40.8 million, stock based compensation expense of $4.0 million, non-cash reorganization items of $11.6 million, amortization of debt issuance costs and debt discount of $6.8 million, gain on extinguishment of debt of $27.0 million, asset impairment charges of $28.0 million and accretion of asset retirement obligations of $4.3 million, and a net increase in our working capital of $102.3 million. The increase in our working capital was primarily driven by lower disbursements for accounts payable and accrued expenses and other current liabilities in the period associated with our purchases from vendors, as well as a decrease in trade accounts receivable and inventories as a result of lower production and sales volumes due to the decline in met coal prices during the period.

Investing Activities

Net cash used in investing activities was $30.9 million for the nine months ended December 31, 2016, primarily as a result of the cash used in connection with the Asset Acquisition and the purchase of U.S. Treasury bills posted as collateral for the self-insured black lung claims that were assumed in the Asset Acquisition of $17.5 million. Net cash used in investing activities was $5.4 million for the three months ended March 31, 2016, primarily due to purchases of property, plant and equipment. Net cash used in investing activities for the year ended December 31, 2015 was $64.2 million, primarily due to purchases of property, plant and equipment.

Financing Activities

Net cash provided by financing activities was $192.7 million for the nine months ended December 31, 2016, primarily due to the proceeds received from the Rights Offerings offset by payments of debt issuance costs. Cash flows from financing activities for Predecessor periods primarily represent net transfers to/from Walter Energy and net payments on debt. As cash and the financing of our Predecessor’s operations have historically been managed by Walter Energy, the components of net transfers to/from Walter Energy include cash transfers from us to Walter Energy and payments by Walter Energy to settle our obligations. These transactions are considered to be effectively settled for cash at the time the transaction is recorded.

ABL Facility

On April 1, 2016, we entered into the ABL Facility with certain lenders and Citibank, N.A. (together with its affiliates, “Citibank”), as administrative agent and collateral agent, with an aggregate lender commitment of up to $50.0 million, at any time outstanding, subject to borrowing base availability. On January 23, 2017, we entered into Amendment No. 1 to Asset-Based Revolving Credit Agreement to, among other things, (i) increase the aggregate lender commitment to $100 million, (ii) reduce the applicable interest rate margins by 100 basis points (“bps”), (iii) permit the corporate conversion and (iv) allow this offering to be consummated without triggering a change of control.

Under the ABL Facility, up to $10 million of the commitments may be used to incur swingline loans from Citibank and up to $50 million of the commitments may be used to issue letters of credit. The ABL Facility will mature on April 1, 2019. As of December 31, 2016, no amounts were outstanding under our ABL Facility.

Revolving loan (and letter of credit) availability under the ABL Facility is subject to a borrowing base, which at any time is equal to the sum of certain eligible billed and unbilled accounts, certain eligible inventory, certain eligible supplies inventory and qualified cash, in each case, subject to specified advance rates. The borrowing base availability is subject to certain reserves, which may be established by the agent in its reasonable credit discretion. The reserves may include rent reserves, lower of cost or market reserve, port charges reserves and any other reserves that the agent determines in its reasonable credit judgment to the extent such reserves relate to conditions that could reasonably be expected to have an adverse effect on the value of the collateral included in the borrowing base. At December 31, 2016, we had $42.3 million of availability under the ABL Facility.

The obligations of the borrowers under the ABL Facility are guaranteed by each of our subsidiaries, and secured by substantially all of our assets. Borrowings under the ABL Facility bear interest at a rate equal to LIBOR plus an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, and ranged from 300 bps to 350 bps as of December 31, 2016 and subsequent to the First Amendment to the ABL Facility dated January 23, 2017 (the “First Amendment”) ranges from 200 bps to 250 bps. In addition to paying interest on the outstanding borrowings under the ABL Facility, we are required to pay a fee in respect of unutilized commitments, which is based on the availability of the commitments under the ABL Facility, ranging from 25 bps to 37.5 bps. We are also required to pay a fee on amounts available to be drawn under outstanding letters of credit under the ABL Facility at a rate not in excess of 250 bps, and certain administrative fees.

We are able to voluntarily repay outstanding loans and reduce unused commitments, in each case, in whole or in part, at any time without premium or penalty. We are required to repay outstanding loans and cash collateralize letters of credit anytime the outstanding loans and letters of credit exceed the maximum availability then in effect. We are also required to use net proceeds from certain significant asset sales to repay outstanding loans, but may re-borrow following such prepayments if the conditions to borrowings are met.

The ABL Facility contains customary covenants for asset-based credit agreements of this type, including among other things: (i) requirements to deliver financial statements, other reports and notices; (ii) restrictions on the existence or incurrence of certain indebtedness; (iii) restrictions on the existence or incurrence of certain liens; (iv) restrictions on making certain restricted payments; (v) restrictions on making certain investments; (vi) restrictions on certain mergers, consolidations and asset dispositions; (vii) restrictions on certain transactions with affiliates; and (viii) restrictions on modifications to certain indebtedness. Additionally, the ABL Facility contains a springing fixed charge coverage ratio of not less than 1.00 to 1.00, which ratio is tested if availability under the ABL Facility is less than a certain amount. Subject to customary grace periods and notice requirements, the ABL Facility also contains customary events of default.

The actual fixed charge covenant ratio for the nine months ended December 31, 2016 was 24.17:1.00.

We were in compliance with all applicable covenants under the ABL Facility as of December 31, 2016.

Promissory Note

As of December 31, 2016, we had debt outstanding of $6.6 million, $2.8 million of which was classified as current, which represents a security agreement and promissory note assumed in the Asset Acquisition. The promissory note matures on March 31, 2019 and bears a fixed interest rate of 4.00% per annum. We are required to make periodic payments of principal and interest over the term of the promissory note. The promissory note is secured by the underground mining equipment it was used to purchase.

Voluntary Employee Beneficiary Association

In connection with the Asset Acquisition, we entered into a new initial CBA with the UMWA pursuant to which we agreed to contribute $25.0 million to a VEBA trust to be formed and administered by the UMWA. We paid $20.8 million in installments during the nine months ended December 31, 2016. Required contributions to the VEBA during fiscal year 2017 are expected to be approximately $4.2 million. Contributions to the VEBA are non-recurring in nature and were immediately expensed and included within cost of sales in the Statements of Operations.

Restricted Cash

As of December 31, 2016, restricted cash included $2.6 million in other long-term assets in the Balance Sheet which represents amounts funded to an escrow account as collateral for coal royalties due under certain underground coal mining lease contracts.

Short-Term Investments

During the nine months ended December 31, 2016, we purchased $17.5 million in United States Treasury bills with a maturity of six months. These Treasury bills were posted as collateral for the self-insured black lung related claims asserted by or on behalf of former employees of Walter Energy and its subsidiaries, which were assumed in the Asset Acquisition and relate to periods prior to March 31, 2016.

Capital Expenditures

Our mining operations require investments to maintain, expand, upgrade or enhance our operations and to comply with environmental regulations. Maintaining and expanding mines and related infrastructure is capital

intensive. Specifically, the exploration, permitting and development of met coal reserves, mining costs, the maintenance of machinery and equipment and compliance with applicable laws and regulations require ongoing capital expenditures. While a significant amount of the capital expenditures required at our mines has been spent, we must continue to invest capital to maintain our production. In addition, any decisions to increase production at our mines or to develop the high-quality met coal recoverable reserves at our Blue Creek Energy Mine in the future could also affect our capital needs or cause future capital expenditures to be higher than in the past and/or higher than our estimates.

To fund our capital expenditures, we will be required to use cash from our operations, incur debt or sell equity securities. Our ability to obtain bank financing or our ability to access the capital markets for future equity or debt offerings may be limited by our financial condition at the time of any such financing or offering and the covenants in our current or future debt agreements, as well as by general economic conditions, contingencies and uncertainties that are beyond our control.

Our capital expenditures were $11.5 million for the nine months ended December 31, 2016, $5.4 million for the three months ended March 31, 2016 and $65.0 million for the year ended December 31, 2015. Capital expenditures for these periods primarily related to investments required to maintain our property, plant and equipment. We evaluate our spending on an ongoing basis in connection with our mining plans and the prices of met coal taking into consideration the funding available to maintain our operations at optimal production levels.

We have a significant capital investment program underway in 2017 to upgrade all key production equipment to further improve efficiency and reliability. Our capital spending is expected to range from $12 to $15 million in the first quarter of 2017 and from $97 to $117 million for the full year 2017, including spending that had been deferred in prior years due to the low met coal pricing environment. These amounts do not include any potential spending associated with our Blue Creek Energy Mine should we decide to develop it for production.

Selected 2017 Targeted Operating Metrics

Subsequent to the Asset Acquisition on March 31, 2016, we operated our mines at lower rates of production and sold lower volumes of met coal when compared to our recent history until the latter part of 2016. We restarted operations at Mine No. 4 in August 2016 and restarted a second longwall at Mine No. 7 in October 2016 in response to a rising market price for met coal and our lower cost structure. As we expect to continue to ramp up production at our mines in 2017, we have established targeted operating metrics that are higher than our 2016 operating results. We are targeting sales in a range of 1.0 to 1.1 million metric tons for the first quarter of 2017 and of 5.0 to 5.4 million metric tons for the full year 2017. As we ramp up our production and sales volumes in the first quarter of 2017, we are targeting cash cost of sales (mine to port) per metric ton in a range of $109 to $118 in the first quarter of 2017 and of $98 to $106 per metric ton for the full year 2017. These selected operating metrics represent our targets and are not projections or forecasts of our performance for any quarterly or annual period in the year ending December 31, 2017 or any other future periods. The selected targeted operating metrics are subject to significant uncertainties and based on management’s assumptions with respect to future decisions and circumstances, including, for example, commodity prices, which are subject to change. Please read “Risk Factors—Risks Related to Our Business—We may not achieve our targeted operating metrics” and “Cautionary Note Regarding Forward-Looking Statements.”

Contractual Obligations

The following is a summary of our significant contractual obligations at December 31, 2016. As of the date of this prospectus, since December 31, 2016, no material transactions have occurred that would materially affect the following schedule.


	Payments due by Year
	Total		Less than 1 year		1 - 3 years		3 - 5 years		More than 5 years
	(in thousands)
Promissory note (principal and interest) ⁽¹⁾	$	6,884	$	3,060	$	3,824	$	—	$	—
Minimum throughput obligations ⁽²⁾		312,066		35,635		71,683		72,248		132,500
Royalty obligations ⁽³⁾		90,953		4,835		10,684		10,324		65,110
Black lung obligations ⁽⁴⁾		85,134		1,524		4,139		3,950		75,521
Asset retirement obligations ⁽⁴⁾		155,978		9,575		11,269		16,161		118,973
VEBA obligations ⁽⁵⁾		4,167		4,167		—		—		—

Total contractual obligations	$	655,182	$	58,796	$	101,599	$	102,683	$	392,104

(1)

(2)	Represents minimum throughput obligations with our rail and port providers.

(3)	We have obligations on various coal and land leases to prepay certain amounts, which are recoupable in future years when mining occurs.

(4)	Represents estimated costs for black lung and asset retirement obligations, which have been presented on an undiscounted basis.

(5)	We entered into a new initial CBA with the UMWA pursuant to which we agreed to contribute $25.0 million to a VEBA trust formed and administered by the UMWA. The remaining obligation of $4.2 million will be paid within one year.

Off-Balance Sheet Arrangements

In the ordinary course of our business, we are required to provide surety bonds and letters of credit to provide financial assurance for certain transactions and business activities. Federal and state laws require us to obtain surety bonds or other acceptable security to secure payment of certain long-term obligations including mine closure or reclamation costs and other miscellaneous obligations. As of December 31, 2016, we had outstanding surety bonds and letters of credit with parties for post-mining reclamation at all of our U.S. mining operations totaling $38.2 million, and $2.1 million for miscellaneous purposes.

Critical Accounting Policies and Estimates

The financial statements are prepared in conformity with GAAP, which require the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses in the period presented. Management evaluates these estimates and assumptions on an ongoing basis, using historical experience, consultation with experts and other methods considered reasonable in the particular circumstances. Nevertheless, actual results may differ significantly from management’s estimates.

We believe the following discussion addresses our most critical accounting estimates, which are those that are most important to the presentation of our financial condition and results of operations and require management’s most difficult, subjective and complex judgments, often as a result of the need to make estimates

about the effect of matters that are inherently uncertain. These estimates are based upon management’s historical experience and on various other assumptions that we believe reasonable under the circumstances. Changes in estimates used in these and other items could have a material impact on our audited and unaudited condensed financial statements. Our significant accounting policies are described in Note 2 to our unaudited condensed financial statements included elsewhere in this prospectus.

Jumpstart Our Business Startups Act of 2012

The JOBS Act permits us, as an “emerging growth company”, to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. However, we have irrevocably opted out of the extended transition period. As a result, we will comply with new or revised accounting standards applicable to public companies as required when they are adopted.

Purchase Price Allocation of Acquisitions

The application of the acquisition method of accounting for business combinations requires the use of significant estimates and assumptions in the determination of the fair value of assets acquired and liabilities assumed in order to properly allocate the purchase price consideration. The purchase price of an acquired business is allocated to its identifiable assets and liabilities based on estimated fair values. The excess of the purchase price over the amount allocated to the assets and liabilities, if any, is recorded as goodwill. All available information is used to estimate fair values including quoted market prices, the carrying value of acquired assets, and widely accepted valuation techniques, such as discounted cash flows. Third-party appraisal firms are engaged to assist in fair value determination of inventories, mineral interests, property, plant and equipment and any other significant assets or liabilities, including asset retirement obligations and black lung liabilities, when appropriate. The judgments made in determining the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, could materially impact our results of operations.

Coal Reserves

There are numerous uncertainties inherent in estimating quantities and values of economically recoverable coal reserves, including many factors that are beyond our control. As a result, estimates of economically recoverable coal reserves are by their nature uncertain. Information about our reserves consists of estimates based on engineering, economic and geological data assembled by our internal engineers and geologists or third-party consultants. A number of sources of information are used to determine accurate recoverable reserve estimates including:

•

geological conditions;

•

historical production from the area compared with production from other producing areas;

•

the assumed effects of regulations and taxes by governmental agencies;

•

previously completed geological and reserve studies;

•

assumptions governing future prices; and

•

future operating costs.

Some of the factors and assumptions, which will change from time to time, that impact economically recoverable reserve estimates include, among other factors:

•

mining activities;

•

new engineering and geological data;

•

acquisition or divestiture of reserve holdings; and

•

modification of mining plans or mining methods.

Each of these factors may vary considerably from the assumptions used in estimating reserves. For these reasons, estimates of economically recoverable quantities of coal attributable to a particular group of properties, and classifications of these reserves based on risk of recovery and estimates of future net cash flows, may vary substantially. Actual production, revenues and expenditures with respect to reserves will likely vary from estimates and these variances may be material. Variances could affect our projected future revenues and expenditures, as well as the valuation of coal reserves and depletion rates. As of December 31, 2016, we had 219.8 million metric tons of proven and probable coal reserves.

Asset Retirement Obligations

Our asset retirement obligations primarily consist of spending estimates to reclaim surface lands and supporting infrastructure at both surface and underground mines in accordance with applicable reclamation laws in the United States as defined by each mining permit. Significant reclamation activities include reclaiming refuse piles and slurry ponds, reclaiming the pit and support acreage at surface mines, and sealing portals at underground mines. Asset retirement obligations are determined for each mine using various estimates and assumptions, including estimates of disturbed acreage as determined from engineering data, estimates of future costs to reclaim the disturbed acreage and the timing of related cash flows, discounted using a credit-adjusted, risk-free rate. On at least an annual basis, we review our entire asset retirement obligation liability and make necessary adjustments for permit changes, the anticipated timing of mine closures, and revisions to cost estimates and productivity assumptions to reflect current experience. As changes in estimates occur, the carrying amount of the obligation and asset are revised to reflect the new estimate after applying the appropriate credit-adjusted, risk-free discount rate. If our assumptions differ from actual experience, or if changes in the regulatory environment occur, our actual cash expenditures and costs that we incur could be materially different than currently estimated. At December 31, 2016, we had recorded asset retirement obligation liabilities of $99.1 million, including $3.1 million reported as current.

Black Lung

We also have significant liabilities for uninsured miners’ black lung benefit liabilities that were assumed in connection with the Asset Acquisition. The recorded amounts of these liabilities are based on estimates of loss from individual claims and on estimates of incurred but not reported claims determined on an actuarial basis from historical experience using assumptions regarding rates of successful claims, benefit increases and mortality rates.

Black lung benefit liabilities are also affected by discount rates used. Changes in the frequency or severity of losses from historical experience and changes in discount rates or actual losses on individual claims that differ materially from estimated amounts could affect the recorded amount of these liabilities.

Income Taxes

As a result of the Asset Acquisition, we have significant federal NOLs of approximately $2.2 billion, which expire predominantly in 2034 through 2036. We also have significant state NOLs of approximately $2.5 billion, which expire predominantly in 2029 through 2031.

We believe the utilization of these NOLs, subject to certain limitations, will significantly reduce the amount of federal and state income taxes payable by us for the foreseeable future as compared to what we would have had to pay at the statutory rates without these NOL benefits. Under Section 382 of the Code, these NOLs could be subject to annual limitations and further limitations, as described below, if we were to undergo a subsequent ownership change in the future. To the extent we have taxable income in the future and can utilize these NOL carryforwards, subject to certain limitations, to reduce taxable income, our cash taxes will be significantly reduced in those future years. Notwithstanding the above, even if all of our regular U.S. Federal income tax liability for a given year is reduced to zero by virtue of utilizing our NOL, we may still be subject to the U.S.

Federal Alternative Minimum Tax and to state, local or other non-Federal income taxes. See “Risk Factors—Risks Related to Our Business—We may be unable to generate sufficient taxable income from future operations, or other circumstances could arise, which may limit our ability to utilize our significant tax NOLs fully or maintain our deferred tax assets.”

GAAP requires that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. Deferred tax assets are required to be reduced by a valuation allowance if it is “more likely than not” that some portion or the entire deferred tax asset will not be realized. As of December 31, 2015, the Predecessor had valuation allowances totaling $139.5 million primarily for deferred tax assets not expected to provide future tax benefits. In our evaluation of the need for a valuation allowance on our U.S. deferred tax assets, we considered all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, carryback of future period losses to prior periods, projected future taxable income, tax planning strategies and recent financial performance. Based on our review of all positive and negative evidence, including a three year U.S. cumulative pre-tax loss, we concluded that a valuation allowance should be recorded against our deferred tax assets that are not expected to be realized through future sources of taxable income generated from carrybacks of future period losses, scheduled reversals of deferred tax liabilities and tax planning strategies. As a result, a valuation allowance was recorded to reflect the portion of the U.S. federal and state deferred tax assets that are not likely to be realized based upon all available evidence. If we later determine that we will more likely than not realize all, or a portion, of the U.S. deferred tax assets, we will reverse the valuation allowance in a future period. All future reversals of the valuation allowance would result in a tax benefit in the period recognized.

Accounting for the Impairment of Long-Lived Assets

Mineral interests, property, plant and equipment and other long-lived assets are reviewed for potential impairment annually or whenever events or changes in circumstances indicate that the book value of the asset may not be recoverable. We periodically evaluate whether events and circumstances have occurred that indicate possible impairment and, if so, assessing whether the asset net book values are recoverable from estimated future undiscounted cash flows. Testing long-lived assets for impairment after indicators of impairment have been identified is a two-step process. Step one compares the net undiscounted cash flows of an asset group to its carrying value. If the carrying value of an asset group exceeds the net undiscounted cash flows of that asset group, step two is performed whereby the fair value of the asset groups is estimated and compared to its carrying amount. The actual amount of an impairment loss to be recorded, if any, is equal to the amount by which the asset’s net book value exceeds its fair market value. Fair market value is generally based on the present values of estimated future cash flows in the absence of quoted market prices. Estimates of future undiscounted cash flows are based on assumptions including third-party global long-term pricing forecasts for each product, anticipated production volumes based on internal and external engineering estimates, capital spending, and operating costs for the life of the mine or estimated useful life of the asset. The estimates of operating cost include labor, fuel, explosives, supplies and similar other major components of mining or gas costs.

Due to market volatility associated with global met coal supply and demand as well as actual mine operating conditions experienced in the years being forecasted, it is possible that the estimate of undiscounted cash flows may change in the near term resulting in a potential need to write down the related assets to fair value, in particular the assets associated with purchased coal reserves. The undiscounted cash flows are dependent upon a number of significant management estimates about future performance and changes in any of these assumptions could materially impact the estimated undiscounted cash flows of our asset groups. The primary uncertainty however pertains to future sales prices. The uncertainty and variability in pricing are described in “Risk Factors” and the uncertainty and variability surrounding coal reserves are described in “Coal Reserve Information.”

Recently Adopted Accounting Standards

A summary of recently adopted accounting pronouncements is included in Note 2 to our audited financial statements included elsewhere in this prospectus.

Internal Controls and Procedures

We are not currently required to comply with the SEC’s rules implementing Section 404 of the Sarbanes-Oxley Act, and are therefore not required to make a formal assessment of the effectiveness of our internal control over financial reporting for that purpose. Upon becoming a public company, we will be required to comply with certain provisions of Section 302 of the Sarbanes-Oxley Act. Beginning with our annual report on Form 10-K for the year ending December 31, 2018 (subject to any change in applicable SEC rules), Section 404 of the Sarbanes-Oxley Act will require that we include management’s assessment of our internal control over financial reporting in our annual reports. In addition, Section 404 will require that our independent registered public accounting firm attest to our internal controls upon us ceasing to qualify for an exemption from the requirement to provide an auditor’s attestation on internal controls afforded to emerging growth companies under the JOBS Act.

Material Weaknesses in Internal Control Over Financial Reporting

Prior to the Asset Acquisition, we were a newly formed company that acquired its operating assets from Walter Energy, which had recently filed for bankruptcy. This resulted in our accounting and financial reporting function having limited accounting and financial reporting personnel and other resources with which to address our internal controls and procedures. In connection with the audits of the financial statements of our Predecessor, our independent registered public accounting firm identified two material weaknesses in our internal control over financial reporting. A material weakness is defined as a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. These material weaknesses resulted in material adjustments to the financial statements of our Predecessor which were corrected in the historical periods presented.

The two material weaknesses identified related to our Predecessor’s internal control over financial reporting:

•

Financial close processes: This material weakness relates to the Predecessor’s design and operation of the account balance reconciliation process, including the performance and preparation of accounting reconciliations and the adequacy of the review of such account balance reconciliations.

•

Process to estimate asset retirement obligation costs: This material weakness relates to the Predecessor’s calculation of asset retirement obligations and ineffective coordination between operational and accounting personnel to determine the appropriate asset retirement obligation.

Each of these material weaknesses could, among other things, adversely impact our ability to provide timely and accurate financial information or result in a misstatement of the account balances or disclosures that could result in a material misstatement to our annual or interim financial statements that would not be prevented or detected. Please see “Risk Factors—Risks Related to Our Business—We have material weaknesses in our internal control over financial reporting. If our remediation of these material weaknesses is not effective, or if we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to accurately or timely report our financial condition or results of operations, which could cause investors to lose confidence in our financial reporting and, as a result, materially adversely affect the trading price of our common stock.”

At the time that the material weaknesses occurred, Walter Energy, the parent of our Predecessor, was in bankruptcy. Many of the employees directly involved in the Predecessor’s account reconciliation process and calculation of the asset retirement obligation had been terminated or had resigned. Many routine and non-routine functions were reassigned to a limited number of financial reporting personnel. Further, during this time, GAAP financial statements were not being prepared for purposes of public disclosure and filing with the SEC.

We are currently in the process of remediating these material weaknesses. Following the closing of the Asset Acquisition on March 31, 2016, our management implemented a new ERP system, re-designed certain

controls and hired additional personnel, which includes a Chief Financial Officer (“CFO”) effective January 1, 2017, in order to improve our internal control over financial reporting. Management expects to make further changes to remediate the material weaknesses that have been identified. These matters have required, and will continue to require, a significant amount of management time, resources and money. Specific aspects of our remediation plan include:

•

the implementation of the new ERP system described above;

•

training users on our ERP system and associated controls;

•

redesigning and implementing internal controls over the account balance reconciliation process and the process of preparing estimates, including asset retirement obligations, which require significant judgment;

•

assessing competencies of accounting and finance personnel with responsibilities for financial accounting and reporting, and developing ongoing training programs;

•

recruiting and hiring accounting and finance personnel, including a new CFO, with the appropriate accounting and reporting technical skills to execute and support financial reporting responsibilities; and

•

recruiting and hiring additional finance personnel to support internal control documentation, testing and monitoring of controls.

We have devoted a significant amount of time and resources to the analysis and preparation of our financial statements. Accordingly, management believes that the financial statements, included elsewhere in this prospectus, fairly present in all material respects, our financial condition, results of operations and cash flows for the periods presented.

It should be noted that any system of controls, however well designed and operated, can provide only reasonable and not absolute assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected or that judgments in decision-making are not based on faulty input.

Our independent registered public accounting firm has not yet performed an audit of our internal control over financial reporting and is not required to report on management’s assessment of our internal control over financial reporting until we are no longer an emerging growth company.

Qualitative and Quantitative Disclosures about Market Risk

Commodity Price Risk

We are exposed to commodity price risk on sales of coal. We sell most of our met coal under fixed price supply contracts primarily with pricing terms of three months and volume terms of up to one year. Sales commitments in the met coal market are typically not long-term in nature, and we are, therefore, subject to fluctuations in market pricing.

We enter into natural gas swap contracts to hedge the exposure to variability in expected future cash flows associated with the fluctuations in the price of natural gas related to the our forecasted sales. As of December 31, 2016, we had natural gas swap contracts outstanding with notional amounts totaling 7.9 billion British thermal units maturing in the fourth quarter of 2017. Our natural gas swap contracts economically hedge certain risk but are not designated as hedges for financial reporting purposes. All changes in the fair value of these derivative instruments are recorded as other revenues in the Statements of Operations.

We have exposure to price risk for supplies that are used directly or indirectly in the normal course of production, such as diesel fuel, steel, explosives and other items. We manage our risk for these items through strategic sourcing contracts in normal quantities with our suppliers. We historically have not entered into any derivative commodity instruments to manage the exposure to changing price risk for supplies.

Credit Risk

Financial instruments that potentially subject us to a concentration of credit risk consist principally of trade receivables. We provide our products to customers based on an evaluation of the financial condition of our customers. In some instances, we require letters of credit, cash collateral or prepayments from our customers on or before shipment to mitigate the risk of loss. Exposure to losses on receivables is principally dependent on each customer’s financial condition. We monitor the exposure to credit losses and maintain allowances for anticipated losses. As of December 31, 2016 (Successor) and December 31, 2015 (Predecessor), we did not have any allowance for credit losses associated with our trade accounts receivables.

Interest Rate Risk

On April 1, 2016, we entered into the ABL Facility that bears an interest rate equal to LIBOR plus an applicable margin, which is based on the average availability of the commitments under the ABL Facility, ranging currently from 200 bps to 250 bps. Any debt that we incur under the ABL Facility will expose us to interest rate risk. If interest rates increase significantly in the future, our exposure to interest rate risk will increase. As of December 31, 2016, a 100 bps point increase or decrease in interest rates would increase or decrease our annual interest expense under the ABL Facility by approximately $1.0 million.

Seasonality

We do not have a seasonal business cycle. Our revenues and operating profits are generally derived evenly throughout the months of the year.

Impact of Inflation

While inflation may impact our revenues and cost of sales, we believe the effects of inflation, if any, on our results of operations and financial condition have not been significant. However, there can be no assurance that our results of operations and financial condition will not be materially impacted by inflation in the future.

INDUSTRY OVERVIEW

Overview of the Met Coal Industry

Met coal, which is converted to coke, is a critical input in the steel production process. In particular, coke is used as a fuel and a reducing agent in steel blast furnaces to convert iron ore to iron and subsequently to create steel. Met coal is a form of hard bituminous coal, which is distinct from softer bituminous and non-bituminous forms of coal that are used to generate electricity.

Met coal is both consumed domestically in the countries where it is produced and exported by several of the largest producing countries. Met coal is primarily exported into the seaborne market, which is projected to account for 89% of met coal exports in 2016, with the remainder exported by land.

Met coal, and in particular HCC, is a scarce commodity with large scale mineable deposits limited to specific geographic regions located in the Eastern United States, Western Canada, Eastern Australia, Russia, China, Mozambique and Mongolia. As of 2016, China is estimated to be the largest producer of met coal, with 99.9% of its output consumed by domestic steelmakers. The next four largest producers of met coal in 2016 are expected to be Australia, the United States, Canada and Russia. According to Wood Mackenzie, in 2016, these four countries are expected to account for 96.3% of total seaborne exports, with Australia being the largest player, responsible for 66.6% of total seaborne exports. In 2016, the largest importers of seaborne met coal are expected to be Japan, China, India and Europe, accounting for 73.6% of total seaborne met coal imports.

Met coal is predominately sold in three forms, HCC, SSCC and PCI, with HCC being the most valuable. Unlike SSCC and PCI, HCC currently has no substitutes and must be used in the production of steel by the blast furnace method. For each type of coal, various specifications can affect price, including the volatility, strength, fluidity, swell and ash content. HCC with low volatile matter and limited swell is required for blending with coal with less desirable qualities. The majority of met coal sold in the seaborne market is priced with reference to a quarterly benchmark HCC price typically set between major Australian suppliers and major Japanese steel mill consumers. The benchmark product is premium HCC sold FOB from ports on the east coast of Australia, and is similar to the coal that we produce at our two mines. A less liquid spot market exists and provides an indicator of future quarterly benchmark price settlements.

Benchmark HCC prices have strengthened significantly since the beginning of 2016. For example, the first quarter 2017 benchmark HCC settlement price of $285 per metric ton represents a 252% increase compared to the first quarter 2016 benchmark HCC settlement price of $81 per metric ton. In addition, met coal spot prices reached $315 per metric ton on November 8, 2016. The recent rise from historic lows was driven largely by supply disruptions in Australia and government policies in China that curbed domestic supply, at a time when demand for met coal was more robust than had been expected. Furthermore, met coal suppliers were unable to respond quickly to the rise in benchmark prices, leading market tightness to persist into the first quarter of 2017.

The following chart shows the inflation-adjusted benchmark HCC settlement price since 2005 (reflecting annual prices prior to 2010, when quarterly pricing began) and the inflation-adjusted average quarterly spot market HCC price since 2010 when a daily trading market for met coal was first developed.

Inflation-adjusted historical HCC prices ($/metric ton)

LOGO

Source:

Bloomberg.

We believe there are a number of structural developments in the industry, both on the supply and demand sides that suggest prices are unlikely to return to levels seen in the first quarter of 2016 in the near-term.

On the supply side, the industry has experienced a net reduction in total seaborne met coal exports in recent years. Wood Mackenzie estimates that from 2013 to 2016, seaborne met coal exports declined from a peak of 302 million metric tons to 278 million metric tons, an 8.2% decline. This reduction in supply has been accompanied by a shift in the mix of key producing regions. According to Wood Mackenzie, from 2011 to 2016, producers in Australia are estimated to have increased seaborne met coal exports by an expected 51 million metric tons, or 37.8%. This increase in exports at a time of multi-year declines in benchmark HCC prices eventually resulted in significant supply rationalization by higher cost met coal exporting regions. For instance, in the United States, seaborne exports will have declined from a peak of 60 million metric tons in 2013 to an expected 33 million metric tons in 2016, a 45.3% decline. In Canada, Wood Mackenzie predicts that seaborne exports will decline from a peak of 34 million metric tons in 2013 to an expected 25 million metric tons in 2016, a 26.9% decline.

From 2016 to 2020, Wood Mackenzie forecasts relatively limited growth in global seaborne exports at a CAGR of 1.0% per annum. Consistent with Wood Mackenzie’s outlook for supply, we believe that much of the decrease in met coal production is likely to persist despite currently elevated prices, and reflects an extended period of underinvestment in the industry, mine-life extension and infrastructure constraints in Australia and Canada, as well as the permanent closure of higher cost mines globally. Wood Mackenzie notes that while current pricing would make restarting certain previously idled mines profitable, they only expect to see a very modest supply response in 2017.

On the demand side, Wood Mackenzie expects demand from blast furnace steel producers to stabilize in 2016 compared to 2015, following a 2.5% decline from 2014 to 2015, which was the first year-over-year decline since 2009. While China was the primary driver of growth in global steel production in the recent past, going forward, Wood Mackenzie expects global steel growth to be driven in large part by India and non-Japan Asia, netting a forecasted CAGR for global steel production of 0.9% from 2016 to 2020.

Seaborne Met Coal Supply Dynamics

Met coal sold into the global seaborne market is primarily produced in four countries, Australia, the United States, Canada and Russia. According to Wood Mackenzie, in 2016 these four countries are expected to account for 96.3% of total seaborne exports, with Australia, the largest supplier, responsible for 66.6% of total 2016 seaborne exports. The following chart shows historical and forecast exports of seaborne met coal in these countries.

Seaborne met coal exports by key regions (Millions of metric tons)


Seaborne exports																															CAGR
(Millions of metric tons)	2011A			2012A			2013A			2014A			2015A			2016E			2017E			2018E			2019E			2020E			‘11 – 16			‘16 – 20
Australia		134			145			169			184			184			185			184			179			180			180			6.6	%		(0.7	%)
United States		59			59			60			43			36			33			35			32			28			27			(11.3	%)		(4.3	%)
Canada		26			30			34			30			27			25			25			25			25			25			(1.0	%)		0.4	%
Russia		11			13			20			22			23			25			27			29			30			32			17.5	%		6.7	%
Other		21			23			19			15			12			10			11			21			24			24			(13.4	%)		24.0	%
Total		252			270			302			294			282			278			283			286			288			289			1.9	%		1.0	%
% growth					7.1	%		11.9	%		(2.7	%)		(4.1	%)		(1.6	%)		2.0	%		0.9	%		0.8	%		0.5	%
% total Australia		53.2	%		53.7	%		56.0	%		62.6	%		65.1	%		66.6	%		65.1	%		62.8	%		62.6	%		62.3	%
% total US		23.6	%		21.8	%		19.7	%		14.7	%		12.7	%		11.7	%		12.4	%		11.1	%		9.8	%		9.5	%
% total Canada		10.4	%		11.1	%		11.3	%		10.3	%		9.6	%		9.0	%		8.9	%		8.8	%		8.8	%		8.8	%
% total Russia		4.4	%		5.0	%		6.6	%		7.4	%		8.3	%		8.9	%		9.5	%		10.0	%		10.3	%		11.1	%
% total Subset		91.6	%		91.6	%		93.6	%		95.0	%		95.8	%		96.3	%		96.0	%		92.8	%		91.5	%		91.6	%

Source:

Wood Mackenzie Coal Markets Tool.

In Australia, exports of seaborne met coal are expected to be 185 million metric tons in 2016, representing a 0.5% increase since 2014. This relatively flat production profile over the past few years is in sharp contrast to the 37.1% increase in production between 2011 and 2014. Wood Mackenzie believes this trend of relatively flat production will continue in the near-to medium-term, as few new met coal projects are in the development pipeline and existing mines will have to contend with reserve degradation, depletion and mine infrastructure constraints.

In the United States, exports of seaborne met coal are expected to be 33 million metric tons in 2016, representing a 45.3% decrease from a peak export level of 60 million metric tons in 2013 due to meaningful mine supply rationalization from high-cost mines in response to weaker met coal prices. According to Wood Mackenzie, of the 21 million metric tons of U.S. met coal capacity that has come offline since 2013, 10 million metric tons are the result of mine closures or idled mines that Wood Mackenzie forecasts to remain closed. A further 11 million metric tons are the result of lower tonnages from existing operations or suspended operations that may restart. While these operations could potentially increase production in response to recent moves in benchmark HCC prices, Wood Mackenzie believes that capital considerations to support such increases, as well as their higher quality-adjusted cost structures relative to global competitors, will likely require greater certainty of a longer-term, higher realized met coal price before such producers can justify re-starting.

Canadian exports of met coal have also declined from a 2013 peak of 34 million metric tons to an expected 25 million metric tons in 2016 due in part to the idling or closure of higher cost mines. Wood Mackenzie expects only an additional 0.3 million metric tons of Canadian exports in 2017 compared to 2016. Recent announcements regarding idled western Canadian mines such as Brule and Wolverine suggest the potential for higher incremental production if benchmark HCC prices remain elevated; however, these mines are not currently included in Wood Mackenzie’s forecasts.

Russia is the one significant region that has shown a steady increase in exports in recent years. These increases have been supported by the sharp decline in the Ruble and proximity to Asia. Wood Mackenzie expects

Russian seaborne exports of met coal to be 25 million metric tons in 2016, representing a 124.1% increase from 11 million metric tons in 2011. Wood Mackenzie forecasts Russian seaborne export growth to slow to a CAGR of 6.7% from 2016 to 2020. Of note, Russia has a relatively small market share of global exports of seaborne HCC.


Seaborne HCC exports
(Millions of metric tons)	2016E		% of total
Australia		103		60.7	%
United States		28		16.5	%
Canada		23		13.6	%
Russia		8		4.5	%
Other		8		4.7	%
Total		170		100.0	%

Source: Wood Mackenzie.

Foreign exchange rates are a significant factor in the cost competitiveness of seaborne met coal suppliers, as benchmark HCC prices (and therefore, the revenues of met coal exporters) are set in U.S. Dollars. Notably, since 2012, the U.S. Dollar has appreciated against the Australian Dollar, Canadian Dollar and Russian Ruble, as shown in the following table. This has provided an advantage to non-U.S. met coal exporters relative to U.S. met coal exporters.


	Exchange rate vs. U.S. Dollar at year-end																				2010 - 2016
	2010		2011			2012			2013			2014			2015			2016			Change			CAGR
Australian Dollar		0.98		0.98			0.96			1.12			1.22			1.37			1.38			41.6	%		6.0	%
y/ o/ y chage				(0.0	%)		(1.3	%)		16.0	%		9.3	%		12.5	%		0.5	%
Canadian Dollar		0.99		1.02			1.02			1.00			1.16			1.39			1.34			35.0	%		5.1	%
y/ o/ y chage				2.5	%		0.0	%		(2.2	%)		16.3	%		19.9	%		(3.5	%)
Russian Ruble		30.53		32.12			30.55			32.86			60.00			73.04			61.04			100.0	%		12.2	%
y/ o/ y chage				5.2	%		(4.9	%)		7.6	%		82.6	%		21.7	%		(16.4	%)

Source:

Bloomberg.

Met Coal Demand Dynamics

Demand for met coal is driven by steel production, particularly relating to production utilizing the basic oxygen / blast furnace method. According to Wood Mackenzie, global steel production is expected to be 1.63 billion metric tons in 2016, up from 1.54 billion metric tons in 2011, representing a CAGR of 1.4%. Global steel production is expected to increase to 1.69 billion metric tons by the end of 2020, with 72.3% of that production coming from blast furnaces.

The following table shows historical and forecast production levels of crude steel by production method.

Crude steel production by method (Millions of metric tons)


Steel production by type																														CAGR
(Millions of metric tons)	2011A		2012A			2013A			2014A			2015A			2016E			2017E			2018E			2019E			2020E			‘11 – 16			‘16 – 20
Basic Oxygen / Blast Furnace		1,066		1,101			1,188			1,239			1,208			1,211			1,218			1,212			1,220			1,224			2.6	%		0.3	%
Electric Arc Furnace		456		450			445			432			412			413			425			437			449			462			(1.9	%)		2.8	%
Open Hearth Furnace		18		12			11			9			7			8			8			8			7			7			(13.9	%)		(3.8	%)
Total		1,540		1,563			1,643			1,679			1,627			1,633			1,651			1,656			1,676			1,693			1.4	%		0.9	%
% growth				1.5	%		5.2	%		2.2	%		(3.1	%)		0.4	%		1.1	%		0.3	%		1.2	%		1.0	%
% BOF / BLF growth				3.2	%		7.9	%		4.3	%		(2.5	%)		0.3	%		0.5	%		(0.5	%)		0.7	%		0.4	%

Source: Wood Mackenzie Steel Long Term Q3 Outlook.


Seaborne HCC imports
(Millions of metric tons)	2016E		% of total
Europe		36		21.0	%
India		34		20.0	%
Japan		28		16.5	%
China		28		16.4	%
Other		45		26.1	%

Total		171		100.0	%

Source: Wood Mackenzie.

Growth in total steel production over the past five years has been predominantly driven by China. Going forward, however, Wood Mackenzie expects the key global steel production growth markets to be India, the Middle East and Africa. These markets are expected to increase their steel production to support ongoing industrialization and, as they do, increase their domestic per-capita steel use. For example, India’s expected 2016 per capita steel use is 61.5 kilograms per person compared to 484.9 kilograms per person in China.

Wood Mackenzie also expects steel production in Europe to show modest annual growth from 222 million metric tons in 2016 to 237 million metric tons in 2020, a CAGR of 1.6%. Key drivers of this growth are approximately 2 million metric ton increases from each of Germany, Italy and France.

The following table shows historical and forecast production levels by region of (i) total crude steel production and (ii) crude steel production using the basic oxygen/blast furnace process.

Crude steel production by region (Millions of metric tons)


Steel production by all methods in key countries / regions																														CAGR
(Millions of metric tons)	2011A		2012A			2013A			2014A			2015A			2016E			2017E			2018E			2019E			2020E			‘11 – 16			‘16 – 20
Europe		252		242			238			235			225			222			225			229			234			237			(2.5	%)		1.6	%
Japan		108		107			111			111			105			104			101			98			96			95			(0.7	%)		(2.3	%)
India		74		78			82			87			89			96			97			99			100			101			5.3	%		1.3	%
China		702		731			813			830			809			817			813			801			805			805			3.1	%		(0.4	%)
South Korea		69		69			66			72			70			68			67			68			68			69			(0.2	%)		0.3	%
Brazil		35		35			34			34			33			31			32			33			33			34			(2.6	%)		2.3	%
Other		300		301			300			311			295			295			315			328			340			353			(0.4	%)		4.5	%
Total		1,540		1,563			1,643			1,679			1,627			1,633			1,651			1,656			1,676			1,693			1.2	%		0.9	%
% growth				1.5	%		5.2	%		2.2	%		(3.1	%)		0.4	%		1.1	%		0.3	%		1.2	%		1.0	%

Basic Oxygen / Blast Furnace steel production in key countries / regions																														CAGR
(Millions of metric tons)	2011A		2012A			2013A			2014A			2015A			2016E			2017E			2018E			2019E			2020E			‘11 – 16			‘16 – 20
Europe		137		133			135			135			130			130			136			138			140			142			(1.1	%)		2.3	%
Japan		83		82			86			85			81			81			79			78			76			75			(0.5	%)		(2.0	%)
India		24		25			35			37			38			43			45			47			49			52			12.6	%		4.8	%
China		631		666			742			779			757			763			757			745			747			745			3.9	%		(0.6	%)
South Korea		42		43			40			47			49			47			47			47			48			48			2.3	%		0.4	%
Brazil		26		26			25			26			26			24			25			25			26			26			(1.9	%)		1.9	%
Other		261		259			260			265			257			254			265			269			275			280			(0.6	%)		2.5	%
Total		1,066		1,101			1,188			1,239			1,208			1,211			1,218			1,212			1,220			1,224			2.6	%		0.3	%
% growth				3.2	%		7.9	%		4.3	%		(2.5	%)		0.3	%		0.5	%		(0.5	%)		0.7	%		0.4	%

Source: Wood Mackenzie Steel Long Term Q3 Outlook.

Wood Mackenzie’s outlook for demand of seaborne met coal is in line with its relatively stable outlook for global crude steel production. In recent years, the four largest importers of seaborne met coal have been Japan, China, India and Europe. According to Wood Mackenzie, these four regions are expected to account for an aggregate of 73.6% of the estimated 278 million metric tons of global seaborne met coal imports in 2016.

China has been a primary driver of global seaborne met coal import demand weakness over the past several years following its approximately 2000% increase in seaborne met coal imports from 2008 to 2013, when it peaked at 77 million metric tons. For 2016, Chinese imports of seaborne met coal are expected to be 40.6% below 2013 peak levels. These declines have coincided with expected declines in Chinese domestic steel production from 2014 to 2016. Wood Mackenzie forecasts Chinese steel production to modestly decline between 2016 and 2020.

Over the next several years, Chinese steel mills may increase their reliance on met coal from the seaborne market relative to domestic met coal production and landborne met coal imports from Mongolia, as the Chinese government has signaled its intent to move steel production capacity from inland areas to port areas. We expect that should this shift continue, it could be supportive for Chinese imports of seaborne met coal due to the closer proximity of these mills to Chinese east coast port facilities.

Wood Mackenzie’s projections for Chinese HCC production and demand through 2021 indicate that China will continue to have a structural need for over 30 million metric tons per year of imported premium HCC. Chinese steelmaking capacity is being relocated away from inland Chinese cities and towards larger facilities in coastal areas.

Steel mills in inland China tend to be smaller and therefore relatively less efficient and more polluting. As Chinese met coal is mostly mined from inland locations and landborne imports are sourced primarily from Mongolia, we believe that the relative increase in steel production capacity in coastal China should make seaborne met coal imports more competitive on a delivered basis. Finally, Chinese officials have announced their intention to increase the proportion of steel produced from larger, more efficient blast furnaces, which require higher quality coals with higher coking strengths.

Japan is also a key driver of met coal seaborne demand as it is currently the largest importer of seaborne met coal. Importantly, Japan is also a consumer of premium HCC coal that it predominantly sources from Australia due to Australia’s proximity. Notwithstanding this proximity, Japanese steel mills have publicly indicated that they are seeking to diversify a portion of their supply away from Australian suppliers for their premium low-vol met coal requirements. This could benefit us, as we are one of the few non-Australian producers of met coal with similar characteristics to Australian premium HCC.

Europe is our key end-market and has shown more stable demand dynamics in recent years. Wood Mackenzie expects that Europe will account for 19.5% of expected seaborne met coal imports in 2016. Although relatively flat since 2010, Wood Mackenzie expects European seaborne met coal imports to rise at a CAGR of 4.5% through 2020, exceeding steel production growth as seaborne imports displace domestic and landborne sources. New blast furnace facilities in Turkey are also expected to contribute to this growth.

India is also viewed as a key growth market for the seaborne met coal industry. Indian seaborne met coal demand is expected to have grown at a CAGR of 8.3% from 2011 to 2016, and is projected to continue at a CAGR of 3.5% through 2020. This is in line with India’s increasing overall steel production, as well as its growing use of blast furnace technology, which Wood Mackenzie projects to grow from 33.8% of Indian domestic steel production in 2010 to 50.9% by 2020.

The following chart shows historical and forecast demand by key region in terms of seaborne met coal imports.

Seaborne met coal imports by key regions (Millions of metric tons)


Seaborne imports																															CAGR
(Millions of metric tons)	2011A			2012A			2013A			2014A			2015A			2016E			2017E			2018E			2019E			2020E			‘11 – 16			‘16 – 20
Japan		60			61			62			59			57			56			56			55			54			53			(1.4	%)		(1.3	%)
India		33			36			36			41			45			48			51			54			55			56			8.3	%		3.5	%
China		31			48			77			62			45			46			43			41			39			37			7.9	%		(4.9	%)
South Korea		32			32			31			35			38			35			35			35			34			34			2.0	%		(0.8	%)
Brazil		17			16			15			15			17			17			17			17			17			18			(0.3	%)		0.9	%
Europe		57			53			54			56			57			54			58			60			62			64			(0.9	%)		4.5	%
Other		22			25			27			27			23			21			23			24			26			27			(1.1	%)		6.5	%
Total		252			270			302			294			282			278			283			286			288			289			1.9	%		1.0	%
% growth					7.1	%		11.9	%		(2.7	%)		(4.1	%)		(1.6	%)		2.0	%		0.9	%		0.8	%		0.5	%
% total Japan		24.0	%		22.4	%		20.6	%		19.9	%		20.1	%		20.2	%		19.8	%		19.2	%		18.8	%		18.4	%
% total India		12.9	%		13.4	%		12.0	%		14.0	%		16.1	%		17.5	%		18.1	%		18.8	%		19.1	%		19.2	%
% total China		12.4	%		17.9	%		25.5	%		20.9	%		16.1	%		16.5	%		15.2	%		14.2	%		13.6	%		12.9	%
% total South Korea		12.7	%		11.8	%		10.3	%		12.0	%		13.6	%		12.7	%		12.3	%		12.1	%		11.8	%		11.8	%
% total Brazil		6.8	%		5.9	%		4.9	%		5.2	%		6.0	%		6.1	%		6.0	%		6.0	%		6.0	%		6.1	%
% total Europe		22.4	%		19.5	%		18.0	%		18.9	%		20.0	%		19.5	%		20.6	%		21.1	%		21.5	%		22.2	%
% total Subset		91.2	%		90.9	%		91.2	%		91.0	%		91.9	%		92.4	%		91.9	%		91.5	%		90.8	%		90.6	%

Source:

Wood Mackenzie Coal Markets Tool.

Overview of the U.S. Met Coal Market

The U.S. met coal market had historically been viewed as the swing supplier in the global seaborne market, since U.S. mines are more adversely affected by changes in benchmark HCC prices than mines in Australia and Canada. This is due to the United States’ relatively larger number of higher cost mines compared to Australia and Canada. According to Wood Mackenzie, the United States is expected to produce 55 million metric tons of met coal in 2016, down 33.9% from 83 million metric tons in 2012, reflecting meaningful mine supply rationalization in response to weaker met coal prices. Of the United States’ expected production of 55 million metric tons, 18 million metric tons (33.6%) are expected to be consumed domestically and 33 million metric tons are expected to be exported through the seaborne market to international blast furnace steel producers, with the balance shipped to Canada. In line with falling overall production, U.S. seaborne exports of met coal in 2016 are expected to be 45.3% lower than peak export levels of 60 million metric tons in 2013. In 2015, U.S. met coal exports were primarily directed to Europe (49% of total U.S. met coal exports), South America (14.7%), and Japan (12.4%).

According to Wood Mackenzie, 10 million metric tons of U.S. met coal capacity reductions since 2013 are the result of permanent mine closures. As noted earlier, Wood Mackenzie does not expect the United States to increase exports through 2020. Wood Mackenzie believes capital considerations to re-start idled U.S mines, as well as their lower margins relative to global competitors, will likely require greater certainty of a longer-term, higher met coal price before owners of idled mines can justify re-starting.

According to Wood Mackenzie, the five largest U.S. exporters of met coal in 2016 are expected to be Alpha Natural Resources, Inc., Blackhawk Mining, LLC, Arch Coal, Coronado Coal, LLC, and Warrior Met Coal, LLC. These five producers are expected to account for approximately 64.3% of U.S. met coal exports in 2016. Wood Mackenzie projects that for 2017, we will be the largest U.S. met coal exporter by tonnage due to our restart of the longwall systems we idled in the first half of 2016.

Overview of the European Steel Market

European steel mills typically source coal from a number of met coal producers in an effort to optimize the coal blend in their blast furnaces. According to Wood Mackenzie, in 2015, European met coal imports (both seaborne and landborne) came 32.8% from Australia, 28.1% from the United States, 21.1% from Russia and 18.0% from the rest of the world. Our largest competitors in the European market are exporters from Australia and Russia. For 2016, the largest met coal producers from Australia are expected to be BHP Billiton Ltd. (in alliance with Mitsubishi Corporation), Anglo American Plc, Peabody Energy Corporation and Rio Tinto Plc. The largest met coal producers from Russia for 2016 are expected to be EVRAZ plc., PAO Mechel, UK Kuzbassrazrezugol OAO, Sibuglemet Holding and PAO Severstal.

Competitive Dynamics

Substantially all of our met coal sales are exported. Our major competitors also sell into our core geographic end-markets of Europe and South America. We compete with producers of premium met coal primarily from Australia, while also competing, to a lesser extent, with met coal producers from Canada, Russia and the United States. The principal factors on which we compete are coal prices at the port of delivery, coal quality and characteristics, customer relationships and the reliability of supply. Of note, the benchmark quality met coal produced by us and select Australian mines have very high coking strengths as indicated by coke strength after reaction (“CSR”) scores compared to other low-vol met coals from U.S. mines. This contributes to our very high price realizations relative to the HCC benchmark, including a 99% average realized price in 2016. In contrast, based on data from public filings made by other U.S. met coal producers that sell a higher proportion of lower-ranked coals, as adjusted based on mine-to-port transportation cost estimates from Wood Mackenzie, we believe that other U.S. met coal producers realized prices of approximately 80 to 90% of the HCC benchmark in 2016.

U.S. met coals with lower CSR scores are most easily sold to U.S. steel mills, which are comparatively older and smaller than their European, Asian and Brazilian counterparts and have lower coking strength requirements. As such, we believe that other U.S. met coal producers are particularly impacted by the competitiveness and financial health of the U.S. steel industry. Conversely, our coals are competitive with coals from Australian mines, and are more exposed to the global economy and worldwide demand for steel. In this vein, we believe that we may be able to market our coal to Japanese steelmakers that have indicated a desire to diversify away from Australian met coal producers.

We believe that we are uniquely advantaged to sell to our primary European customer base relative to other North American met coal producers due to (i) the superior quality and higher strength of the coal produced at our Mine No. 4 and Mine No. 7; and (ii) our freight cost advantage from the Port of Mobile, Alabama, which, according to Wood Mackenzie, enables us to deliver our product to the European market in approximately two weeks, in contrast to the approximately five weeks required to ship HCC from Australia to the European market. We are similarly able to access key Brazilian ports in two weeks.

BUSINESS

Our Business

We are a large scale, low-cost U.S.-based producer and exporter of premium met coal operating two highly productive underground mines in Alabama, Mine No. 4 and Mine No. 7, that have an estimated annual production capacity of 7.3 million metric tons of coal. According to Wood Mackenzie, in 2017, we are expected to be the largest seaborne met coal supplier in the Atlantic Basin, and a top ten supplier to the global seaborne met coal market. As of December 31, 2016, based on a reserve report prepared by Marshall Miller, our two operating mines had approximately 107.8 million metric tons of recoverable reserves and, based on a reserve report prepared by Norwest, our undeveloped Blue Creek Energy Mine, contained 103.0 million metric tons of recoverable reserves. The HCC we produce at Mine No. 4 and Mine No. 7 is of a similar quality to coal referred to as the “benchmark HCC” produced in Australia, which is used to set quarterly pricing for the met coal industry.

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We employ a highly efficient longwall mining method with development support from continuous miners at both of our operating mines. This mining method, together with a redesigned flexible mine plan developed and implemented around the time of the Asset Acquisition, new logistics contracts and a new initial CBA with the UMWA, has enabled us to structurally reduce the operating costs at our Mine No. 4 and Mine No. 7, while also increasing our ability to adjust our cost structure with respect to the HCC benchmark price. We believe the step-down in costs and greater variability in our cost structure relative to Walter Energy equip our operations to endure adverse price environments and generate strong cash flows in favorable price environments.

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time of the Asset Acquisition, allowing us to maximize profitability and operating cash flow. For example, we operated our mines at reduced levels in the early part of 2016 in response to weak met coal market conditions throughout the first nine months of 2016, during which we produced 2.2 million metric tons of met coal. During the fourth quarter of 2016, we commenced ramping up production in response to the increase in the HCC benchmark price, which resulted in us producing 3.1 million metric tons of met coal for the year ended December 31, 2016. During 2013, when the HCC quarterly benchmark price averaged $159 per metric ton, our two operating mines produced a combined 7.3 million metric tons, which we estimate equals our current capacity. We are increasing our production during 2017 and, given our favorable cost structure, generate significantly higher operating cash flow.

For the year ended December 31, 2015 and the nine months ended December 31, 2016, our coal operations:

•

generated sales of $514.3 million and $276.6 million, respectively; and

•

incurred cost of sales of $601.5 million and $244.7 million, respectively.

Our Competitive Strengths

We believe that we have the following competitive strengths:

Exposure to “pure play,” high quality met coal production . Unlike many other mining companies, substantially all of our revenue is derived from the sale of met coal in the global seaborne markets. All of our resources are allocated to the mining, transportation and marketing of met coal. The premium HCC we produce at Mine No. 4 and Mine No. 7 is of a similar quality to coal referred to as the “benchmark HCC” produced in Australia, which is used to set quarterly pricing for the met coal industry. Coal from Mine No. 7 is classified as a premium low-volatility HCC and coal from Mine No. 4 is classified as a premium mid-volatility HCC. The combination of low sulfur, low-to-medium ash, low-to-medium volatility, and other characteristics of our coal, as well as our ability to blend them, makes our HCC product an important component within our customers’ overall coking coal requirements. As a result, our realized price has historically been in line with or at a slight discount to the HCC benchmark. Our 2016 average realized price of 99% of the HCC benchmark is in significant contrast to other U.S. met coal producers, which we believe sell a relatively higher proportion of lower rank coals to domestic steel producers and achieved realized prices of approximately 80% to 90% of the HCC benchmark in 2016, based on data from public filings made by such other U.S. met coal producers, as adjusted based on mine-to-port transportation cost estimates from Wood Mackenzie.

Strong leverage to met coal prices with strong operating cash flow generation . Our overall operations have robust operating margins, require modest sustaining capital expenditures and are expected to generate significant operating cash flows in a range of met coal price environments. We acquired our operations in the Asset Acquisition on a debt-free basis and with minimal legacy liabilities and, as a result, we have a strong balance sheet and currently have minimal interest expense. We expect our operating cash flows to benefit from a low effective tax rate, predominantly driven by significant NOLs that were acquired in connection with the Asset Acquisition. Our new initial CBA, combined with our flexible rail, port and barge logistics and our royalty structure, results in a highly variable operating cost profile that allows our cash cost of sales to move with changes in the price we realize for our coal. Our variable cost structure dramatically lowers our cash cost of sales if our realized price falls, while being effectively capped in higher price environments allowing us to generate significant operating cash flow. The following table presents illustrative run rate cash cost of sales:


HCC benchmark ($ per metric ton)	$	100	$	120	$	150	$	175	$	200
Illustrative cash cost of sales ($ per metric ton)	$	80	$	92	$	97	$	101	$	104

ton in the fourth quarter of 2015). Similarly, in the fourth quarter of 2016, in response to the substantial increase in met coal prices, we rapidly restarted our Mine No. 4 and ramped up production at the second longwall within Mine No. 7 to increase our production rates. Our production in the fourth quarter of 2016 was 0.9 million metric tons, when the HCC benchmark was $200 per metric ton versus 0.6 million metric tons in the fourth quarter of 2015, when the HCC benchmark was $89 per metric ton. On an annual basis, we believe we can ramp up production to 7.3 million metric tons, which was our historical high production level set in 2013.

Highly experienced leadership team with proven commitment to safety and operational excellence . Our CEO, Walter J. Scheller, III, is the former CEO of Walter Energy and has six years of direct experience managing Mine No. 4 and Mine No. 7, and over 30 years of experience in longwall coal mining. Furthermore, following the Asset Acquisition, we hired several key personnel with extensive direct operational experience in met coal longwall mining, including our Chief Operating Officer, Jack Richardson, and our Chairman, Stephen D. Williams. We have a strong record of operating safe mines and are committed to environmental excellence. Our dedication to safety is at the core of all of our overall operations as we work to further reduce workplace incidents by focusing on policy awareness and accident prevention. Our continued emphasis on enhancing our safety performance has resulted in zero fatal incidents as well as non-fatal days lost incidence rates of 3.73 at Mine No. 4 and 3.27 at Mine No. 7 for the year ended December 31, 2016, which are considerably lower than the 2016 national average incident rate for all underground coal mines in the United States of 4.99 non-fatal days lost per site.

Our Business Strategies

South America and 10% in Asia. We have an arrangement with Xcoal to serve as Xcoal’s exclusive and strategic partner for exports of low volatility HCC. Under this arrangement, Xcoal takes title to and markets coal that we would historically have sold on the spot market, in an amount of up to 10% of our sales. While the volumes being sold through this arrangement with Xcoal are relatively limited, we are positioned to potentially benefit from Xcoal’s expertise and relationships across all coal that we sell. To that end, we also have an incentive-based arrangement with Xcoal to cover other tonnage, in the event Xcoal is able to offer us a higher realized price relative to the HCC benchmark than we have previously achieved.

Rigorously evaluate our organic and inorganic growth pipeline, including the high-quality Blue Creek Energy Mine . We are continuously analyzing new opportunities to expand our business, but would require any mine openings or asset acquisitions to be highly strategic and additive to our existing high-quality met coal portfolio and result in a strong balance sheet on a pro forma basis. In particular, we own the undeveloped Blue Creek Energy Mine, which, based on a reserve report prepared by Norwest, had 103.0 million metric tons of high quality met coal recoverable reserves as of December 31, 2016. We believe that the Blue Creek Energy Mine is a large block of high quality coal reserves that could support a new longwall operation with a mine life of greater than 30 years. As such, management is evaluating additional leases for this site as well as considering approving additional engineering work to further evaluate this opportunity. Should we decide to develop it in the future, we expect that the Blue Creek Energy Mine would significantly increase our annual production.

Corporate History and Structure

Walter Energy Restructuring

Warrior Met Coal, LLC was formed on September 3, 2015 by certain of Walter Energy’s First Lien Lenders in connection with the acquisition by the Company of certain core assets of the Walter Energy Debtors related to their Alabama mining operations. The acquisition was accomplished through a credit bid of the first lien obligations of the Walter Energy Debtors pursuant to section 363 of the U.S. Bankruptcy Code and the Sale Order. Prior to the closing of the Asset Acquisition, the Company had no operations and nominal assets. The Asset Acquisition closed on March 31, 2016.

In connection with the Asset Acquisition, we conducted the Rights Offerings. Proceeds from the Rights Offerings were used to pay certain costs associated with the Asset Acquisition and for general working capital purposes.

Post-IPO Corporate Structure

Upon completion of the corporate conversion and this offering, the Apollo Funds will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full), the GSO Funds will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full), the KKR Funds will own approximately % of our outstanding shares of common stock (or % if the

underwriters’ option to acquire additional shares of common stock is exercised in full), and the Franklin Funds will own approximately % of our outstanding shares of common stock (or % if the underwriters’ option to acquire additional shares of common stock is exercised in full). In addition, members of our management team will own an approximate aggregate % interest in us.

Description of Our Business

Our mining operations consist of two active underground met coal mines in Southern Appalachia’s coal seam (Mines No. 7 and No. 4) and other surface met and thermal coal mines, five of which are currently under lease to third parties and four of which are not operating and are not currently planned to be operated in the future. For a comprehensive summary of all of our coal properties and of our coal reserves and production levels as of December 31, 2016, see the tables summarizing our coal reserves and production in “—Estimated Recoverable Coal Reserves.” Our met coal production totaled 4.9 million metric tons in 2015 and 3.1 million metric tons in 2016. Our natural gas operations remove and sell natural gas from the coal seams owned or leased by us and others as a byproduct of coal production. Our degasification operations improve mining operations and safety by reducing natural gas levels in our mines.

Our underground mining operations are headquartered in Brookwood, Alabama and as of December 31, 2016, based on a reserve report prepared by Marshall Miller, were estimated to have approximately 107.8 million metric tons of recoverable reserves located in west central Alabama between the cities of Birmingham and Tuscaloosa. Operating at approximately 2,000 feet below the surface, the Mines No. 4 and No. 7 are two of the deepest underground coal mines in North America. The met coal is mined using longwall extraction technology with development support from continuous miners. We extract met coal primarily from Alabama’s Blue Creek coal seam, which contains high-quality bituminous coal. Blue Creek coal offers high coking strength with low coking pressure, low sulfur and low-to-medium ash content with high Btu values that can be sold either as met coal (used to produce coke) or as compliance thermal coal (used by electric utilities because it meets current environmental compliance specifications). Pricing for met coal has historically been significantly higher than for that of compliance thermal coal. Therefore, we currently market our coal solely as met coal.

The met coal from our Mines No. 4 and No. 7 is sold as a high quality low and mid-vol met coal. Mines No. 4 and No. 7 are located near Brookwood, Alabama, and are serviced by CSX railroad. A coal producer is typically responsible for transporting the coal from the mine to an export coal-loading facility. Exported coal is usually sold at the loading port, with the buyer responsible for further transportation from the port to their location. Both mines also have access to our barge load-out facility on the Black Warrior River. Service via both rail and barge culminates in delivery to the Port of Mobile in Mobile, Alabama, where shipments are exported to our international customers via ocean vessels. Substantially all of our met coal sales consists of sales to international customers. We also own mineral rights for approximately 103.0 million additional metric tons of recoverable reserves at our Blue Creek Energy Mine located to the northwest of the Mine No. 4, based on a reserve report prepared by Norwest. The related mineral leases form the core of the project to be operated by Warrior Met Coal BCE, LLC, an indirect subsidiary of the Company, which project contemplates the development of a new underground met coal mine that has an estimated life of greater than 30 years. We refer to the underground met coal mine related to this project as the “Blue Creek Energy Mine.”

Coal Preparation and Blending

Our met coal mines have preparation and blending facilities convenient to each mine. The met coal preparation and blending facilities receive, blend, process and ship met coal that is produced from the mines. Using these facilities, we are able to ensure a consistent quality and efficiently blend our met coal to meet our customers’ specifications.

Marketing, Sales and Customers

Met coal prices differ substantially by region and are impacted by many factors, including the overall economy, demand for steel, location, market, quality and type of met coal, mine operation costs and the cost of

customer alternatives. The major factors influencing our business are the global economy and demand for steel. Our operations’ high quality met coal is considered among the highest quality met coals in the world and is preferred as a base met coal in our customers’ blends. Our marketing strategy is to focus on international markets mostly in Europe and South America where we have a shipping time and distance advantage and where our met coal is in demand.

We focus on long-term customer relationships where we have a competitive advantage. We sell most of our met coal under price supply contracts primarily with pricing terms of three months and volume terms of up to one year. Some of our sales of met coal can, however, occur in the spot market as dictated by available supply and market demand. Our business is not substantially dependent on any contract, such as a contract to sell the major part of our products or other agreement to use a patent, formula, trade secret, process or trade name upon which our business depends to a material extent. For more information regarding our customers, see Note 2 to our audited combined financial statements included elsewhere in this prospectus.

We have an arrangement with Xcoal to serve as Xcoal’s exclusive and strategic partner for exports of low volatility HCC. Xcoal has specialized marketing capabilities and deep technical expertise as the largest met coal marketer in the United States. Our arrangement with Xcoal is expected to expand the geographic reach of our customers through Xcoal’s global presence. Xcoal has 16 offices worldwide, including in Brussels, the UAE, Singapore, Beijing, Shanghai, Seoul, Mumbai, and Rio de Janeiro. We expect to be able to leverage Xcoal’s more than 30 year history selling coal to key European and Asian steel customers to further improve the selling prices of our met coal relative to the global HCC benchmark.

Trade Names, Trademarks and Patents

As part of the Asset Acquisition, we acquired all intellectual property, including copyrights, patents, trademarks, trade names and trade secrets, owned by the Walter Energy Debtors and used or held for use in the business or our assets. Promptly following the closing of the Asset Acquisition, each Walter Energy Debtor, including Walter Energy, was required to discontinue the use of its name (and any other trade names or “d/b/a” names currently utilized by the Walter Energy Debtors) and may not subsequently change its name to or otherwise use or employ any name which includes the words “Walter.” We do not believe that any one such trademark is material to our individual segments or to the business as a whole.

Competition

Substantially all of our met coal sales are exported. Our major competitors are businesses that sell into our core business areas of Europe and South America. We primarily compete with producers of premium met coal from Australia, Canada, Russia and the United States. The principal factors on which we compete are met coal prices at the port of delivery, coal quality and characteristics, customer relationships and the reliability of supply. The demand for our met coal is significantly dependent on the general global economy and the worldwide demand for steel. Although there are significant challenges in the current economy, we believe that we have competitive strengths in our business areas that provide us with distinct advantages.

Suppliers

Supplies used in our business include petroleum-based fuels, explosives, tires, conveyance structure, ventilation supplies, lubricants and other raw materials as well as spare parts and other consumables used in the mining process. We use third-party suppliers for a significant portion of our equipment rebuilds and repairs, drilling services and construction. We believe adequate substitute suppliers are available and we are not dependent on any one supplier; however, we procure some equipment from a concentrated group of suppliers, and obtaining this equipment often involves long lead times. Occasionally, demand for such equipment by mining companies can be high and some types of equipment may be in short supply. We continually seek to develop relationships with suppliers that focus on reducing our costs while improving quality and service.

Properties

The following map shows the major locations of our mining operations.

LOGO

Our administrative headquarters and production facilities as of December 31, 2016 were as follows:


		Land Acreage				Building Square Footage
Business Unit /Location (State/County/Town)	Principal Operations	Leased		Owned		Leased		Owned
Warrior Met Coal Mining, LLC
Alabama/Tuscaloosa/Brookwood	Administrative headquarters & mine support facilities		—		—		—		624,070
Alabama/Jefferson & Tuscaloosa/Adger & Brookwood	Coal mines, mine support facilities, land holdings & barge loadout		15,373		47,767		—		—
Alabama/Mobile/Mobile	Administrative headquarters, mine support facilities & real estate		—		—		1,471		—
Warrior Met Coal BCE, LLC
Alabama/Tuscaloosa/Whitson	Coal mines & land holdings		26,194		1,153		—		2,360
Warrior Met Coal Gas, LLC
Alabama/Tuscaloosa/Tuscaloosa	Administrative headquarters & mine support facilities		10		28		—		15,425
Alabama/Tuscaloosa & Fayette /Various	Natural gas fields—developed		90,432		—		—		—
Warrior Met Coal Land, LLC
Alabama/Various/Various	Real estate		—		21,496		400		12,430
Alabama/Various/Various	Real estate—mineral interest only		—		184,648		—		—


		Land Acreage				Building Square Footage
Business Unit /Location (State/County/Town)	Principal Operations	Leased		Owned		Leased		Owned
Warrior Met Coal TRI, LLC
Alabama/Tuscaloosa/ Brookwood	Real estate		—		188		664		3,460
Warrior Met Coal LA, LLC
Louisiana/Terrebonne/Houma	Real estate		—		3,223		—		—
Warrior Met Coal WV, LLC
West Virginia/Various/Various	Real estate		—		2,510		—		—
West Virginia/Various/Various	Real estate—mineral interest only		—		3,740		—		—

Estimated Recoverable Coal Reserves

The estimates of our proven and probable reserves as of December 31, 2016 included in this prospectus (i) for our Mine No. 4 and Mine No. 7 were prepared by Marshall Miller, (ii) for our Blue Creek Energy Mine were prepared by Norwest, and (iii) for our other mining properties described in this prospectus were prepared by McGehee. Within Marshall Miller, the technical person primarily responsible for preparing the estimates of our proven and probable reserves for our Mine No. 4 and Mine No. 7 is K. Scott Keim. Within Norwest, the technical person primarily responsible for preparing the estimates of our proven and probable reserves for our Blue Creek Energy Mine is Kevin Whipkey. Within McGehee, the technical person primarily responsible for preparing the estimates of our proven and probable reserves for our mining properties owned by Warrior Met Coal TRI, LLC and Warrior Met Coal Land, LLC is C.W. McGehee.

We maintain an internal staff of engineers and geoscience professionals who worked closely with our independent reserve engineers to ensure the integrity, accuracy and timeliness of the data used to calculate our estimated reserves. Our internal technical team members meet with our independent reserve engineers periodically to discuss the assumptions and methods used in the proved reserve estimation process. We provide historical information to the independent reserve engineers for our properties, such as ownership interest, production, test data, commodity prices and operating and development costs.

These estimates are based on engineering, economic and geologic data, coal ownership information and current and proposed mine plans. Our proven and probable coal reserves are reported as “recoverable coal reserves,” which is the portion of the coal that could be economically and legally extracted or produced at the time of the reserve determination, taking into account mining recovery and preparation plant yield. These estimates are periodically updated to reflect past coal production, new drilling information and other geologic or mining data. Acquisitions or dispositions of coal properties will also change these estimates. Changes in mining methods may increase or decrease the recovery basis for a coal seam, as will changes in preparation plant processes.

“Reserves” are defined by the SEC Industry Guide 7 as that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. Industry Guide 7 divides reserves between “proven (measured) reserves” and “probable (indicated) reserves,” which are defined as follows:

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the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.

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“Probable (Indicated) Reserves.” Reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.

As of December 31, 2016, we had estimated reserves totaling 219.8 million metric tons, of which 115.4 million metric tons, or 52.0%, were “assigned” recoverable reserves that were either being mined, were controlled and accessible from a then active mine, or located at idled facilities where limited capital expenditures would be required to initiate operations when conditions warrant. The remaining 104.4 million metric tons were classified as “unassigned,” representing coal at currently non-producing locations that we anticipate mining in the future, but which would require significant additional development capital before operations could begin.

Our reserve estimates are predicated on engineering, economic, and geological data assembled and analyzed by internal engineers, geologists and finance associates, as well as third-party consultants. We update our reserve estimates annually to reflect past coal production, new drilling information and other geological or mining data, and acquisitions or sales of coal properties.

The following table provides the location and coal reserves associated with each mine or potential mine as of December 31, 2016:

As of December 31, 2016

(in thousands of metric tons) ⁽¹⁾


									Recoverable Reserves ⁽²⁾						Reserve Control ⁽⁵⁾
Location/Mine	Type ⁽⁷⁾		Status of Operation ⁽⁶⁾		Coal Bed		Assigned/ Unassigned ⁽⁴⁾		Reserves ⁽²⁾		Proven ⁽³⁾		Probable ⁽³⁾		Owned		Leased
Alabama:
Warrior Met Coal Mining, LLC
No. 4		U		Production		Mary Lee		Assigned		43,725		43,329		396		—		43,725
No. 7		U		Production		Mary Lee		Assigned		64,071		55,828		8,243		353		63,718
Warrior Met Coal BCE, LLC
Blue Creek Energy Mine		U		Exploration		Mary Lee		Unassigned		103,042		64,309		38,733		2,624		100,418
Warrior Met Coal TRI, LLC
Carter/Swann’s Crossing		S		Idled		Brookwood		Assigned		2,803		2,803		—		2,803		—
Panther 3		S		Idled		Brookwood		Assigned		262		262		—		262		—
Warrior Met Coal Land, LLC
Beltona East		S		Development		Black Creek		Unassigned		1,013		1,013		—		1,013		—
Carter P-3986 ⁽⁸⁾		S		Production		Brookwood		Assigned		11		11		—		11		—
Howton		S		Idled		Brookwood		Unassigned		271		271		—		271		—
Kimberly ⁽⁸⁾		S		Development		Black Creek		Assigned		128		128		—		128		—
Morris ⁽⁸⁾		S		Production		Mary Lee		Assigned		4,119		4,119		—		4,119		—
Searles 8 ⁽⁸⁾		S		Production		Brookwood		Assigned		303		303		—		303		—
Sloan Mountain ⁽⁸⁾		S		Production		Black Creek		Assigned		13		13		—		13		—

Total Alabama										219,761		172,389		—		11,900		207,861

Total Warrior Met Coal										219,761		172,389		47,372		11,900		207,861

(1)	1 metric ton is equivalent to 1.102311 short tons.

(2)

Reserves are that part of a mineral deposit which can be economically and legally extracted or produced at the time of the reserve determination. Recoverable reserves represent the amount of proven and probable reserves that can actually be recovered taking into account all mining and preparation losses involved in producing a saleable product using existing methods under current law. Recoverable reserve estimates incorporate losses for dilution and mining recovery based upon a 95% longwall recovery, 35% to 40% continuous miner recovery and a 95% preparation plant efficiency.

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The ranges of met coal sales prices used to assess our reserves at the time of reporting were $150 per metric ton at Mine No. 4 and Mine No. 7 and $160 to $180 per metric ton at Blue Creek Energy Mine. Mine No. 4 and Mine No. 7 proven reserves were estimated within a 3/4 mile radius from point of measurement with thickness and representative coal quality and probable reserves were estimated within a 3/4 mile radius from a point of measurement with thickness but no representative coal quality. The Blue Creek Energy Mine and our surface mines proven reserves were estimated within a 1/4 mile radius from point of measurement.

(3)

Reserves are further categorized as Proven (Measured) and Probable (Indicated) as defined by SEC Industry Guide 7 as follows: Proven (Measured) Reserves are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (b) the sites of inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established. Probable (Indicated) Reserves are reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling and measurement are father apart or are otherwise less adequately spaced. The degree of assurance, although lower than for proven (measured) reserves, is high enough to assume continuity between points of observation.

(4)

“Assigned” reserves represent recoverable reserves that are either currently being mined, reserves that are controlled and accessible from a currently active mine or reserves at idled facilities where limited capital expenditures would be required to initiate operations. “Unassigned” reserves represent coal at currently non-producing locations that would require significant additional capital spending before operations begin.

(5)

“Reserve Control” of recoverable reserves is either through direct ownership of the property or through third-party leases. Third-party leases have initial terms extending up to 30 years and generally provide for terms or renewals through the anticipated life of the associated mine. These renewals are conditioned upon the payment of minimum royalties. Under current mining plans, assigned reserves reported will be mined out within the period of existing leases or within the time period of probable lease renewal periods. All recoverable reserves reported are either 100% owned or controlled through lease agreements.

(6)

The “Status of Operation” for each mine is classified as follows: Exploration—mines where exploration has been conducted sufficient to define recoverable reserves, but the mine is not yet in development or production stage; Development—we are engaged in the preparation of an established commercially minable deposit (reserves) for extraction but that are not yet in production; Production—the mine is actively operating; Idled —previously active mines that have been idled until such time as reinitiating operations are considered feasible. If conditions warrant, the mines could be re-opened with less capital investment than would be required to develop a new mine.

(7)	Type of Mine: U = Underground; S = Surface

(8)	Reserve is leased to a third party, royalty is collected by us from the third party and we have first right of refusal to purchase mined product if we elect to exercise the right.

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The following table provides a summary of the quality of our reserves as of December 31, 2016:

Estimated Recoverable Coal Reserves (Continued)

As of December 31, 2016

(in thousands of metric tons) ⁽¹⁾


					Quality						Average Coal Seam Thickness		Date Mine:
Location/Mine	Reserves		Type ⁽²⁾		% Ash		% Sulfur		BTU/lb.		(in Feet)		Acquired/ Opened		Ceased/ Idled
Alabama:
Warrior Met Coal Mining, LLC
No. 4		43,725		MVM		9.96		0.75		N/A		6.50		1976		N/A
No. 7		64,071		LVM		8.61		0.63		N/A		4.65		1978		N/A
Warrior Met Coal BCE, LLC
Blue Creek Energy Mine		103,042		HVM		9.10		0.70		N/A		5.20		N/A		N/A
Warrior Met Coal TRI, LLC
Carter/Swann’s Crossing		2,803		M/T		11.04		1.21		12,609		9.93		2011		2013
Panther 3		262		T		8.93		1.47		13,636		1.99		2007		2008
Warrior Met Coal Land, LLC
Beltona East		1,013		M/T		7.79		2.58		14,162		4.88		N/A		N/A
Carter P-3986		11		M/T		6.57		1.58		13,937		1.50		2016		N/A
Howton		271		M/T		10.07		1.07		12,811		7.52		2006		2009
Kimberly		128		M/T		6.47		2.32		13,747		5.58		N/A		N/A
Morris		4,119		T		11.86		1.12		12,668		5.13		2014		N/A
Searles 8		303		M/T		11.79		1.26		12,500		8.21		2013		N/A
Sloan Mountain		13		M/T		3.42		0.75		14,902		4.22		2010		N/A

Total Alabama		219,761

Total Warrior Met Coal		219,761

(1)	1 metric ton is equivalent to 1.102311 short tons.

(2)	Coal Type: M=Metallurgical Coal; T=Thermal; LVM = Low Vol Metallurgical Coal; MVM=Mid Vol Metallurgical Coal; HVM=High Vol Metallurgical Coal

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The following table provides a summary of information regarding our mining operations as of December 31, 2016:

Transportation

Preparation Plant

Location/Mine

Reserves
(thousands of
metric tons) ⁽¹⁾

Type ⁽²⁾

Mining
Equipment ⁽³⁾

Rail

Other ⁽⁴⁾

Capacity
(metric tons
per hr)

Utilization
%

Source of
Power ⁽⁵⁾

Alabama:

Warrior Met Coal Mining, LLC

No. 4

43,725

LW,CM

CSX

T,B

1,179

ALPCO

No. 7

64,071

LW,CM

CSX

T,B

2,177

ALPCO

Warrior Met Coal BCE, LLC

Blue Creek Energy Mine

103,042

In exploration or development

Warrior Met Coal TRI, LLC

Carter/Swann’s Crossing

2,803

S,T

N/A

T,B

N/A

ALPCO

Panther 3

262

S,T

N/A

T,B

N/A

ALPCO

Warrior Met Coal Land, LLC

Beltona East

1,013

In exploration or development

Carter P-3986

S,T

N/A

ALPCO

Howton

271

S,T

N/A

ALPCO

Kimberly

128

In exploration or development

Morris

4,119

S,T

N/A

ALPCO

Searles 8

303

S,T

N/A

ALPCO

Sloan Mountain

S,T

N/A

ALPCO

Total Alabama

219,761

Total Warrior Met Coal

219,761

(1)	1 metric ton is equivalent to 1.102311 short tons.

(2)	Type of Mine: S = Surface; U = Underground

(3)	Mining Equipment: D = Dragline; S = Shovel/Excavator/Loader; T = Trucks; LW = Longwall; CM = Continuous Miner; H=Highwall Miner

(4)	Transportation: Other T = Trucks; B = Barge Loadout availability

(5)	Source of Power: ALPCO = Alabama Power Company

The following table provides the production (in thousands) and average coal selling price per metric ton for our operating mines for each of the three years ended December 31, 2016, 2015 and 2014:


	Production ⁽¹⁾ / Average Coal Selling Price Per Metric Ton
Location/Mine	2016				2015				2014
Alabama:
Warrior Met Coal Mining, LLC
No. 4		312	$	138.00		2,192	$	99.00		2,468	$	112.00
No. 7		2,783	$	103.00		2,754	$	100.00		4,741	$	117.00

Total Alabama		3,095				4,946				7,209

(1)	There were no purchases of coal from third parties during the periods presented. All metric tons produced were on leased property.

Information provided within the previous tables concerning our properties has been prepared in accordance with applicable U.S. federal securities laws. All mineral reserve estimates have been prepared in accordance with SEC Industry Guide 7.

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Environmental and Regulatory Matters

Our businesses are subject to numerous federal, state and local laws and regulations with respect to matters such as permitting and licensing, employee health and safety, reclamation and restoration of property and protection of the environment. In the U.S., environmental laws and regulations include, but are not limited to, the federal Clean Air Act and its state and local counterparts with respect to air emissions; the Clean Water Act and its state counterparts with respect to water discharges and dredge and fill operations; the Resource Conservation and Recovery Act and its state counterparts with respect to solid and hazardous waste generation, treatment, storage and disposal, as well as the regulation of underground storage tanks; the Comprehensive Environmental Response, Compensation and Liability Act and its state counterparts with respect to releases, threatened releases and remediation of hazardous substances; the Endangered Species Act with respect to protection of threatened and endangered species; the National Environmental Policy Act with respect to the impacts of federal actions such as the issuance of permits and licenses; and the Surface Mining Control and Reclamation Act of 1977 and its state counterparts with respect to environmental protection and reclamation standards for mining activities. Compliance with these laws and regulations may be costly and time-consuming and may delay commencement, continuation or expansion of exploration or production at our operations. These laws are constantly evolving and may become increasingly stringent. The ultimate impact of complying with existing laws and regulations is not always clearly known or determinable due in part to the fact that certain implementing regulations for these environmental laws have not yet been promulgated and in certain instances are undergoing revision or judicial review. These laws and regulations, particularly new legislative or administrative proposals (or judicial interpretations of existing laws and regulations) related to the protection of the environment, could result in substantially increased capital, operating and compliance costs and could have a material adverse effect on our operations and/or, along with analogous foreign laws and regulations, our customers’ ability to use our products.

Due in part to the extensive and comprehensive regulatory requirements, along with changing interpretations of these requirements, violations occur from time to time in our industry and at our operations. Expenditures relating to environmental compliance are a major cost consideration for our operations and environmental compliance is a significant factor in mine design, both to meet regulatory requirements and to minimize long-term environmental liabilities. To the extent that these expenditures, as with all costs, are not ultimately reflected in the prices of our products and services, operating results will be reduced. We believe that our major North American competitors are confronted by substantially similar conditions and thus do not believe that our relative position with regard to such competitors is materially affected by the impact of environmental laws and regulations. However, the costs and operating restrictions necessary for compliance with environmental laws and regulations may have an adverse effect on our competitive position with regard to foreign producers and operators who may not be required to undertake equivalent costs in their operations. In addition, the specific impact on each competitor may vary depending on a number of factors, including the age and location of its operating facilities, applicable legislation and its production methods.

Permitting and Approvals

Numerous governmental permits and approvals are required for mining and natural gas operations. We are required to prepare and present to federal, state and local authorities data pertaining to the effect or impact that any proposed exploration project for production of coal or gas may have on the environment, the public and our employees. In addition, we must also submit a comprehensive plan for mining and reclamation upon the completion of mining operations. The requirements are costly and time-consuming and may delay commencement or continuation of exploration, production or expansion at our operations. Typically we submit necessary mining permit applications several months, or even years, before we anticipate mining a new area.

Applications for permits and permit renewals at our mining and gas operations are subject to public comment and may be subject to litigation from third parties seeking to deny issuance of a permit or to overturn the applicable agency’s grant of the permit application, which may also delay commencement, continuation or expansion of our mining and gas operations. Further, regulations provide that applications for certain permits or

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permit modifications in the U.S. can be delayed, refused or revoked if an officer, director or a stockholder with a 10% or greater interest in the entity is affiliated with or is in a position to control another entity that has outstanding permit violations or has had a permit revoked. In the current regulatory environment, we anticipate approvals will take even longer than previously experienced, and some permits may not be issued at all. Significant delays in obtaining, or denial of, permits could have a material adverse effect on our business.

Mine Safety and Health

The MSHA, under the Mine Act and the MINER Act, as well as regulations adopted under these federal laws impose rigorous safety and health standards on mining operations. Such standards are comprehensive and affect numerous aspects of mining operations, including, but not limited to: training of mine personnel, mining procedures, ventilation, blasting, use of mining equipment, dust and noise control, communications and emergency response procedures. For instance, MSHA implemented a rule in August 2014 to reduce miners’ exposure to respirable coal dust, which reduced respirable dust standards for certain occupants and miners and required certain monitoring of shift dust levels. In August 2016, Phase III of MSHA’s respirable dust rule went into effect, further lowering the respirable dust standards. Separately, MSHA has implemented a rule imposing a requirement on certain continuous mining machines, requiring operators to provide proximity detection systems. MSHA monitors compliance with these laws and standards by regularly inspecting mining operations and taking enforcement actions where MSHA believes there to be non-compliance. These federal mine safety and health laws and regulations have a significant effect on our operating costs.

Workers’ Compensation and Black Lung

We are insured for workers’ compensation benefits for work related injuries that occur within our operations. Workers’ compensation liabilities, including those related to claims incurred but not reported, are recorded principally using annual valuations based on discounted future expected payments using historical data of the operating subsidiary or combined insurance industry data when historical data is limited. In addition, certain of our subsidiaries are responsible for medical and disability benefits for black lung disease under the Federal Coal Mine Health and Safety Act of 1969, the Mine Act and the Black Lung Benefits Act, each as amended, and are insured beginning on April 1, 2016 for black lung claims of any of our employees. In addition, we assumed all of the black lung liabilities of Walter Energy and its U.S. subsidiaries and are self-insured against such black lung related claims. For additional information, please see “Risk Factors—Risks Related to Our Business—We are responsible for medical and disability benefits for black lung disease under federal law. We assumed certain historical self-insured back lung liabilities of Walter Energy and its subsidiaries incurred prior to April 1, 2016 in connection with the Asset Acquisition. We are self-insured for these black lung liabilities and have posted certain collateral with Department of Labor as described below. Changes in the estimated claims to be paid or changes in the amount of collateral required by the Department of Labor may have a greater impact on our profitability and cash flows in the future.” Under the Black Lung Benefits Act, as amended, each coal mine operator must make payments to a trust fund for the payment of benefits and medical expenses to claimants who last worked in the coal industry prior to January 1, 1970. The trust fund is funded by an excise tax on production; however, this excise tax does not apply to coal shipped outside the United States. Based on our limited sales of coal in the United States, we do not expect to incur a material expense related to this excise tax. However, the excise tax may result in a material expense to us in the future if our coal sales in the United States significantly increase. The Patient Protection and Affordable Care Act includes significant changes to the federal black lung program, including an automatic survivor benefit paid upon the death of a miner with an awarded black lung claim and the establishment of a rebuttable presumption with regard to pneumoconiosis among miners with 15 or more years of coal mine employment that are totally disabled by a respiratory condition. These changes could have a material impact on our costs expended in association with the federal black lung program. In addition to possibly incurring liability under federal statutes we may also be liable under state laws for black lung claims.

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Surface Mining Control and Reclamation Act

The SMCRA requires that comprehensive environmental protection and reclamation standards be met during the course of and following completion of mining activities. Permits for all mining operations must be obtained from the Federal Office of Surface Mining Reclamation and Enforcement (“OSM”) or, where state regulatory agencies have adopted federally approved state programs under the SMCRA, the appropriate state regulatory authority. The Alabama Surface Mining Commission reviews and approves SMCRA permits in Alabama.

SMCRA permit provisions include requirements for coal prospecting, mine plan development, topsoil removal, storage and replacement, selective handling of overburden materials, mine pit backfilling and grading, subsidence control for underground mines, surface drainage control, mine drainage and mine discharge control, treatment and revegetation. These requirements seek to limit the adverse impacts of coal mining and more restrictive requirements may be adopted from time to time.

Before a SMCRA permit is issued, a mine operator must submit a bond or otherwise secure the performance of reclamation obligations. The Abandoned Mine Land Fund, which is part of SMCRA, imposes a general funding fee on all coal produced. The proceeds are used to reclaim mine lands closed or abandoned prior to 1977. On December 7, 2006, the Abandoned Mine Land Program was extended for another 15 years.

We maintain extensive coal refuse areas and slurry impoundments at our mining complexes. Such areas and impoundments are subject to comprehensive regulation. Structural failure of an impoundment can result in damage to the environment and natural resources, such as bodies of water that the coal slurry reaches, as well as create liability for related personal injuries, property damages and injuries to wildlife. Some of our impoundments overlie mined out areas, which can pose a heightened risk of failure and the assessment of damages arising out of such failure. If one of our impoundments were to fail, we could be subject to substantial claims for the resulting environmental contamination and associated liability, as well as for related fines and penalties.

On December 12, 2008, the OSM finalized rulemaking regarding the interpretation of the stream buffer zone provisions of SMCRA, which confirmed that excess spoil from mining and refuse from coal preparation could be placed in permitted areas of a mine site that constitute waters of the U.S. The rule was subsequently vacated based, in part, upon the fact that the U.S. Fish & Wildlife Service was not consulted with respect to possible effects on endangered species under terms of the Endangered Species Act. At present, an earlier 1983 rule is in place, which requires coal companies to keep operations 100 feet from streams or otherwise minimize any damage. On December 20, 2016, OSM published a new, finalized “Stream Protection Rule,” setting standards for “material damage to the hydrologic balance outside the permit area” that are applicable to surface and underground mining operations. However, on February 17, 2017, President Trump signed a joint congressional resolution disapproving the Stream Protection Rule pursuant to the Congressional Review Act. Accordingly, the regulations in effect prior to the Stream Protection Rule apply, including OSM’s 1983 rule. It remains unclear whether and how the results of the 2016 U.S. election could further impact regulatory or enforcement activities pursuant to the SMCRA.

Drainage flowing from or caused by mining activities can be acidic with elevated levels of dissolved metals, a condition referred to as AMD. Treatment of AMD can be costly. Although we do not currently face material costs associated with AMD, there can be no assurance that we will not incur significant costs in the future.

Surety Bonds/Financial Assurance

We use surety bonds and letters of credit to provide financial assurance for certain transactions and business activities. Federal and state laws require us to obtain surety bonds or other acceptable security to secure payment of certain long-term obligations including mine closure or reclamation costs and other miscellaneous obligations. The amount of security required to be obtained can change as the result of new federal or state laws, as well as changes to the factors used to calculate the bonding or security amounts.

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Surety bond rates have increased in recent years and the market terms of such bonds have generally become less favorable. In addition, the number of companies willing to issue surety bonds has decreased. Bonding companies may also require posting of collateral, typically in the form of letters of credit to secure the surety bonds. Moreover, the changes in the market for coal used to generate electricity in recent years have led to bankruptcies involving prominent coal producers. Several of these companies relied on self-bonding to guarantee their responsibilities. In response to these bankruptcies, OSMRE issued a Policy Advisory in August 2016 to state agencies that are authorized under the SMCRA to implement the act in their states. Certain states had previously announced that they would no longer accept self-bonding to secure reclamation obligations under the state mining laws. This Policy Advisory is intended to discourage authorized states from approving self-bonding arrangements and may lead to increased demand for other forms of financial assurance, which may strain capacity for those instruments and increase our costs of obtaining and maintaining the amounts of financial assurance needed for our operations. In addition, OSMRE announced in August 2016 that it would initiate a rulemaking under SMCRA to revise the requirements for self-bonding. Individually and collectively, these revised various financial assurance requirements may increase the amount of financial assurance needed and limit the types of acceptable instruments, straining the capacity of the surety markets to meet demand. This may increase the time required to obtain, and increase the cost of obtaining, the required financial assurances. Although Alabama’s regulatory framework technically allows for self-bonding, Alabama, in practice, requires surety bonds in order to engage in coal mining activities in the state. As of December 31, we had outstanding surety bonds with parties for post-mining reclamation at all of our U.S. mining operations totaling $38.2 million, and $2.1 million for miscellaneous purposes.

Climate Change

Global climate change continues to attract considerable public and scientific attention, with widespread concern about the impacts of human activity, especially the emission of GHGs such as carbon dioxide and methane. Some of our operations, such as methane release resulting from met coal mining, directly emit GHGs. Further, the products that we produce result in the release of carbon dioxide into the atmosphere by end-users. Laws and regulations governing emissions of GHGs have been adopted by foreign governments, including the European Union and member countries, U.S. regulatory agencies, individual states in the U.S. and regional governmental authorities. While Congress has from time to time considered legislation to reduce emissions of GHGs, there has not been significant activity in the form of adopted legislation to reduce GHG emissions at the federal level in recent years. In the absence of such federal climate legislation, almost one-half of the states have taken legal measures to reduce emissions of GHGs primarily through the planned development of GHG emission inventories and/or regional GHG cap and trade programs. Further, numerous proposals have been made and are likely to continue to be made at the international, national, regional and state levels of government that are intended to limit emissions of GHGs by enforceable requirements and voluntary measures.

In December 2009, the EPA published findings that GHG emissions present an endangerment to public health and welfare because, according to the EPA, emissions of such gases contribute to warming of the earth’s atmosphere and other climatic changes. The EPA’s findings focus on six GHGs, including carbon dioxide and nitrous oxide (which are emitted from coal combustion) and methane (which is emitted from coal beds). The findings by the EPA allowed the agency to proceed with the adoption and implementation of regulations to restrict emissions of GHGs under existing provisions of the federal Clean Air Act, including rules that regulate emissions of GHGs from motor vehicles and certain large stationary sources of emissions such as power plants or industrial facilities. In May 2010, the EPA adopted regulations that, among other things, established Prevention of Significant Deterioration (“PSD”) and Title V permit reviews for certain large stationary sources, such as coal-fueled power plants, that are potential major sources of GHG emissions. The so-called Tailoring Rule established new GHG emissions thresholds that determine when stationary sources must obtain permits under the PSD and Title V programs of the Clean Air Act. On June 23, 2014, the Supreme Court held that stationary sources could not become subject to PSD or Title V permitting solely by reason of their GHG emissions. The Court ruled, however, that the EPA may require installation of best available control technology for GHG emissions at sources otherwise subject to the PSD or Title V programs. On August 26, 2016, the EPA proposed changes

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needed to bring EPA’s air permitting regulations in line with Supreme Court and D.C. Circuit decisions on greenhouse gas permitting. The proposed rule was published in the Federal Register on October 3, 2016 and the public comment period closed on December 16, 2016. It is unclear when a final rule will be issued and/or whether and how the results of the 2016 U.S. election could impact further regulatory developments in this area.

In June 2010, Earthjustice petitioned the EPA to make a finding that emissions from coal mines may reasonably be anticipated to endanger public health and welfare, and to list them as a stationary source subject to further regulation of emissions. On April 30, 2013, the EPA denied the petition. Judicial challenges seeking to force the EPA to list coal mines as stationary sources have likewise been unsuccessful to date. If the EPA were to make an endangerment finding in the future, we may have to further reduce our methane emissions, install additional air pollution controls, pay certain taxes or fees for our emissions, incur costs to purchase credits that permit us to continue operations as they now exist at our underground coal mines or perhaps curtail coal production.

In addition, in August 2015, the EPA announced three separate, but related, actions to address carbon dioxide pollution from power plants, including final Carbon Pollution Standards for new, modified and reconstructed power plants, a final Clean Power Plan to cut carbon dioxide pollution from existing power plants, and a proposed federal plan to implement the Clean Power Plan emission guidelines. Upon publication of the Clean Power Plan on October 23, 2015, more than two dozen states as well as industry and labor groups challenged the Clean Power Plan in the D.C. Circuit Court of Appeals. On February 9, 2016, the U.S. Supreme Court stayed the Clean Power Plan pending disposition of the legal challenges. If the Clean Power Plan ultimately is upheld in its current form and it is not further altered by the EPA, it could have a material adverse impact on the demand for thermal coal nationally. While the Clean Power Plan does not affect our marketing of met coal, the continued regulatory focus could lead to future GHG regulations for the mining industry and its steelmaking customers, which ultimately could make it more difficult or costly for us to conduct our operations or adversely affect demand for our products. It remains unclear whether and how the results of the 2016 U.S. election could impact further regulatory developments in this area.

Furthermore, on January 15, 2016, the Secretary of Interior directed the Bureau of Land Management to prepare an environmental study analyzing potential leasing and management reforms to the current federal coal program, including how best to address the climate impacts of the federal program to meet both the nation’s energy needs and its climate goals. Pending this review, the Secretary has put in place a moratorium on new applications for thermal (steam) coal leases or lease modification on federal land, subject to certain exceptions. Among other things, the moratorium does not apply to met coal. While the moratorium does not affect the Company’s operations at this time, the continued regulatory focus could lead to future GHG regulations for the mining industry and its steelmaking customers, which could ultimately make it more difficult or costly for us to conduct our operations or adversely affect demand for our products.

Demand for met coal and natural gas also may be impacted by international efforts to reduce GHG emissions. In October 2014, the leaders of the 28 European Union countries agreed to a commitment to reduce GHG emissions by 40% from 1990 levels by 2040 and to adopt a non-binding goal of 27% use of renewable energy resources by 2030. Some exceptions were provided to secure approval of all EU members, and the reductions by some sectors participating in the existing Emission Trading System, such as utilities and heavy industry, will need to be greater than 40% to accommodate lower goals for other sectors, such as the agricultural and services industries, to achieve the overall 40% goal. The current goal is to reduce GHGs by 20% from 1990 levels by 2020. Furthermore, in November 2014, the U.S. and China announced a bilateral agreement to reduce GHG emissions. The U.S. agreed to reduce GHGs by 26-28% below 2005 levels by 2025. China pledged to stabilize its GHG emissions by 2030, to be accomplished in part by increasing its percentage of renewable energy sources such as solar and wind to 20% of the nation’s total energy production.

In December 2015, the United States joined the international community at the 21st Conference of the Parties of the United Nations Framework Convention on Climate Change in Paris, France. The text of the Paris

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Agreement calls for nations to undertake “ambitious efforts” to hold the increase in the global average temperature to well below 2º C above pre-industrial levels and pursue efforts to limit the temperature increase to 1.5º C above pre-industrial levels; reach global peaking of GHG emissions as soon as possible; and take action to conserve and enhance sinks and reservoirs of GHGs, among other requirements. The Paris Agreement went into effect on November 4, 2016. The Paris Agreement establishes a framework for the parties to cooperate and report actions to reduce GHG emissions. It is possible that the agreement and subsequent domestic and international regulations will have adverse effects on the market for met coal, natural gas, and other fossil fuel products.

Methane must be expelled from our underground coal mines for mining safety reasons. Our gas operations extract methane from our underground met coal mines prior to mining. With the exception of some methane which is vented into the atmosphere when the met coal is mined, much of the methane is captured and sold into the natural gas market and used as fuel. If regulation of GHG emissions does not exempt the release of methane, we may have to curtail met coal production, pay certain taxes or fees for our emissions or incur costs to purchase credits that allow us to continue operations as they now exist at our underground met coal mines.

Finally, climate change may cause more extreme weather conditions such as more intense hurricanes, thunderstorms, tornadoes and snow or ice storms, as well as rising sea levels and increased volatility in seasonal temperatures. Extreme weather conditions can interfere with our services and increase our costs, and damage resulting from extreme weather may not be fully insured. However, at this time, we are unable to determine the extent to which climate change may lead to increased storm or weather hazards affecting our operations.

Clean Air Act

The federal Clean Air Act (“CAA”) and comparable state laws that regulate air emissions affect coal mining operations both directly and indirectly. Direct impacts on coal mining may occur through permitting requirements and/or emission control requirements relating to particulate matter, such as fugitive dust, or fine particulate matter measuring 2.5 micrometers in diameter or smaller. The CAA indirectly affects our mining operations by extensively regulating the air emissions of sulfur dioxide, nitrogen oxides, mercury, ozone and other compounds emitted by steel manufacturers, coke ovens and coal-fired utilities. As described above, existing and proposed regulations also subject GHG emissions to regulation under the CAA.

Clean Water Act

The federal CWA and corresponding state and local laws and regulations affect our operations by restricting the discharge of pollutants, including dredged and fill materials, into waters of the United States. CWA requirements that may directly or indirectly affect our operations include the following:

•

Water Discharge . The CWA and corresponding state laws affect our operations by imposing restrictions on discharges of wastewater into creeks and streams. These restrictions, more often than not, require us to pre-treat the wastewater prior to discharging it. Permits requiring regular monitoring and compliance with effluent limitations and reporting requirements govern the discharge of pollutants into regulated waters. Our mining operations maintain water discharge permits as required under the National Pollutant Discharge Elimination System program of the CWA. We believe that we have obtained all permits required under the CWA and corresponding state laws and are in substantial compliance with such permits. However, new requirements under the CWA and corresponding state

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laws may cause us to incur significant additional costs that could adversely affect our operating results. For instance, stringent water quality standards for materials such as selenium have recently been issued. We have begun to incorporate these new requirements into our current permit applications; however, there can be no guarantee that we will be able to meet these or any other new standards with respect to our permit applications.

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Dredge and Fill Permits . Many mining activities, such as the development of refuse impoundments, fresh water impoundments, refuse fills, and other similar structures, may result in impacts to waters of the United States, including wetlands, streams and, in certain instances, man-made conveyances that have a hydrologic connection to such streams or wetlands. Under the CWA, coal companies are required to obtain a Section 404 permit from the USACE prior to conducting such mining activities. The USACE is authorized to issue general “nationwide” permits for specific categories of activities that are similar in nature and that are determined to have minimal adverse effects on the environment. Permits issued to Nationwide Permit 21 generally authorize the disposal of dredged and fill material from surface coal mining activities into waters of the United States, subject to certain restrictions. The USACE may also issue individual permits for mining activities that do not qualify for Nationwide Permit 21.

Recent regulatory actions and court decisions have created some uncertainty over the scope of CWA jurisdiction. On June 29, 2015, in response to a 2006 Supreme Court decision discussing the scope of CWA jurisdiction, the EPA and the USACE jointly promulgated final rules redefining the scope of waters protected under the CWA, revising regulations that had been in place for more than 25 years. The new rules may expand the scope of CWA jurisdiction, making more waters subject to the CWA’s permitting and other requirements in the case of discharges. Following its promulgation, numerous industry groups, states, and environmental groups challenged the rule and on October 9, 2015, a federal court stayed the rule’s implementation nationwide, pending further action in court. In response to this decision, the EPA and the USACE have resumed nationwide use of the agencies’ prior regulations defining the term “waters of the United States.” Further, on February 28, 2017, President Trump signed an executive order directing the relevant executive agencies to review the rules and to conduct notice and comment rulemaking to rescind or revise them, as appropriate under the stated policies of protecting navigable waters from pollution while promoting economic growth, reducing uncertainty, and showing due regard for Congress and the states. It remains unclear whether and how the results of the 2016 U.S. election could further impact regulatory developments in this area.

Resource Conservation and Recovery Act

The Resource Conservation and Recovery Act (“RCRA”) and corresponding state laws establish standards for the management of solid and hazardous wastes generated at our various facilities. Besides affecting current waste disposal practices, RCRA also addresses the environmental effects of certain past hazardous waste treatment, storage and disposal practices. In addition, RCRA also requires certain of our facilities to evaluate and respond to any past release, or threatened release, of hazardous waste that may pose a risk to human health or the environment.

RCRA may affect coal mining operations by establishing requirements for the proper management, handling, transportation and disposal of solid and hazardous wastes. Currently, certain coal mine wastes, such as earth and rock covering a mineral deposit (commonly referred to as overburden) and coal cleaning wastes, are exempted from hazardous waste management under RCRA. Any change or reclassification of this exemption could significantly increase our coal mining costs.

On April 17, 2015, the EPA published its final power plant coal ash disposal rule. The rule regulates coal ash as a solid waste under Subtitle D of RCRA. The rule requires closure of sites that fail to meet prescribed engineering standards, requires regular inspections of impoundments, establishes limits on the location of new sites, and requires immediate remediation and closure of unlined ponds that are polluting ground water.

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However, the rule gives states flexibility on how to implement and enforce the rule and allows citizen suits to be filed against coal ash pond operators. The rule does not regulate closed coal ash impoundments unless located at active power plants. The rule likely will impose added costs for coal-fired power plants and may adversely affect the demand for coal.

Comprehensive Environmental Response, Compensation and Liability Act

The Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA” or “Superfund”) and similar state laws affect our met coal mining operations by, among other things, imposing investigation and cleanup requirements for threatened or actual releases of hazardous substances. Under CERCLA, joint and several liability may be imposed on operators, generators, site owners, lessees and others regardless of fault or the legality of the original activity that caused or resulted in the release of the hazardous substances. Although the EPA excludes most wastes generated by coal mining and processing operations from the hazardous waste laws, the universe of materials and substances governed by CERCLA is broader than “hazardous waste” and as such even non-hazardous wastes can, in certain circumstances, contain hazardous substances, which if released into the environment are governed by CERCLA. Alabama’s version of CERCLA mirrors the federal version with the important difference that there is no joint and several liability. Liability is consistent with one’s contribution to the contamination. In addition, the disposal, release or spilling of some products used by coal companies in operation, such as chemicals, could trigger the liability provisions of CERCLA or similar state laws. Thus, we may be subject to liability under CERCLA and similar state laws for properties that (1) we currently own, lease or operate, (2) we, our predecessors, or former subsidiaries have previously owned, leased or operated, (3) sites to which we, our predecessors or former subsidiaries, sent waste materials, and (4) sites at which hazardous substances from our facilities’ operations have otherwise come to be located.

Endangered Species Act and Similar Laws

The federal Endangered Species Act and other related federal and state statutes, such as the federal Bald and Golden Eagle Protection Act, protect species threatened or endangered with possible extinction. Protection of threatened, endangered and other special status species may have the effect of prohibiting or delaying us from obtaining mining permits and may include restrictions on our activities in areas containing the affected species. Also, the designation of previously unidentified threatened, endangered or special status species in areas where we operate could cause us to incur additional costs or become subject to operating delays, restrictions or bans.

Seasonality

Our primary business is not materially impacted by seasonal fluctuations. Demand for met coal is generally more heavily influenced by other factors such as the global economy, interest rates and commodity prices.

Employees and Labor

As of December 31, 2016, we had 1,130 employees, of whom 791 were hourly employees and 339 were salaried employees, and of whom approximately 68% were covered by the UMWA CBA, which expires on March 31, 2021. We have not had any union-organized work stoppages since our inception. We believe that we have good relationships with our employees and with the unions representing our employees.

Legal Proceedings

We are involved in various legal proceedings occurring in the ordinary course of business. It is the opinion of management, after consultation with legal counsel, that these matters will not materially affect our consolidated financial position, results of operations or cash flows.

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The Company is subject to a wide variety of laws and regulations concerning the protection of the environment, both with respect to the construction and operation of its plants, mines and other facilities and with respect to remediating environmental conditions that may exist at its own and other properties. See “—Environmental and Regulatory Matters” for additional information. The Company believes that it is in substantial compliance with federal, state and local environmental laws and regulations. The Company accrues for environmental expenses resulting from existing conditions that relate to past operations when the costs are probable and can be reasonably estimated.

Additional Information

Our principal executive offices are located at 16243 Highway 216, Brookwood, AL 35444, and our telephone number at that address is (205) 554-6150. Our website address is www.warriormetcoal.com. Information contained on our website is not incorporated by reference herein and does not constitute part of this prospectus.

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MANAGEMENT

Executive Officers and Directors

The following table provides information regarding our executive officers and directors as of March 6, 2017. Certain members of our current board of managers were nominated and appointed by the Principal Shareholders pursuant to the terms of the LLC Agreement. See “—Our Board of Directors and Committees” and “Certain Relationships and Related Party Transactions—Composition of Our Board of Managers under the LLC Agreement.”


Name	Age		Position
Walter J. Scheller, III		56	Chief Executive Officer and Director
Dale W. Boyles		56	Chief Financial Officer
Michael T. Madden		65	Chief Commercial Officer
Kelli K. Gant		45	Chief Administrative Officer and Secretary
Jack K. Richardson		55	Chief Operating Officer
Brian M. Chopin		34	Chief Accounting Officer and Controller
Stephen D. Williams		53	Chairman of the Board
Keith Luh		42	Director
Blaine MacDougald		38	Director
Matthew R. Michelini		35	Director
Darren L. Richman		45	Director
Gareth Turner		53	Director
			Director Nominee
			Director Nominee

Set forth below is a description of the backgrounds of our executive officers and directors.

Walter J. Scheller, III was appointed as our Chief Executive Officer and as one of our directors in connection with the Asset Acquisition. Mr. Scheller was the Chief Executive Officer of Walter Energy from September 2011 to March 2016, and served as President and Chief Operating Officer of Walter Energy’s primary subsidiary, Jim Walter Resources, Inc. from June 2010 to September 2011. On July 15, 2015, the Walter Energy Debtors filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code. Prior to joining Walter Energy, he served as Senior Vice President—Strategic Operations of Peabody Energy Corporation (“Peabody”) from June 2006 to June 2010. Prior to his career at Peabody, Mr. Scheller worked for CNX Gas Corporation as Vice President and, prior to that, at Consol Energy where he held a number of executive and operational roles, the last of which was Vice President—Operations. Mr. Scheller previously served as director of Walter Energy. Mr. Scheller graduated from West Virginia University with a Bachelor of Science degree in Mining Engineering, and received his Juris Doctor degree from Duquesne University and his Master of Business Administration degree from the University of Pittsburgh—Joseph M. Katz Graduate School of Business.

Mr. Scheller is the only officer of our company who also serves as a director. With over 32 years of experience in the mining sector, Mr. Scheller has significant knowledge of the coal mining industry, as well as leadership, executive management and operational experience. For these reasons, we believe Mr. Scheller is qualified to serve as a director.

Dale W. Boyles has been our Chief Financial Officer since January 2017. From November to December 2016, he provided consulting services to us. Mr. Boyles was the Chief Financial Officer of Noranda Aluminum Holding Corporation (formerly NYSE listed under “NOR”), a primary aluminum and aluminum coil manufacturer from November 2013 to November 2016. While in that role, he oversaw the voluntary reorganization under Chapter 11 of the U.S. Bankruptcy Code of Noranda in 2016. From 2006 to June 2012, Mr. Boyles served in several capacities for Hanesbrands, Inc. (NYSE listed under “HBI”), an apparel company,

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including Operating Chief Financial Officer from October 2011 to June 2012, Interim Chief Financial Officer from May 2011 to October 2011 and Vice President, Controller and Chief Accounting Officer from 2006 to May 2011. From 1997 to 2006, he served in various capacities for KPMG LLP, most recently as Audit Partner, Consumer & Industrial Markets. Mr. Boyles was Corporate Division Controller for Collins & Aikman Corporation from 1993 to 1996. Mr. Boyles graduated from the University of North Carolina—Charlotte with a Bachelor of Science degree in Accounting.

Michael T. Madden was appointed as our Chief Commercial Officer in connection with the Asset Acquisition. Mr. Madden was the Senior Vice President and Chief Commercial Officer of Walter Energy from May 2012 to March 2016 and, prior to that, the Senior Vice President of Marketing of Walter Energy from April 2011 to May 2012. On July 15, 2015, the Walter Energy Debtors filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code. Mr. Madden joined Walter Energy after having spent 13 years at Walter Energy’s primary subsidiary, Jim Walter Resources, Inc., where he held positions as the Senior Vice President of Sales and Marketing from February 2010 to April 2011 and as the Vice President of Marketing, Transportation and Quality Control from February 1997 to February 2010. Mr. Madden graduated from St. Bonaventure University with a Bachelor of Science degree in Marketing.

Kelli K. Gant was appointed as our Chief Administrative Officer in connection with the Asset Acquisition and as our Secretary in January 2017. Ms. Gant was the Director—Benefits at Walter Energy from December 2009 to July 2011 and the VP—Human Resources at Walter Energy from August 2011 to March 2016. Before joining Walter Energy, she was the Senior Vice President and Corporate Benefits Director of Colonial Bank from December 2008 to November 2009 and the Senior Vice President and Institutional Services Manager of Regions Morgan Keegan Trust from October 2000 to July 2007. Ms. Gant graduated from Auburn University at Montgomery with a Bachelor of Science degree in Human Resources Management, and received her Juris Doctor degree from Jones School of Law at Faulkner University.

Jack K. Richardson was appointed as our Chief Operating Officer in connection with the Asset Acquisition. Mr. Richardson was the Vice President of Murray Energy from September 2015 to March 2016. From June 2014 to August 2015, he served as the Chief Executive Officer of White Oak Resources, LLC. Mr. Richardson was employed by Consol Energy for over 30 years, with his most recent position being Vice President of Coal Operations. Mr. Richardson has worked in the energy sector for over 30 years and has experience in all basins east of the Mississippi River. Mr. Richardson graduated from Bluefield State College with a Bachelor of Science degree in Mining Engineering Technology and an Associate of Science degree in Business Management.

Brian M. Chopin was appointed as our Chief Accounting Officer and Controller in connection with the Asset Acquisition. Mr. Chopin was appointed as Chief Accounting Officer and Controller of Walter Energy in May 2015. On July 15, 2015, the Walter Energy Debtors filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code. Mr. Chopin was the Assistant Corporate Controller from January 2014 to May 2015 and the SEC Reporting Manager from July 2012 to January 2014, of Walter Energy. Before joining Walter Energy, Mr. Chopin was an Audit Manager at KPMG in its Assurance and Advisory Business Services practice from September 2006 to July 2012. Mr. Chopin graduated from the University of Mississippi with a Bachelor of Science degree in Accounting and a Master of Accounting degree with an emphasis in taxation.

Stephen D. Williams has served as the Chairman of our board of directors since the Asset Acquisition. Mr. Williams has been a consultant at Stephen D. Williams Consulting since July 2015. He has extensive experience working as an executive in the coal industry. From January 2013 to February 2015, he was the Chief Executive Officer of Mechel Bluestone, Inc. Prior to that, he was the Chief Operating Officer of NRI, LLC, where he focused on coal acquisition, from October 2010 to December 2012, and the Chief Operating Officer of INR Energy, LLC, a coal company, from October 2009 to August 2010. From August 2007 to September 2009, Mr. Williams was the Senior Vice President of North American Coal at Cliffs Natural Resources. Mr. Williams graduated from West Virginia University’s College of Mineral and Energy Resources with a Bachelor of Science degree in Mining Engineering, and received his Juris Doctor degree from West Virginia University’s College of Law.

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Mr. Williams has considerable experience in all facets of multiple coal operations, including the operation of longwall coal mines. For these reasons, we believe Mr. Williams is qualified to serve as a director.

Keith Luh has served as one of our directors since the Asset Acquisition. Mr. Luh joined Franklin Mutual Advisers, LLC in 2005, where he is a Portfolio Manager and Head of Cross-Asset Investing. Prior to joining Franklin Mutual Advisers, LLC, Mr. Luh was a senior analyst in global investment research at Putnam Investments. Previously, he worked in the investment banking group at Volpe Brown Whelan and Co., LLC, and the derivative products trading group at BNP. Mr. Luh is also Adjunct Professor in Finance and Economics at the Graduate School of Business, Columbia University. In addition to his position on our board of directors, Mr. Luh serves on the board of Sorenson Holdings LLC. Mr. Luh is a CFA Charterholder. He graduated from the University of Pennsylvania with a Bachelor of Arts degree in Economics and a Minor in History and received his Master of Business Administration degree from Columbia University.

Mr. Luh has experience financing, analyzing and investing in public and private companies, including transactions in mining and related sectors. For this reason, we believe Mr. Luh is qualified to serve as a director.

Blaine MacDougald has served as one of our directors since the Asset Acquisition. Mr. MacDougald joined KKR & Co., L.P. in 2011, where he is a Director and Co-Head of European Special Situations. Prior to joining KKR, he was employed by D.E. Shaw & Co. as a Vice President from 2006 to 2011, where he focused on credit and private equity investments and served on the board of directors of several portfolio companies. Previously, Mr. MacDougald worked at RBC Capital Markets. Mr. MacDougald is a CFA Charterholder and graduated from Queen’s University in Canada with a Bachelor of Science degree in Mechanical Engineering.

Mr. MacDougald has considerable experience financing, analyzing and investing in public and private companies, including transactions in the mining and related sectors. For this reason, we believe Mr. MacDougald is qualified to serve as a director.

Matthew R. Michelini has served as one of our directors since the Asset Acquisition. Mr. Michelini is a partner at Apollo Global Management, LLC, which he joined in 2006. At Apollo, Mr. Michelini has executed deals across the world, including in North America, Europe and Asia. From 2004 to 2006, prior to joining Apollo, Mr. Michelini was a member of the Mergers & Acquisitions group at Lazard Frères & Co. Mr. Michelini has served on the boards of directors of Athene Holding Ltd. since 2010, Aleris Corporation since 2015 and Athene Asset Management, L.P. since 2013, and previously served as a director of Metals USA Holdings Corp. (formerly NYSE listed under “MUSA”) and Noranda Aluminum Holding Corporation (formerly NYSE listed under “NOR”). Mr. Michelini is actively involved in various charities dedicated to helping underprivileged children in New York City. Mr. Michelini graduated from Princeton University with a Bachelor of Science degree in Mathematics and a Certificate in Finance, and received his Master of Business Administration degree from Columbia University.

Mr. Michelini is a partner at Apollo and has over 10 years’ experience financing, analyzing and investing in public and private companies, many of which were in the metals and mining sector. Mr. Michelini provides valuable insights to our board of directors. For these reasons, we believe Mr. Michelini is qualified to serve as a director.

Darren L. Richman has served as one of our directors since July 2016. Mr. Richman was formerly a Senior Managing Director with The Blackstone Group from September 2006 to December 2016. He focused on special situation and distressed investments and was a member of GSO’s Investment Committee. Before joining GSO Capital Partners in 2006, Mr. Richman worked at DiMaio Ahmad Capital, where he was a founding member and the co-head of its investment research team. Prior to joining DiMaio Ahmad Capital, Mr. Richman was a Vice President and Senior Special Situations Analyst at Goldman, Sachs & Co. Mr. Richman began his career with Deloitte & Touche, and ultimately served as a Manager in the firm’s Mergers & Acquisitions Services Group. Mr. Richman is a member of the boards of directors of Sorenson Communications and Outward Bound USA and is a member of the Economic Club of New York. He previously served on the board of directors of Seneca

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Mortgage. Mr. Richman graduated from the University of Hartford with Bachelor of Arts and Bachelor of Science degrees in Accounting, and received his Masters of Business Administration degree from NYU’s Stern School of Business. He was formerly a Certified Public Accountant and a Member of the American Institute of Certified Public Accountants.

Mr. Richman has considerable experience completing and managing special situation and distressed investments. For these reasons, we believe Mr. Richman is qualified to serve as a director.

Gareth Turner has served as one of our directors since the Asset Acquisition. Mr. Turner joined Apollo Private Equity in 2005, where he is a Senior Partner focused on the firm’s natural resource activities. From 1997 to 2005, Mr. Turner was employed by Goldman Sachs as a Managing Director in its Industrial and Natural Resources investment banking group. From 2003 to 2005, Mr. Turner was head of Goldman Sachs’ Global Metals and Mining Group and managed the firm’s investment banking relationships with the major companies in the sector. He has a broad range of experience in both capital markets and merger and acquisition transactions. Prior to joining Goldman Sachs, Mr. Turner was employed at Lehman Brothers from 1992 to 1997, by Salomon Brothers from 1991 to 1992 and by RBC Dominion Securities from 1986 to 1989. Mr. Turner served on the board of directors of Constellium Holdco N.V. from 2010 to 2014 and Noranda Aluminum Holding Corporation (formerly NYSE listed under “NOR”) from 2007 to 2014. Mr. Turner graduated from the University of Toronto with a Bachelor of Arts degree in Economics, and received his Master of Business Administration degree from the University of Western Ontario School of Business Administration.

Mr. Turner has considerable experience completing and managing private equity investments on behalf of Apollo. With over 20 years’ experience financing, analyzing and investing in public and private companies, many of which were in the metals and mining sector, Mr. Turner also provides valuable insights to our board of directors. For these reasons, we believe Mr. Turner is qualified to serve as a director.

Our Board of Directors and Committees

Our business and affairs are currently managed by our limited liability company board of managers, which consists of seven members. Upon the corporate conversion, prior to the effectiveness of the registration statement of which this prospectus forms a part, the members of our board of managers will become our board of directors, and we refer to them as such. Upon the effective date of the registration statement of which this prospectus forms a part, the size of the board of directors will be increased from seven directors to nine directors. Effective upon the corporate conversion, our certificate of incorporation and bylaws will provide that our board of directors will consist of a single class of directors and that the terms of office of the directors will be one year from the time of their election until the next annual meeting of stockholders or until their successors are duly elected and qualified.

Our certificate of incorporation will provide that the authorized number of directors will generally be not less than nor more than , and the exact number of directors will be fixed from time to time exclusively by our board of directors pursuant to a resolution adopted by a majority of the whole board. In addition, our certificate of incorporation and bylaws will provide that, in general, vacancies on our board of directors may be filled by a majority of directors in office, although less than a quorum.

In evaluating director candidates, our board of directors will assess whether a candidate possesses the integrity, judgment, knowledge, experience, skill and expertise that are likely to enhance the ability of our board of directors to manage and direct our affairs and business, including, when applicable, to enhance the ability of committees of our board of directors to fulfill their duties. We have no minimum qualifications for director candidates. In general, however, our board of directors will review and evaluate both incumbent and potential new directors in an effort to achieve diversity of skills and experience among our directors and in light of the following criteria:

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experience in business, government, education, technology or public interests;

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•

high-level managerial experience in large organizations;

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breadth of knowledge regarding our business or industry;

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specific skills, experience or expertise related to an area of importance to us, such as energy production, consumption, distribution or transportation, government, policy, finance or law;

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moral character and integrity;

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commitment to our stockholders’ interests;

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ability to provide insights and practical wisdom based on experience and expertise;

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ability to read and understand financial statements; and

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ability to devote the time necessary to carry out the duties of a director, including attendance at meetings and consultation on company matters.

Although we do not have a policy in regard to the consideration of diversity in identifying director nominees, qualified candidates for nomination to our board of directors will be considered without regard to race, color, religion, gender, ancestry or national origin.

Director Independence

Our board of directors has determined that, under NYSE listing standards and taking into account any applicable committee standards and rules under the Exchange Act, each of is an independent director. We will rely on the phase-in rules of the NYSE with respect to the independence of the members of our board of directors. In accordance with these rules, our board of directors will be comprised of a majority of independent directors within one year of the listing date.

Audit Committee

Our board of directors will establish an audit committee in connection with this offering. will serve as the initial members of our audit committee, and our board of directors has determined that is an audit committee financial expert, as defined by the SEC, and the other members of our audit committee will satisfy the financial literacy standards for audit committee members under these rules and listing standards. It has been further determined that is “independent” under the standards of the NYSE and SEC regulations. We will rely on the phase-in rules of the SEC and the NYSE with respect to the independence of our audit committee. These rules permit us to have an audit committee that has one member that is independent upon the effectiveness of the registration statement of which this prospectus forms a part, a majority of members that are independent within 90 days thereafter and all members that are independent within one year thereafter. The functions of the audit committee will include the following:

•

assist our board of directors in its oversight responsibilities regarding the integrity of our financial statements, our compliance with legal and regulatory requirements, the independent accountant’s qualifications and independence and our accounting and financial reporting processes of and the audits of our financial statements;

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prepare the report required by the SEC for inclusion in our annual proxy or information statement;

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appoint, retain, compensate, evaluate and terminate our independent accountants;

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approve audit and non-audit services to be performed by the independent accountants;

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review and approve related party transactions; and

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perform such other functions as our board of directors may from time to time assign to the audit committee.

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The specific functions and responsibilities of the audit committee will be set forth in the audit committee charter.

Compensation Committee

Our board of directors will establish a compensation committee in connection with this offering, whose functions will include the following: establishing salaries, incentives and other forms of compensation for officers and other employees, and administering our incentive compensation and benefit plans. will serve as the initial members of our compensation committee. We will rely on the phase-in rules of the NYSE with respect to the independence of our compensation committee. These rules permit us to have a compensation committee that has one member that is independent upon listing, a majority of members that are independent within 90 days thereafter and all members that are independent within one year thereafter. The specific functions and responsibilities of the compensation committee will be set forth in the compensation committee charter.

Nominating and Governance Committee

Our board of directors will establish a nominating and governance committee in connection with this offering, whose functions will include the following: identifying, evaluating and recommending qualified nominees to serve on our board of directors, developing and overseeing our internal corporate governance processes and maintaining a management succession plan. will serve as the initial members of our nominating and governance committee. We will rely on the phase-in rules of the NYSE with respect to the independence of our nominating and governance committee. These rules permit us to have a nominating and governance committee that has one member that is independent upon listing, a majority of members that are independent within 90 days thereafter and all members that are independent within one year thereafter. The specific functions and responsibilities of the nominating and governance committee will be set forth in the nominating and governance committee charter.

Pursuant to our bylaws, our board of directors will be able to, from time to time, establish other committees to facilitate the management of our business and operations.

Code of Ethics

In connection with the closing of this offering, our board of directors will adopt a code of business conduct and ethics (the “Code of Conduct”) that will apply to all directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer. Upon the closing of this offering, the Code of Conduct will be available in the Corporate Governance section of our website at www.warriormetcoal.com. The contents of our website are not incorporated by reference herein or otherwise a part of this prospectus.

Corporate Governance Guidelines

Our board of directors will adopt corporate governance guidelines in accordance with the corporate governance rules of the NYSE.

Director Compensation Following this Offering

Following the completion of this offering, our independent non-employee directors will receive cash and equity-based compensation for their services as directors, as follows:

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an annual cash retainer of $ ;

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an additional annual cash retainer of $ for membership on the audit committee and $ for membership on the compensation committee, nominating and governance committee or any other board committee;

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an additional annual retainer of $ for service as the chair of the audit committee, the compensation committee or the nominating and governance committee and $ for service as the chair of any other board committee; and

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an annual award of restricted stock granted under our 2016 Equity Incentive Plan having a value as of the grant date of $ , vesting in equal annual installments.

Directors will also receive reimbursement for out-of-pocket expenses associated with attending board or committee meetings and director and officer liability insurance coverage. Each director will be fully indemnified by us for actions associated with being a director to the fullest extent permitted under Delaware law. In connection with this offering, we intend to enter into separate indemnification agreements with each of our directors and executive officers, which may be broader than the specific indemnification provisions contained in Delaware law.

Compensation Committee Interlocks and Insider Participation

Our board of directors will establish a compensation committee in connection with this offering. None of our executive officers serves, or has served during the past year, as a member of our board of directors or compensation committee of any other company that has one or more executive officers serving as a member of our board of directors or compensation committee.

Executive Compensation

Impact of Offering

In connection with the corporate conversion, prior to the effectiveness of the registration statement of which this prospectus forms a part, we will convert all awards of restricted Class C units and phantom Class C units issued pursuant to the Warrior Met Coal, LLC 2016 Equity Incentive Plan such that, with respect to the number of Class C units underlying such awards prior to the corporate conversion, the awards will be converted into awards in respect of an equivalent number of shares of our common stock following the corporate conversion. The vesting and other terms of the options will generally remain the same.

2016 Summary Compensation Table

The following table summarizes the total compensation for each of our named executive officers, who are identified in the following table, for services rendered during our fiscal year ended December 31, 2016.


Name and principal position	Year		Salary ($) ⁽¹⁾		Bonus ($) ⁽²⁾		Stock Awards ($) ⁽³⁾		Option Awards ($)		Non-equity Incentive Plan Compensation ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensation ($) ⁽⁴⁾		Total ($)
Walter J. Scheller, III; Chief Executive Officer		2016		634,231		480,000		1,225,463		—		—		—		46,916		2,386,610
Jack K. Richardson; Chief Operating Officer		2016		242,656		355,000		612,768		—		—		—		92,550		1,302,974
Michael T. Madden; Chief Commercial Officer		2016		328,380		227,000		363,100		—		—		—		38,952		957,432

(1)

Mr. Richardson’s base salary was pro-rated based on his start date with our Predecessor on March 21, 2016. Messrs. Scheller, Richardson and Madden received total base salaries of $634,231, $242,656 and $328,380, respectively, in 2016, including $429,231 from the Company following the Asset Acquisition and $205,000 from our Predecessor prior to the Asset Acquisition for Mr. Scheller, $232,500 from the Company following the Asset Acquisition and $10,156 from our Predecessor prior to the Asset Acquisition for Mr. Richardson and $228,923 from the Company following the Asset Acquisition and $99,457 from our Predecessor prior to the Asset Acquisition for Mr. Madden.

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(2)

On August 8, 2016, Messrs. Richardson and Madden were paid discretionary cash bonuses of $75,000 and $35,000, respectively, under a bonus plan to incentivize performance within the first 100 days following the Asset Acquisition. In addition, in January 2017, Messrs. Scheller, Richardson and Madden received discretionary annual bonuses of $480,000, $280,000 and $192,000, respectively, with respect to fiscal year 2016.

(3)

The amounts in this column represent the aggregate grant date fair value of stock awards issued to our named executive officers in accordance with FASB ASC Topic 718. On April 1, 2016, Mr. Scheller was granted 16,875 restricted units. On April 20, 2016, Messrs. Richardson and Madden were granted 8,438 and 5,000 restricted units, respectively.

(4)

For Mr. Scheller, the amounts in this column include: (i) $20,733 in employer-paid health and welfare benefit insurance costs; (ii) $10,027 in the Company’s matching contribution to the Warrior Met Coal, LLC Salaried 401(k) Plan (the “401(k) Plan”); (iii) $10,523 in a car allowance; and (iv) $5,633 in a tax gross-up for group-term life benefits. For Mr. Richardson, the amounts in this column include: (i) $15,061 in employer-paid health and welfare benefit insurance costs; (ii) $13,250 in the Company’s matching contribution to the 401(k) Plan; (iii) $696 for a Company car; (iv) $1,088 in a tax gross-up related to group-term life benefit; and (v) $62,455 in relocation benefits. For Mr. Madden, the amounts in this column include: (i) $19,574 in employer-paid health and welfare benefit insurance costs; (ii) $13,196 in the Company’s matching contribution to the 401(k) Plan; (iii) $1,291 for a Company car; and (iv) $4,891 in a tax gross-up related to group-term life benefits.

Employment Agreements

We have entered into an employment agreement with each of Messrs. Scheller, Richardson and Madden, as described below.

Walter J. Scheller, III. We entered into an employment agreement with Walter J. Scheller, III effective April 1, 2016, pursuant to which Mr. Scheller serves as our Chief Executive Officer and as a member of our board of directors. The term of the agreement is indefinite. Mr. Scheller’s annual base salary is $600,000. He is eligible to receive an annual bonus with a target award equal to 100% of his base salary contingent upon the achievement of performance goals approved by our board of directors. In addition, pursuant to his employment agreement, Mr. Scheller was eligible to, however, he ultimately did not, receive an award under a bonus plan to incentivize performance within the first 100 days following the Asset Acquisition.

In the event that we terminate Mr. Scheller’s employment without “Cause” (as defined below) or Mr. Scheller resigns for “Good Reason” (as defined below), subject to Mr. Scheller’s execution of a release of claims in a form that we reasonably determine and his compliance with the restrictive covenants described below, we will provide Mr. Scheller with severance as follows: (i) an amount equal to one times his base salary, payable in substantially equal installments for one year following the date of such termination, (ii) if such termination should occur following the third quarter of our fiscal year, a pro-rated bonus payment for the year of termination based on our actual results for such year and (iii) if such termination should occur within 30 days prior to a vesting date relating to an equity award previously granted to Mr. Scheller, vesting of the portion of the award that would have become vested within such 30-day period.

In the event that we terminate Mr. Scheller’s employment without Cause or Mr. Scheller resigns for Good Reason within 12 months following the occurrence of a “Change in Control” (as defined in his employment agreement), subject to Mr. Scheller’s execution of a release of claims in a form that we reasonably determine and compliance with the restrictive covenants described below, we will provide Mr. Scheller with severance in an amount equal to two times his base salary, payable as a lump sum and in lieu of the severance described above.

If any of our financial statements are required to be restated due to errors, omissions, fraud or misconduct (including, but not limited to circumstances where we have been required to prepare an accounting restatement due to material non-compliance with any financial reporting requirement), we may recover all or a portion of any cash incentive, equity compensation or severance disbursements paid to Mr. Scheller with respect to any fiscal year for which the financial results are negatively affected by such restatement.

Mr. Scheller is subject to a (i) 12-month post-termination non-competition covenant relating to our or our subsidiaries’ business, (ii) 24-month post-termination non-solicitation covenant in respect of our or our

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subsidiaries or affiliates’ employees, representatives, agents, consultants, customers, suppliers, licensees, licensors and other business relationships and (iii) perpetual confidentiality and non-disparagement covenants.

Jack K. Richardson. We entered into an employment agreement with Jack K. Richardson effective April 1, 2016, pursuant to which Mr. Richardson serves as our Chief Operating Officer. The term of the agreement is indefinite. Pursuant to his employment agreement, Mr. Richardson’s annual base salary was $325,000. Effective January 1, 2017, his annual base salary was increased to $355,000. He is eligible to receive an annual bonus with a target award equal to 100% of his base salary contingent upon the achievement of performance goals approved by our board of directors. In addition, pursuant to his employment agreement, Mr. Richardson was eligible to receive an award under a bonus plan to incentivize performance within the first 100 days following the Asset Acquisition.

In the event that we terminate Mr. Richardson’s employment without “Cause” (as defined below) or Mr. Richardson resigns for “Good Reason” (as defined below), subject to Mr. Richardson’s execution of a release of claims in a form that we reasonably determine and compliance with the restrictive covenants described below, we will provide Mr. Richardson with severance as follows: (i) an amount equal to one times his base salary, payable in substantially equal installments for one year following the date of such termination, (ii) if such termination should occur following the third quarter of our fiscal year, a pro-rated bonus payment for the year of termination based on our actual results for such year and (iii) if such termination should occur within 30 days prior to a vesting date relating to an equity award previously granted to Mr. Richardson, vesting of the portion of the award that would have become vested within such 30-day period.

In the event that we terminate Mr. Richardson’s employment without Cause or Richardson resigns for Good Reason within 12 months following the occurrence of a “Change in Control” (as defined in his employment agreement), subject to Mr. Richardson’s execution of a release of claims in a form that we reasonably determine and compliance with the restrictive covenants described below, we will provide Mr. Richardson with severance in an amount equal to one and one-half times his base salary, payable as a lump sum and in lieu of the severance described above.

If any of our financial statements are required to be restated due to errors, omissions, fraud or misconduct (including, but not limited to circumstances where we have been required to prepare an accounting restatement due to material non-compliance with any financial reporting requirement), we may recover all or a portion of any cash incentive, equity compensation or severance disbursements paid to Mr. Richardson with respect to any fiscal year for which the financial results are negatively affected by such restatement.

Mr. Richardson is subject to a (i) 12-month post-termination non-competition covenant relating to our or our subsidiaries’ business, (ii) 24-month post-termination non-solicitation covenant in respect of our or our subsidiaries or affiliates’ employees, representatives, agents, consultants, customers, suppliers, licensees, licensors and other business relationships and (iii) perpetual confidentiality and non-disparagement covenants.

Michael T. Madden. We entered into an employment agreement with Michael T. Madden effective April 1, 2016, pursuant to which Mr. Madden serves as our Chief Commercial Officer. The term of the agreement is indefinite. Mr. Madden’s annual base salary is $320,000. He is eligible to receive an annual bonus with a target award equal to 75% of his base salary contingent upon the achievement of performance goals approved by our board of directors. In addition, pursuant to his employment agreement, Mr. Madden was eligible to receive an award under a bonus plan to incentivize performance within the first 100 days following the Asset Acquisition.

In the event that we terminate Mr. Madden’s employment without “Cause” (as defined below) or he resigns for “Good Reason” (as defined below), subject to Mr. Madden’s execution of a release of claims in a form that we reasonably determine and compliance with the restrictive covenants described below, we will provide Mr. Madden with severance as follows: (i) an amount equal to one times his base salary, payable in substantially equal installments for one year following the date of such termination, (ii) if such termination should occur

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following the third quarter of our fiscal year, a pro-rated bonus payment for the year of termination based on our actual results for such year and (iii) if such termination should occur within 30 days prior to a vesting date relating to an equity award previously granted to Mr. Madden, vesting of the portion of the award that would have become vested within such 30-day period.

In the event that we terminate Mr. Madden’s employment without Cause or Mr. Madden resigns for Good Reason within 12 months following the occurrence of a “Change in Control” (as defined in his employment agreement), subject to Mr. Madden’s execution of a release of claims in a form that we reasonably determine and compliance with the restrictive covenants described below, we will provide Mr. Madden with severance in an amount equal to one and one-half times his base salary, payable as a lump sum and in lieu of the severance described above.

If any of our financial statements are required to be restated due to errors, omissions, fraud or misconduct (including, but not limited to circumstances where we have been required to prepare an accounting restatement due to material non-compliance with any financial reporting requirement), we may recover all or a portion of any cash incentive, equity compensation or severance disbursements paid to Mr. Madden with respect to any fiscal year for which the financial results are negatively affected by such restatement.

Mr. Madden is subject to a (i) 12-month post-termination non-competition covenant relating to our or our subsidiaries’ business, (ii) 24-month post-termination non-solicitation covenant in respect of our or our subsidiaries or affiliates’ employees, representatives, agents, consultants, customers, suppliers, licensees, licensors and other business relationships and (iii) perpetual confidentiality and non-disparagement covenants.

For purposes of these employment agreements, “Cause” means the applicable executive’s (i) commission of, conviction for, plea of guilty or nolo contendere to a felony or a crime involving moral turpitude, or other material act or omission involving dishonesty or fraud; (ii) engaging in conduct that constitutes fraud or embezzlement; (iii) engaging in conduct that constitutes gross negligence or willful gross misconduct that results or could reasonably be expected to result in harm to our or any of our affiliate’s business or reputation; (iv) breach of any material terms of the executive’s employment, which results or could reasonably be expected to result in harm to our or any of our affiliate’s business or reputation; (v) continued willful failure to substantially perform the executive’s duties; or (vi) breach of any our or our affiliate’s material policy that is applicable to employees generally that is reasonably likely to result in demonstrable harm to the Company or our affiliate.

For purposes of these employment agreements, “Good Reason” means the applicable executive’s voluntary resignation after any of the following actions taken by the Company without the executive’s written consent: (i) a material diminution in the executive’s title or authority; (ii) any material failure to pay compensation when due; (iii) a reduction in base pay or bonus opportunity other than reductions applicable to senior executives generally occurring after December 31, 2016; (iv) relocation of the executive’s principal place of business by more than 50 miles that materially increases the executive’s commute; or (v) any other material breach of the applicable employment agreement by the Company.

Other Employment Agreements

We entered into an employment agreement with Dale W. Boyles effective January 1, 2017, pursuant to which Mr. Boyles serves as our Chief Financial Officer. The term of the agreement is indefinite. Mr. Boyles’ annual base salary is $350,000. He is eligible to receive an annual bonus with a target award equal to 100% of his base salary contingent upon the achievement of performance goals approved by our board of directors.

Mr. Boyles also received a signing bonus of $55,000 and was issued restricted units of our Class C Units with an aggregate grant date fair market value equal to approximately $675,000 pursuant to the 2016 Equity Plan. In addition, Mr. Boyles is eligible for a bonus of up $500,000 generally in connection with (i) an initial public

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offering of the Company or our subsidiaries, (ii) the acquisition of more than 50% of the combined voting power of the Company, (iii) the disposition of all or substantially of the business or assets of the Company or (iv) any merger or consolidation of the Company.

In the event that we terminate Mr. Boyles’ employment without “Cause” (as defined above) or Mr. Boyles resigns for “Good Reason” (as defined above), subject to Mr. Boyles’ execution of a release of claims in a form that we reasonably determine and his compliance with the restrictive covenants described below, we will provide Mr. Boyles with severance as follows: (i) an amount equal to one times his base salary, payable in substantially equal installments for one year following the date of such termination, (ii) if such termination should occur following the third quarter of our fiscal year, a pro-rated bonus payment for the year of termination based on our actual results for such year and (iii) if such termination should occur within 30 days prior to a vesting date relating to an equity award previously granted to Mr. Boyles, vesting of the portion of the award that would have become vested within such 30-day period.

In the event that we terminate Mr. Boyles’ employment without Cause or Mr. Boyles resigns for Good Reason within 12 months following the occurrence of a “Change in Control” (as defined in his employment agreement) subject to Mr. Boyles’ execution of a release of claims in a form that we reasonably determine and compliance with the restrictive covenants described below, we will provide Mr. Boyles with severance in an amount equal to one and one-half times his base salary, payable as a lump sum and in lieu of the severance described above.

If any of our financial statements are required to be restated due to errors, omissions, fraud or misconduct (including, but not limited to circumstances where we have been required to prepare an accounting restatement due to material non-compliance with any financial reporting requirement), we may recover all or a portion of any cash incentive, equity compensation or severance disbursements paid to Mr. Boyles with respect to any fiscal year for which the financial results are negatively affected by such restatement.

Mr. Boyles is subject to a (i) 12-month post-termination non-competition covenant relating to our or our subsidiaries’ business, (ii) 24-month post-termination non-solicitation covenant in respect of our or our subsidiaries or affiliates’ employees, representatives, agents, consultants, customers, suppliers, licensees, licensors and other business relationships and (iii) perpetual confidentiality and non-disparagement covenants.

Warrior Met Coal, LLC 2016 Equity Incentive Plan

In connection with the Asset Acquisition, we adopted the Warrior Met Coal, LLC 2016 Equity Incentive Plan (the “2016 Equity Plan”), as described below.

Purpose . The purpose of the 2016 Equity Plan is to enhance our and our affiliates’ ability to attract and retain employees, officers, managers, directors, consultants and advisors of outstanding ability and to provide employees, officers, managers, directors, consultants and advisors with an interest in the Company that is parallel to that of our unitholders (the “Members”). The 2016 Equity Plan will terminate automatically on March 31, 2026. No awards will be granted under the 2016 Equity Plan after that date, but awards granted prior to that date may extend beyond that date.

Awards . Under the 2016 Equity Plan, awards of options to purchase our Class C Units, excluding “incentive stock options” within the meaning of Code Section 424, restricted units, phantom units, unit appreciation rights and unit bonus awards may be granted. The maximum number of our Class C Units (“units”) that is authorized and reserved for issuance under the 2016 Equity Plan is 93,750, subject to adjustment for certain corporate events or changes in our capital structure.

Eligibility . Our and our affiliates’ current or prospective employees, managers, directors or consultants are eligible for awards under the 2016 Equity Plan. A written agreement will evidence the terms of each award granted under the 2016 Equity Plan.

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Units Subject to the 2016 Equity Plan . The units that may be issued pursuant to awards are our Class C Units and the maximum aggregate amount of units which may be issued upon exercise of all awards under the 2016 Equity Plan may not exceed 93,750, subject to adjustment to reflect certain corporate transactions or changes in our capital structure. If any award under the 2016 Equity Plan is forfeited, units subject to such award will be available for subsequent awards.

Administration . Our compensation committee administers the 2016 Equity Plan. Among other responsibilities, our compensation committee selects participants from among the eligible individuals, determine the number of units that will be subject to each award and determine the provisions of each award granted, including the time or times when the participant shall be permitted to receive units pursuant to an award. In general, our board of directors may amend, supplement, modify and restate, and our compensation committee may suspend or terminate, the 2016 Equity Plan at any time.

Adjustments in Capitalization . In the event of (i) any extraordinary non-cash dividend or other distribution other than an ordinary dividend (whether in the form of cash, units, other securities or property), recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of our assets or equity securities, or exchange of units or other of our securities, issuance of warrants or other rights to purchase units or other of our securities, or other similar corporate transaction or event (including, without limitation, a “Change in Control” (as defined in the 2016 Equity Plan)) that affects the units, appropriate equitable adjustments (as determined by our compensation committee) will be made to the number and kind of units (or other securities or property) with respect to which awards may be granted or awarded, the number and kind of units (or other securities or property) subject to outstanding awards, and/or the grant or exercise price with respect to any award to prevent dilution or enlargement of benefits or potential benefits intended to be made available under the 2016 Equity Plan or with respect to an award. In addition, our compensation committee may terminate any outstanding award and provide for the purchase of any such award in cash or the replacement of such award with other rights or property and/or provide that such award shall be exercisable (whether or not vested) as to all units covered thereby.

Change in Control . In the event of a “Change in Control,” our compensation committee may generally provide that, with respect to any particular outstanding award or awards: (i) all options and unit appreciation rights subject to an award will become fully vested and immediately exercisable and (ii) that any restricted period imposed upon awards will expire immediately.

Nontransferability . Awards under the 2016 Equity Plan are subject to transfer restrictions as set forth in the plan and the LLC Agreement.

Restrictive Covenants . The 2016 Equity Plan subjects participants to a (i) 18-month post-termination non-competition covenant relating to the coal mining business, (ii) 18-month post-termination non-solicitation covenant in respect to our or our affiliates’ employees, consultants, customer, supplier, licensee, licensor or other business relationships and (iii) perpetual confidentiality and non-disparagement covenants.

No Rights as a Member . No participant shall be deemed to be the holder of, or to have any of the rights of a holder with respect to, any units subject to such award unless and until such units have been delivered to such participant upon satisfaction of the conditions, if any, for such delivery.

In connection with this offering, Class C Units of Warrior Met Coal, LLC, including Class C Units subject to awards issued under the 2016 Equity Plan, will convert into an aggregate of shares of our common stock as described under “Corporate Conversion.” The 2016 Equity Plan will remain in effect with respect to such converted awards following the completion of this offering.

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Warrior Met Coal, LLC 2016 Equity Incentive Plan Restricted Unit Award Agreement

We have entered into restricted unit award agreements with each of our named executive officers. The agreements provide for the grant of restricted units under the 2016 Equity Plan.

Vesting . Subject to the participant’s continued service on the relevant vesting date, such restricted units vest as follows: (i) in the event of an initial public offering of the Company and contingent upon at least half of the units originally acquired by the “Investors” (as defined in the 2016 Equity Plan) having been disposed of to one or more independent third parties, one-third of such units will vest in equal installments on each of the first five anniversaries of the date of grant (“Tranche A Restricted Units”); (ii) one-third of such units will vest at such time as the Investors realize an internal rate of return equal to at least 30% and a return on investment in the Company equal to at least 3.5x, in each case, based on the cash proceeds received by the Investors (“Tranche B Restricted Units”); and (iii) one-third of such units will vest at such time as the Investors realize an internal rate of return equal to at least 37.5% and a return on investment in the Company equal to at least 4.5x, in each case, based on the cash proceeds received by the Investors (“Tranche C Restricted Units”). In the event of the termination of the participant’s continuous service for any reason, the participant will forfeit any unvested restricted units held as of the date of such termination without consideration. In the event of a “Change in Control” (as defined in the 2016 Equity Plan), any unvested Tranche A Restricted Units held by the participant shall vest and any unvested Tranche B and Tranche C Restricted Units shall vest, if at all, based on the Investor rate of return and return on investment in the Company realized by the Investors based on the cash proceeds received as a result of such transaction. Any Tranche B and Tranche C Restricted Units that have not vested prior to, or do not become vested at, the time the Investors fully dispose of their investment in the Company shall be forfeited without consideration.

Rights as a Member . The participant shall be the record owner of the restricted units, and, as such, shall be entitled to all rights of a Member, provided, that the voting rights with respect to restricted units will be exercised by our compensation committee and the participant shall execute an irrevocable voting proxy in favor of our compensation committee and any distributions payable with respect to the restricted units shall be subject to the same vesting criteria of the underlying restricted units and shall be paid to the participant at such time as the restricted units vest.

LLC Agreement . Upon issuance, the Class C Units are subject to the terms of the LLC Agreement. The LLC Agreement will no longer be applicable following the completion of this offering and the conversion of the Class C Units into shares of our common stock.

Outstanding Equity Awards at 2016 Fiscal Year-End

The following table sets forth the outstanding equity awards for each of our named executive officers as of December 31, 2016.


	Stock Awards
Named Executive Officer	Number of shares or units of stock that have not vested (#) ⁽¹⁾		Market value of shares or units of stock that have not vested ($) ⁽²⁾		Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#)		Equity incentive plan awards: market or payout value of unearned shares, units or other rights that have not vested ($)
Walter J. Scheller, III		16,875		1,225,463		—		—
Jack K. Richardson		8,438		612,768		—		—
Michael T. Madden		5,000		363,100		—		—

(1)	On April 1, 2016, Mr. Scheller was granted 16,875 restricted units. On April 20, 2016, Messrs. Richardson and Madden were granted 8,438 and 5,000 restricted units, respectively. Subject to the applicable named

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executive officer’s continued service on the relevant vesting date, such restricted units vest as follows: (i) in the event of an initial public offering of the Company and contingent upon at least half of the units originally acquired by the Investors having been disposed of to one or more independent third parties, one-third of such units will vest in equal installments on each of the first five anniversaries of the date of grant; (ii) one-third of such units will vest at such time as the Investors realize an internal rate of return equal to at least 30% and a return on investment in the Company equal to at least 3.5x, in each case, based on the cash proceeds received by the Investors; and (iii) one-third of such units will vest at such time as the Investors realize an internal rate of return equal to at least 37.5% and a return on investment in the Company equal to at least 4.5x, in each case, based on the cash proceeds received by the Investors.

(2)	The amounts in this column represent the aggregate grant date fair value of stock awards in accordance with FASB ASC Topic 718.

Pension Benefits and Nonqualified Deferred Compensation

We do not provide defined benefit pension benefits or non-qualified deferred compensation. Our named executive officers are eligible to participate in our 401(k) Plan on the same basis as other employees who satisfy the 401(k) Plan’s eligibility requirements. As such, our named executive officers, along with other 401(k) Plan participants, are eligible for employer matching contributions equal to 5% of salary deferrals up to 100% of the participant’s compensation. Under the new initial UMWA CBA, eligible union employees participate in a 401(k) plan, which includes employer contributions of $1.50 per hour worked.

Payments upon a Change in Control or Certain Termination of Employment Events

Other than the severance benefits described above pursuant to the terms of the employment agreements with Messrs. Scheller, Richardson and Madden and the impact of a change in control on the restricted units described above under the terms of the 2016 Equity Plan and applicable restricted unit award agreement, none of our named executive officers is party to any other plan or arrangement providing for payments or benefits in connection with the executive’s termination of employment or a change in control of the Company.

Director Compensation

For 2016, a non-employee member of our board of directors received compensation in the forms of annual base fees and equity as set forth in the table below. Stephen D. Williams is the only non-employee director to receive compensation from the Company solely for serving as a director. The material terms of his compensation arrangements are also described below.


Name	Fees earned or paid in cash ($) ⁽¹⁾		Stock Awards ($) ⁽²⁾		Option Awards ($)		Non-equity Incentive Plan Compensation		Nonqualified Deferred Compensation Earnings ($)		All Other Compensation ($)		Total ($)
Stephen D. Williams		366,000		736,094		—		—		—		—		1,102,094

(1)	Mr. Williams received a total base fee from the Company and our Predecessor of $276,000 in 2016, including $108,000 from the Company following the Asset Acquisition and $168,000 from our Predecessor prior to the Asset Acquisition. He also received a bonus of $90,000 from the Company in 2016.

(2)

The amounts in this column represent the aggregate grant date fair value of stock awards issued to Mr. Williams in accordance with FASB ASC Topic 718. On April 1, 2016, Mr. Williams was granted 3,125 phantom units and 3,125 restricted units. As of December 31, 2016, all such phantom units were fully vested and all such restricted units were unvested. The phantom units will be settled as described below.

Annual Fee

Mr. Williams, who serves as the Chairman of our board of directors, was entitled to an annual fee of $112,500 paid in monthly installments. Effective January 1, 2017, his annual fee was increased to $150,000. He

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is also eligible for an incentive target of 100% of his annual fee, granted in cash or stock, based on our annual incentive plan for management as approved by our compensation committee.

Warrior Met Coal, LLC 2016 Equity Incentive Plan Restricted Unit Award Agreement

We have entered into a restricted unit award agreement with Mr. Williams. The agreement provides for the grant of restricted Class C units under the 2016 Equity Plan.

Vesting . Subject to Mr. William’s continued service on the relevant vesting date, such restricted units vest as follows: (i) in the event of an initial public offering of the Company and contingent upon at least half of the units originally acquired by the “Investors” (as defined in the 2016 Equity Plan) having been disposed of to one or more independent third parties, one-third of such units will vest in equal installments on each of the first five anniversaries of the date of grant (“Williams Tranche A Restricted Units”); (ii) one-third of such units will vest at such time as the Investors realize an internal rate of return equal to at least 30% and a return on investment in the Company equal to at least 3.5x, in each case, based on the cash proceeds received by the Investors (“Williams Tranche B Restricted Units”); and (iii) one-third of such units will vest at such time as the Investors realize an internal rate of return equal to at least 37.5% and a return on investment in the Company equal to at least 4.5x, in each case, based on the cash proceeds received by the Investors (“Williams Tranche C Restricted Units”). In the event of the termination of Mr. William’s continuous service for any reason, he will forfeit any unvested restricted units held as of the date of such termination without consideration. In the event of a “Change in Control” (as defined in the 2016 Equity Plan), any unvested Williams Tranche A Restricted Units held by him shall vest and any unvested Williams Tranche B and Williams Tranche C Restricted Units shall vest, if at all, based on the Investor rate of return and return on investment in the Company realized by the Investors based on the cash proceeds received as a result of such transaction. Any Williams Tranche B and Williams Tranche C Restricted Units that have not vested prior to, or do not become vested at, the time the Investors fully dispose of their investment in the Company shall be forfeited without consideration.

Rights as a Member. Mr. Williams shall be the record owner of the restricted units, and, as such, shall be entitled to all rights of a Member, provided, that the voting rights with respect to restricted units will be exercised by our compensation committee and he shall execute an irrevocable voting proxy in favor of our compensation committee and any distributions payable with respect to the restricted units shall be subject to the same vesting criteria of the underlying restricted units and shall be paid to him at such time as the restricted units vest.

Warrior Met Coal, LLC 2016 Equity Incentive Plan Phantom Unit Award Agreement

We have entered into a phantom unit award agreement with Mr. Williams. The agreement provides for the grant of phantom units under the 2016 Equity Plan.

Settlement . The phantom units were fully vested on April 1, 2016. Each such phantom unit constitutes the right of Mr. Williams to receive one Class C unit on the earlier of (i) a “Change in Control” (as defined in the 2016 Equity Plan) or (ii) April 1, 2021 (together with (i), the “Settlement Date”). On the Settlement Date, we will issue to Mr. Williams one unit for each phantom unit awarded under the agreement.

Rights as a Member. Unless and until the phantom units become settled in units, Mr. Williams will have no rights as the holder thereto. On the Settlement Date, Mr. Williams will become the record owner of the units, and, as such, shall be entitled to all rights of a Member. If we make a cash distribution on our units prior to the Settlement Date, Mr. Williams will receive a lump sum cash payment with respect to such distribution on the Settlement Date.

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LLC Agreement . Upon settlement, the Class C Units are subject to the terms of the LLC Agreement. The LLC Agreement will no longer be applicable following the completion of this offering and the conversion of the Class C Units into shares of our common stock.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Review and Approval of Related Party Transactions

Upon completion of this offering, pursuant to its written charter, our audit committee will review and, subject to certain exceptions, approve or recommend to our board of directors for approval, all related-party transactions, which include any related party transactions that we would be required to disclose pursuant to Item 404 of Regulation S-K promulgated by the SEC. For a discussion of the composition and responsibilities of our audit committee see “Management—Our Board of Directors and Committees—Audit Committee.” In determining whether to approve a related party transaction, the audit committee will consider a number of factors, including whether the related party transaction complies with the restrictions set forth in the ABL Facility and whether it is on terms and conditions no less favorable to us than may reasonably be expected in arm’s-length transactions with unrelated parties.

Walter Energy Restructuring

As part of the Walter Energy Restructuring, on November 5, 2015, the Company and the Walter Energy Debtors entered into an asset purchase agreement, pursuant to which the Company agreed, on behalf of Walter Energy’s First Lien Lenders, to credit bid the first lien debt held by Walter Energy’s First Lien Lenders, to release the liens on the assets being sold as part of the Asset Acquisition, to assume certain liabilities of the Walter Energy Debtors and to pay certain cash consideration in connection with the Asset Acquisition. On January 8, 2016, the Bankruptcy Court approved the Asset Acquisition pursuant to a sale order, and the Asset Acquisition closed on March 31, 2016.

In connection with the closing of the Asset Acquisition, each of Walter Energy’s First Lien Lenders was entitled to receive, on a pro rata basis in proportion to the Walter Energy first lien debt held by it, a distribution of Class A Units in Warrior Met Coal, LLC. The Apollo Funds received an aggregate of 246,079 Class A Units, the GSO Funds received an aggregate of 157,355 Class A Units, the KKR Funds received an aggregate of 92,963 Class A Units, the Franklin Funds received an aggregate of 110,413 Class A Units and certain investment funds managed, advised or sub-advised by Caspian Capital LP or its affiliates (such funds, the “Caspian Funds”) received an aggregate of 45,499 Class A Units, in each case in exchange for the credit bid portion of the first lien debt of the Walter Energy Debtors held by such fund.

In connection with the Asset Acquisition, we conducted the Rights Offerings, pursuant to which we issued an aggregate of 2,500,004 Class B Units for proceeds of $200 million. Upon the closing of the Rights Offerings, the Apollo Funds were issued an aggregate of 800,376 Class B Units and 103,885 Class A Units, the GSO Funds were issued an aggregate of 517,952 Class B Units and 67,215 Class A Units, the KKR Funds were issued an aggregate of 330,596 Class B Units and 39,733 Class A Units, the Franklin Funds were issued an aggregate of 370,339 Class B Units and 48,030 Class A Units and the Caspian Funds were issued an aggregate of 150,877 Class B Units and 19,575 Class A Units. The subscription price per Class B Unit issued in the Rights Offerings was $80. The Class A Units were issued as a commitment premium for the backstopping of the Rights Offering to Walter Energy’s First Lien Lenders by the funds discussed above.

At closing of the Asset Acquisition, we agreed to reserve a small portion of our Class A Units to issue to revolving lenders under the Walter Energy Debtors’ first lien revolving credit facility, to the extent outstanding but undrawn letters of credit issued under such revolving credit facility were subsequently drawn following closing of the Asset Acquisition. As part of these obligations, as revolving lenders who were required to fund amounts drawn on these letters of credit following closing of the Asset Acquisition, (i) the Apollo Funds received an aggregate of 99 Class A Units upon the draw of letters of credit in the aggregate amount of $214,201 and (ii) the Caspian Funds received an aggregate of 128 Class A Units upon the draw of letters of credit in the aggregate amount of $280,080 since the closing of the Asset Acquisition. For more information regarding the Walter Energy Restructuring, see “Business—Corporate History and Structure—Walter Energy Restructuring.”

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Registration Rights

Pursuant to the LLC Agreement, we granted to certain of our Members (including the selling stockholders) and their affiliates the right, under certain circumstances and subject to certain restrictions, to require us to register under the Securities Act units in Warrior Met Coal, LLC that are held or acquired by them.

Demand Rights

Specifically, the LLC Agreement grants the Members unlimited “demand” registration rights to request that we register all or part of their units under the Securities Act (including on Form S-3 after a public offering of the equity interests of the Company or its successor in which the net proceeds received by the Company or its successor are at least $50 million (a “Qualified Public Offering”)). We are not required to comply with any demand to file a registration statement unless the aggregate gross cash proceeds reasonably expected to be received from the sale of securities requested to be included in the registration statement, for an offering occurring prior to a Qualified Public Offering, is at least $100 million, or for an offering occurring after a Qualified Public Offering, is at least $25 million.

Blackout Periods

We have the ability to delay the filing of a registration statement in connection with a demand request for not more than one period of 180 days (or 90 days in the case of a Form S-3 registration statement) in any twelve-month period, subject to certain conditions.

Piggyback Registration Rights

The LLC Agreement also grants to the Members certain “piggyback” registration rights, which allow such holders the right to include certain securities in a registration statement filed by us, subject to certain customary exceptions. In connection with the exercise of any “demand” registration rights by any other unit holder possessing such rights, the “piggyback” registration rights are granted to (i) each Member that (together with its affiliates) holds at least 5% of the outstanding units and (ii) each of the Principal Shareholders and the Caspian Funds.

Cut-Backs

If we reasonably determine (in consultation with the applicable underwriter) that the amount of units requested to be included in this offering exceeds the amount that can be sold without adversely affecting such offering, then (i) in the case of a “demand” registration, we will reduce the units to be included in such offering pro rata based on the number of units owned by each of the participating Members, and (ii) in the case of an offering for our own account or for the benefit of any Member, we will reduce the units to be included in such offering by (x) first only including the units being sold for our account that we so determine can be included and (ii) second, to the extent that all units being sold for our account can be included, then only including the total number of units of the Members as we so determine can be included, with each such Member entitled to include its pro rata share based on the number of units owned and proposed to be included by such Member.

Underwriters

In connection with any underwritten offering pursuant to the LLC Agreement, the underwriter will be selected: in the case of a “demand” registration, by the Member(s) issuing the demand notice (subject to our approval, which will not be unreasonably withheld); and in all other cases (including a “piggyback” registration), by us.

Indemnification; Expenses

We have agreed to indemnify prospective sellers in an offering pursuant to the LLC Agreement and certain related parties against any losses or damages arising out of or based upon any untrue statement or omission of

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material fact in any registration statement or prospectus pursuant to which such prospective seller sells securities, unless such liability arose out of or is based on such party’s misstatement or omission. The LLC Agreement also provides that we may require each prospective seller, jointly and not severally, as a condition to including any securities in a registration statement filed in accordance with the LLC Agreement, to agree to indemnify us against all losses caused by its misstatements or omissions up to the amount of net proceeds received by such prospective seller upon the sale of the securities giving rise to such losses. We will pay all registration expenses incidental to our obligations under the LLC Agreement, including legal fees and expenses of a single counsel to the Members (subject to a cap) participating in the registration as a group, and the prospective seller will pay its portion of all underwriting discounts and commissions, if any, relating to the sale of securities under the LLC Agreement.

Registration Rights Agreement

In connection with the corporate conversion, we will enter into a registration rights agreement with certain of our stockholders containing provisions substantially similar to those set forth above relating to the common stock (including the Right issued under the Rights Plan).

Composition of our Board of Managers under the LLC Agreement

Pursuant to the LLC Agreement, the Principal Shareholders and the Caspian Funds (collectively, the “Initial Investors”) were granted certain rights with respect to the designation of managers to serve on our board of managers. Our board of managers is comprised of seven managers, (i) two of whom are designated by the Apollo Funds, (ii) one of whom is designated by each of the GSO Funds, the KKR Funds and the Franklin Funds, (iii) one of whom is our Chief Executive Officer and (iv) one of whom is our Chairman. Pursuant to the LLC Agreement, if the Apollo Funds’ ownership of our voting securities is reduced to less than 30.1% of such outstanding voting securities, the Apollo Funds will only have the right to designate one manager and the Caspian Funds will then have the right to designate one manager.

If any Initial Investor owns between 30.1% and 50% of our outstanding voting securities, such Initial Investor has the right to appoint two managers to our board of managers, and if any Initial Investor owns greater than 50% of our outstanding voting securities, such Initial Investor has the right to appoint a total of three managers to our board of managers. The manager or managers, as applicable, appointed by the Initial Investor or Investors who hold the fewest voting securities among all Initial Investors will then resign in order to permit the appointment of such additional managers.

Each Initial Investor who appoints a manager to our board of managers has the right to continue to appoint such manager; provided that if at any time an Initial Investor either (A) elects to no longer appoint a manager or (B) (x) has sold, in aggregate, an amount of our voting securities in excess of 50% of its total voting securities that it (and its affiliates) held as of the date of the Asset Acquisition and (y) such Initial Investor, together with its affiliates, no longer is among the five members holding (together with their respective affiliates) the highest aggregate number of voting securities, then the Initial Investor, which, together with its affiliates (an “Appointing Member”), holds the highest aggregate number of our voting securities is entitled to appoint one manager and replace the previously appointed manager and such manager or managers, as applicable, appointed by such Initial Investor who holds the fewest qualified voting securities, will resign in order to permit the appointment of such new manager. If at any time any Appointing Member ceases to qualify as an Appointing Member, it will cause its appointed manager(s) to, and such manager(s) will, resign.

If an Initial Investor (together with its affiliates) sells more than 50% of its total voting securities that it held as of the Asset Acquisition but remains or subsequently once again becomes, together with its affiliates, eligible to appoint a manager pursuant to the above, such Initial Investor has the right to appoint one of the managers.

If the manager serving as our Chief Executive Officer ceases to serve as our Chief Executive Officer, such individual will automatically resign from our board of managers and be replaced with the individual next serving

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as Chief Executive Officer, and if the individual serving as our Chairman ceases to serve on our board of managers, his or her seat will be filled by a replacement selected with the approval of a supermajority of our remaining managers.

In connection with the corporate conversion, the LLC Agreement will be terminated and the Initial Investors will no longer have the nominating rights described above.

Additional Capital Commitment under the LLC Agreement

Pursuant to the LLC Agreement, the members holding Class B Units (the “Class B Members”) have irrevocably committed to make additional capital contributions and to purchase additional Class A Units in the Company on a pro rata basis (the “Additional Capital Commitment”). The Additional Capital Commitment can be called by a supermajority vote of our board of managers, which managers must include managers appointed by at least two Initial Investors unaffiliated with each other. The terms and conditions of the Additional Capital Commitment are governed by the LLC Agreement and include (among other things) customary transfer restrictions.

The obligations of the Class B Members to make the Additional Capital Commitment automatically terminates upon the earliest to occur of: (i) the date on which the Company has issued Class A Units in the Additional Capital Commitment in one or more transactions for gross proceeds of $100,000,000 in the aggregate, (ii) the five-year anniversary of the Asset Acquisition, (iii) the consummation of a qualified public offering, (iv) a change of control, and (v) the affirmative supermajority vote of the board of managers terminating such obligations.

Immediately prior to our corporate conversion, the Additional Capital Commitment will be terminated upon the affirmative supermajority vote of our board of managers, and all outstanding Class B Units will be automatically converted into Class A Units. Such Class A Units in turn will be converted into shares of common stock as described under “Corporate Conversion.”

Other Related Party Transactions

Certain affiliates of Apollo and KKR will be acting as underwriters in this offering. See “Underwriting—Other Relationships.”

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PRINCIPAL AND SELLING STOCKHOLDERS

Beneficial ownership is determined in accordance with the rules of the SEC and includes the power to vote or direct the voting of securities, or to dispose or direct the disposition thereof or the right to acquire such powers within 60 days. Except as indicated by footnote, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them. Our calculation of the percentage of beneficial ownership is based on shares of common stock outstanding as of , 2017, after giving effect to the corporate conversion. The number of shares of common stock outstanding used in calculating the percentage for each listed person includes the shares of common stock underlying options held by that person that are exercisable within 60 days of 2017, but excludes shares of common stock underlying options held by any other person.

The following table sets forth certain information as of , 2017, after giving effect to the corporate conversion, with respect to the beneficial ownership of our common stock by:

•

the selling stockholders;

•

each stockholder known by us to be the beneficial owner of more than five percent of the outstanding shares of our common stock;

•

each of our directors;

•

each of our named executive officers; and

•

all of our directors and executive officers as a group.

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Except as otherwise indicated, we believe that each of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned.

Prior to this
Offering

Shares to be Sold in this
Offering

After this Offering

Common Stock
Beneficially Owned

Assuming
Underwriters’
Option to
Purchase
Additional
Shares is not
Exercised ⁽¹⁾

Assuming
Underwriters’
Option to
Purchase
Additional
Shares is
Exercised in
Full ⁽¹⁾

Common Stock
Beneficially Owned
Assuming
Underwriters’
Option to Purchase
Additional Shares is
not Exercised ⁽¹⁾

Common Stock
Beneficially Owned
Assuming
Underwriters’
Option to Purchase
Additional Shares is
Exercised in Full ⁽¹⁾

Name of Beneficial Owner

Number

Percentage

Number

Percentage

Number

Percentage

Selling Stockholders and other 5% Stockholders:

Apollo Funds ⁽¹⁾

GSO Funds ⁽²⁾

KKR Funds ⁽³⁾

Franklin Funds ⁽⁴⁾

Caspian Funds ⁽⁵⁾

All other selling stockholders as a group ⁽⁶⁾

Named Executive Officers and Directors:

Walter J. Scheller, III

Michael T. Madden

Jack K. Richardson

Stephen D. Williams

Keith Luh

Blaine MacDougald

Matthew R. Michelini

Darren L. Richman

Gareth Turner

All executive officers and directors as a group (12 persons)

*	Less than 1%.

(1)

Consists of shares of common stock held of record prior to the offering giving effect to the corporate conversion by AESI (Holdings) II, L.P.(“AESI”), Apollo Centre Street Partnership, L.P. (“Centre Street”), Apollo Credit Master Fund Ltd. (“Credit Master Fund”), Apollo Credit Opportunity Fund III AIV I, L.P. (“Credit Opportunity”), Apollo Credit Strategies Master Fund Ltd. (“Credit Strategies”), Apollo Franklin Partnership L.P. (“Franklin Fund”), Apollo Lincoln Private Credit Fund, L.P. (“Lincoln Fund”), Apollo Special Opportunities Managed Account, L.P. (“SOMA Fund”), Apollo SPN Investments I (Credit), LLC (“SPN Fund”), Apollo Value Investment Master Fund L.P. (“Value Master Fund”), SKSI Real Property Holdings Ltd.(“SKSI Fund”), Vulcan Holdings, L.P (“Vulcan LP”), and Zeus Investments, L.P. (“Zeus LP”) (collectively, the “Apollo Funds”). The Apollo Funds each disclaims beneficial ownership of all shares of our common stock included above other than the shares of common stock held of record by such Apollo Fund.

The following entities and persons each disclaims beneficial ownership of all of the shares of our common stock held of record by the Apollo Funds, and the following shall not be construed as an admission that any such person or entity is the beneficial owner of any such securities for purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934, as amended, or for any other purpose:

Apollo European Strategic Management, LP (“Euro Management”) is the investment manager of the AESI. Apollo European Strategic Management GP, LLC (Euro Management GP”) is the general partner of European Management. Apollo Centre Street Management, LLC (“Centre Street Management”) serves as

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the investment manager of Centre Street. Apollo ST Fund Management, LLC (“ST Management”) serves as the investment manager of Credit Master Fund and Credit Strategies. Apollo ST Operating LP (“ST Operating”) is the sole member of ST Management. Apollo ST Capital LLC (“ST Capital”) is the general partner of ST Operating. ST Management Holdings LLC (“ST Management Holdings”) is the sole member of ST Capital. Apollo Credit Opportunity Management III LLC (“Credit Opportunity Management”) serves as the investment manager for Credit Opportunity. Apollo Franklin Management, LLC (“Franklin Management”) serves as the investment manager for Franklin Fund and Apollo Lincoln Private Credit Management, LLC (“Lincoln Management “) is the investment manager for Lincoln Fund.

Apollo SOMA Advisors, L.P. (“SOMA Advisors”) serves as the general partner of SOMA Fund, and Apollo SOMA Capital Management, LLC (“SOMA Capital Management”) serves as the general partner of SOMA Advisors. Apollo SVF Management, L.P. (“SVF Management”) serves as the investment manager of SOMA Fund, and Apollo SVF Management GP, LLC (“SVF Management GP”) serves as the general partner of SVF Management.

Apollo SPN Investments 1, L.P. (“SPN Investments”) is the sole member of SPN Fund. Apollo SPN Management, LLC (“SPN Management”) serves as the investment manager of SPN Investments.

Apollo Value Advisors, L.P. (“Value Advisors”) is the managing general partner of Value Master Fund and Apollo Value Capital Management, LLC (“Value Capital Management”) is the general partner of Value Advisors. Apollo Principal Holdings II, L.P. (“Principal II”) is the sole member and manager of Value Capital Management. Apollo Principal Holdings II GP, LLC (“Principal II GP”) is the general partner of Principal II. Apollo Value Management, L.P. (“Value Management”) is the investment manager of Value Master Fund and Apollo Value Management GP, LLC (“Value Management GP”) is the general partner of Value Management.

Apollo SK Strategic Investments, L.P. (“SK Strategic LP”) is the sole shareholder of SKSI Fund. Apollo SK Strategic Management, LLC (“SK Strategic Management”) serves as the investment manager of SK Strategic LP.

Apollo Advisors VIII, L.P. (“Advisors VIII”) and Apollo ANRP Advisors, L.P. (“Advisors ANRP”) are the general partners of Vulcan LP. Apollo Capital Management VIII, LLC (“Capital Management VIII”) is the general partner of Advisors VIII. APH Holdings. L.P. (“APH Holdings”) is the sole member and manager of Capital Management VIII. Apollo Principal Holdings III GP, Ltd. (“Principal III GP”) is the general partner of APH Holdings. Apollo ANRP Capital Management, LLC (“ANRP Capital Management”) is the general partner of Advisors ANRP. Apollo Principal Holdings I, L.P. (“Principal I”) is the sole member and manager of ANRP Capital Management. Apollo Principal Holdings I GP, LLC (“Principal I GP”) is the general partner of Principal I.

Apollo Zeus Strategic Advisors, L.P. (“Zeus Advisors LP”) serves as the general partner of Zeus LP and Apollo Zeus Strategic Advisors, LLC (“Zeus Advisors GP”) serves as the general partner of Zeus Advisors LP. APH Holdings (DC), L.P. (“APH Holdings (DC)”) serves as the sole member and manager of Zeus Advisors GP and of SOMA Capital Management. Apollo Principal Holdings IV GP, Ltd. (“Principal IV GP”) serves as the general partner of APH Holdings (DC).

Apollo Capital Management, L.P. (“Capital Management”) is the sole member and manager of Euro Management GP, Centre Street Management, ST Management Holdings, Credit Opportunity Management, Franklin Management, Lincoln Management, SVF Management GP, SPN Management, Value Management GP, and SK Strategic Management. Apollo Capital Management GP, LLC (“Capital Management GP”) is the general partner of Capital Management. Apollo Management Holdings, L.P. (“Management Holdings”) serves as the sole member and manager of Capital Management GP. Apollo Management Holdings GP, LLC (“Management Holdings GP”) is the general partner of Management Holdings. Leon Black, Joshua Harris and Marc Rowan are the directors of Principal III GP and Principal IV GP, and the managers, as well as executive officers, of Principal I GP, Principal II GP and Management Holdings GP, and as such may be deemed to have voting and dispositive control of shares of our common stock that are held by the Apollo Funds.

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The address of AESI, Value Master Fund, Credit Strategies and Credit Master Fund is c/o Maples Corporate Services Limited, P.O. Box 309, Ugland House, George Town, KY1 1104, Cayman Islands. The address for each of APH Holdings, SKSI Fund and Principal III GP is c/o Intertrust Corporate Services (Cayman) Limited, 190 Elgin Street, George Town, Grand Cayman KY1-9005, Cayman Islands.

The address of Centre Street, Centre Street Management, Credit Opportunity, SK Strategic LP, Franklin Fund, Lincoln Fund, SPN Fund, SPN Investments, Value Advisors, Value Capital Management, Vulcan LP, SOMA Fund, SOMA Advisors, SOMA Capital Management, Advisors VIII, Capital Management VIII, Advisors ANRP, ANRP Capital Management, Zeus LP, APH Holdings (DC), Principal I, Principal I GP, Principal II, Principal II GP and Principal IV GP, is One Manhattanville Road, Suite 201, Purchase, New York 10577.

The address of each of Credit Opportunity Management, Franklin Management, Lincoln Management, Euro Management, Euro Management GP, SPN Management, Value Management, Value Management GP, SVF Management, SVF Management GP, ST Management, ST Operating, ST Capital, ST Management Holdings, SK Strategic Management, Zeus Advisors LP, Zeus Advisors GP, Capital Management, Capital Management GP, Management Holdings, Management Holdings GP, and Messrs. Black, Harris and Rowan, is 9 West 57th Street, 43rd Floor, New York, New York 10019.

The Apollo Funds are affiliates of a broker-dealer and affiliates of the Apollo Funds indirectly own interests in other broker-dealers.

(2)

Includes (i) shares held of record by FS Global Credit Opportunities Fund (“FS Fund”), (ii) shares held of record by GSO Special Situations Fund LP (“Special Situations Fund”), (iii) shares held of record by GSO SSOMF Locomotive Blocker Ltd. (“SSOMF Fund”), (iv) shares held of record by Steamboat Locomotive Blocker Ltd. (“Steamboat Fund”), (v) shares held of record by GSO ADGM Locomotive Blocker Ltd. (“ADGM Fund”), (vi) shares held of record by GSO Cactus Credit Opportunities Fund LP (“Cactus Fund”), (vii) shares held of record by GSO Churchill Partners LP (“Churchill Fund”), (viii) shares held of record by GSO Coastline Credit Partners LP (“Coastline Fund”), (ix) shares held of record by GSO Credit-A Partners LP (“Credit-A Fund”), (x) shares held of record by GSO Palmetto Opportunistic Investment Partners LP (“Palmetto Fund”), and (xi) shares held of record by GSO Credit Alpha Fund AIV-2 LP (“COCA AIV-2 Fund”, and collectively with Special Situations Fund, SSOMF Fund, Steamboat Fund, ADGM Fund, Cactus Fund, Churchill Fund, Coastline Fund, Credit-A Fund and Palmetto Fund, the “GSO Funds”).

FS Global Advisor, LLC (“FS Advisor”) serves as the investment adviser of FS Fund. The investment committee of FS Advisor makes investment decisions on behalf of FS Advisor and has the power to vote or to direct the vote of, and to dispose or to direct the disposition of, the shares of the Company held by FS Fund. The members of the investment committee of FS Advisor are Michael C. Forman, Gerald F. Stahlecker, Zachary Klehr and Robert Hoffman. None of FS Advisor or any member of FS Advisor’s investment committee owns any shares of the Company directly, and FS Advisor and each member of FS Advisor’s investment committee disclaims beneficial ownership of the shares of the Company held by FS Fund, except, in the case of the members of FS Advisor’s investment committee, to the extent of their pecuniary interest therein. The business address of FS Fund, FS Advisor and each member of FS Advisor’s investment committee is 201 Rouse Boulevard, Philadelphia, Pennsylvania 19112.

GSO Special Situations Overseas Master Fund Ltd. is the sole shareholder of SSOMF Fund. Steamboat Credit Opportunities Intermediate Fund LP is the sole shareholder of Steamboat Fund. GSO Aiguille des Grands Montets Fund I LP, GSO Aiguille des Grands Montets Fund II LP and GSO Aiguille des Grands Montets Fund III LP are the shareholders of ADGM Fund. GSO Cactus Credit Opportunities Fund LP is the sole shareholder of Cactus Fund.

GSO Churchill Associates LLC is the general partner of the Churchill Fund. GSO Credit-A Associates LLC is the general partner of Credit-A Fund. GSO Palmetto Opportunistic Associates LLC is the general partner

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of the Palmetto Fund. GSO Credit Alpha Associates LLC is the general partner of COCA AIV-2 Fund. GSO Holdings I L.L.C. is the managing member of each of GSO Churchill Associates LLC, GSO Credit-A Associates LLC, GSO Palmetto Opportunistic Associates LLC and GSO Credit Alpha Associates LLC. Blackstone Holdings I L.P. (“Blackstone I”) is the managing member of GSO Holdings I L.L.C. with respect to the shares beneficially owned by COCA AIV-2 Fund. Blackstone Holdings II L.P. (“Blackstone II”) is the managing member of GSO Holdings I L.L.C. with respect to shares beneficially owned by GSO Churchill Associates LLC, GSO Credit-A Associates LLC and GSO Credit Alpha Associates LLC.

GSO Capital Partners LP (“GSO Capital Partners”) is the non-discretionary investment sub-adviser to, and votes at the direction of, FS Advisor. GSO Capital Partners is the investment manager or advisor with respect to the shares of the Company held by Special Situations Fund, SSOMF Fund, Steamboat Fund, ADGM Fund, Cactus Fund, Churchill Fund, Coastline Fund and Credit-A Fund. GSO Advisor Holdings LLC (“GSO Advisor”) is the special limited partner of GSO Capital Partners with the investment and voting power over the securities beneficially owned by GSO Capital Partners. Blackstone I is the sole member of GSO Advisor. Blackstone Holdings I/II GP Inc. (“Blackstone I/II GP”) is the general partner of Blackstone I and Blackstone II. The Blackstone Group L.P. (“Blackstone Group”) is the controlling shareholder of Blackstone I/II GP. Blackstone Group Management L.L.C. (“Blackstone Group Management”) is the general partner of Blackstone Group. Blackstone Group Management is controlled by Stephen A. Schwarzman, one of its founders. Each of Bennett J. Goodman and J. Albert Smith III is an executive of GSO Capital Partners and GSO Holdings I L.L.C. and may be deemed to have shared voting power and/or investment power with respect to the shares held by the GSO Funds. Each of such persons disclaims beneficial ownership of the shares directly held by the GSO Funds (other than the GSO Funds to the extent of their direct holdings).

The business address for each of the persons and entities named in this footnote 2, unless otherwise stated, is 345 Park Avenue, 31st Floor, New York, NY 10154.

Darren Richman has been a director of the Company since July 2016 and, from September 2006 to December 2016, was a Senior Managing Director of Blackstone Group (an affiliate of GSO Capital Partners). Mr. Richman disclaims any beneficial ownership of the shares of our common stock held by the foregoing entities.

(3)

Includes the shares of record held in funds or client accounts for which KKR Credit Advisors (US) LLC serves as an investment advisor. Kohlberg Kravis Roberts & Co. L.P. is the sole member of KKR Credit Advisors (US) LLC. KKR Management Holdings L.P. is the general partner of Kohlberg Kravis Roberts & Co. L.P. and KKR Management Holdings Corp. is the general partner of KKR Management Holdings L.P. KKR Group Holdings L.P. is the sole shareholder of KKR Management Holdings Corp. and KKR Group Limited is the general partner of KKR Group Holdings L.P. KKR & Co. L.P. is the sole shareholder of KKR Group Limited. KKR Management LLC is the sole general partner of KKR & Co. L.P. The designated members of KKR Management LLC are Messrs. Kravis and Roberts. Each of the KKR entities and Messrs. Kravis and Roberts may be deemed to share voting and investment power with respect to the shares beneficially owned by KKR, but each has disclaimed beneficial ownership of such shares, except to the extent directly held. The address for KKR Credit Advisors (US) LLC is 555 California Street, 50th Floor, San Francisco, CA 94104. The address for all other entities noted above and for Mr. Kravis is c/o Kohlberg Kravis Roberts & Co. L.P., 9 West 57th Street, Suite 4200, New York, NY 10019. The address for Mr. Roberts is c/o Kohlberg Kravis Roberts & Co. L.P., 2800 Sand Hill Road, Suite 200, Menlo Park, CA 94025.

(4)

Franklin Mutual is an indirect wholly owned subsidiary of Franklin Resources, Inc. (“FRI”), which is the beneficial owner of these shares for purposes of Rule 13d-3 under the Securities Exchange Act of 1934 (the “Exchange Act”) in its capacity as the investment adviser to various investment companies registered under Section 8 of the Investment Company Act of 1940 and other accounts. When an investment management contract (including a sub-advisory agreement) delegates to Franklin Mutual investment discretion or voting power over the securities held in the investment advisory accounts that are subject to that agreement, FRI

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treats Franklin Mutual as having sole investment discretion or voting authority, as the case may be, unless the agreement specifies otherwise. Accordingly, Franklin Mutual reports for purposes of section 13(d) of the Exchange Act that it has sole investment discretion and voting authority over the securities covered by any such investment management agreement, unless otherwise specifically noted. The voting and investment powers held by Franklin Mutual are exercised independently from FRI, the investment management subsidiaries and their other affiliates. Furthermore, internal policies and procedures of Franklin Mutual and FRI establish informational barriers that prevent the flow between Franklin Mutual and FRI and its other affiliates of information that relates to the voting and investment powers over the securities owned by their investment management clients. Consequently, Franklin Mutual, on the one hand, and FRI and its other affiliates, on the other hand, report the securities over which they hold investment and voting power separately from each other for purposes of Section 13 of the Exchange Act. The address of Franklin Mutual is 101 John F. Kennedy Parkway, Short Hills, New Jersey 07078.

(5)	Includes (i) shares held of record by Caspian Solitude Master Fund, L.P. (“Caspian Solitude”), (ii) shares held of record by Caspian SC Holdings, L.P. (“Caspian SC”), (iii) shares held of record by Caspian BD Ltd. (“Caspian BD”), and (iv) shares held of record by Caspian BD2 Ltd. (“Caspian BD2”).

Caspian Focused Opportunities Fund, L.P. (“Caspian Focused”), Caspian Thematic Credit Fund LP (“Caspian Thematic”), Super Caspian Cayman Fund Limited (“Super Caspian”), Caspian HLSC1, LLC (“Caspian HLSC1”) and Mariner LDC are all shareholders of Caspian BD.

Caspian Select Credit Master Fund, Ltd. (“Caspian Select”) and Caspian Focused are shareholders of Caspian BD2.

The shares owned by Caspian Solitude and Caspian SC and beneficially owned by Caspian Focused, Caspian Thematic and Caspian HLSC1 (collectively, the “Caspian Funds”) may also be deemed to be beneficially owned by Caspian Credit Advisors, LLC, the general partner to each of the Caspian Funds (the “General Partner”); Caspian GP Holdings, LLC, the sole member of the General Partner; Caspian Capital LP (“Caspian Capital”), the investment adviser to each of the Caspian Funds; and Adam S. Cohen and David N. Corleto as principals of Caspian (collectively, the “Principals”); all of whom disclaim beneficial ownership of these shares, except to the extent of their pecuniary interest therein.

The shares owned by Caspian Select and Super Caspian may also be deemed to be beneficially owned by Caspian Capital, the investment adviser to each of Caspian Select and Super Caspian; and the Principals; all of whom disclaim beneficial ownership of these shares except to the extent of their pecuniary interest therein.

Mariner Investment Group, LLC (“Mariner”) is the investment adviser to Mariner LDC. Mariner delegated its investment authority over a managed account to Caspian Capital that includes the shares. Caspian Capital, in its role as the account manager for the shares, and the Principals, may be deemed to possess voting and/or investment power over the shares. Caspian Capital and the Principals disclaim beneficial ownership of these shares, except to the extent of their pecuniary interest therein. The business address for each of the persons and entities named in this footnote, unless otherwise stated, is 767 Fifth Avenue, 45th Floor, New York, NY 10153.

(6)	Shares shown in the table include shares owned by the selling stockholders other than those named in the table that in the aggregate beneficially own less than 1.0% of our common stock outstanding prior to this offering.

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DESCRIPTION OF OUR CAPITAL STOCK

The following description of our common stock, certificate of incorporation and bylaws are summaries thereof and are qualified by reference to our certificate of incorporation and our bylaws, forms of which will be filed with the SEC as exhibits to the registration statement of which this prospectus is a part. The descriptions of the common stock and preferred stock reflect changes to our capital structure that will be in effect upon the closing of this offering.

After giving effect to the corporate conversion, our authorized capital stock will consist of shares of common stock, par value $0.01 per share, and shares of preferred stock, par value $0.01 per share. We intend to apply for listing of our shares of common stock on the NYSE under the symbol “HCC.”

Common Stock

Holders of shares of common stock will be entitled to one vote per share on all matters submitted to a vote of stockholders. Shares of common stock will not have cumulative voting rights, which means that the holders of more than 50% of the shares voting for the election of our board of directors will be able to elect all the directors to be elected at that time, and, in such event, the holders of the remaining shares will be unable to elect any directors to be elected at that time. Our certificate of incorporation will deny stockholders any preemptive rights to acquire or subscribe for any stock, obligation, warrant or other securities of ours. Holders of shares of our common stock will have no redemption or conversion rights nor will they be entitled to the benefits of any sinking fund provisions.

In the event of our liquidation, dissolution or winding up, holders of shares of common stock will be entitled to receive, pro rata, all the remaining assets of the Company available for distribution to our stockholders after payment of our debts and after there shall have been paid to or set aside for the holders of capital stock ranking senior to common stock in respect of rights upon liquidation, dissolution or winding up the full preferential amounts to which they are respectively entitled.

Holders of record of shares of common stock will be entitled to receive dividends when and if declared by our board of directors out of any assets legally available for such dividends, subject to both the rights of all outstanding shares of capital stock ranking senior to the common stock in respect of dividends and to any dividend restrictions contained in debt agreements. All outstanding shares of common stock and any shares sold and issued in this offering will be fully paid and nonassessable by us.

Preferred Stock

Our board of directors will be authorized to issue up to shares of preferred stock in one or more series and to determine:

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the distinctive serial designation and number of shares of the series;

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the voting powers and the right, if any, to elect a director or directors;

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the terms of office of any directors the holders of preferred shares are entitled to elect;

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the dividend rights, if any;

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the terms of redemption, and the amount of and provisions regarding any sinking fund for the purchase or redemption thereof;

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the liquidation preferences and the amounts payable on dissolution or liquidation;

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the terms and conditions under which shares of the series may or shall be converted into any other series or class of stock or debt of the corporation; and

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any other terms or provisions which our board of directors is legally authorized to fix or alter.

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We will not need stockholder approval to issue or fix the terms of the preferred stock. The actual effect of the authorization of the preferred stock upon your rights as holders of common stock is unknown until our board of directors determines the specific rights of owners of any series of preferred stock. Depending upon the rights granted to any series of preferred stock, your voting power, liquidation preference or other rights could be adversely affected. Preferred stock may be issued in acquisitions or for other corporate purposes. Issuance in connection with a stockholder rights plan or other takeover defense could have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from acquiring, control of the Company. We have no present plans to issue any shares of preferred stock.

Our board of directors expects to adopt the Rights Plan, which, upon the corporate conversion, will give the holders of our common stock the right to purchase one one-thousandth of a share of our Series A Junior Participating Preferred Stock, par value $ per share of the Company (the “Series A Preferred Stock”), in the event of certain beneficial acquisitions of our common stock. In connection with the adoption of the Rights Plan, our board of directors designated shares of our preferred stock as Series A Preferred Stock. See “—Rights Plan” and “—Anti-takeover Effects of Provisions of Our Certificate of Incorporation, Bylaws and Rights Plan.”

Rights Plan

In connection with the corporate conversion, we intend to enter into the Rights Plan with Computershare Trust Company, N.A., as rights agent. In connection therewith, our board of directors will declare a dividend of one Right for each outstanding share of the Company’s common stock. The dividend will be payable on to stockholders of record as of the close of business on (the “Record Date”). In addition, one Right will automatically attach to each share of common stock issued between the Record Date and the Distribution Date (as defined below).

Our board of directors expects to adopt the Rights Plan in an effort to prevent the imposition of significant limitations under Section 382 of the Code on our ability to utilize our current NOLs to reduce our future tax liabilities. If we experience an “ownership change,” as defined in Section 382 of the Code, our ability to fully utilize the NOLs on an annual basis will be substantially limited (and in some circumstances eliminated), and the timing of the usage of the NOLs could be substantially delayed, which could therefore significantly impair the value of those benefits. An “ownership change” generally will occur when the percentage of the Company’s ownership by one or more “5-percent shareholders” (as defined in the Code) has increased by more than 50 percent over the lowest percentage owned by such shareholders at any time during the prior three years. In general terms, the Rights Plan works by imposing a significant penalty upon any person or group that acquires beneficial ownership (defined generally as direct or constructive ownership as determined under Section 382 of the Code) of 4.99% or more of our outstanding common stock without the approval of our board of directors (an “Acquiring Person”). The Rights Plan also gives discretion to our board of directors to determine that someone is an Acquiring Person even if they do not own 4.99% or more of the outstanding common stock but do own 4.99% or more in value of the Company’s outstanding stock, as determined pursuant to Section 382 of the Code and the regulations promulgated thereunder (a “Value Determination”). Stockholders who currently own 4.99% or more of our common stock will not trigger the Rights unless they acquire additional common stock shares, subject to certain exceptions set forth in the Rights Plan. In addition, our board of directors has established procedures to consider requests to exempt certain acquisitions of our securities from the Rights Plan if our board of directors determines that doing so would not limit or impair the availability of the NOLs or is otherwise in the best interests of the Company.

The Rights . Our board of directors will authorize the issuance of a Right with respect to each share of common stock outstanding on the Record Date. The Rights will initially trade with, and will be inseparable from, our common stock. New Rights will accompany any new shares of common stock issued after the Record Date until the earliest of the Distribution Date, the redemption date or the expiration date of the Rights, as described below. Prior to exercise, a Right does not give its holder any dividend, voting or liquidation rights.

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Exercise Price . Each Right will allow its registered holder to purchase from the Company one one-thousandth of a share of Series A Preferred Stock, for $ , subject to adjustment under certain circumstances (the “Purchase Price”), once the Rights become exercisable.

Exercisability . The Rights will not be exercisable until the earlier to occur of

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10 business days following public announcement that a person or group of affiliated or associated persons has become an “Acquiring Person” by obtaining beneficial ownership of 4.99% or more of the outstanding common stock or a Value Determination, except where such person or group has acquired such ownership in certain circumstances prior to the first public announcement of the adoption of the Rights Plan, or

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10 business days (or a later date determined by our board of directors before any person or group becomes an Acquiring Person) following the commencement of, or announcement of an intention to make, a tender or exchange offer which, if completed, would result in that person or group becoming an Acquiring Person.

The date when the Rights become exercisable is referred to as the “Distribution Date.” Until the Distribution Date, the Rights are evidenced, with respect to any common stock certificates outstanding as of the Record Date, by such common stock certificates, and with respect to any shares of common stock held in uncertificated form as of the Record Date, by the book entries in the book-entry system for our common stock, in each case together with a copy of a Summary of Rights that the Company will send to all holders of record of common stock as of the Record Date. Until the Distribution Date, new common stock certificates issued after the Record Date upon transfer or new issuance of common stock shares will contain a legend regarding the Rights (which certificates will evidence the associated Rights) and we will deliver a notice regarding the Rights upon the transfer or new issuance of shares of common stock held in book-entry form (which book-entries will evidence the associated Rights). Until the Distribution Date (or earlier redemption, exchange, termination or expiration of the Rights), the surrender for transfer of any certificates for common stock or book-entry shares, with or without such legend, notice or Summary of Rights, will also constitute the transfer of the associated Rights. After the Distribution Date, the Rights will separate from the common stock and be evidenced solely by Right certificates that we will mail to all eligible holders of common stock. Any Rights held by an Acquiring Person or an associate or affiliate thereof and certain transferees thereof will be null and void and may not be exercised.

Consequences of a Person or Group Becoming an Acquiring Person. If a person or group of affiliated or associated persons becomes an Acquiring Person, all holders of Rights except the Acquiring Person or an associate or affiliate thereof and certain transferees thereof may, upon exercise of a Right, purchase for the Purchase Price shares of common stock with a market value of two times the Purchase Price, based on the market price of our common stock prior to such acquisition. If we do not have a sufficient number of shares of common stock available, we may under certain circumstances substitute shares of Series A Preferred Stock or other securities or property for our common stock into which the Rights would have otherwise been exercisable.

Exempt Persons . Our board of directors recognizes that there may be instances when an acquisition of shares of our common stock that would cause a stockholder to become an Acquiring Person may not jeopardize or endanger, in any material respect, the availability of the NOLs to the Company. Accordingly, the Rights Plan grants sole and absolute discretion to our board of directors to designate a person as an “Exempt Person” if our board of directors determines that (i) neither the beneficial ownership of shares of common stock by any person, directly or indirectly, as a result of such transaction nor any other aspect of such transaction would jeopardize or endanger the unrestricted availability to the Company of the Company’s tax benefits or (ii) such transaction is otherwise in the best interests of the Company. In granting an exemption, our board of directors may require certain representations or undertakings or to agree that any violation or attempted violation of such representations or undertakings will result in such consequences and subject the person to such conditions as our board of directors may determine in its sole discretion.

Series A Preferred Stock Provisions.

Each one one-thousandth of a share of Series A Preferred Stock, if issued:

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will not be redeemable;

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will entitle the holder to quarterly dividend payments equal to the dividend paid on one share of common stock;

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will entitle the holder upon liquidation, dissolution or winding-up of the Company to receive the greater of (a) $ per one one-thousandth of a share of Series A Preferred Stock (plus any accrued but unpaid dividends) and (b) an amount equal to the payment made on one share of common stock;

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will have the same voting power as one share of common stock; and

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if shares of common stock are exchanged via merger, consolidation, or a similar transaction, will entitle the holder to a payment equal to the payment made on one share of common stock.

The value of one one-thousandth interest in a share of Series A Preferred Stock should approximate the value of one share of common stock.

Expiration . The Rights will expire on the earliest of (i) 5:00 p.m., New York City time, on , (ii) the close of business on if stockholder approval of the Rights Plan has not been received by or on such date, (iii) the time at which the Rights are redeemed or exchanged under the Rights Plan or (iv) the time at which our board of directors determines that the NOLs are fully utilized or no longer available under Section 382 of the Code.

Redemption . Our board of directors may redeem the Rights for $ per Right at any time before any person or group becomes an Acquiring Person. If our board of directors redeems any Rights, it must redeem all of the Rights. Once the Rights are redeemed, the only right of the holders of Rights will be to receive the redemption price of $ per Right. The redemption price will be adjusted if we have a stock split or issue stock dividends of our common stock.

Exchange . After a person or group becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of our outstanding common stock, our board of directors may extinguish the Rights by exchanging one share of common stock or an equivalent security or other property for each Right, other than Rights held by the Acquiring Person or an affiliate or associate thereof and certain transferees thereof, which will have become null and void.

Anti-Dilution Provisions . The Purchase Price of the Series A Preferred Stock, the number of shares of Series A Preferred Stock issuable and the number of outstanding Rights are subject to adjustment to prevent dilution that may occur as a result of certain events, including among others, a stock dividend, a stock split, or a reclassification of the Series A Preferred Stock or common stock. With certain exceptions, no adjustments to the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price.

Amendments . The terms of the Rights Plan may be amended by our board of directors without the consent of the holders of the Rights on or prior to the Distribution Date. Thereafter, the terms of the Rights and the Rights Plan may be amended without the consent of the holders of Rights in order to (i) cure ambiguities, (ii) shorten or lengthen any time period pursuant to the Rights Plan or (iii) make changes that do not adversely affect the interests of holders of the Rights.

Related Party Transactions and Corporate Opportunities

Subject to the limitations of applicable law, our certificate of incorporation, among other things:

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will permit us to enter into transactions with entities in which one or more of our officers or directors are financially or otherwise interested so long as it has been approved by our board of directors;

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will permit any of our stockholders, officers or directors to conduct business that competes with us and to make investments in any kind of property in which we may make investments; and

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Anti-takeover Effects of Provisions of Our Certificate of Incorporation, Bylaws and Rights Plan

Our certificate of incorporation and bylaws will contain provisions that could make it more difficult to acquire us by means of a merger, tender offer, proxy contest or otherwise, or to remove our incumbent officers and directors. These provisions, summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging such proposals because negotiation of such proposals could result in an improvement of their terms.

Undesignated preferred stock . The ability to authorize and issue undesignated preferred stock may enable our board of directors to render more difficult or discourage an attempt to change control of us by means of a merger, tender offer, proxy contest or otherwise. For example, if in the due exercise of its fiduciary obligations, our board of directors were to determine that a takeover proposal is not in our best interest, our board of directors could cause shares of preferred stock to be issued without stockholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer or insurgent stockholder or stockholder group.

Stockholder meetings . Our certificate of incorporation and bylaws will provide that a special meeting of stockholders may be called only by the chairman of our board, by a resolution adopted by a majority of our board of directors or at the request of holders of 50.1% or more of our outstanding common stock. Stockholders requesting a special meeting will be required to provide a notice to us with the proposed date, time and place of the meeting (which may not be earlier than 60 days after the date the notice is delivered to us (or 90 days in the case of special meetings called to elect one or more directors)) and the purposes for which the special meeting is being called. The stockholders requesting the special meeting will also be required to comply with the requirements that would be applicable if the stockholders were proposing to nominate a candidate for election as a director at an annual meeting or proposing a topic for consideration at an annual meeting.

Requirements for advance notification of stockholder nominations and proposals . Our bylaws will establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of our board of directors. These procedures will provide that notice of stockholder nominations or proposals must be timely given in writing to our corporate secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary date of the date on which we first mailed our proxy materials for the annual meeting for the preceding year. Our bylaws will specify the requirements as to form and content of all stockholders’ notices. These requirements may make it more difficult for stockholders to bring matters before the stockholders at an annual or special meeting.

Stockholder action by written consent . Our bylaws will provide that stockholders may take action by written consent if the consent is signed by holders of our outstanding shares having the number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and the stockholders seeking to take the action provide us with the same information that would have been required to be provided if they were proposing to take the action at a special meeting of stockholders.

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Rights Plan . Although the Rights Plan will be structured and approved by our board of directors to protect our ability to use our NOLs to offset future tax liabilities, the existence of the Rights Plan may nevertheless discourage a third party from making a partial tender offer or otherwise attempting to obtain a substantial position in the equity securities or seeking to obtain control of the Company. To the extent any potential acquirers are deterred by our Rights Plan, the plan may have the effect of preserving incumbent directors and management in office or preventing acquisitions of the Company. The Rights Plan has a limited life and is not intended for defensive or anti-takeover purposes. See “—Rights Plan.”

Removal of Directors . Our bylaws will provide that, subject to the rights, if any, of the holders of shares of any class or series of preferred stock then outstanding to remove directors, any director or our entire board of directors may be removed from office, with or without cause, upon the affirmative vote of the holders of 50.1% or more of our outstanding common stock.

The provisions of our certificate of incorporation and bylaws and the Rights Plan could have the effect of discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible that these provisions could make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best interests.

Amendments to Our Certificate of Incorporation or our Bylaws

Our certificate of incorporation will be able to be amended as allowed by the DGCL. Our bylaws will contain provisions allowing our board of directors to amend and repeal the bylaws, subject to the power of the holders of our common stock to amend the bylaws upon the vote of the holders of more than 50% of the total voting power of the shares entitled to vote in the election of directors, voting together as a single class, and subject to the rights, if any, of the holders of any series of preferred stock outstanding at such time.

Business Combinations with Interested Stockholders

In general, Section 203 of the DGCL prevents an interested stockholder, which is defined generally as a person owning 15% or more of the outstanding voting stock of a Delaware corporation, from engaging in a business combination (as defined therein) for three years following the date that such person became an interested stockholder unless various conditions are satisfied. We will elect to opt out of the provisions of DGCL Section 203. Accordingly, we will not be subject to the anti-takeover effects of DGCL Section 203. At some time in the future, we may be governed by DGCL Section 203. DGCL Section 203 could have the effect of delaying, deferring or preventing a change in control that our stockholders might consider to be in their best interests.

Exclusive Forum

Our certificate of incorporation will require, to the fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers and other employees for breach of a fiduciary duty and other similar actions may be brought only in specified courts in the State of Delaware. Although we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against our directors, officers and other employees. See “Risk Factors—Risks Related to this Offering and the Ownership of our Common Stock—Our certificate of incorporation will designate courts in the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.”

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Limitation of Liability and Indemnification Matters

Our certificate of incorporation will limit the liability of our directors for monetary damages for breach of their fiduciary duty as directors, except for the following liabilities that cannot be eliminated under the DGCL:

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for any breach of their duty of loyalty to us or our stockholders;

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for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

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for an unlawful payment of dividends or an unlawful stock purchase or redemption, as provided under Section 174 of the DGCL; or

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for any transaction from which the director derived an improper personal benefit.

Any amendment or repeal of these provisions will be prospective only and would not affect any limitation on liability of a director for acts or omissions that occurred prior to any such amendment or repeal.

Our bylaws will also provide that we will indemnify our directors and officers to the fullest extent permitted by Delaware law; provided that we shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the board of directors. Our bylaws will also explicitly authorize us to purchase insurance to protect any of our officers, directors, employees or agents or any person who is or was serving at our request as an officer, director, employee or agent of another enterprise for any expense, liability or loss, regardless of whether Delaware law would permit indemnification.

We expect to enter into indemnification agreements with each of our directors and officers. The agreements will provide that we will indemnify and hold harmless each indemnitee for certain expenses to the fullest extent permitted or authorized by law, including the DGCL, in effect on the date of the agreement or as it may be amended to provide more advantageous rights to the indemnitee. If such indemnification is unavailable as a result of a court decision and if we and the indemnitee are jointly liable in the proceeding, we will contribute funds to the indemnitee for his expenses in proportion to relative benefit and fault of us and indemnitee in the transaction giving rise to the proceeding. The indemnification agreements will also provide that we will indemnify the indemnitee for monetary damages for actions taken as our director or officer or for serving at our request as a director or officer or another position at another corporation or enterprise, as the case may be. The indemnification agreements will also provide that we must advance payment of certain expenses to the indemnitee, including fees of counsel, subject to receipt of an undertaking from the indemnitee to return such advance if it is it is ultimately determined that the indemnitee is not entitled to indemnification.

We believe that the limitation of liability provision to be included in our certificate of incorporation and the indemnification agreements will facilitate our ability to continue to attract and retain qualified individuals to serve as directors and officers.

Transfer Agent and Registrar

Computershare Trust Company, N.A. will be the transfer agent and registrar for our common stock.

Listing

We intend to apply for listing of our shares of common stock (and the Rights) on the NYSE under the symbol “HCC.”

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DESCRIPTION OF CERTAIN INDEBTEDNESS

On April 1, 2016, we entered into the ABL Facility with certain lenders and Citibank, as administrative agent and collateral agent, with an aggregate lender commitment to make revolving loans of up to $50 million at any time outstanding, subject to borrowing base availability. On January 23, 2017, we entered into the First Amendment to, among other things, (i) increase the aggregate lender commitment to $100 million, (ii) reduce the applicable interest rate margins by 100 bps, (iii) permit the corporate conversion and (iv) allow this offering to be consummated without triggering a change of control. Under the ABL Facility, up to $10 million of the commitments may be used to incur swingline loans from Citibank and up to $50 million of the commitments may be used to issue letters of credit. The ABL Facility will mature on April 1, 2019. As of December 31, 2016, no amounts were outstanding under our ABL Facility.

The obligations of the borrowers under the ABL Facility are guaranteed by each of our subsidiaries, and secured by substantially all of our assets.

Borrowings under the ABL Facility bear interest at a rate equal to LIBOR plus an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, ranging from 200 bps to 250 bps. In addition to paying interest on the outstanding borrowings under the ABL Facility, we are required to pay a fee in respect of unutilized commitments, which is determined based on the availability of the commitments under the ABL Facility, ranging from 25 bps to 37.5 bps. We are also required to pay a fee on undrawn but available amounts under outstanding letters of credit under the ABL Facility at a rate not in excess of 250 bps, and certain administrative fees.

We are able to voluntarily repay outstanding loans and reduce unused commitments, in each case, in whole or in part, at any time without premium or penalty. We are required to repay outstanding loans and cash collateral letters of credit anytime the outstanding loans and letters of credit exceed the maximum availability then in effect. We are also required to use net proceeds from certain significant asset sales to repay outstanding loans, but may re-borrow following such prepayments if the conditions to borrowings are met.

The ABL Facility contains customary covenants for asset-based credit agreements of this type, including, among other things: (i) requirements to deliver financial statements, other reports and notices; (ii) restrictions on the existence or incurrence of certain indebtedness; (iii) restrictions on the existence or incurrence of certain liens; (iv) restrictions on making certain restricted payments; (v) restrictions on making certain investments; (vi) restrictions on certain mergers, consolidations and asset dispositions; (vii) restrictions on certain transactions with affiliates; and (viii) restrictions on modifications to certain indebtedness. Additionally, the ABL Facility contains a springing fixed charge coverage ratio of not less than 1.00 to 1.00, which ratio is tested if availability under the ABL Facility is less than a certain amount. Subject to customary grace periods and notice requirements, the ABL Facility also contains customary events of default.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common stock. Future sales of substantial amounts of our common stock in the public market, or the perception that such sales may occur, could adversely affect the prevailing market price of our common stock. We cannot predict the effect, if any, that future sales of shares, or the availability of shares for future sales, will have on the market price of our common stock prevailing from time to time.

Sale of Restricted Shares

After giving effect to the corporate conversion and upon completion of this offering, we will have shares of common stock outstanding. Of these shares of common stock, the shares of common stock being sold in this offering, plus any shares sold upon exercise of the underwriters’ option to purchase additional shares, will be freely tradable without restriction under the Securities Act, except for any such shares held or acquired by an “affiliate” of ours, as that term is defined in Rule 144 promulgated under the Securities Act, which shares will be subject to the volume limitations and other restrictions of Rule 144 described below. The remaining shares of common stock held by our existing stockholders upon completion of this offering, or shares if the underwriters exercise their option to purchase additional shares in full, will be “restricted securities,” as that phrase is defined in Rule 144, and may be resold only after registration under the Securities Act or pursuant to an exemption from such registration, including, among others, the exemptions provided by Rule 144 and 701 under the Securities Act, which rules are summarized below.

Rule 144

In general, under Rule 144 as currently in effect, persons who became the beneficial owner of shares of our common stock prior to the completion of this offering may sell their shares upon the earlier of (1) the expiration of a six-month holding period, if we have been subject to the reporting requirements of the Exchange Act for at least 90 days prior to the date of the sale and have filed all reports required thereunder, or (2) the expiration of a one-year holding period.

At the expiration of the six-month holding period, assuming we have been subject to the Exchange Act reporting requirements for at least 90 days and have filed all periodic reports required thereunder, a person who was not one of our affiliates at any time during the three months preceding a sale would be entitled to sell an unlimited number of shares of our common stock, and a person who was one of our affiliates at any time during the three months preceding a sale would be entitled to sell, within any three-month period, a number of shares of common stock that does not exceed the greater of either of the following:

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1% of the number of shares of our common stock then outstanding, which will equal approximately shares immediately after this offering; or

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the average weekly trading volume of our common stock on the NYSE during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.

At the expiration of the one-year holding period, a person who was not one of our affiliates at any time during the three months preceding a sale would be entitled to sell an unlimited number of shares of our common stock without restriction. A person who was one of our affiliates at any time during the three months preceding a sale would remain subject to the volume restrictions described above.

Sales under Rule 144 by our affiliates are also subject to manner of sale provisions and notice requirements and to the availability of current public information about us.

Rule 701

In general, under Rule 701, any of our employees, directors, officers, consultants or advisors who purchased shares from us in connection with a compensatory stock or option plan or other written agreement before the

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effective date of this offering, or who purchased shares from us after that date upon the exercise of options granted before that date, are eligible to resell such shares in reliance upon Rule 144 beginning 90 days after the date of this prospectus. If such person is not an affiliate, the sale may be made subject only to the manner-of-sale restrictions of Rule 144. If such a person is an affiliate, the sale may be made under Rule 144 without compliance with its one-year minimum holding period, but subject to the other Rule 144 restrictions described above.

Registration Rights

In connection with the corporate conversion, we will enter into a registration rights agreement with certain of our stockholders. For more information, see “Certain Relationships and Related Party Transactions—Registration Rights—Registration Rights Agreement.”

Stock Plans

We intend to file a registration statement on Form S-8 under the Securities Act to register shares of our common stock issued or reserved for issuance under our equity incentive plan. The registration statement is expected to be filed soon after the date of this prospectus and will automatically become effective upon filing with the SEC. Accordingly, shares registered under such registration statement will be available for sale in the open market following the effective date, unless such shares are subject to vesting restrictions with us, Rule 144 restrictions applicable to our affiliates or the lock-up restrictions described below.

Lock-Up Agreements

Our officers, directors, the selling stockholders and holders of substantially all of our stock have agreed, subject to certain exceptions, that they will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our common stock, enter into a transaction that would have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of our common stock, whether any of these transactions are to be settled by delivery of our common stock or other securities, in cash or otherwise, or publicly disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap, hedge or other arrangement, without, in each case, the prior written consent of Credit Suisse for a period of 180 days after the date of this prospectus. Upon the expiration of the lock-up period, the shares subject to such lock-up restrictions will become eligible for sale, subject to the limitations discussed above.

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MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSEQUENCES FOR NON-U.S. HOLDERS OF OUR COMMON STOCK

The following is a discussion of material U.S. federal income and estate tax consequences of the ownership and disposition of our common stock by a non-U.S. holder. This discussion deals only with common stock purchased in this offering that is held as a capital asset (generally, property held for investment) by a non-U.S. holder. Except as modified for estate tax purposes, the term “non-U.S. holder” means a beneficial owner of our common stock that is not, for U.S. federal income tax purposes:

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an individual who is a citizen or resident of the United States;

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a corporation (including any entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

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an entity or arrangement treated as a partnership;

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an estate whose income is subject to U.S. federal income taxation regardless of its source; or

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a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons (as defined under the U.S. Internal Revenue Code of 1986, as amended (the “Code”)) has authority to control all substantial decisions of the trust, or if it has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a United States person.

An individual may generally be treated as a resident of the United States in any calendar year for U.S. federal income tax purposes, by, among other ways, being present in the United States for at least 31 days in that calendar year and for an aggregate of at least 183 days during a three-year period ending in the current calendar year. For purposes of the 183-day calculation, all of the days present in the current year, one-third of the days present in the immediately preceding year and one-sixth of the days present in the second preceding year are counted. Residents are taxed for U.S. federal income tax purposes as if they were U.S. citizens.

This discussion is based upon provisions of the Code, the U.S. Treasury Regulations promulgated thereunder, administrative rulings and judicial decisions, all as of the date hereof. Those authorities may be changed, even retroactively, so as to result in U.S. federal income and estate tax consequences different from those discussed herein. There can be no assurance that the Internal Revenue Service (the “IRS”) will not take a contrary position with respect to one or more of the tax consequences described herein and we have not obtained, nor do we intend to obtain, a ruling from the IRS with respect to the U.S. federal income or estate tax consequences of the ownership or disposition of our common stock. This discussion does not address all aspects of U.S. federal income and estate taxation and does not deal with other U.S. federal tax laws (such as gift tax laws) or state, local, non-U.S. or other tax considerations that may be relevant to non-U.S. holders in light of their personal circumstances. This discussion does not discuss any tax considerations relevant to Principal Shareholders. In addition, this discussion does not address tax considerations applicable to investors that may be subject to special treatment under the U.S. federal income tax laws, such as (without limitation):

•

certain former U.S. citizens or residents;

•

stockholders that hold our common stock as part of a straddle, constructive sale transaction, synthetic security, hedge, conversion transaction, wash sale or other integrated investment or risk reduction transaction;

•

stockholders that acquired our common stock through the exercise of employee stock options or otherwise as compensation or through a tax-qualified retirement plan;

•

stockholders that are partnerships or entities treated as partnerships for U.S. federal income tax purposes or other pass-through entities or owners thereof;

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•

“Controlled Foreign Corporations;”

•

“Passive Foreign Investment Companies;”

•

financial institutions;

•

insurance companies;

•

tax-exempt entities;

•

dealers in securities or foreign currencies; and

•

traders in securities that use a mark-to-market method of accounting for U.S. federal income tax purposes.

If a partnership (including an entity treated as a partnership for U.S. federal income tax purposes) holds our common stock, the tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. If you are a partnership (including an entity treated as a partnership for U.S. federal income tax purposes), or a partner in a partnership, holding our common stock, you should consult your tax advisor.

Investors considering the purchase of our common stock should consult their own tax advisors regarding the application of the U.S. federal income and estate and gift tax laws to their particular situation as well as the applicability and effect of any state, local or non-U.S. tax laws or tax treaties.

The Conversion

The corporate conversion prior to this offering is expected to qualify as a tax-free reorganization pursuant to Section 368(a)(1)(F) of the Code. Accordingly, it is anticipated that no gain or loss will be recognized by Predecessor upon the transfer of assets solely in exchange for shares of Successor and its assumption of liabilities, if any, or by members of Predecessor upon their receipt of shares of Successor in connection with the conversion.

Distributions on Common Stock

As discussed under “Dividend Policy” above, we may pay cash distributions on our common stock. In the event we make distributions of cash (or property other than certain pro rata distributions of our common stock) with respect to our common stock, these distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. If any such distribution exceeds our current and accumulated earnings and profits, the excess will be treated as a non-taxable return of capital to the extent of the non-U.S. holder’s tax basis in our common stock and will reduce (but not below zero) such non-U.S. holder’s adjusted tax basis in our common stock, and thereafter as capital gain from the sale or exchange of such common stock. See “—Gain on Disposition of Common Stock.” Dividends paid to a non-U.S. holder of our common stock that are not effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States will be subject to U.S. withholding tax at a 30% rate, or if an income tax treaty applies, a lower rate specified by the treaty. In order to receive a reduced treaty rate, a non-U.S. holder must provide to the withholding agent a properly executed IRS Form W-8BEN or W-8BEN-E, as applicable (or applicable substitute or successor form), properly certifying eligibility for the reduced rate.

Dividends that are effectively connected with a non-U.S. holder’s conduct of a trade or business in the United States and, if an income tax treaty so requires, are attributable to a permanent establishment maintained by the non-U.S. holder in the United States, are taxed on a net income basis at the regular graduated rates and in the manner applicable to United States persons (as defined under the Code). In that case, we will not have to withhold U.S. federal withholding tax if the non-U.S. holder complies with applicable certification and disclosure

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requirements (which may generally be met by providing an IRS Form W-8ECI). In addition, a “branch profits tax” may be imposed at a 30% rate (or a lower rate specified under an applicable income tax treaty) on dividends received by a foreign corporation that are effectively connected with its conduct of a trade or business in the United States, subject to certain adjustments.

The certifications described above must be provided to the applicable withholding agent prior to the payment of dividends and must be updated periodically. A non-U.S. holder may obtain a refund or credit of any excess amounts withheld by timely filing an appropriate claim for a refund with the IRS. Non-U.S. holders should consult their own tax advisors regarding their eligibility for benefits under a relevant income tax treaty and the manner of claiming such benefits.

Gain on Disposition of Common Stock

A non-U.S. holder generally will not be subject to U.S. federal income tax (including withholding thereof) on gain recognized on a sale or other disposition of our common stock unless:

•

the gain is effectively connected with the non-U.S. holder’s conduct of a trade or business in the United States and, if an income tax treaty applies and so requires, is attributable to a permanent establishment maintained by the non-U.S. holder in the United States, in which case, the gain will be taxed on a net income basis at the regular graduated rates and in the manner applicable to United States persons (as defined under the Code), unless an applicable income tax treaty provides otherwise, and if the non-U.S. holder is a foreign corporation, the branch profits tax described above may also apply;

•

the non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of the disposition and meets other requirements, in which case, except as otherwise provided by an applicable income tax treaty, the non-U.S. holder will be subject to a flat 30% tax on the gain derived from the disposition, which may be offset by U.S. source capital losses, even though the non-U.S. holder is not considered a resident of the United States under the Code; or

•

we are or have been a “United States real property holding corporation,” or USRPHC, for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of disposition or the period that the non-U.S. holder held our common stock.

Generally, a corporation is a USRPHC if the fair market value of its United States real property interests equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business. We believe that we are, and we expect to remain, a USRPHC for United States federal income tax purposes. As a result, subject to the exception below, non-U.S. Holders should expect to be subject to U.S. federal income tax on any gain from a disposition of our common stock as if the non-U.S. holder were a U.S. resident and would be required to file a U.S. tax return with respect to such gain, and a 15% withholding tax would apply to the gross proceeds from the sale of our common stock by a non-U.S. Holder. However, so long as our common stock is “regularly traded on an established securities market” (as provided in applicable U.S. Treasury regulations), a non-U.S. holder will not be subject to U.S. federal income tax as a result of our being a USRPHC on any gain from a disposition of our common stock, unless the non-U.S. holder actually or constructively holds or held (at any time during the shorter of the five-year period preceding the date of disposition or the holder’s holding period) more than 5% of our common stock. We intend to apply for listing of our common stock on the NYSE and we anticipate that our common stock will be regularly traded on an established securities market for so long as it remains so listed.

Non-U.S. holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules.

Information Reporting and Backup Withholding Tax

Dividends paid to you will generally be subject to information reporting and may be subject to U.S. backup withholding. You will be exempt from backup withholding if you properly provide an IRS Form W-8BEN or

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W-8BEN-E or W-8ECI certifying under penalties of perjury that you are a non-U.S. holder or otherwise meet documentary evidence requirements for establishing that you are a non-U.S. holder, or you otherwise establish an exemption. Copies of the information returns reporting such dividends and the tax withheld with respect to such dividends also may be made available to the tax authorities in the country in which you reside.

The gross proceeds from the sale or other disposition of our common stock may be subject to U.S. information reporting and backup withholding. If you receive payments of the proceeds of a disposition of our common stock to or through a U.S. office of a broker, the payment will be subject to both U.S. backup withholding and information reporting unless you properly provide an IRS Form W-8BEN or W-8BEN-E or W-8ECI certifying under penalties of perjury that you are a non-U.S. person (and the payor does not have actual knowledge or reason to know that you are a United States person, as defined under the Code) or you otherwise establish an exemption. If you sell your common stock outside the United States through a non-U.S. office of a non-U.S. broker and the sales proceeds are paid to you outside the United States, then the U.S. backup withholding and information reporting requirements generally will not apply to that payment. However, U.S. information reporting, but not backup withholding, will generally apply to a payment of sales proceeds, even if that payment is made outside the United States, if you sell your common stock through a non-U.S. office of a broker that has certain relationships with the United States unless the broker has documentary evidence in its files that you are a non-U.S. person and certain other conditions are met, or you otherwise establish an exemption.

Backup withholding is not an additional tax. You may obtain a refund or credit of any amounts withheld under the backup withholding rules that exceed your U.S. federal income tax liability, if any, provided the required information is timely furnished to the IRS.

Federal Estate Tax

Our common stock that is owned (or treated as owned) by an individual who is not a citizen or resident of the United States (as specially defined for United States federal estate tax purposes) at the time of death will be included in such individual’s gross estate for United States federal estate tax purposes, unless an applicable tax treaty provides otherwise, and, therefore, may be subject to United States federal estate tax.

Foreign Account Tax Compliance Act

Under the Foreign Account Tax Compliance Act, or FATCA, a 30% withholding tax will generally apply to (i) U.S. source dividends (including dividends paid on our common stock) and (ii) gross proceeds from the sale or other disposition of stock that can produce U.S. source dividends ocurring after December 31, 2018 (including the sale or other disposition of our common stock), in each case, paid to certain foreign entities, whether acting as a beneficial owner or an intermediary, unless the foreign entity complies with certain information reporting requirements regarding accounts held by certain U.S. persons or U.S.-owned foreign entities and certain withholding requirements regarding certain payments to account holders and certain other persons, or otherwise qualifies for an exemption from these rules. Accordingly, the entity through which a non-U.S. holder holds its common stock will affect the determination of whether such withholding is required.

Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our common stock.

THE SUMMARY OF MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSEQUENCES ABOVE IS INCLUDED FOR GENERAL INFORMATION PURPOSES ONLY. POTENTIAL PURCHASERS OF OUR COMMON STOCK ARE URGED TO CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE U.S. FEDERAL, STATE, LOCAL AND NON-U.S. TAX CONSIDERATIONS OF OWNING AND DISPOSING OF OUR COMMON STOCK.

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UNDERWRITING

Under the terms and subject to the conditions contained in an underwriting agreement, dated , 2017, the selling stockholders have agreed to sell to the underwriters named below, for whom Credit Suisse is acting as representative, the following respective numbers of shares of common stock:


Underwriter		Number of Shares
Credit Suisse Securities (USA) LLC
Citigroup Global Markets Inc.
Morgan Stanley & Co. LLC
BMO Capital Markets Corp.
RBC Capital Markets, LLC
Apollo Global Securities, LLC
KKR Capital Markets LLC
Clarksons Platou Securities, Inc.

Total

The underwriting agreement provides that the underwriters are obligated to purchase all the shares of common stock in this offering if any are purchased, other than those shares covered by the over-allotment option described below. The underwriting agreement also provides that if an underwriter defaults, the purchase commitments of non-defaulting underwriters may be increased or this offering may be terminated.

We and the selling stockholders have agreed to indemnify the underwriters and certain of their controlling persons against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that the underwriters may be required to make in respect of those liabilities.

The selling stockholders have granted to the underwriters a 30-day option to purchase on a pro rata basis up to additional shares at the initial public offering price less the underwriting discounts and commissions. The option may be exercised only to cover any over-allotments of common stock.

The underwriters propose to offer the shares of common stock initially at the public offering price on the cover page of this prospectus and to selling group members at that price less a selling concession of $ per share. The underwriters and selling group members may allow a discount of $ per share on sales to other broker/dealers. After the initial public offering the representative may change the public offering price and concession and discount to broker/dealers. The offering of the shares by the underwriters is subject to receipt and acceptance and subject to the underwriters’ right to reject any order in whole or in part.

The following table summarizes the underwriting discounts and commissions the selling stockholders will pay:

Per Share

Total

Without
Over-allotment

With
Over-allotment

Without
Over-allotment

With
Over-allotment

Underwriting Discounts and Commissions paid by selling stockholders

We estimate that our out-of-pocket expenses for this offering will be approximately $ . We have agreed to pay expenses incurred by the selling stockholders in connection with this offering, other than the underwriting discounts and commissions. We have also agreed to reimburse the underwriters up to $ for their FINRA counsel fee. In accordance with FINRA Rule 5110, this reimbursed fee is deemed underwriting compensation for this offering.

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We have agreed, subject to certain exceptions, that we will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, or file with the SEC a registration statement under the Securities Act relating to, any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our common stock, or publicly disclose the intention to make any offer, sale, pledge, disposition or filing, without the prior written consent of Credit Suisse for a period of 180 days after the date of this prospectus.

We intend to apply to list the shares of common stock on the NYSE under the symbol “HCC.”

Prior to this offering, there has been no public market for our common stock. The initial public offering price will be determined by negotiations between the selling stockholders and the representative and will not necessarily reflect the market price of the common stock following this offering. The principal factors that were considered in determining the initial public offering price included:

•

the information set forth in this prospectus and otherwise available to the underwriters;

•

the history of, and prospects for, the industry in which we compete;

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the ability of our management;

•

the prospects for our future earnings;

•

the present state of our development, results of operations and our current financial condition;

•

the general condition of the securities markets at the time of this offering;

•

the recent market prices of, and the demand for, publicly traded common stock of generally comparable companies; and

•

other factors deemed relevant by the underwriters and the selling stockholders.

We cannot assure you that the initial public offering price will correspond to the price at which the common stock will trade in the public market subsequent to this offering or that an active trading market for the common stock will develop and continue after this offering.

In connection with this offering, the underwriters may engage in stabilizing transactions, over-allotment transactions, syndicate covering transactions and penalty bids in accordance with Regulation M under the Exchange Act.

•

Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum.

•

Over-allotment involves sales by the underwriters of shares in excess of the number of shares the underwriters are obligated to purchase, which creates a syndicate short position. The short position may be either a covered short position or a naked short position. In a covered short position, the number of shares over-allotted by the underwriters is not greater than the number of shares that they may purchase in the over-allotment option. In a naked short position, the number of shares involved is greater than the number of shares in the over-allotment option. The underwriters may close out any covered short position by either exercising their over-allotment option and/or purchasing shares in the open market.

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•

Syndicate covering transactions involve purchases of the common stock in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of shares to close out the short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. If the underwriters sell more shares than could be covered by the over-allotment option, a naked short position, the position can only be closed out by buying shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in this offering.

•

Penalty bids permit the representative to reclaim a selling concession from a syndicate member when the common stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.

These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our common stock or preventing or retarding a decline in the market price of the common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. These transactions may be effected on the NYSE or otherwise and, if commenced, may be discontinued at any time.

A prospectus in electronic format may be made available on the web sites maintained by one or more of the underwriters, or selling group members, if any, participating in this offering and one or more of the underwriters participating in this offering may distribute prospectuses electronically. The representative may agree to allocate a number of shares to underwriters and selling group members for sale to their online brokerage account holders. Internet distributions will be allocated by the underwriters and selling group members that will make internet distributions on the same basis as other allocations.

Other Relationships

The underwriters and their respective affiliates are full-service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. Certain of the underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory and investment banking services for us, for which they received or will receive customary fees and expenses. In particular, affiliates of Apollo Global Securities, LLC and KKR Capital Markets LLC manage the Apollo Funds and the KKR Funds, respectively.

In addition, in the ordinary course of their business activities, the underwriters and their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. These investments and securities activities may involve securities and/or instruments of ours or our affiliates. The underwriters and their affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.

Selling Restrictions

Canada

Resale Restrictions

The distribution of our shares of common stock in Canada is being made only in the provinces of Ontario, Quebec, Manitoba, Alberta and British Columbia on a private placement basis exempt from the requirement that

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we and the selling stockholders prepare and file a prospectus with the securities regulatory authorities in each province where trades of these securities are made. Any resale of the shares in Canada must be made under applicable securities laws which may vary depending on the relevant jurisdiction, and which may require resales to be made under available statutory exemptions or under a discretionary exemption granted by the applicable Canadian securities regulatory authority. Purchasers are advised to seek legal advice prior to any resale of the securities.

Representations of Canadian Purchasers

By purchasing shares of our common stock in Canada and accepting delivery of a purchase confirmation, a purchaser is representing to us, the selling stockholders and the dealer from whom the purchase confirmation is received that:

•

the purchaser is entitled under applicable provincial securities laws to purchase the shares without the benefit of a prospectus qualified under those securities laws as it is an “accredited investor” as defined under National Instrument 45-106 – Prospectus Exemptions (“NI 45-106”) or Section 73.3 of the Securities Act (Ontario), as applicable,

•

the purchaser is a “permitted client” as defined in National Instrument 31-103 - Registration Requirements, Exemptions and Ongoing Registrant Obligations ,

•

where required by law, the purchaser is purchasing as principal and not as agent, and

•

the purchaser has reviewed the text above under Resale Restrictions.

Conflicts of Interest

Canadian purchasers are hereby notified that the underwriters are relying on the exemption set out in section 3A.3 of National Instrument 33-105 – Underwriting Conflicts from having to provide certain conflict of interest disclosure in this document.

Statutory Rights of Action

Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if the offering memorandum (including any amendment thereto) such as this document contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser of these securities in Canada should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights or consult with a legal advisor.

Enforcement of Legal Rights

All of our directors and officers as well as the experts named herein and the selling stockholders may be located outside of Canada and, as a result, it may not be possible for Canadian purchasers to effect service of process within Canada upon us or those persons. All or a substantial portion of our assets and the assets of those persons may be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against us or those persons in Canada or to enforce a judgment obtained in Canadian courts against us or those persons outside of Canada.

Taxation and Eligibility for Investment

Canadian purchasers of the shares of common stock should consult their own legal and tax advisors with respect to the tax consequences of an investment in the shares in their particular circumstances and about the eligibility of the shares for investment by the purchaser under relevant Canadian legislation.

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National Instrument 43-101 – Standards of Disclosure for Mineral Projects

As the shares of common stock offered hereunder are only being sold in certain provinces of Canada to “accredited investors”, as such term is defined in NI 45-106 or Section 73.3 of the Securities Act (Ontario), as applicable, the Company is not required to file with the applicable securities regulatory authorities in such provinces a technical report prepared in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101”) in connection with the Offering. However, all disclosure of scientific or technical information made by the Company in the attached prospectus, including disclosure of proven and probable coal reserves, concerning mineral projects on properties material to the Company is based upon information that was prepared by or under the supervision of a “qualified person” as that term is defined in NI 43-101. The Company considers its Mine No. 4, Mine No. 7 and Blue Creek Energy Mine (collectively, the “Material Properties”) to be its material mining properties.

The qualified persons for purposes of disclosure regarding the Material Properties are (i) Mike McClure and Scott Keim, employees for Marshall Miller, with respect to Mine No. 4 and Mine No. 7, and (ii) Larry Henchel and Kevin Whipkey, employees of Norwest, with respect to the Blue Creek Energy Mine.

The estimates of the Company’s coal reserves at the Material Properties disclosed in the attached prospectus have been prepared and presented in accordance with SEC Industry Guide 7. Each of the qualified persons named above in respect of the applicable Material Properties is of the opinion that the definitions and standards of SEC Industry Guide 7 with respect to the Company’s coal reserves are similar to the definitions and standards of the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM Standards”) with respect to such reserves, and that a reconciliation of the Company’s coal reserves as stated in compliance with SEC Industry Guide 7 would not be expected to result in materially different coal reserves if prepared in compliance with the CIM Standards.

The scientific and technical disclosure regarding the applicable Material Properties, including sampling, analytical and test data underlying such disclosure, has been verified by or under the supervision of the qualified persons named above using such recognized industry methods and procedures as were determined by such qualified persons to be appropriate in the circumstances having regard to the characteristics of the deposits and the quality of the work performed by the Company, among other things.

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), each underwriter represents and agrees that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State, it has not made and will not make an offer of securities which are the subject of the offering contemplated by this prospectus to the public in that Relevant Member State other than:

•

to any legal entity which is a qualified investor as defined in the Prospectus Directive;

•

to fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the representatives for any such offer; or

•

in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities shall require us or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer to the public” in relation to any securities in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to purchase or subscribe

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the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State, the expression Prospectus Directive means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

France

Neither this prospectus nor any other offering material relating to the securities described in this prospectus has been submitted to the clearance procedures of the Autorité des Marchés Financiers or of the competent authority of another member state of the European Economic Area and notified to the Autorité des Marchés Financiers. The securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in France. Neither this prospectus nor any other offering material relating to the securities has been or will be:

•

to any legal entity which is a qualified investor as defined in the Prospectus Directive;

•

to fewer than 100 or, if the relevant member state has implemented the relevant provision of the 2010 PD Amending Directive, 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the relevant Dealer or Dealers nominated by us for any such offer;

•

in any other circumstances falling within Article 3(2) of the Prospectus Directive,

•

released, issued, distributed or caused to be released, issued or distributed to the public in France; or

•

used in connection with any offer for subscription or sale of the securities to the public in France.

Such offers, sales and distributions will be made in France only:

•

to qualified investors ( investisseurs qualifiés) and/or to a restricted circle of investors ( cercle restreint d’investisseurs ), in each case investing for their own account, all as defined in, and in accordance with articles L.411-2, D.411-1, D.411-2, D.734-1, D.744-1, D.754-1 and D.764-1 of the French Code monétaire et financier;

•

to investment services providers authorized to engage in portfolio management on behalf of third parties; or

•

in a transaction that, in accordance with article L.411-2-II-1°-or-2°-or 3° of the French Code monétaire et financier and article 211-2 of the General Regulations ( Règlement Général ) of the Autorité des Marchés Financiers, does not constitute a public offer ( appel public à l’épargne ).

The securities may be resold directly or indirectly, only in compliance with articles L.411-1, L.411-2, L.412-1 and L.621-8 through L.621-8-3 of the French Code monétaire et financier.

Switzerland

This document is not intended to constitute an offer or solicitation to purchase or invest in the securities described herein. The securities may not be publicly offered, sold or advertised, directly or indirectly, in, into or from Switzerland and will not be listed on the SIX Swiss Exchange or on any other exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the securities constitutes a prospectus as such term is understood pursuant to article 652a or article 1156 of the Swiss Code of Obligations or a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange or any other regulated trading facility in Switzerland, and neither this document nor any other offering or marketing material relating to the securities may be publicly distributed or otherwise made publicly available in Switzerland.

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Neither this document nor any other offering or marketing material relating to the offering, nor the Company nor the securities have been or will be filed with or approved by any Swiss regulatory authority. The securities are not subject to the supervision by any Swiss regulatory authority, e.g., the Swiss Financial Markets Supervisory Authority FINMA (FINMA), and investors in the securities will not benefit from protection or supervision by such authority.

United Kingdom

Each of the underwriters severally represents warrants and agrees as follows:

•

it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000 (FSMA) received by it in connection with the issue or sale of the securities in circumstances in which Section 21 of the FSMA does not apply to us; and

•

it has complied with, and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the securities in, from or otherwise involving the United Kingdom.

Australia

No placement document, prospectus, product disclosure statement or other disclosure document has been lodged with the Australian Securities and Investments Commission (“ASIC”), in relation to the offering. This prospectus supplement does not constitute a prospectus, product disclosure statement or other disclosure document under the Corporations Act 2001 (the “Corporations Act”), and does not purport to include the information required for a prospectus, product disclosure statement or other disclosure document under the Corporations Act. Any offer in Australia of the securities may only be made to persons (the “Exempt Investors”) who are “sophisticated investors” (within the meaning of section 708(8) of the Corporations Act), “professional investors” (within the meaning of section 708(11) of the Corporations Act) or otherwise pursuant to one or more exemptions contained in section 708 of the Corporations Act so that it is lawful to offer the securities without disclosure to investors under Chapter 6D of the Corporations Act. The securities applied for by Exempt Investors in Australia must not be offered for sale in Australia in the period of 12 months after the date of allotment under the offering, except in circumstances where disclosure to investors under Chapter 6D of the Corporations Act would not be required pursuant to an exemption under section 708 of the Corporations Act or otherwise or where the offer is pursuant to a disclosure document which complies with Chapter 6D of the Corporations Act. Any person acquiring securities must observe such Australian on-sale restrictions. This prospectus supplement contains general information only and does not take account of the investment objectives, financial situation or particular needs of any particular person. It does not contain any securities recommendations or financial product advice. Before making an investment decision, investors need to consider whether the information in this prospectus supplement is appropriate to their needs, objectives and circumstances, and, if necessary, seek expert advice on those matters.

Japan

The securities have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended) and accordingly, will not be offered or sold, directly or indirectly, in Japan, or for the benefit of any Japanese Person or to others for re-offering or resale, directly or indirectly, in Japan or to any Japanese Person, except in compliance with all applicable laws, regulations and ministerial guidelines promulgated by relevant Japanese governmental or regulatory authorities in effect at the relevant time. For the purposes of this paragraph, “Japanese Person” shall mean any person resident in Japan, including any corporation or other entity organized under the laws of Japan.

159

Hong Kong

The securities may not be offered or sold in Hong Kong by means of any document other than (i) to “professional investors” as defined in the Securities and Futures Ordinance (Cap.571) of Hong Kong and any rules made under that Ordinance, or (ii) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies Ordinance (Cap.32) of Hong Kong or which do not constitute an offer to the public within the meaning of that Ordinance. No advertisement, invitation or document relating to the depositary securities may be issued or may be in the possession of any person for the purpose of issue, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to depositary securities which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities and Futures Ordinance and any rules made under that Ordinance.

Singapore

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus supplement and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of securities may not be circulated or distributed, nor may the securities be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than:

•

to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275, of the SFA, or

•

otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Where the securities are subscribed or purchased under Section 275 of the SFA by a relevant person which is:

•

a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or

•

a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor, securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the securities pursuant to an offer made under Section 275 of the SFA except:

•

to an institutional investor or to a relevant person defined in Section 275(2) of the SFA, or to any person arising from an offer referred to in Section 275(1A) or Section 276(4)(i)(B) of the SFA;

•

where no consideration is or will be given for the transfer;

•

where the transfer is by operation of law;

•

as specified in Section 276(7) of the SFA; or

•

as specified in Regulation 32 of the Securities and Futures (Offers of Investments) (Sharesand Debentures) Regulations 2005 of Singapore.

Dubai International Financial Centre

This document relates to an exempt offer in accordance with the Offered Securities Rules of the Dubai Financial Services Authority. This document is intended for distribution only to persons of a type specified in

160

those rules. It must not be delivered to, or relied on by, any other person. The Dubai Financial Services Authority has no responsibility for reviewing or verifying any documents in connection with exempt offers. The Dubai Financial Services Authority has not approved this document nor taken steps to verify the information set out in it, and has no responsibility for it. The notes which are the subject of the offering contemplated by this offering memorandum may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the notes offered should conduct their own due diligence on the notes. If you do not understand the contents of this document you should consult an authorized financial advisor.

Qatar

The securities have not been and will not be offered, sold or delivered at any time, directly or indirectly, in the State of Qatar (“Qatar”) in a manner that would constitute a public offering. This prospectus has not been reviewed or approved by or registered with the Qatar Central Bank, the Qatar Exchange or the Qatar Financial Markets Authority. This prospectus is strictly private and confidential, and may not be reproduced or used for any other purpose, nor provided to any person other than the recipient thereof.

161

LEGAL MATTERS

The validity of the common stock that is offered hereby by the selling stockholders will be passed upon by Akin Gump Strauss Hauer & Feld LLP, New York, New York. Certain legal matters will be passed upon for the underwriters by Fried, Frank, Harris, Shriver & Jacobson LLP, New York, New York.

EXPERTS

The consolidated financial statements of Warrior Met Coal, LLC at December 31, 2016 and for the nine months then ended and the combined financial statements of the Predecessor as of December 31, 2015 and for the year then ended and for the three months ended March 31, 2016, appearing in this Prospectus and Registration Statement, have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein, and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

The information included in this prospectus relating to the estimates of the quantity and quality of our proven and probable coal reserves for Mine No. 4 and Mine No. 7 was prepared by Marshall Miller & Associates, Inc., an independent engineering firm, and has been included herein in reliance upon the authority of this firm as an expert in these matters.

The information included in this prospectus relating to the estimates of the quantity and quality of our proven and probable coal reserves for the Blue Creek Energy Mine was prepared by Norwest Corporation, an independent international mining consulting firm, and has been included herein in reliance upon the authority of this firm as an expert in these matters.

The information included in this prospectus relating to the estimates of the quantity and quality of our proven and probable coal reserves for the Carter/Swann’s Crossing Mine, the Panther 3 Mine, the Beltona East Mine, the Carter P-3986 Mine, the Howton Mine, the Kimberly Mine, the Morris Mine, the Searles 8 Mine and the Sloan Mountain Mine was prepared by McGehee Engineering Corp., an independent engineering firm, and has been included herein in reliance upon the authority of this firm as an expert in these matters.

The sections in this prospectus entitled “Prospectus Summary,” “Industry Overview” and “Business” contain certain information with respect to the coal industry that has been sourced from Wood Mackenzie. Wood Mackenzie has agreed to be named as an expert with respect to such information, as indicated in the consent of Wood Mackenzie filed as an exhibit to the Registration Statement on Form S-1 of which this prospectus forms a part.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act covering the securities offered by this prospectus. This prospectus, which constitutes a part of that registration statement, does not contain all of the information that you can find in that registration statement and its exhibits. Certain items are omitted from this prospectus in accordance with the rules and regulations of the SEC. For further information about us and the common stock offered by this prospectus, reference is made to the registration statement and the exhibits filed with the registration statement. Statements contained in this prospectus as to the contents of any contract or other document referred to are not necessarily complete and in each instance such statement is qualified by reference to each such contract or document filed as part of the registration statement. When we complete this offering, we will be required to file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read any materials we file with the SEC free of charge at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Copies of all or any part of these

162

documents may be obtained from such office upon the payment of the fees prescribed by the SEC. The public may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The address of the site is www.sec.gov. The registration statement, including all exhibits thereto and amendments thereof, has been filed electronically with the SEC.

163

INDEX TO FINANCIAL STATEMENTS


		Page
*Unaudited Pro Forma Condensed Combined Statements of Operations*
Pro Forma Condensed Combined Statement of Operations for the year ended December 31, 2016		F-4
Pro Forma Condensed Combined Statement of Operations for the year ended December 31, 2015		F-5

*Audited Financial Statements*
Report of Independent Registered Public Accounting Firm		F-10
Balance Sheets at December 31, 2016 (Successor) and December 31, 2015 (Predecessor)		F-11
Statements of Operations for the nine months ended December 31, 2016 (Successor), three months ended March 31, 2016 (Predecessor) and year ended December 31, 2015 (Predecessor)		F-12
Statements of Changes in Members’ Equity and Parent Net Investment for the nine months ended December 31, 2016 (Successor), three months ended March 31, 2016 (Predecessor) and year ended December 31, 2015 (Predecessor)		F-13
Statements of Cash Flows for the nine months ended December 31, 2016 (Successor), three months ended March 31, 2016 (Predecessor) and year ended December 31, 2015 (Predecessor)		F-14

F-1

WARRIOR MET COAL, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS

Introduction

The unaudited pro forma condensed combined statements of operations (“pro forma statements of operations”) for the year ended December 31, 2016 and the year ended December 31, 2015 of Warrior Met Coal, Inc. are set forth below. The pro forma statements of operations have been derived from and should be read in conjunction with the audited statements of operations for the nine months ended December 31, 2016 (Successor), the three months ended March 31, 2016 (Predecessor), and the year ended December 31, 2015 (Predecessor) included elsewhere in this prospectus.

In this introduction and the notes to the accompanying pro forma statements of operations, (i) the “Company” and “Successor” refer to (A) Warrior Met Coal, Inc., a Delaware corporation, and its subsidiaries for periods beginning with the Company’s conversion from a Delaware limited liability company to a Delaware corporation as described in “Corporate Conversion” included elsewhere in this prospectus (the “Corporate Conversion”) and thereafter and (B) Warrior Met Coal, LLC, a Delaware limited liability company, and its subsidiaries for periods beginning with the consummation of the Asset Acquisition (as defined below) and ending immediately before the completion of the Corporate Conversion, and (ii) the “Predecessor” refers to the assets acquired and liabilities assumed by the Company from Walter Energy, Inc. (“Walter Energy”) pursuant to section 363 under Chapter 11 of Title 11 of the U.S. Bankruptcy Code on March 31, 2016 (the “Asset Acquisition”).

The accompanying pro forma statements of operations reflect pro forma adjustments to the Company’s statements of operations to give effect to the Asset Acquisition, this offering and the payment of a special distribution to the holders of the Company’s Class A Units and Class B Units (the “Special Distribution”) (collectively, the “Transactions”) as if the Transactions had occurred on January 1, 2015. The Asset Acquisition has already been reflected in the Company’s historical audited balance sheet as of December 31, 2016; therefore, no unaudited pro forma balance sheet as of December 31, 2016 is presented herein. Please refer to “Capitalization” included elsewhere in this prospectus and the unaudited pro forma balance sheet of the Successor included on page F-11 of this prospectus for certain pro forma balance sheet information as of December 31, 2016, which gives effect to the Corporate Conversion and the Special Distribution.

The historical financial information has been adjusted in the accompanying pro forma statements of operations to give pro forma effect to events that are (1) directly attributable to the Transactions, (2) factually supportable and (3) expected to have a continuing impact on our consolidated results.

The pro forma statements of operations give pro forma effect to the matters described in the accompanying notes, including:

•

removal of interest expense and gain on extinguishment of debt related to Walter Energy debt, that was not assumed as part of the Asset Acquisition and the addition of interest expense related to the Successor’s asset-based revolving credit agreement (the “ABL Facility”);

•

removal of pension and post-retirement benefits expense related to obligations which were not assumed by the Company as part of the Asset Acquisition and the addition of the Successor’s 401(k) contribution expenses under the new initial collective bargaining agreement with the United Mine Workers of America (the “UMWA CBA”);

•

removal of stock compensation expense for the Predecessor periods and the addition of stock compensation expense related to the Successor’s long-term incentive plan (“LTIP”);

•

adjustment to depreciation and depletion expense resulting from the preliminary estimate of fair value of Property, Plant and Equipment and Mineral Interests acquired in the Asset Acquisition;

F-2

•

adjustment to cost of sales for accretion expense resulting from the preliminary estimate of fair value of the Company’s asset retirement obligation assumed in the Asset Acquisition;

•

removal of one-time transaction related costs directly attributable to the Asset Acquisition and the IPO; and

•

effect of income taxes on the adjustments described above.

The pro forma statements of operations have been prepared by management for illustrative purposes only and are not necessarily indicative of the consolidated results of operations that would have been realized had the Transactions occurred as of the date indicated. In addition, future results may vary significantly from those reflected in the pro forma statements of operations and should not be relied on as an indication of any future results of operations of the Company.

The pro forma adjustments included in the pro forma statements of operations are based on currently available data and estimates and assumptions; therefore, actual adjustments may differ from the pro forma adjustments. However, management believes that the assumptions used to prepare these pro forma adjustments provide a reasonable basis for presenting the significant effects of the Transactions.

In the pro forma statements of operations, the Asset Acquisition has been accounted for as a business combination using the acquisition method of accounting under the provisions of Accounting Standard Codification Topic 805, Business Combinations, or ASC 805, and applying the pro forma assumptions and adjustments described in the accompanying notes. Because the acquisition method of accounting is dependent upon certain valuations and other studies which have not been completed, the allocation of fair value to the assets acquired and liabilities assumed remains preliminary. The Company expects to finalize its valuation by the end of the first quarter of 2017.

The pro forma statements of operations do not reflect any additional costs that may arise from being a public company or the realization of any expected cost savings, operating efficiencies or other synergies that may result from the Asset Acquisition.

The pro forma statements of operations are qualified by reference to, and should be read in conjunction with, “Capitalization,” “Selected Consolidated and Combined Historical and Pro Forma Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Certain Relationships and Related Party Transactions,” “Description of Certain Indebtedness,” and the audited Predecessor and Successor financial statements and the related notes and other financial information included elsewhere in this prospectus.

F-3

Warrior Met Coal, Inc.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the Year Ended December 31, 2016

(in thousands, except per unit and per share amounts)


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			Pro Forma Adjustments					Warrior Met Coal, Inc. Pro Forma
Revenues:
Sales	$	276,560		$	65,154		$	—				$	341,714
Other revenues		21,074			6,229			—					27,303

Total revenues		297,634			71,383			—					369,017
Cost and expenses:
Cost of sales (exclusive of items shown separately below)		244,723			72,297			(1,227	)	(3a	)		315,563
								(230	)	(3b	)
										(3c	)
Cost of other revenues (exclusive of items shown separately below)		19,367			4,698			—					24,065
Depreciation and depletion		47,413			28,958			(17,421	)	(3d	)		58,950
Selling, general and administrative		20,507			9,008			—					29,515
Other postretirement benefits		—			6,160			(6,160	)	(3e	)		—
Restructuring costs		—			3,418			—					3,418
Transaction and other costs		13,568			—			(13,568	)	(3f	)		—

Total costs and expenses		345,578			124,539			(38,606	)				431,511

Operating loss		(47,944	)		(53,156	)		(38,606	)				(62,494	)
Interest expense, net		(1,711	)		(16,562	)		16,030		(3g	)		(2,243	)
Reorganization items, net		—			7,920			(7,920	)	(3i	)		—

Loss before income taxes		(49,655	)		(61,798	)		46,716					(64,737	)
Income tax expense		18			18			—		(3j	)		36

Net loss	$	(49,673	)	$	(61,816	)	$	46,716				$	(64,773	)

Net loss per member unit:
Basic and diluted	$	(13.15	)
Weighted average member units outstanding		3,777

Pro forma net loss per share:
Basic and diluted
Pro forma weighted average shares outstanding

The accompanying notes are an integral part of this unaudited pro forma condensed combined statement of operations.

F-4

Warrior Met Coal, Inc.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the Year Ended December 31, 2015

(in thousands)


	Warrior Met Coal, LLC Predecessor			Pro Forma Adjustments					Warrior Met Coal, Inc. Pro Forma
Revenues:
Sales	$	514,334		$	—				$	514,334
Other revenues		30,399			—					30,399

Total revenues		544,733			—					544,733
Cost and expenses:
Cost of sales (exclusive of items shown separately below)		601,545			(18,583	)	(3a	)		582,441
					(521	)	(3b	)
							(3c	)
Cost of other revenues (exclusive of items shown separately below)		27,442			—					27,442
Depreciation and depletion		123,633			(57,605	)	(3d	)		66,028
Selling, general and administrative		38,922								38,922
Other postretirement benefits		30,899			(30,899	)	(3e	)		—
Restructuring costs		13,832			—					13,832
Asset impairment charges		27,986			—					27,986

Total costs and expenses		864,259			(107,608	)				756,651

Operating loss		(319,526	)		107,608					(211,918	)
Interest expense, net		(51,077	)		48,834		(3g	)		(2,243	)
Gain on extinguishment of debt		26,968			(26,968	)	(3h	)		—
Reorganization items, net		(7,735	)		7,735		(3i	)		—

Loss before income taxes		(351,370	)		137,209					(214,161	)
Income tax benefit		(40,789	)		—		(3j	)		(40,789	)

Net loss	$	(310,581	)	$	137,209				$	(173,372	)

The accompanying notes are an integral part of this unaudited pro forma condensed combined statement of operations.

F-5

WARRIOR MET COAL, INC.

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS

1.	Description of the Asset Acquisition

On July 15, 2015, Walter Energy and certain of its wholly owned U.S. subsidiaries (collectively, the “Walter Energy Debtors”) filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code in the Northern District of Alabama, Southern Division (the “Bankruptcy Court”).

The Company was formed as a Delaware limited liability company on September 3, 2015 by certain Walter Energy lenders under the 2011 Credit Agreement, dated as of April 1, 2011 (“2011 Credit Agreement”) and the noteholders under the 9.50% Senior Secured Notes due 2019 (such lenders and noteholders, collectively, “Walter Energy’s First Lien Lenders”) in connection with the Asset Acquisition.

On November 5, 2015, the Walter Energy Debtors entered into an asset purchase agreement with the Company, pursuant to which, among other things, the Company, on behalf of Walter Energy’s First Lien Lenders, agreed to acquire the Predecessor through a credit bid of $1.1 billion and a release of the liens under the 2011 Credit Agreement and the 9.50% Senior Secured Notes due 2019, to assume certain liabilities of the Walter Energy Debtors and to pay cash consideration in accordance with sections 363 and 365 of the U.S. Bankruptcy Code. On January 8, 2016, the Bankruptcy Court approved the Asset Acquisition which closed on March 31, 2016. Prior to the Asset Acquisition, the Company had no operations and nominal assets.

2.	Basis of Presentation

The accompanying unaudited pro forma condensed combined statements of operations (“pro forma statements of operations”) were prepared in accordance with Article 11 of Regulation S-X. The pro forma statements of operations for the year ended December 31, 2016 and the year ended December 31, 2015 give effect to the Transactions as if they had occurred on January 1, 2015 and were prepared using the audited financial statements for the nine months ended December 31, 2016 (Successor), the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor).

3.	Adjustments to the Pro Forma Statements of Operations

(a)

Adjustment to reflect the net effect of (i) the elimination of the Predecessor’s historical United Mine Workers’ Association (“UMWA”) pension and benefit trust expense of $1.5 million and $22.8 million for the year ended December 31, 2016 and the year ended December 31, 2015 respectively, related to the pension and benefit trust obligations which were not assumed as part of the Asset Acquisition and (ii) the inclusion of the Company’s 401(k) contribution expenses associated with the UMWA CBA of $0.3 million and $4.3 million for the year ended December 31, 2016 and the year ended December 31, 2015, respectively.

(b)

Adjustment to cost of sales for accretion expense as a result of the change in the basis of the Asset Retirement Obligations (“ARO”) to their preliminary estimate of fair value in connection with the Asset Acquisition. The ARO is amortized using the units-of-production method over the estimated life of the reserves. The estimate of fair value is preliminary and will not be final until the completion of certain valuations and studies.

F-6

WARRIOR MET COAL, INC.

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS

(c)

Adjustment to eliminate the Predecessor’s historical stock compensation expense allocated to the Company and to record stock compensation expense under the LTIP for the restricted Class C units, which do not vest until an initial public offering, as follows (in thousands):


	Predecessor/ Successor		Predecessor
	For the year ended December 31, 2016		For the year ended December 31, 2015
LTIP	$		$
Historical		400		4,000

Pro forma stock compensation expense	$		$

(d)

Adjustment to depreciation and depletion expense as a result of the change in the basis of Property, Plant and Equipment and Mineral Interests to their preliminary estimate of fair value in connection with the Asset Acquisition. Property, Plant and Equipment is being depreciated over useful lives ranging from one to forty years. Mineral Interests are depleted using the units-of-production method over the life of the proven and probable reserves. The estimate of fair value is preliminary and will not be final until the completion of certain valuations and studies. The net decrease in depreciation and depletion expense represents a decrease in depreciation expense related to Property, Plant and Equipment partially offset by an increase in depletion expense related to Mineral Interests.

(e)

Adjustment to eliminate the Predecessor’s historical other postretirement benefit expense associated with the Predecessor’s historical other postretirement benefit obligations for retiree medical and life insurance benefits, which were not assumed by the Company.

(f)

Adjustment to eliminate historical non-recurring transaction and other related costs of $13.6 million for the year ended December 31, 2016, which were directly attributable to the Asset Acquisition ($10.5 million) and this offering ($3.1 million).

(g)

Adjustment to reflect the net effect of (i) the elimination of the Predecessor’s historical interest expense related to the notes, loans and other debt that was not assumed by the Company as part of the Asset Acquisition, (ii) the Successor’s new financing arrangements, including a $100 million ABL Facility, and (iii) the Company’s promissory note at the stated interest rate, which was assumed by the Company as part of the Asset Acquisition as follows (in thousands):


	Predecessor / Successor			Predecessor
	For the year ended December 31, 2016			For the year ended December 31, 2015
ABL Facility commitment fees	$	(250	)	$	(250	)
Amortization of ABL Facility origination fees		(1,701	)		(1,701	)
Promissory note		(292	)		(292	)

Pro forma interest expense		(2,243	)		(2,243	)
Less: Historical interest expense		18,273			51,077

Pro forma interest expense adjustment	$	16,030		$	48,834

(h)

Adjustment to eliminate the gain on extinguishment of debt related to Walter Energy debt that was not assumed as part of the Asset Acquisition.

(i)

Adjustment to eliminate historical reorganization items incurred by the Predecessor.

F-7

WARRIOR MET COAL, INC.

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS

(j)

Prior to the Corporate Conversion, the Company elected to be taxed as a corporation for income tax purposes. The Company records deferred tax assets to the extent these assets will more likely than not be realized. In making such determination, the Company considered all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial performance. Based upon the review of all positive and negative evidence, including its recent history of operating losses, the Company concluded that a valuation allowance was necessary. The tax provision differs significantly from the expected federal statutory rate of 35% due to the adjustment in the valuation allowance.

4.	Pro Forma Net Loss per Share

Unaudited pro forma basic and diluted net loss per share is determined by dividing the pro forma net loss by the weighted average number of common shares outstanding. For the year ended December 31, 2016, there were no dilutive securities outstanding and, therefore, pro forma diluted net loss per share is equal to pro forma basic net loss per share.

Unaudited pro forma net loss per share for the year ended December 31, 2016 is as follows:


		For the year ended December 31, 2016
Numerator:
Pro forma net loss		$

Denominator:
Weighted-average shares used to compute pro forma net loss per share, basic and diluted

Pro forma net loss per share, basic and diluted		$

F-8

WARRIOR MET COAL, LLC

FINANCIAL STATEMENTS

As of December 31, 2016 (Successor) and December 31, 2015 (Predecessor), and for the period from April 1, 2016 to December 31, 2016 (Successor), for the period from January 1, 2016 to March 31, 2016 (Predecessor) and for the period from January 1, 2015 to December 31, 2015 (Predecessor)

F-9

Report of Independent Registered Public Accounting Firm

The Board of Managers and Members of Warrior Met Coal, LLC

We have audited the accompanying consolidated balance sheet of Warrior Met Coal, LLC (Company) as of December 31, 2016, and the related consolidated statements of operations, changes in members’ equity, and cash flows for the nine months ended December 31, 2016. We also have audited the accompanying combined balance sheet of the Company’s Predecessor as of December 31, 2015, and the related combined statements of operations, changes in Parent net investment and cash flows for the three months ended March 31, 2016 and for the year ended December 31, 2015. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s or the Predecessor’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s or the Predecessor’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated and combined financial position of Warrior Met Coal, LLC and its Predecessor at December 31, 2016 and 2015, and the consolidated and combined results of their operations and their cash flows for the periods referred to in the introductory paragraph, in conformity with U.S. generally accepted accounting principles.

/s/ Ernst & Young LLP

Birmingham, Alabama

March 7, 2017

F-10

WARRIOR MET COAL, LLC

BALANCE SHEETS

(in thousands)


	Pro Forma (See Note 26)
	Successor	Successor			Predecessor
	December 31, 2016	December 31, 2016			December 31, 2015
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	$	150,045		$	79,762
Short-term investments			17,501			—
Trade accounts receivable			65,896			25,636
Other receivables			5,901			2,790
Inventories, net			39,420			51,575
Prepaid expenses			12,010			33,889
Other current assets			—			291

Total current assets			290,773			193,943
Mineral interests, net			143,231			5,295
Property, plant and equipment, net			496,959			567,594
Other long-term assets			16,668			35,305

Total assets	$	$	947,631		$	802,137

LIABILITIES, MEMBERS’ EQUITY AND PARENT NET INVESTMENT
Liabilities not subject to compromise:
Current liabilities:
Accounts payable	$	$	6,043		$	13,773
Accrued expenses			47,339			43,452
Asset retirement obligations			3,098			5,006
Other current liabilities			5,307			2,154
Current portion of long-term debt			2,849			—

Total current liabilities			64,636			64,385
Long-term debt			3,725			—
Deferred income taxes			1,944			2,434
Asset retirement obligations			96,050			30,573
Black lung obligations			27,156			24,351
Other long-term liabilities			1,153			4,977

Total liabilities not subject to compromise			194,664			126,720
Liabilities subject to compromise			—			1,496,278

Total liabilities			194,664			1,622,998
Commitments and contingencies (Note 18)
Members’ equity and parent net investment:
Parent net investment			—			(820,861	)
Members’ equity:
Contributed capital			802,640			—
Accumulated deficit			(49,673	)		—

Total members’ equity and parent net investment			752,967			(820,861	)

Total liabilities, members’ equity and parent net investment	$	$	947,631		$	802,137

The accompanying notes are an integral part of these financial statements.

F-11

WARRIOR MET COAL, LLC

STATEMENTS OF OPERATIONS

(in thousands, except per unit amounts)


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
Revenues:
Sales	$	276,560		$	65,154		$	514,334
Other revenues		21,074			6,229			30,399

Total revenues		297,634			71,383			544,733

Costs and expenses:
Cost of sales (exclusive of items shown separately below)		244,723			72,297			601,545
Cost of other revenues (exclusive of items shown separately below)		19,367			4,698			27,442
Depreciation and depletion		47,413			28,958			123,633
Selling, general and administrative		20,507			9,008			38,922
Other postretirement benefits		—			6,160			30,899
Restructuring costs		—			3,418			13,832
Asset impairment charges		—			—			27,986
Transaction and other costs		13,568			—			—

Total costs and expenses		345,578			124,539			864,259

Operating loss		(47,944	)		(53,156	)		(319,526	)
Interest expense, net		(1,711	)		(16,562	)		(51,077	)
Gain on extinguishment of debt		—			—			26,968
Reorganization items, net		—			7,920			(7,735	)

Loss before income tax benefit		(49,655	)		(61,798	)		(351,370	)
Income tax expense (benefit)		18			18			(40,789	)

Net loss	$	(49,673	)	$	(61,816	)	$	(310,581	)

Basic and diluted net loss per unit:
Net loss per unit—basic and diluted	$	(13.15	)

Weighted average number of units outstanding—basic and diluted		3,777

Pro forma basic and diluted net loss per share (unaudited) (Note 26):
Pro forma net loss per share—basic and diluted	$

Pro forma weighted average number of shares outstanding—basic and diluted

The accompanying notes are an integral part of these financial statements.

F-12

WARRIOR MET COAL, LLC

STATEMENTS OF CHANGES IN MEMBERS’ EQUITY AND PARENT NET INVESTMENT

(in thousands)


	Total Parent Net Investment
*Predecessor*
Balance at December 31, 2014	$	288,699
Net loss		(310,581	)
Change in attribution of Parent debt (Note 22)		(663,701	)
Net transfers to Parent		(135,278	)

Balance at December 31, 2015	$	(820,861	)

Net loss		(61,816	)
Change in attribution of Parent debt		(626	)
Net transfers to Parent		(12,900	)

Balance at March 31, 2016	$	(896,203	)


	Contributed capital		Accumulated deficit			Total Members’ Equity
*Successor*
Balance at April 1, 2016	$	—	$	—		$	—
Issuance of 1,274,364 Class A member units (Note 1 and Note 19)		602,131		—			602,131
Issuance of 2,500,004 Class B member units (Note 1 and Note 19)		200,000		—			200,000
Equity award compensation		509		—			509
Net loss		—		(49,673	)		(49,673	)

Balance at December 31, 2016	$	802,640	$	(49,673	)	$	752,967

The accompanying notes are an integral part of these financial statements.

F-13

WARRIOR MET COAL, LLC

STATEMENTS OF CASH FLOWS

(in thousands)


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
OPERATING ACTIVITIES
Net loss	$	(49,673	)	$	(61,816	)	$	(310,581	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and depletion		47,413			28,958			123,633
Deferred income tax expense (benefit)		544			18			(40,789	)
Stock based compensation expense		509			390			4,034
Non-cash reorganization items		—			(18,882	)		(11,558	)
Amortization of debt issuance costs and debt discount, net		1,244			10,164			6,760
Gain on extinguishment of debt		—			—			(26,968	)
Asset impairment charges		—			—			27,986
Accretion of asset retirement obligations		2,817			1,169			4,276
Changes in operating assets and liabilities, net of the effect of acquisitions:
Trade accounts receivable		(54,911	)		15,097			46,858
Other receivables		(2,530	)		1,070			(12,474	)
Inventories		9,524			677			20,604
Prepaid expenses and other current assets		(11,001	)		13,020			8,378
Accounts payable		(4,144	)		(15,338	)		16,675
Accrued expenses and other current liabilities		45,408			(16,083	)		22,303
Asset retirement obligations		(311	)		(107	)		(1,083	)
Black lung obligations		2,997			(1,083	)		(698	)
Other		2,927			2,048			(9,174	)

Net cash used in operating activities		(9,187	)		(40,698	)		(131,818	)

INVESTING ACTIVITIES
Purchase of property, plant and equipment		(11,531	)		(5,422	)		(64,971	)
Proceeds from sale of property, plant and equipment		34			—			722
Cash paid for acquisition, net of cash acquired		(24,107	)		—			—
Cash receipt from escrow refund		9,364			—			—
Proceeds from termination of life insurance policy		12,857			—			—
Purchases of short-term investments		(17,501	)		—			—

Net cash used in investing activities		(30,884	)		(5,422	)		(64,249	)

FINANCING ACTIVITIES
Proceeds from Rights Offerings		200,000			—			—
Proceeds from issuance of debt		—			15,723			—
Retirements of debt		(2,295	)		(285	)		(4,610	)
Net cash transfers to Parent		—			(13,290	)		(142,535	)
Debt issuance costs paid		(4,978	)		(8,388	)		—

Net cash provided by (used in) financing activities		192,727			(6,240	)		(147,145	)

Net increase (decrease) in cash and cash equivalents and restricted cash		152,656			(52,360	)		(343,212	)
Cash and cash equivalents and restricted cash at beginning of period		—			84,462			427,674

Cash and cash equivalents and restricted cash at end of period	$	152,656		$	32,102		$	84,462

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid, net of capitalized interest	$	231		$	—		$	42,595
Non-cash investing activities
Assets acquired in Asset Acquisition (Note 3)	$	828,321		$	—		$	—
Liabilities assumed in Asset Acquisition (Note 3)	$	175,360		$	—		$	—

The accompanying notes are an integral part of these financial statements.

F-14

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS

Note 1—Business and Basis of Presentation

Description of the Business

On July 15, 2015, Walter Energy, Inc. (“Walter Energy” or the “Parent”) and certain of its wholly owned U.S. subsidiaries (collectively, the “Walter Energy Debtors”) filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code (the “Chapter 11 Cases”) in the Northern District of Alabama, Southern Division (the “Bankruptcy Court”).

Warrior Met Coal, LLC (the “Company” or, for the periods beginning as of April 1, 2016, the “Successor”) was formed on September 3, 2015 by certain Walter Energy lenders under the 2011 Credit Agreement, dated as of April 1, 2011 (the “2011 Credit Agreement”) and the noteholders under the 9.50% Senior Secured Notes due 2019 (such lenders and noteholders, collectively, “Walter Energy’s First Lien Lenders”) in connection with the acquisition by the Company of certain core operating assets of Walter Energy under section 363 under Chapter 11 of Title 11 of the U.S. Bankruptcy Code (“U.S. Bankruptcy Code”). These operating assets acquired and liabilities assumed are referred to as the “Predecessor” for all periods on or before March 31, 2016. The Company and its Predecessor are a U.S. based producer and exporter of metallurgical (“met”) coal for a diversified customer base of blast furnace steel producers located primarily in Europe and South America. The Company also generates ancillary revenues from the sale of natural gas extracted as a byproduct from the underground coal mines and royalty revenues from leased properties.

On November 5, 2015, the Walter Energy Debtors entered into an asset purchase agreement (as amended, the “Asset Purchase Agreement”) with the Company, pursuant to which, among other things, the Company, on behalf of Walter Energy’s First Lien Lenders, agreed to acquire the Predecessor through a credit bid of $1.1 billion and a release of the liens under the 2011 Credit Agreement and the 9.50% Senior Secured Notes due 2019 (“Walter Energy First Lien Obligations”), to assume certain liabilities of the Walter Energy Debtors and to pay cash consideration in accordance with sections 363 and 365 of the U.S. Bankruptcy Code (the “Asset Acquisition”). On January 8, 2016, the Bankruptcy Court approved the Asset Acquisition, which closed on March 31, 2016.

In connection with the Asset Acquisition, the Company also conducted rights offerings to Walter Energy’s First Lien Lenders and certain qualified unsecured creditors to purchase newly issued Class B Units of the Company, which diluted the Class A Units on a pro rata basis (the “Rights Offerings”). Proceeds from the Rights Offerings were used to pay certain costs associated with the Asset Acquisition and for general working capital purposes (see Note 19).

Basis of Presentation

Prior to the closing of the Asset Acquisition on March 31, 2016, the Company had no operations and nominal assets.

The accompanying financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”).

The accompanying financial statements have been presented on a consolidated basis for the Successor periods subsequent to the Asset Acquisition, which include the nine months ended December 31, 2016, and on a combined basis for the Predecessor periods prior to the Asset Acquisition, which includes the year ended December 31, 2015 and the three months ended March 31, 2016.

The accompanying financial statements present separately the financial position, results of operations, cash flows and changes in members’ equity for the Company on a “Successor” basis (reflecting the Company’s capital

F-15

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

structure and the Company’s basis in the assets and liabilities of the Predecessor after accounting for the Asset Acquisition) and Parent net investment on a “Predecessor” basis (reflecting Walter Energy’s ownership and cost basis). The financial information of the Company has been separated by a vertical line on the face of the financial statements to identify these different bases of accounting for Predecessor and Successor periods.

Predecessor Presentation

The Predecessor’s combined financial statements have been “carved-out” from the accounting records of Walter Energy. The Predecessor consists of all or a material portion of the following operations and assets of the Parent (all of which were under common control and management):

•

Alabama Underground and Gas, including Mine No. 4 and Mine No. 7,

•

Jim Walter Resources Mine No. 5,

•

Barge Loadout located in Tuscaloosa County, Alabama,

•

Highway 59 Mine,

•

East Brookwood Mine,

•

Blue Creek Coal Sales, Inc.,

•

Black Warrior Methane Corporation,

•

Black Warrior Transmission Corporation,

•

Port of Mobile Lease,

•

Walter Black Warrior Basin LLC,

•

Tuscaloosa Resources, Inc., including Swanns Crossing Mine,

•

Blue Creek Energy Mine,

•

Walter Minerals land holdings, and non-mining property interests, including Panther and Howton Mines,

•

J.W. Walter, Inc., which includes non-mining property interests in West Virginia, and

•

Walter Land, which includes non-mining property interests in Louisiana.

Historically, the Predecessor did not operate as an independent standalone company. For periods subsequent to filing the Chapter 11 Cases, the Predecessor applied the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 852, Reorganizations, in preparing its combined financial statements. ASC 852 requires that the financial statements distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, certain revenues, expenses, realized gains and losses and provisions for losses that were realized or incurred in the Chapter 11 Cases have been recorded in a reorganization line item on the Combined Statements of Operations. In addition, the pre-petition obligations that may be impacted by the reorganization process have been classified on the Combined Balance Sheet as liabilities subject to compromise. These liabilities are reported at the amounts expected to be allowed by the Bankruptcy Court, even if they may be settled for lesser amounts.

Preparation of the combined financial statements included making certain adjustments necessary to reflect all costs of doing business to present the historical records on a basis as if the Predecessor had been a separate stand alone entity. These adjustments include, for example, allocations of Parent overhead and selling, general and administrative expenses.

F-16

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The combined financial statements include certain assets and liabilities that have historically been held at the Parent corporate level but are specifically identifiable or otherwise allocable to the Predecessor. The cash and cash equivalents of the Parent were attributed to the Predecessor for the period presented. The combined financial statements also include an allocation of a portion of debt and related interest expense from the Parent (see Note 22).

The historical costs and expenses reflected in the combined financial statements include an allocation for certain corporate functions historically provided by the Parent. Substantially all of the Predecessor’s senior management were employed by the Parent and certain functions critical to the Predecessor’s operations were centralized and managed by the Parent. Historically, the centralized functions have included executive senior management, financial reporting, financial planning and analysis, accounting, shared services, information technology, tax, risk management, treasury, legal, human resources, and strategy and development. The costs of each of these services has been allocated to the Predecessor on the basis of the Predecessor’s relative headcount, revenue and total assets to that of the Parent. These cost allocations were $7.8 million and $32.0 million for the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor), respectively.

All intracompany transactions have been eliminated. The net effect of the settlement of transactions between the Predecessor, the Parent and other affiliates of the Parent, together with cash transfers to and from the Parent’s cash management accounts are reflected in the Combined Statements of Changes in Members’ Equity and Parent Net Investment as net transfers to Parent, in the Combined Statements of Cash Flows as a financing activity and in the Combined Balance Sheet as Parent net investment.

The Parent used a centralized approach to cash management and financing of its operations. Historically, the majority of the Predecessor’s cash was transferred to the Parent on a daily basis. This arrangement is not reflective of the manner in which the Predecessor would have been able to finance its operations had it been a standalone business separate from the Parent during the periods presented.

The Predecessor’s employees participated in benefit and stock-based compensation plans of the Parent. A portion of the cost of those plans is included in the combined financial statements. However, the Combined Balance Sheet as of December 31, 2015 does not include liabilities for certain Parent sponsored benefit plan obligations. See Notes 13 and 14 for a further description of the accounting for benefit plans and stock-based compensation, respectively.

The allocation methodologies have been described in the notes to the financial statements where appropriate, and management considers the allocations to be reasonable. The financial information included herein may not necessarily reflect the financial position, results of operations and cash flows of the Predecessor in the future or what they would have been had the Predecessor been a separate, standalone entity during the periods presented.

F-17

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

For the three months ended March 31, 2016 (Predecessor), the Company revised its classification of a gain recognized upon the settlement of a transportation and throughput agreement in connection with the Chapter 11 Cases to present the amount as a component of reorganization items, net in the previously issued Statement of Operations. The gain was previously recognized within cost of sales (exclusive of items shown separately below) in the previously issued Statements of Operations. This revision did not impact net loss, total assets or liabilities, parent net investment or cash flows from operations. The following reflects the revision for the three months ended March 31, 2016 (in thousands):


	Predecessor
	For the three months ended March 31, 2016
*Revisions to Statement of Operations:*
Cost of sales (exclusive of items shown separately below), prior to revision	$	61,204
Revision of gain on settlement of transportation and throughput agreement		11,093

Cost of sales (exclusive of items shown separately below), revised	$	72,297

Reorganization items, net, prior to revision	$	(3,173	)
Revision of gain on settlement of transportation and throughput agreement		11,093

Reorganization items, net, revised	$	7,920


	Predecessor
	For the three months ended March 31, 2016
*Revisions to Statement of Cash Flows:*
Non-cash reorganization items	$	(7,789	)
Revision of gain on settlement of transportation and throughput agreement		(11,093	)

Non-cash reorganization items, revised	$	(18,882	)

Changes in accounts payable	$	(26,431	)
Revision of gain on settlement of transportation and throughput agreement		11,093

Changes in accounts payable, revised	$	(15,338	)

Note 2—Summary of Significant Accounting Policies

Use of Estimates

The Company prepares its financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Due to the inherent uncertainty involved in making estimates, actual results could differ from those estimates.

Concentrations of Credit Risk and Major Customers

The Company’s principal line of business is mining and marketing met coal to foreign steel producers. During the nine months ended December 31, 2016, approximately 97% of sales were derived from coal shipments to these customers, located primarily in Europe and South America. At December 31, 2016,

F-18

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

approximately 91% of trade receivables related to these customers. The Company also generates ancillary revenues from the sale of natural gas extracted as a byproduct from the underground coal mines and royalty revenues from leased properties. During the nine months ended December 31, 2016, Salzgitter Flachstahl GmBH, Voestelpine and Huettenwerke Krupp Mannesmann GmBH accounted for $43.1 million or 15.6%, $35.3 million or 12.7% and $34.0 million or 12.3% of total revenues, respectively. During the three months ended March 31, 2016, Xcoal Energy & Resources and Voestelpine accounted for $10.7 million or 16.4% and $8.3 million or 12.8% of total revenues, respectively. During the year ended December 31, 2015, ArcelorMittal accounted for $88.7 million or 16.3% of total revenues and no other customer accounted for 10% or more of total revenues. Credit is extended based on an evaluation of the individual customer’s financial condition. In some instances, the Company required letters of credit, cash collateral or prepayments from its customers on or before shipment to mitigate the risk of loss. These efforts have consistently resulted in minimal historical credit losses.

Revenue Recognition

Revenue is recognized when the following criteria have been met: (i) persuasive evidence of an arrangement exists; (ii) the price to the buyer is fixed or determinable; (iii) delivery has occurred; and (iv) collectability is reasonably assured. Delivery is considered to have occurred at the time title and risk of loss transfers to the customer. For coal shipments to domestic customers via rail, delivery occurs when the railcar is loaded. For coal shipments to international customers via ocean vessel, delivery occurs when the vessel is loaded at the Port of Mobile, Alabama. For natural gas sales, delivery occurs when the gas has been transferred to the pipeline.

Shipping and Handling

Costs incurred to transport coal to the point of sale at the Port of Mobile, Alabama, are included in cost of sales and the gross amounts billed to customers, if any, to cover shipping and handling to the ultimate/final destination are included in sales.

Cash and Cash Equivalents and Restricted Cash

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Balance Sheets that sum to the total of the same such amounts shown in the Statements of Cash Flows (in thousands):


	Successor		Predecessor
	December 31, 2016		December 31, 2015
Cash and cash equivalents	$	150,045	$	79,762
Restricted cash included in other long-term assets		2,611		4,700

Total cash and cash equivalents and restricted cash included in the Statements of Cash Flows	$	152,656	$	84,462

Cash and cash equivalents include short-term deposits and highly liquid investments that have original maturities of three months or less when purchased and are stated at cost, which approximates fair value. As of December 31, 2016 (Successor) and December 31, 2015 (Predecessor), restricted cash included in other long-term assets in the Balance Sheet represents amounts funded to an escrow account as collateral for coal royalties due under certain underground coal mining lease contracts.

Short-Term Investments

Instruments with maturities greater than three months, but less than twelve months, are included in short-term investments. The Company purchases United States Treasury bills with maturities ranging from six to

F-19

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

twelve months which are classified as held to maturity and are carried at amortized cost, which approximates fair value. Securities classified as held to maturity securities are those securities that management has the intent and ability to hold to maturity.

As of December 31, 2016 (Successor), the Company’s short-term investments consisted of $17.5 million in Treasury bills with a maturity of six months. These Treasury bills were posted as collateral for the self-insured black lung related claims asserted by or on behalf of former employees of Walter Energy and its subsidiaries, which were assumed in the Asset Acquisition and relate to periods prior to March 31, 2016. There were no short-term investments as of December 31, 2015 (Predecessor).

Inventories

Inventories are valued at the lower of cost or market. Coal inventory costs include labor, supplies, equipment costs, operating overhead, freight, royalties, depreciation and depletion and other related costs. Coal inventories are valued using the first-in, first-out (“FIFO”) inventory valuation method. The valuation of coal inventories is subject to estimates due to possible gains and losses resulting from inventory movements from the mine site to storage facilities, inherent inaccuracies in belt scales and aerial surveys used to measure quantities and fluctuations in moisture content. Periodic adjustments to coal tonnages on hand are made for an estimate of coal shortages and overages due to these inherent gains and losses, primarily based on historical results from aerial surveys and periodic coal pile clean-ups. Supplies inventories are valued using the average cost method of accounting. Management evaluates its inventory in terms of excess and obsolete exposures which includes such factors as anticipated usage, inventory turnover, inventory levels and ultimate market value. A reserve for excess and obsolete inventory is established and charged to cost of sales in the Statements of Operations.

Deferred Longwall Move Expenses

Direct costs, including labor and supplies, associated with moving longwall equipment and the related equipment refurbishment costs are deferred and included in prepaid expenses. These deferred costs are amortized on a unit-of-production basis into cost of sales over the life of the subsequent panel of coal mined by the longwall equipment. See Note 5 for further disclosures related to deferred longwall move expenses.

Advanced Mining Royalties

Lease rights to coal reserves are often acquired in exchange for royalty payments. Advance mining royalties are advance payments made to lessors under terms of mineral lease agreements that are recoupable against future production royalties. These advance payments are deferred and charged to operations as the coal reserves are mined. Advance mining royalties are included in other long-term assets.

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation is recorded principally on the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized on the straight-line method over the lesser of the useful life of the improvement or the remaining lease term. Estimated useful lives used in computing depreciation expense range from three to ten years for machinery and equipment, and from fifteen to thirty years for land improvements and buildings. Well life is used to estimate the useful life for gas properties and related development, and mine life is used for amortizing mine development costs. Gains and losses upon disposition are reflected in the Statements of Operations in the period of disposition. Maintenance and repair expenditures are charged to cost of sales as incurred.

F-20

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Deferred Mine Development

Costs of developing new underground mines and certain underground expansion projects are capitalized. Underground development costs, which are costs incurred to make the coal physically accessible, may include construction permits and licenses, mine design, construction of access roads, main entries, airshafts, roof protection and other facilities. Costs of developing the first pit within a permitted area of a surface mine are capitalized up to the point of coal production attaining a level that would be more than de minimis. A surface mine is defined as the permitted mining area, which includes various adjacent pits that share common infrastructure, processing equipment and a common coal reserve. Surface mine development costs include construction costs for entry roads, drilling, blasting and removal of overburden to access the first coal seam. Mine development costs are amortized primarily on a unit-of-production basis over the estimated reserve tons directly benefiting from the capital expenditures. Costs incurred during the production phase of a mine are capitalized into inventory and expensed to cost of sales as the coal is sold.

Owned and Leased Mineral Interests

Costs to obtain coal reserves and lease mineral rights are capitalized based on cost or the fair value at acquisition and depleted using the unit-of-production method over the life of proven and probable reserves. Lease agreements are generally long-term in nature (original terms range from 10 to 50 years) and substantially all of the leases contain provisions that allow for automatic extension of the lease term provided certain requirements are met. Depletion expense was $4.5 million for the nine months ended December 31, 2016 (Successor) and is included in depreciation and depletion in the accompanying Statements of Operations. There was no depletion expense recorded for the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor).

Asset Retirement Obligations

The Company has certain asset retirement obligations primarily related to mine closing reclamation costs, perpetual water care costs and other costs associated with dismantling and removing facilities. The future costs of these obligations is accrued at the estimated fair value in the period in which it is incurred if a reasonable estimate of fair value can be made. The present value of the estimated asset retirement cost is capitalized as part of the carrying amount of the long-lived asset. Capitalized asset retirement costs are amortized on a unit-of-production basis over the estimated reserves. Accretion of the asset retirement obligation is recognized over time and generally will escalate over the life of the producing asset, typically as production declines. Accretion is included in cost of sales on the Statements of Operations.

Accrued mine closing costs, perpetual care costs and reclamation costs and other costs of dismantling and removing facilities are regularly reviewed by management and revised for changes in future estimated costs and regulatory requirements, as necessary.

Impairment of Long-Lived Assets

Property, plant and equipment and other long-lived assets are reviewed for impairment at least annually or whenever events or changes in circumstances indicate that the book value of the asset may not be recoverable. The Company periodically evaluates whether events and circumstances have occurred that would indicate possible impairment. When impairment indicators exist, the Company uses an estimate of the future undiscounted cash flows of the related asset or asset group over the remaining life in measuring whether or not the asset values are recoverable. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, impairment is recognized equal to the amount by which the carrying amount of the asset exceeds the

F-21

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

fair value of the asset or asset group. Fair value is generally determined using market quotes, if available, or a discounted cash flow approach. The Company’s estimate of future undiscounted cash flows is based on assumptions including long-term met coal pricing forecasts, anticipated production volumes and mine operating costs for the life of the mine or estimated useful life of the asset.

Equity Award Compensation (Successor)

The Company accounts for equity award-based compensation to employees and non-employee/directors in accordance with ASC 718 requiring employee equity awards to be accounted for under the fair value method adjusted for estimated forfeitures rates based on historical experience. The Company recognizes compensation expense associated with equity awards for all awards made to employees as the requisite service, performance and market vesting conditions are met. The Company measures compensation expense based on the grant-date fair value of the awards calculated using a Black-Scholes or Monte Carlo valuation model.

Compensation expense for equity awards with a service-only condition is recognized over the employee’s requisite service period using a graded vesting method. For awards with a performance condition that affects vesting, the performance condition is not considered in determining the award’s grant-date fair value; however, the performance conditions are considered when estimating the quantity of awards that are expected to vest. No compensation expense is recorded for awards with performance conditions until the performance condition is determined to be probable of achievement. For awards with a market condition that affects vesting, the market condition is considered in determining the award’s grant-date fair value. Compensation expense for awards with a market condition is recognized straight-line over the derived or implied service period. For awards with both performance and market conditions, the market condition is incorporated into the fair value of the award, while the performance condition impacts the timing of expense recognition.

Compensation expense for equity awards is included in selling, general and administrative in the accompanying Statements of Operations.

Stock-Based Compensation (Predecessor)

Prior to the Asset Acquisition, the Parent periodically granted stock-based awards to its employees and its Board of Directors. Stock-based compensation expenses related to these awards were allocated to the Predecessor based on the awards and terms previously granted to the employees of the Predecessor’s business units or subsidiaries as well as an allocation of the Parent’s corporate employee expenses.

The Parent measured stock options and other stock-based awards granted to employees and directors based on the fair value on the date of the grant and recognized compensation expense for those awards, net of estimated forfeitures, over the requisite service period, which was generally the vesting period of the respective award.

The Parent recognized compensation expense for only the portion of awards that were expected to vest. In developing a forfeiture rate estimate, the Parent considered its historical experience to estimate pre-vesting forfeitures for service-based awards. The impact of a forfeiture rate adjustment was recognized in full in the period of adjustment, and when the actual forfeiture rate was materially different from the estimate.

The Parent used the Black-Scholes option pricing model to value stock option grants and also estimated forfeitures in calculating the expense related to stock-based compensation. The Parent used the Monte Carlo simulation to value its performance share units in calculating the expense related to stock-based compensation.

F-22

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Deferred Financing Costs

The costs to obtain new debt financing or amend existing financing agreements are deferred and amortized to interest expense over the life of the related indebtedness or credit facility using the straight line method. As of December 31, 2016 (Successor), there were $3.7 million of origination fees related to the ABL Facility (as defined below) in other long-term assets on the accompanying Balance Sheet. The unamortized balance of deferred financing costs was $20.0 million at December 31, 2015 (Predecessor), which is presented as a deduction from the carrying amount of the debt recognized in the accompanying Balance Sheet.

Net Income (Loss) per Unit

Basic net income (loss) per unit is computed by dividing net income (loss) by the weighted average number of member units outstanding during the period. Diluted net income (loss) per unit is computed by using the weighted average number of member units outstanding plus the effect of potentially dilutive units for periods with net income.

Income Taxes

Results of operations of the Predecessor have historically been included in the consolidated federal and state income tax returns of the Parent. The income tax provision included in the Predecessor financial statements was calculated using a method consistent with a separate return basis, as if the Predecessor’s business had been a separate taxpayer. Similarly, historical tax attributes (net operating losses, alternative minimum tax credits, etc.) have been allocated to the Predecessor’s business utilizing a reasonable method of allocation.

The Company records a tax provision for the expected tax effects of the reported results of operations. The provision for income taxes is determined using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax impact of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carryforwards. Deferred income tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets and liabilities are expected to be realized or settled. The Company records a valuation allowance to reduce deferred income tax assets to the amount that is believed more likely than not to be realized. When the Company concludes that all or part of the net deferred income tax assets are not realizable in the future, the Company makes an adjustment to the valuation allowance that is charged to earnings in the period that such determination was made.

The Company recognizes tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.

Fair Value Measurements

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. A three level hierarchy has been established for valuing assets and liabilities based on how transparent (observable) the inputs are that are used to determine fair value, with the inputs considered most observable categorized as Level 1 and those that are the least observable categorized as Level 3. Hierarchy levels are defined as follows:

Level 1:

Quoted prices in active markets for identical assets and liabilities.

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Level 2:

Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

Level 3:

Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

New Accounting Pronouncements

In November 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. The Company adopted this standard for the year ended December 31, 2015.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments,” which addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments relate to debt prepayment or debt extinguishment costs, settlement of zero coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate owned life insurance policies, distributions received from equity method investees, and beneficial interests in securitization transactions. ASU 2016-15 also states that, in the absence of specific guidance for cash receipts and payments that have aspects of more than one class of cash flows, an entity should classify each separately identifiable source or use within the cash receipts and payments on the basis of their nature in financing, investing, or operating activities. In situations in which cash receipts or payments cannot be separated by source or use, the appropriate classification should depend on the activity that is likely to be the predominant source or use of cash flows for the item. The new guidance will be effective for fiscal years beginning after December 15, 2017 and interim periods therein, with early adoption permitted. The amendments in ASU 2016-15 should be applied retrospectively to all periods presented, unless deemed impracticable, in which case, prospective application is permitted. The Company is currently evaluating whether this standard will have a material impact on the Company’s presentation of cash flows upon retrospective adoption.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The pronouncement replaces the incurred loss methodology to record credit losses with a methodology that reflects the expected credit losses for financial assets not accounted for at fair value with gains and losses recognized through net income. This standard is effective for fiscal years beginning after December 15, 2019 and interim periods therein, with early adoption permitted for fiscal years, and interim periods therein, beginning after December 15, 2018. The Company is currently evaluating whether this standard will have a material impact on the Company’s consolidated financial position and results of operations.

In March 2016, the FASB issued ASU 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” ASU 2016-09 simplifies the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. The new guidance will be

F-24

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

effective prospectively for annual periods beginning after December 15, 2016 and interim periods therein, with early adoption permitted. Because the standard will be adopted prospectively, it will not have a retrospective effect on the Company’s consolidated financial position and results of operations for 2016.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”. ASU 2016-02 contains accounting guidance that will require a lessee to recognize in its balance sheet a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term for leases with lease terms of more than 12 months. Consistent with current U.S. GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. Additional qualitative disclosures along with specific quantitative disclosures will also be required. The new guidance will take effect for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. Upon adoption, the Company will be required to recognize and measure leases at the beginning of 2017 using a modified retrospective approach. The Company is currently evaluating the impact of this standard on the Company’s future consolidated financial position and results of operations. The Company is currently evaluating whether this standard will have a material impact on the Company’s consolidated financial position and results of operations.

In November 2015, FASB issued ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes.” ASU 2015-17 requires that deferred tax assets and liabilities be classified as noncurrent in a classified statement of financial position. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The Company elected to early adopt ASU 2015-17 for the year ended December 31, 2015 and all subsequent periods.

In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date,” which defers the effective date of ASU 2014-09 by one year. ASU 2015-14 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period and permits early adoption on a limited basis. ASU 2014-09, “Revenue from Contracts with Customers”, requires an entity to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The guidance 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 and assets recognized from costs incurred to obtain or fulfill a contract. The Company is currently in the process of evaluating the impact of this new pronouncement on its consolidated results of operations. The Company plans to complete its assessment of the impact of the new standard in 2017 and expects to be compliant by the first quarter of 2018.

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory.” The FASB issued ASU 2015-11 as part of its Simplification Initiative. The amendments apply to inventory that is measured using first-in, first-out (FIFO) or average cost. Topic 330, Inventory , currently requires an entity to measure inventory at the lower of cost or market, where market could be replacement cost, net realizable value, or net realizable value less an approximately normal profit margin. In accordance with ASU 2015-11, an entity should now measure inventory within the scope of ASU 2015-11 at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted this standard in the year ended December 31, 2015.

In April 2015, the FASB issued ASU No. 2015-03, “ Interest—Imputation of Interest (Subtopic 835-30).” ASU 2015-03 simplifies the presentation of debt issuance costs by requiring debt issuance costs to be presented

F-25

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

in the balance sheet as a direct deduction from the carrying amount of the recognized debt liability. The Company adopted this standard in the year ended December 31, 2015 (see Note 22).

Note 3—Acquisition of the Predecessor

On November 5, 2015, the Walter Energy Debtors entered into the Asset Purchase Agreement with the Company, pursuant to which, among other things, the Company, on behalf of Walter Energy’s First Lien Lenders, agreed to acquire the Predecessor via a credit bid and release of the liens on the Walter Energy First Lien Obligations. On January 8, 2016, the Bankruptcy Court approved the Asset Acquisition, which closed on March 31, 2016.

The cash consideration of $50.8 million included the funding of escrow accounts to be used to pay certain expenses on behalf of the Walter Energy Debtors, some of which required residual amounts contained in the escrow accounts to be refunded to the Company after a specified time period. The Company received refunds of approximately $9.4 million during the nine months ended December 31, 2016 (Successor), which is presented in the investing section of the Statements of Cash Flows. The net cash paid for the Asset Acquisition was $24.1 million, which was $50.8 million of cash paid less cash and cash equivalents acquired of $26.7 million.

The purchase consideration has been preliminarily allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of the Asset Acquisition. A full and detailed valuation of the assets and liabilities is being completed with the assistance of an independent third party and certain information and analysis remains pending at this time. Accordingly, the allocation is preliminary and may change as additional information becomes available and is assessed by the Company. The final allocation of the consideration transferred may include adjustments to the fair value estimates of identifiable assets and liabilities, including but not limited to depreciable tangible assets, tax basis of assets acquired and liabilities assumed and amounts of various tax attributes after a full analysis has been completed. The Company expects to finalize its valuation during the first quarter of 2017.

In determining the fair values of net assets acquired in the Asset Acquisition, the Company considered, among other factors, the analyses of the Predecessor’s historical financial performance and estimates of the future performance of the acquired business, as well as the highest and best use of the acquired assets.

Working capital, excluding inventory, and non-current restricted cash were recorded at the Predecessor’s carrying value, which is representative of the fair value on the date of acquisition. Inventory was valued at its net realizable value.

Mineral interest, property, plant and equipment, and other assets were recorded at fair values based on management’s estimates and assumptions including variations of the income approach, the cost approach and the market approach. Black lung obligations and asset retirement obligations were recorded at fair value using a combination of market data, operational data and discounted cash flows and were adjusted by a discount rate factor reflecting current market conditions at the time of acquisition.

The Company incurred transaction costs, primarily professional and legal fees, related to the Asset Acquisition of approximately $10.5 million, which are included in transaction and other costs in the Statement of Operations for the nine months ended December 31, 2016 (Successor).

F-26

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The following tables summarize the preliminary estimate of the purchase price and fair values of assets acquired and liabilities assumed as of April 1, 2016 (in thousands):


Preliminary estimate of the purchase price:
Cash paid	$	50,830
Estimated fair value of First Lien Obligations relinquished in exchange for net assets of the Predecessor		602,131

Total preliminary estimate of the purchase price	$	652,961


Preliminary estimated fair values of assets acquired and liabilities assumed:
Cash and cash equivalents	$	26,723
Trade and other receivables		14,358
Inventories		46,464
Prepaid expenses and other current assets		30,722
Mineral interests		147,748
Property, plant and equipment		533,441
Other long-term assets		28,865

Total assets		828,321

Accounts payable		10,470
Accrued expenses		12,843
Other current liabilities		24,044
Current debt		2,879
Long-term debt		5,758
Deferred income taxes		1,400
Other long-term liabilities		117,966

Total liabilities		175,360

Total preliminary fair value of net assets acquired	$	652,961

Supplemental Unaudited Pro Forma Financial Information

The following unaudited pro forma results of operations give effect to the Asset Acquisition as if it had occurred on January 1, 2015. This unaudited pro forma financial information should not be relied upon as necessarily being indicative of the historical results that would have been obtained if the Asset Acquisition had actually occurred on that date, nor the results of operations in the future. The 2016 supplemental unaudited pro forma financial information was adjusted to exclude transaction costs incurred to consummate the Asset Acquisition of $10.5 million and a gain on reorganization items of $7.9 million associated with the Chapter 11 Cases. The 2015 supplemental unaudited pro forma financial information was adjusted to include transaction costs incurred to consummate the Asset Acquisition of $10.5 million and to exclude non-recurring charges of $7.7 million related to reorganization costs associated with the Chapter 11 Cases.


	Successor						Predecessor
	For the year ended December 31, 2016						For the year ended December 31, 2015
(in thousands)	As reported ⁽¹⁾			Pro forma ⁽²⁾			As reported			Pro forma
Revenue	$	297,634		$	369,017		$	544,733		$	544,733
Net loss	$	(49,673	)	$	(67,866	)	$	(310,581	)	$	(183,847	)

F-27

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

(1)	Reflects nine months of Successor period operations.

(2)	Includes nine months of Successor period operations and three months of Predecessor period operations on a pro forma basis.

Note 4—Inventories, net

Inventories, net are summarized as follows (in thousands):


	Successor		Predecessor
	December 31, 2016		December 31, 2015
Coal	$	18,788	$	24,362
Raw materials, parts, supplies and other, net		20,632		27,213

Total inventories, net	$	39,420	$	51,575

For the nine months ended December 31, 2016 (Successor), the Company recognized inventory write-downs of $5.5 million based on a lower of cost or market assessment.

Note 5—Prepaid Expenses

Prepaid expenses consisted of the following (in thousands):


	Successor		Predecessor
	December 31, 2016		December 31, 2015
Deferred longwall move expenses	$	7,145	$	13,517
Prepaid insurance		3,140		9,745
Prepaid deposits		970		6,300
Other		755		4,327

Total prepaid expenses	$	12,010	$	33,889

Note 6—Mineral Interests and Property, Plant and Equipment, net

Mineral interests totaled $147.7 million and $9.7 million and the related accumulated depletion totaled $4.5 million and $4.4 million as of December 31, 2016 (Successor) and December 31, 2015 (Predecessor), respectively.

Property, plant and equipment are summarized as follows (in thousands):


	Successor			Predecessor
	December 31, 2016			December 31, 2015
Land	$	72,882		$	23,672
Land improvements		11,444			17,354
Building and leasehold improvements		64,814			28,923
Mine development and infrastructure costs		—			409,909
Machinery and equipment		366,317			847,825
Construction in progress		26,873			30,512

Total		542,330			1,358,195
Less: Accumulated depreciation		(45,371	)		(790,601	)

Property, plant and equipment, net	$	496,959		$	567,594

F-28

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Depreciation and depletion expense was $47.4 million and $123.6 million for the nine months ended December 31, 2016 (Successor) and year ended December 31, 2015 (Predecessor), respectively.

Note 7—Other Long-Term Assets

Other long-term assets consisted of the following (in thousands):


	Successor		Predecessor
	December 31, 2016		December 31, 2015
Cash surrender value of life insurance	$	—	$	12,965
Advance mining royalties		9,847		8,587
Restricted cash		2,611		4,700
Other		4,210		9,053

Total other long-term assets	$	16,668	$	35,305

Note 8—Income Taxes

The Company records deferred tax assets to the extent these assets will more likely than not be realized. In making such determination, the Company considered all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial performance. Based upon the review of all positive and negative evidence, including its recent history of operating losses, the Company concluded that a full valuation allowance was necessary for net deferred tax assets at December 31, 2016 (Successor) and December 31, 2015 (Predecessor), exclusive of certain deferred tax liabilities that have an indefinite life.

Results of operations of the Predecessor have historically been included in the federal and state income tax returns of the Parent. Accordingly, the income tax provision included in the Predecessor financial statements was calculated using a method consistent with a separate return basis, as if the Predecessor had been a separate taxpayer. Similarly, historical tax attributes (net operating losses, alternative minimum tax credits, etc.) have been allocated to the Predecessor’s business utilizing a reasonable method of allocation.

Income tax expense (benefit) consisted of the following (in thousands):


	Successor		Predecessor
	For the nine months ended December 31, 2016		For the three months ended March 31, 2016		For the year ended December 31, 2015
Federal	$	16	$	16	$	(40,789	)
State		2		2		—

Total	$	18	$	18	$	(40,789	)

F-29

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The income tax expense (benefit) at the Company’s and Predecessor’s effective tax rate differed from the U.S. statutory rate of 35% as follows (in thousands):


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
Loss before income tax benefit	$	(49,655	)	$	(61,798	)	$	(351,370	)

Tax benefit at statutory tax rate of 35%		(17,379	)		(21,629	)		(122,980	)
Effect of:
State and local income tax, net of federal effect		(1,051	)		(1,615	)		(8,888	)
Valuation allowance on deferred tax assets		14,460			22,204			81,370
Non-deductible transaction costs		4,318			—			—
Impact of restructuring		—			1,111			10,067
Other		(330	)		(53	)		(358	)

Tax expense (benefit) recognized	$	18		$	18		$	(40,789	)

Deferred income tax assets and liabilities reflect the effects of tax losses, credits, and the future income tax effects of temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates that apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Significant components of the Company’s and Predecessor’s deferred income tax assets and liabilities were (in thousands):


	Successor			Predecessor
	December 31, 2016			December 31, 2015
Deferred income tax assets:
Net operating loss and credit carryforwards	$	896,181		$	252,101
Inventory		851			1,752
Asset retirement obligations		37,425			12,690
Black lung obligations		10,826			9,671
Accrued expenses		2,501			7,964
Other		1,963			3,575

Total		949,747			287,753
Less: valuation allowance for deferred income tax assets		(767,290	)		(139,530	)

Net deferred income tax assets		182,457			148,223

Deferred income tax liabilities:
Prepaid expenses		(8,073	)		(12,893	)
Property, plant and equipment		(174,098	)		(130,962	)
Other		(2,230	)		(6,802	)

Total deferred income tax liabilities		(184,401	)		(150,657	)

Net deferred income tax liability	$	(1,944	)	$	(2,434	)

As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact management’s view with regard to future realization of deferred income tax assets. As part of

F-30

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

the Asset Acquisition, the Company succeeded to certain tax attributes and assumed the tax bases of the acquired assets and assumed liabilities. The tax attributes included net operating losses and alternative minimum tax and general business tax credits. As part of the evaluation of the acquired assets and assumed liabilities as of April 1, 2016, management determined that a valuation allowance was needed for deferred tax assets not expected to provide future tax benefits. If it is later determined that the Company will more likely than not realize all, or a portion, of the deferred tax assets, the Company will adjust the valuation allowance in a future period. Future recognized tax benefits relation to the valuation allowance will result in a tax benefit in the period recognized.

As of December 31, 2016, the Company determined that sufficient negative evidence existed to conclude that it was more likely than not that deferred tax assets of $767.3 million would not be realized. In recognition of this risk, the valuation allowance was increased by $14.5 million in 2016.

A roll forward of the deferred tax asset valuation allowance is as follows (in thousands):


	Successor		Predecessor
	For the nine months ended December 31, 2016		For the three months ended March 31, 2016		For the year ended December 31, 2015
Beginning balance	$	—	$	139,530	$	58,160
Additions - charges to tax expense		14,460		22,204		81,370
Additions - purchase accounting		752,830		—		—

Ending balance	$	767,290	$	161,734	$	139,530

The Parent filed income tax returns in the U.S. and in various state and local jurisdictions which are routinely examined by tax authorities in these jurisdictions. Net operating losses and carryforwards are subject to adjustments based on examination and the statute of limitations is currently open for all such loss and credit carryforwards.

The Company has federal net operating loss carryforwards of approximately $2.2 billion, which expire predominantly in December 31, 2034 through December 31, 2036. The Company has state net operating loss carryforwards of approximately $2.5 billion, which expire predominantly in December 31, 2029 through December 31, 2031. In addition, the Company has approximately $6.6 million of general business credits which begin to expire in December 31, 2027 and fully expire in December 31, 2033. The Company also has approximately $40.2 million of alternative minimum tax credits which can be carried forward indefinitely. The Company is subject to annual limitations on the use of these tax attributes. The Company may be subject to additional limitations under Internal Revenue Code Section 382 if there is a future ownership change.

F-31

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Note 9—Asset Retirement Obligations

Changes in the asset retirement obligations (“ARO”) were as follows (in thousands):


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the year ended December 31, 2015
Balance at Beginning of Period	$	—		$	31,129
ARO liability assumed in the Asset Acquisition		96,642			—
Accretion expense		2,817			4,276
Revisions in estimated cash flows		—			1,256
Obligations settled		(311	)		(1,082	)

Balance at End of Period	$	99,148		$	35,579

The portion of costs expected to be paid within a year of December 31, 2016 (Successor) is $3.1 million. The portion of costs expected to be incurred beyond one year of December 31, 2016 (Successor) is $96.1 million. There were no assets that were legally restricted for purposes of settling asset retirement obligations at December 31, 2016 (Successor).

Note 10—Accrued Expenses

Accrued expenses consisted of the following (in thousands):


	Successor		Predecessor
	December 31, 2016		December 31, 2015
Accrued wages and employee benefits	$	12,789	$	15,085
Accrued operating expenses		12,584		2,719
Accrued royalties		7,393		1,794
Accrued freight		2,029		1,859
Accrued severance		—		9,786
Accrued interest		—		7,501
Accrued non-income taxes		1,440		3,567
Other		11,104		1,141

Total accrued expenses	$	47,339	$	43,452

Note 11—Reorganization Items, Net

Expenses and income directly associated with the Chapter 11 Cases are reported separately in the Statements of Operations as reorganization items as required by ASC 852. Reorganization items also include adjustments to reflect the carrying value of liabilities subject to compromise at their estimated allowed claim amounts, as such adjustments are determined.

Reorganization items include an allocation of professional fees incurred in relation to the Chapter 11 Cases. For the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor), the cost of these professional fees was allocated on the basis of the Predecessor’s assets as compared to the total consolidated assets of the Parent for each reporting period.

F-32

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The following table presents reorganization items (in thousands):


	Predecessor
	For the three months ended March 31, 2016			For the year ended December 31, 2015
Rejected workers’ compensation liabilities	$	—		$	22,169
Professional fees		(10,962	)		(19,293	)
Walter Energy Canada Holdings Inc. receivable impairment		—			(13,627	)
Rejected executory contracts, leases and other		18,882			3,016

Reorganization items, net	$	7,920		$	(7,735	)

Net cash paid for reorganization items for the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor) totaled approximately $12.3 million and $11.5 million, respectively.

Note 12—Restructuring Cost and Asset Impairment

For the three months ended March 31, 2016 (Predecessor) and for the year ended December 31, 2015 (Predecessor), the Predecessor recognized restructuring charges of approximately $3.4 million and $13.8 million, respectively, due to workforce reductions at the Alabama No. 7 underground mine, the Alabama No. 4 underground mine and corporate headquarters in conjunction with cost containment initiatives implemented in response to the deterioration in the metallurgical coal market. The restructuring charges consist primarily of severance and related benefits costs. The Company does not expect to incur any additional restructuring charges in the Successor periods in connection with the Predecessor restructuring actions.

As a result of the depressed met coal market associated with global supply and demand factors and a reduction in global steel production and steel demand, the Predecessor determined that indicators of impairment existed with respect to substantially all of its property, plant and equipment and mineral interest reserves during 2015. The Predecessor’s asset groups generally consist of assets and applicable liabilities of one or more mines and preparation plants and associated coal reserves for which the cash flows are largely independent of cash flows of other mines, preparation plants and associated coal reserves. Management concluded that all of the long-lived assets that were tested for impairment during 2015 were recoverable from future cash flows, except for the Blue Creek Energy Mine. The Predecessor recognized asset impairment charges of approximately $28.0 million to write-off advance royalties and mine development costs for the Blue Creek Energy Mine in 2015.

Note 13—Workers’ Compensation and Pneumoconiosis (“Black Lung”) Obligations

Workers’ Compensation Obligations

Beginning on April 1, 2016, the Company is insured, through third party insurance carriers, for workers’ compensation benefits for work related injuries.

The Statements of Operations include expense associated with the Predecessor’s self-insured workers’ compensation arrangements of zero for the three months ended March 31, 2016 (Predecessor) and $6.4 million for the year ended December 31, 2015 (Predecessor). The Predecessor’s workers’ compensation obligations are included in cost of sales and selling, general and administrative expense on the Statements of Operations and represent the expected losses for claims incurred over each respective period.

In connection with the Chapter 11 Cases, the State of Alabama Department of Labor required the Predecessor to contribute $15.0 million as a security deposit to the State in order for the Predecessor to remain

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

self-insured for its workers’ compensation liabilities. As a result of the Chapter 11 Cases and due to the insolvency of the Parent, the Alabama Worker’s Compensation Self-Insurers Guaranty Association assumed all of the Predecessor workers’ compensation liabilities and retained the $15.0 million security deposit, which resulted in the recognition of a $22.2 million gain in reorganization items, net in the Statement of Operations for the year ended December 31, 2015 (see Note 11). As of December 31, 2015, $0.7 million of workers’ compensation expenses were accrued for and classified in other current liabilities in the Balance Sheet.

Black Lung Obligations

The Company is responsible for medical and disability benefits for black lung disease under the Federal Coal Mine Health and Safety Act of 1969, as amended. Beginning on April 1, 2016, the Company is insured, through a third party insurance carrier, for black lung claims raised by any employee. In addition, in connection with the Asset Acquisition, the Company assumed all black lung liabilities of Walter Energy and its U.S. subsidiaries incurred prior to March 31, 2016. The Company is self-insured for the black lung claims assumed in the Asset Acquisition. Due to a limited operating history as a stand-alone company and as a result of being self-insured for these historical black lung claims, the Department of Labor required the Company to post $17.5 million in Treasury bills as collateral, in addition to maintaining the black lung trust of $4.2 million acquired in the Asset Acquisition. The $17.5 million of collateral is recognized as short-term investments and the $4.2 million black lung trust is offset against the long-term portion of the black lung obligations within the Balance Sheet as of December 31, 2016. Under the terms of the agreement with the U.S. Department of Labor, the Company may elect to replace the $17.5 million collateral deposit with a surety bond or other form of assurance every six months. The estimated total black lung liabilities (net of black lung trust assets) were $28.7 million as of December 31, 2016 (Successor), of which $1.5 million is classified in other current liabilities and the remainder of $27.2 million is displayed as a long-term liability as a separate line item in the Balance Sheet. The Company performs an annual evaluation of its black lung liabilities at each balance sheet date. The calculation uses assumptions regarding rates of successful claims, discount factors, benefit increases and mortality rates, among others.

Note 14—Pension and Other Postretirement Benefits

Successor Benefit Plans

In connection with the Asset Acquisition, the Company did not assume any of the Parent’s obligations under the plans discussed in further detail below. The Company established new employee benefit plans for its employees subsequent to closing the Asset Acquisition. The plans are defined contribution plans. Contributions to these defined contribution plans amounted to $1.1 million for the nine months ended December 31, 2016 (Successor).

New Initial CBA

In connection with the Asset Acquisition, we negotiated a new initial collective bargaining agreement (“CBA”) with the UMWA (the “UMWA CBA”), which was ratified by UMWA’s members on February 16, 2016 and expires on March 31, 2021. Pursuant to the UMWA CBA the Company agreed to contribute $25.0 million to a Voluntary Employee Beneficiary Association (“VEBA”) trust formed and administered by the UMWA. The Company had a remaining obligation of $4.2 million in connection with the VEBA trust, which will be paid within one year. As of December 31, 2016, 68% of our employees were represented by the UMWA.

Predecessor Benefit Plans

In the Predecessor periods, the Parent had various defined benefit pension plans covering eligible salaried and hourly employees. The Parent also provided certain postretirement benefits other than pensions, primarily

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

healthcare, to eligible retirees. In addition to its own pension plans and other postretirement benefit plans, the Parent contributed to several multi-employer benefit plans covering eligible employees who were represented by the United Mine Workers of America (“UMWA”). The Parent funded its defined benefit pension plans in amounts sufficient to satisfy the “Minimum Funding Standards” of the Employee Retirement Income Security Act of 1974 (“ERISA”). Other postretirement benefit plans were funded as benefits were paid or as assessed by third-party plan sponsors.

On December 28, 2015 the Bankruptcy Court entered the Memorandum Opinion and Order Granting Debtors’ Motion for an Order (I) authorizing the Walter Energy Debtors to (A) reject collective bargaining agreements, (B) implement final labor proposals, and (C) terminate retiree benefits; and (II) granting related relief, authorizing the Walter Energy Debtors to reject their collective bargaining agreements with the UMWA (the “UMWA Order”). The UMWA Order authorized the Walter Energy Debtors to reject their collective bargaining agreements with the UMWA and allow for the sale of the Walter Energy Debtors’ assets free and clear of collective bargaining obligations. For purposes of the Predecessor financial statements, these defined benefit plans are being treated as multi-employer plans. Accordingly, the benefit obligations, plan assets and accumulated other comprehensive income or loss amounts are not shown in the Balance Sheets. The contributions to the Parent’s defined benefit plans related to the Predecessor’s employees recognized as expenses were $6.2 million and $30.9 million for the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor), respectively.

Parent-Sponsored Defined Benefit Plans

Certain of the Predecessor’s active U.S. based salaried employees were participants in a defined benefit pension plan sponsored by the Parent. This defined benefit plan covered active employees of the Predecessor and new employees that were eligible upon the participation requirements. In connection with the Chapter 11 Cases, this defined benefit pension plan was terminated on December 31, 2015 and the Pension Benefit Guaranty Corporation was appointed trustee. No amount of the plan settlement gains or losses recognized by the Parent upon termination of the Parent sponsored pension plans were allocated to the combined financial statements of the Predecessor.

The related defined benefit pension plan trust assets and liabilities have not been allocated to the Predecessor and are not presented in the accompanying Balance Sheet since the obligations are and will remain a liability of the Parent. The Predecessor recorded expenses related to claim payments made of $30.9 million for the year ended December 31, 2015, which has been reflected within other postretirement benefits in the accompanying Statement of Operations.

UMWA Multi-employer Benefit Plans

The Parent was required under its agreement with the UMWA to contribute to multiemployer plans providing pension, healthcare and other postretirement benefits. At December 31, 2015, approximately 61.4% of the Predecessor’s workforce was represented by the UMWA and covered under the Predecessor’s collective bargaining agreement, which began July 11, 2012 and was to expire December 31, 2016. The Predecessor’s obligations to make contributions to the UMWA multi-employer pension and benefit plans ceased upon entry of the UMWA Order by the Bankruptcy Court effective as of March 31, 2016.

The Parent was required under its agreements with the UMWA, specifically the 1974 UMWA Pension Plan, the UMWA Combined Benefit Fund, the UMWA 1992 Benefit Fund, the UMWA 1993 Benefit Plan, and the 2012 Retiree Bonus Plan, to pay amounts based principally on hours worked by UMWA represented employees. Contributions under the UMWA multi-employer pension and benefit plans were set at an aggregate rate of $8.16

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

per hour worked. Aggregate contributions related to the Predecessor’s employees under these plans were approximately $6.2 million for the three months ended March 31, 2016 (Predecessor) and $22.8 million for the year ended December 31, 2015 (Predecessor).

Note 15—Equity Award Plans

Warrior Met Coal, LLC 2016 Equity Incentive Plan

The Company adopted the Warrior Met Coal, LLC 2016 Equity Incentive Plan (the “2016 Equity Plan”). Under the 2016 Equity Plan, employees, directors and officers of the Company may be granted equity interests in Warrior Met Coal, LLC in the form of options to purchase Class C Units (excluding incentive stock options), restricted units, phantom units, unit appreciation rights and unit bonus awards. The total number of units available for grant of awards under the 2016 Equity Plan are 93,750. Forfeited awards will be available for subsequent award grants. As of December 31, 2016 (Successor) the equity awards granted under the 2016 Equity Plan are comprised of newly issued restricted Class C Units as well as phantom units.

The restricted Class C Units have certain service-based, performance-based and market-based vesting conditions, including the occurrence of an initial public offering (“IPO”) or a change in control as set forth in the 2016 Equity Plan and the applicable award agreements. As of December 31, 2016 (Successor), 49,063 restricted Class C Units were issued, none of which have vested.

Holders of phantom units have the right to receive Class C Units of the Company on the earlier of (i) a change in control as defined by the 2016 Equity Plan or (ii) the fifth anniversary of the grant date of the phantom unit. The phantom units are settled in the Company’s Class C Units and cannot be settled in cash. As of December 31, 2016 (Successor), there were 3,125 phantom units issued to a director of the Company, all of which were fully vested upon issuance.

Restricted Class C Units are issued proportionally as Class C Tranche A Units, Class C Tranche B Units and Class C Tranche C Units.

The Class C Tranche A Units have service and performance based vesting conditions and the awards vest in equal installments on each of the first five anniversaries of the grant date that occurs prior to an IPO and thereafter, subject to the employee’s continued employment or the director’s continued service with the Company through these dates. Vesting is conditioned and contingent upon at least 50% of the units originally acquired by Walter Energy’s First Lien Lenders in the Asset Acquisition having been disposed of to an independent third party, whether before or after the IPO.

The Class C Tranche B and Class C Tranche C Units are performance- and market-based awards, with vesting being contingent upon the achievement of certain market conditions and subject to the employee’s continued employment with the Company through the date of achievement.

In the event of a change in control, any Class C Tranche A Units that have not previously vested shall become fully vested and exercisable at the time of such change in control, subject to the employee’s continued employment with the Company through the change in control date. Any Class C Tranche B and Class C Tranche C Units that have not vested prior to a change in control shall vest based upon the achievement of certain market conditions as set forth in the agreements.

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Restricted Class C Units

The following table presents a summary of Restricted Class C Unit activity for the nine-months ended December 31, 2016 (Successor):


	Number of Restricted Class C Units		Weighted- Average Grant Date Fair Value
Non-vested at April 1, 2016		—		—
Granted		49,063	$	77.24

Non-vested at December 31, 2016		49,063	$	77.24

The Company uses the Black-Scholes option pricing model to estimate the fair value of restricted Class C Tranche A Units granted and the Monte Carlo pricing model to estimate fair value of restricted Class C Tranche B and Class C Tranche C Units granted. The pricing models incorporate the assumptions as presented in the following table, shown at their weighted average values:


	Successor
	For the nine months ended December 31, 2016
Expected stock price volatility (a)		25.25	%
Risk-free interest rate (b)		1.25	%
Expected life (years)		5.0

(a)	Expected volatility. The Company bases its expected volatility on a group of companies believed to be a representative peer group, selected based on industry and market capitalization.

(b)	Risk free rate. The risk-free rate for periods within the expected term of the award is based on the U.S. Government Bond yield with a term equal to the awards’ expected term on the date of grant.

(c)	Expected term. Expected term represents the period of time that awards granted are expected to be outstanding.

Equity Award Compensation Expense

For the nine month ended December 31, 2016 (Successor), compensation expense associated with the vested phantom units was $0.5 million. As of December 31, 2016 (Successor), no restricted Class C Unit had vested and, as such, no compensation expense related to these awards was recognized in the accompanying Statement of Operations for the nine months ended December 31, 2016 (Successor). Unrecognized compensation expense related to the restricted Class C Units amounted to $3.8 million.

Predecessor Stock-Based Compensation

Certain of the Predecessor’s employees participated in stock-based compensation plans sponsored by the Parent.

For the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor), the Predecessor recorded stock-based compensation expense related to equity awards granted by the Parent totaling approximately $0.4 million and $4.0 million, respectively.

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Note 16—Debt

On April 1, 2016, the Company entered into an Asset-Based Revolving Credit Agreement (the “ABL Facility”) with certain lenders and Citibank, N.A. (together with its affiliates, “Citibank”), as administrative agent and collateral agent, with an aggregate lender commitment to make a revolving loan of up to $50.0 million, subject to borrowing base availability (see Note 25). The Company’s obligations under the ABL Facility are guaranteed by each of the Company’s subsidiaries, and secured by substantially all of the Company’s assets.

Under the ABL Facility, Citibank has made available to the Company a swingline facility of up to $10.0 million and, in addition, the full amount of the ABL Facility will be available for the Company to issue letters of credit. The ABL Facility will mature on April 1, 2019. As of December 31, 2016 (Successor), no amounts were outstanding under the ABL Facility and there were no outstanding letters of credit.

Revolving loan (and letter of credit) availability under the ABL Facility is subject to a borrowing base, which at any time is equal to the sum of certain eligible billed and unbilled accounts, certain eligible inventory, certain eligible supplies inventory and qualified cash, in each case, subject to specified advance rates. The borrowing base availability is subject to certain reserves, which are established by the agent in its reasonable credit discretion. The reserves may include rent reserves, lower of cost or market reserve, port charges reserves and any other reserves that the agent determines, in its reasonable credit judgment, to the extent such reserves relate to conditions that could reasonably be expected to have an adverse effect on the borrowing base. At December 31, 2016 (Successor), the Company had $42.3 million of availability under the ABL Facility.

Borrowings under the ABL Facility bear interest at a rate equal to the London Interbank Offered Rate (“LIBOR”) plus applicable margin, which is based on the average availability of the commitments under the ABL Facility, ranging from 300 basis points (“bps”) to 350 bps. In addition to paying interest on the outstanding borrowings under the ABL Facility, the Company is required to pay a fee in respect of unutilized commitments, which is based on the average availability of the commitments under the ABL Facility, ranging from 25 bps to 37.5 bps. The Company is also required to pay a fee on outstanding letters of credit under the ABL Facility at a rate not in excess of 350 bps, as well as certain administrative fees.

The Company is able to voluntarily repay outstanding loans and reduce unused commitments, in each case, in whole or in part, at any time without premium or penalty. The Company is required to repay outstanding loans and cash collateral letters of credit anytime the outstanding loans and letters of credit exceed the maximum availability then in effect. The Company is also required to use net proceeds from certain significant asset sales to repay outstanding loans, but may re-borrow following such prepayments if the conditions to borrowings are met.

The ABL Facility contains customary covenants for asset-based credit agreements of this type, including, among other things: (i) requirements to deliver financial statements, other reports and notices; (ii) restrictions on the existence or incurrence of certain indebtedness; (iii) restrictions on the existence or incurrence of certain liens; (iv) restrictions on making certain restricted payments; (v) restrictions on making certain investments; (vi) restrictions on certain mergers, consolidations and asset dispositions; (vii) restrictions on certain transactions with affiliates; and (viii) restrictions on modifications to certain indebtedness. Additionally, the ABL Facility contains a springing fixed charge coverage ratio subject to availability under the ABL Facility. The fixed charge coverage ratio required under the ABL Facility must be greater than or equal to 1.00 to 1.00, which ratio is tested if availability under the ABL Facility is less than a certain amount. Subject to customary grace periods and notice requirements, the ABL Facility also contains customary events of default.

In connection with the Asset Acquisition, the Company assumed a security agreement and promissory note of $6.6 million as of December 31, 2016 (Successor), of which $2.8 million was classified as a current

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

obligation. The amount owed in respect of the promissory note was originally used for the purchase of underground mining equipment and such note is secured by the same mining equipment. The promissory note matures on March 31, 2019 and bears a fixed interest rate of 4.00% per annum. The Company is required to make monthly payments of principal and interest during the term of the promissory note.

Note 17—Related Party Transactions

In connection with the Asset Acquisition the Company acquired a 50% interest in Black Warrior Methane (“BWM”) and Black Warrior Transmission (“BWT”), which are accounted for under the proportionate consolidation method and equity interest method, respectively. The Company has granted the rights to produce and sell methane gas from its coal mines to BWM and BWT. The Company’s net investments in, advances to/from BWT and equity in earnings or loss of BWT are not material to the Company. The Company supplied labor to BWM and incurred costs, including property and liability insurance, to support the joint venture. The Company charged the joint venture for such costs on a monthly basis, which were $1.7 million, $0.3 million and $7.4 million for the nine months ended December 31, 2016 (Successor), the three months ended March 31, 2016 (Predecessor) and year ended December 31, 2015 (Predecessor), respectively.

The Predecessor also received revenue from coal sales to affiliates of the Parent that were not acquired in connection with the Asset Acquisition. The Predecessor recognized revenue from these affiliates of $1.4 million and $11.2 million for the three months ended March 31, 2016 (Predecessor) and the year ended December 31, 2015 (Predecessor), respectively.

Note 18—Commitments and Contingencies

Environmental Matters

The Company believes that it is in substantial compliance with federal, state and local environmental laws and regulations. The Company accrues for environmental expenses resulting from existing conditions that relate to past operations when the costs are probable and can be reasonably estimated. As of December 31, 2016 (Successor) and December 31, 2015 (Predecessor), there were no accruals for environmental matters other than asset retirement obligations for mine reclamation (see Note 9).

Miscellaneous Litigation

From time to time, the Company is party to a number of lawsuits arising in the ordinary course of their businesses. The Company records costs relating to these matters when a loss is probable and the amount can be reasonably estimated. The effect of the outcome of these matters on the Company’s future results of operations cannot be predicted with certainty as any such effect depends on future results of operations and the amount and timing of the resolution of such matters. As of December 31, 2016 (Successor) and December 31, 2015 (Predecessor), there were no items accrued for miscellaneous litigation.

Indemnifications

In the ordinary course of business, the Company entered into a contractual arrangement under which the Company has agreed to indemnify a third party to such arrangement from any losses arising from certain events

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

as specified in the particular contracts, which may include, for example, litigation or claims relating to past performance. The Company had accrued $0.3 million as of December 31, 2016 (Successor) included in other long-term liabilities and the remaining maximum exposure under this arrangement is $0.2 million.

Commitments and Contingencies—Other

The Company is party to various transportation and throughput agreements with rail and barge transportation providers and the Alabama State Port Authority. These agreements contained annual minimum tonnage guarantees with respect to coal transported from the mine sites to the Port of Mobile, Alabama, unloading of rail cars or barges, and the loading of vessels. If the Company does not meet its minimum throughput obligations, which are based on annual minimum amounts, it is required to pay the transportation providers or the Alabama State Port Authority a contractually specified amount per metric ton for the difference between the actual throughput and the minimum throughput requirement. At December 31, 2016 (Successor), the Company had accrued a liability of $2.1 million as a result of not meeting the required minimums, which is included in accrued expenses on the Balance Sheet. The Predecessor’s obligation under similar arrangements with these service providers amounted to $18.9 million at December 31, 2015 (Predecessor), which is included within liabilities subject to compromise as trade payables on the Balance Sheet.

Royalty and Lease Obligations

The Company’s leases are primarily for mining equipment and automobiles. The Predecessor and the Successor had no future minimum payments due under non-cancellable operating leases as of December 31, 2016 (Successor).

A substantial amount of the coal that the Company mines is produced from mineral reserves leased from third-party land owners. These leases convey mining rights to the Company in exchange for royalties to be paid to the land owner as either a fixed amount per ton or as a percentage of the sales price. Although coal leases have varying renewal terms and conditions, they generally last for the economic life of the reserves. Coal royalty expense was $17.5 million, $3.6 million, and $28.3 million for the nine months ended December 31, 2016 (Successor), three months ended March 31, 2016 (Predecessor) and for the year ended December 31, 2015 (Predecessor), respectively.

Note 19—Members’ Equity

As a limited liability company, interests in the Company held by its members are presented as “units.” No member has the right to act for, on behalf of, or bind the Company other than the members of the Board of Managers and no member, manager or officer of the Company is personally liable for any indebtedness, liability or obligation of the Company. As of December 31, 2016 (Successor), the Company had 1,274,364 Class A Units and 2,500,004 Class B Units issued and outstanding. The Company also has granted 3,125 phantom units which were vested and 49,063 restricted Class C Units, all of which remained unvested as of December 31, 2016 (Successor).

Class A Units and Class B Units

The original Class A Units and Class B Units were issued to members of the Company in connection with the Asset Acquisition and the Rights Offerings (see Note 1). Class A Units and Class B Units represent the Company’s voting ownership interest and vote together as a single class. Class A Units and Class B Units have the same rights, preferences and privileges and participate in distributions equally on a pro rata basis.

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Under the amended and restated Limited Liability Company Agreement of the Company (the “LLC Agreement”), the holders of Class B Units are responsible for funding additional capital commitments as determined by the Board of Managers. The capital commitments are terminated by certain events set forth in the LLC Agreement, which causes the Class B Units to retire and automatically convert into an equal amount of Class A Units.

Under the LLC Agreement, the Company reserved an aggregate of 7,890 Class A Units for issuance to Walter Energy’s First Lien Lenders who, prior to the Asset Acquisition, had committed to (or are required to) fund letters of credit arising under the 2011 Credit Agreement (see Note 1). The reserved Class A Units are contingently issuable to the extent that there are any draws subsequent to March 31, 2016 on such letters of credit that were outstanding but undrawn as of the closing of the Asset Acquisition. On April 14, 2016, April 22, 2016, May 11, 2016 and October 19, 2016 the Company issued 686, 1,178, 112 and 2,578 Class A Units, respectively in connection with draws on outstanding letters of credit. These letters of credit will expire by July 10, 2017.

Restricted Class C Units

Restricted Class C Units represent non-voting ownership interest which may be issued to officers, directors and employees, and are subject to the terms and conditions of any award agreements. Vested and unvested Class C Units are not entitled to distributions, unless otherwise approved by the Board of Members. In general, distributions with respect to Class C Units subject to unvested awards will be held back and paid to the holders upon vesting and/or settlement of the applicable award or portion thereof.

Note 20—Derivative Instruments

The Company enters into natural gas swap contracts to hedge the exposure to variability in expected future cash flows associated with the fluctuations in the price of natural gas related to the Company’s forecasted sales. As of December 31, 2016 (Successor), the Company had natural gas swap contracts outstanding with notional amounts totaling 7,920 million British thermal units maturing in the fourth quarter of 2017. The Company had no outstanding derivative instruments as of December 31, 2015 (Predecessor).

The Company’s natural gas swap contracts economically hedge certain risk but are not designated as hedges for financial reporting purposes. All changes in the fair value of these derivative instruments are recorded as other revenues in the Statements of Operations. The Company records all derivative instruments at fair value and had a liability of $3.8 million related to natural gas swap contracts outstanding as of December 31, 2016 (Successor), included in other current liabilities in the accompanying Balance Sheets.

Note 21—Fair Value of Financial Instruments

The following table presents information about the Company’s financial liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values:


	Fair Value Measurements as of December 31, 2016 (Successor) Using:
	Level 1		Level 2		Level 3		Total
Liabilities:
Natural gas swap contracts	$	—	$	3,784	$	—	$	3,784

The Company has no assets or any other liabilities measured at fair value on a recurring basis as of December 31, 2016 (Successor). During the nine months ended December 31, 2016 (Successor) there were no transfers between Level 1, Level 2 and Level 3. The Company uses quoted dealer prices for similar contracts in active over-the-counter markets for determining fair value of Level 2 liabilities. There were no changes to the

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

valuation techniques used to measure liability fair values on a recurring basis during the nine months ended December 31, 2016 (Successor). The Predecessor had no assets or liabilities measured at fair value at December 31, 2015 (Predecessor).

The following methods and assumptions were used to estimate the fair value for which the fair value option was not elected:

Cash and cash equivalents, short-term investments, restricted cash, receivables and accounts payable— The carrying amounts reported in the Balance Sheet approximate fair value due to the short-term nature of these assets and liabilities.

Debt— All of the Company’s debt included in the Balance Sheet is carried at cost. The Successor’s outstanding promissory note approximates fair value. There is little or no market data available to support a Level 1 or 2 estimate of fair value of the Predecessor debt that was subject to compromise in the bankruptcy. Accordingly, management estimated the aggregate fair value of the Predecessor’s outstanding debt as of December 31, 2015 (Predecessor) to be approximately $602 million based on Level 3 fair value assumptions and estimates associated with the collateral-dependent nature of the various debt instruments that were outstanding. The net assets acquired in the Asset Acquisition represented the collateral base of the Predecessor’s various debt instruments that were outstanding. Accordingly, the fair values of the net assets acquired in the Asset Acquisition were used in determining the fair value of the Predecessor’s outstanding debt as of December 31, 2015 (Predecessor) using a collateral analysis. See Note 3 for valuation methods used in determining the fair values of net assets acquired in the Asset Acquisition.

Note 22—Liabilities Subject to Compromise

For periods subsequent to filing of the Chapter 11 Cases, the Predecessor applied the provisions of ASC 852, Reorganizations, in preparing its combined financial statements. ASC 852 requires that the financial statements distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Liabilities subject to compromise represent unsecured or under secured obligations of the Predecessor that could potentially have been affected by the Chapter 11 Cases. Pre-petition obligations that may be impacted by the bankruptcy reorganization process are classified as liabilities subject to compromise in the Balance Sheet. These liabilities are reported at the amounts expected to be allowed by the Bankruptcy Court, even if they may be settled for lesser amounts. These liabilities represent the amounts expected to be allowed on known or potential claims to be resolved through the Chapter 11 process, and remain subject to future adjustments arising from negotiated settlements, actions of the Bankruptcy Court, rejection of executory contracts and unexpired leases, the determination as to the value of collateral securing the claims, proofs of claim, or other events. Liabilities subject to compromise also include certain items that may be assumed under a plan of reorganization and, as such, may be subsequently reclassified to liabilities not subject to compromise. Generally, actions to enforce and otherwise effect payment of pre-petition liabilities are stayed.

Parent’s consolidated debt incurred prior to the Chapter 11 Cases was $3,057 million, of which $1,414 million was attributed to or otherwise included in the Balance Sheet for the year ended December 31, 2015 (Predecessor) as liabilities subject to compromise. The liabilities subject to compromise were not assumed in connection with the Asset Acquisition. The attributed debt is net of allocated unamortized debt discount of $6.4 million and unamortized debt issuance costs of $20.0 million. The attribution of debt also resulted in a net change in the Parent net investment of approximately $663.7 million for the year ended December 31, 2015 (Predecessor).

Interest expense on the Parent’s debt attributed to the Predecessor was $16.6 million and $51.1 million for the three months ended March 31, 2016 (Predecessor) and year ended December 31, 2015 (Predecessor),

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WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

respectively. The Parent also recognized a net gain on extinguishment of debt of $58.6 million prior to the Chapter 11 Cases, of which $27.0 million was attributed to and included in the year ended December 31, 2015 (Predecessor) as a gain on extinguishment of debt in the Statement of Operations.

Liabilities subject to compromise consist of the following (in thousands):


	Predecessor
	December 31, 2015
Notes, loans and other debt (1)	$	1,414,332
Interest payable		34,176
Trade payables		31,672
Other accrued liabilities		11,713
Accrued royalties		4,029
Employee claims		356

Total liabilities subject to compromise	$	1,496,278

(1)	Notes, loans and other debt include related unamortized deferred financing costs, discounts and premiums.

Event of Default and Effect of Chapter 11 Cases

The filing of the Parent’s voluntary petitions under the U.S. Bankruptcy Code constituted an event of default that accelerated the Parent’s obligations under each of its debt instruments.

As a result of the commencement of the Chapter 11 Cases, any efforts to collect or otherwise enforce such payment obligations under the debt instruments were automatically stayed and the creditors’ rights of enforcement in respect of the debt instruments were subject to the applicable provisions of the Bankruptcy Code. Accordingly, all of the outstanding debt and accrued interest allocated to the consolidated financial statements for the Predecessor period is classified as non-current and is subject to compromise.

Note 23—Segment Information

The Company identifies a business as an operating segment if: i) it engages in business activities from which it may earn revenues and incur expenses; ii) its operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is the Company’s Chief Executive Officer, to make decisions about resources to be allocated to the segment and assess its performance; and iii) it has available discrete financial information. The Company has determined that its two underground mining operations are its operating segments. The CODM reviews financial information at the operating segment level to allocate resources and to assess the operating results and financial performance for each operating segment. Operating segments are aggregated into a reportable segment if the operating segments have similar quantitative economic characteristics and if the operating segments are similar in the following qualitative characteristics: i) nature of products and services; ii) nature of production processes; iii) type or class of customer for their products and services; iv) methods used to distribute the products or provide services; and v) if applicable, the nature of the regulatory environment.

The Company has determined that the two operating segments are similar in both quantitative and qualitative characteristics and thus the two operating segments have been aggregated into one reportable segment. The Company has determined that its natural gas and royalty businesses did not meet the criteria in ASC 280 to be considered as operating or reportable segments. Therefore, the Company has included their results in an “all other” category as a reconciling item to consolidated amounts.

F-43

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The Company does not allocate all of its assets, or its depreciation and depletion expense, selling, general and administrative expenses, other post-retirement benefits, transactions costs, restructuring costs, interest expense, reorganization items, net and income tax expense by segment.

The following tables include reconciliations of segment information to consolidated amounts (in thousands):


	Successor		Predecessor
	For the nine months ended December 31, 2016		For the three months ended March 31, 2016		For the year ended December 31, 2015
Revenues
Mining		276,560	$	65,154	$	514,334
All other		21,074		6,229		30,399

Total revenues	$	297,634	$	71,383	$	544,733


	Successor		Predecessor
	For the nine months ended December 31, 2016		For the three months ended March 31, 2016		For the year ended December 31, 2015
Capital Expenditures
Mining	$	9,342	$	4,588	$	61,416
All other		2,189		834		3,555

Total capital expenditures	$	11,531	$	5,422	$	64,971


	Successor		Predecessor
	December 31, 2016		December 31, 2015
Assets
Mining	$	696,691	$	479,720
All other		250,940		322,417

Total assets	$	947,631	$	802,137

F-44

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The Company evaluates the performance of its segment based on Segment Adjusted EBITDA, which is defined as net loss adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative, other postretirement benefits, and certain transactions or adjustments that the CODM does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA does not represent and should not be considered as an alternative to cost of sales under GAAP and may not be comparable to other similarly titled measures used by other companies. Below is a reconciliation of Segment Adjusted EBITDA to net loss, which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands):


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
Segment Adjusted EBITDA (1)	$	31,837		$	(7,143	)	$	(115,197	)
Other revenues		21,074			6,229			30,399
Cost of other revenues		(19,367	)		(4,698	)		(27,442	)
Depreciation and depletion		(47,413	)		(28,958	)		(123,633	)
Selling, general and administrative		(20,507	)		(9,008	)		(38,922	)
Other postretirement benefits		—			(6,160	)		(30,899	)
Restructuring and asset impairment charges		—			(3,418	)		(13,832	)
Transaction and other costs		(13,568	)		—			—
Interest expense, net		(1,711	)		(16,562	)		(51,077	)
Reorganization items, net (1)		—			7,920			(7,735	)
Gain on extinguishment of debt		—			—			26,968
Income tax (expense) benefit		(18	)		(18	)		40,789

Net loss	$	(49,673	)	$	(61,816	)	$	(310,581	)

⁽¹⁾	Reflects revision for reclassification of gain recognized on settlement of a rejected contract in bankruptcy for the period ended March 31, 2016—See Note 1.

The following table presents a summary of the total revenues from external customers by geographic location:


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
Foreign		97.4	%		96.9	%		90.3	%
United States		2.6	%		3.1	%		9.7	%

Total revenues from external customers		100.0	%		100.0	%		100.0	%

F-45

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

The following table summarizes the Company’s export coal sales to customers in foreign countries in excess of 10% of sales, as determined by the location of the customer:


	Successor			Predecessor
	For the nine months ended December 31, 2016			For the three months ended March 31, 2016			For the year ended December 31, 2015
Germany		37.3	%		26.0	%		26.3	%
Brazil		17.9	%		8.5	%		10.4	%
Austria		12.7	%		12.8	%		10.2	%

As the Company operates as one reportable segment, all required financial segment information can be found in these financial statements. All of the Company’s tangible assets are held in the United States.

Note 24—Net Loss per Unit

Basic and diluted net loss per unit was calculated as follows (in thousands, except per unit data):


	Successor
	For the nine months ended December 31, 2016
Numerator:
Net loss	$	(49,673	)

Denominator:
Weighted-average units used to compute net loss per unit—basic and diluted		3,777

Net loss per unit—basic and diluted	$	(13.15	)

A total of 49,063 potentially dilutive Class C Units have been excluded from the computation of diluted weighted-average units outstanding because the performance or market condition had not been met and their inclusion would have been anti-dilutive.

Note 25—Subsequent Events

On January 23, 2017, the Company entered into Amendment No. 1 to the ABL Facility to, among other things, (i) increase the aggregate lender commitment to $100.0 million to lend subject to the borrowing base availability, (ii) reduce the applicable interest rate margins by 100 bps, (iii) permit the corporate conversion and (iv) allow the Company’s initial public offering to be consummated without triggering a change of control. As of December 31, 2016 (Successor), no amounts were outstanding under the ABL Facility.

F-46

WARRIOR MET COAL, LLC

NOTES TO FINANCIAL STATEMENTS (Continued)

Note 26—Unaudited Pro Forma Balance Sheet and Pro Forma Earnings (Loss) Per Share Information

Prior to the consummation of the IPO, the Company may declare and pay a special cash distribution of $ million as a return of capital (the “Special Distribution”), to holders of record of Class A Units and Class B Units. The Special Distribution, if any, will be funded through the cash and cash equivalents on hand.

The unaudited pro forma balance sheet and pro forma earnings (loss) per share have been presented in accordance with SEC Staff Accounting Bulletin (“SAB”) Topic 1.B.3. Under SAB Topic 1B.3, a distribution declared at or in the year preceding an initial public offering is deemed to be in contemplation of the offering with the intention of repayment out of the offering proceeds to the extent that the amount of the distribution exceeded the amount of earnings during the twelve-month period ended on the balance sheet date. The unaudited pro forma balance sheet gives effect to the Special Distribution of $ million deemed to be in contemplation of the offering with the intention of repayment out of the offering proceeds.

Earnings for the nine months ended December 31, 2016 consisted of $49.7 million of net loss. Pro forma basic and diluted earnings (loss) per share was computed by adding shares of common stock, representing the number of shares that would be required to generate net proceeds sufficient to pay the Special Distribution of $ million deemed to be in contemplation of the offering with the intention of repayment out of the offering proceeds. The number of shares that would be required to pay the Special Distribution is based on an estimated initial public offering price of $ per share, the midpoint of the estimated initial public offering price range set forth on the cover page of this prospectus.

F-47

APPENDIX A: GLOSSARY OF SELECTED TERMS

Ash. Impurities consisting of silica, iron, alumina and other incombustible matter that are contained in coal. Since ash increases the weight of coal, it adds to the cost of handling and can affect the burning characteristics of coal.

Assigned reserves . Coal that is planned to be mined at an operation that is currently operating, currently idled or for which permits have been submitted and plans are eventually to develop the mine and begin mining operations.

Bituminous coal . A common type of coal with moisture content less than 20% by weight. It is dense and black and often has well-defined bands of bright and dull material.

British thermal unit (“Btu”) . A measure of the thermal energy required to raise the temperature of one pound of pure liquid water one degree Fahrenheit at the temperature at which water has its greatest density (39 degrees Fahrenheit).

Coal seam . Coal deposits occur in layers. Each layer is called a “seam.”

Coke . A hard, dry carbon substance produced by heating coal to a very high temperature in the absence of air. Coke is used in the manufacture of iron and steel. Its production results in a number of useful by-products.

Continuous miner. A machine used in underground mining to cut coal from the seam and load onto conveyers or shuttle cars in a continuous operation. In contrast, a conventional mining unit must stop extracting in order to begin loading.

Continuous mining . A form of underground mining that cuts the coal from the seam and loads the coal on to a conveyor system continuously, thus eliminating the separate cycles of cutting, drilling, shooting and loading.

CSX. CSX Corporation.

EPA. Environmental Protection Agency.

Hard coking coal (“HCC”) . Hard coking coal is a type of met coal that is a necessary ingredient in the production of strong coke. It is evaluated based on the strength, yield and size distribution of coke produced from such coal, which is dependent on the rank and plastic properties of the coal. Hard coking coals trade at a premium to other coals due to their importance in producing strong coke and because they are a limited resource.

Limited swell. A characteristic of coal that when heated in the absence of air shows limited increase in volume.

Longwall mining. A form of underground mining that employs a shearer with two rotating drums pulled mechanically back and forth across a long exposed coal face. A hydraulic system supports the roof of the mine while the drums are mining the coal. Conveyors move the loosened coal to an underground mine conveyor that transports coal to the surface. Longwall mining is the most efficient underground mining method.

Metallurgical (“met”) coal. The various grades of coal with suitable carbonization properties to make coke or to be used as a pulverized injection ingredient for steel manufacture, including hard coking coal (see definition above), semi-soft coking coal and PCI coal. Met coal quality depends on four important criteria: (1) volatility, which affects coke yield; (2) the level of impurities, including sulfur and ash, which affect coke quality; (3) composition, which affects coke strength; and (4) other basic characteristics that affect coke oven safety. Met coal typically has particularly high Btu characteristics but low ash and sulfur content.

A-1

Metric ton . Equal to approximately 2,205 pounds. The international standard for quoting price per ton is based in U.S. dollars per metric ton. Unless otherwise indicated, the metric ton is the unit of measure referred to in this prospectus and any reference to “ton(s)” or “tonnage” in this prospectus refers to metric ton(s). One metric ton is equivalent to 1.10231 short tons.

Mineable Coal. That portion of the coal reserve base which is commercially mineable and excludes all coal that will be left, such as in pillars, fenders or property barriers.

MSHA. Mine Safety and Health Administration.

Overburden . Layers of earth and rock covering a coal seam. In surface mining operations, overburden must be removed prior to coal extraction.

PCI coal . Coal used by steelmakers for pulverized coal injection (PCI) into blast furnaces to use in combination with the coke used to produce steel. The use of PCI allows a steel maker to reduce the amount of coke needed in the steel making process.

Preparation plant. Preparation plants are usually located on a mine site, although one plant may serve several mines. A preparation plant is a facility for crushing, sizing and washing coal to remove impurities and prepare it for use by a particular customer. The washing process has the added benefit of removing some of the coal’s sulfur content.

Probable reserves. Reserves for which quantity and grade and/or quality are computed from information similar to that used for proven reserves, but the sites for inspection, sampling and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven reserves, is high enough to assume continuity between points of observation.

Productivity. As used in this prospectus, refers to clean metric tons of coal produced per underground man hour worked, as published by the MSHA.

Proven reserves . Reserves for which: (a) quantity is computed from dimensions revealed in outcrops (part of a rock formation that appears at the surface of the ground), trenches, workings or drill holes; (b) grade and/or quality are computed from the results of detailed sampling; and (c) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.

Reclamation. The process of restoring land and the environment to their original or otherwise rehabilitated state following mining activities. The process commonly includes “recontouring” or reshaping the land to its approximate original appearance, restoring topsoil and planting native grass and ground covers. Reclamation operations are usually underway before the mining of a particular site is completed. Reclamation is closely regulated by both state and federal law.

Recoverable reserves . Metric tons of mineable coal that can be extracted and marketed after deduction for coal to be left behind within the seam (i.e. pillars left to hold up the ceiling, coal not economical to recover within the mine, etc.) and adjusted for reasonable preparation and handling losses

Reserve . That part of a mineral deposit that could be economically and legally extracted or produced at the time of the reserve determination.

Roof. The stratum of rock or other mineral above a coal seam; the overhead surface of a coal working place.

SEC. Securities and Exchange Commission.

A-2

Slurry Impoundment . The entire structure used for coal slurry waste disposal, including the embankment, basin, beach, pool, and slurry. During the process of mining and cleaning coal, waste is created and must be permanently disposed of in an impoundment. Slurry, a combination of silt, dust, water, bits of coal and clay particles is the most commonly disposed of material held in an impoundment.

Subsidence. Lateral or vertical movement of surface land that occurs when the roof of an underground mine collapses. Longwall mining causes planned subsidence by the mining out of coal that supports the overlying strata.

Sulfur . One of the elements present in varying quantities in coal that contributes to environmental degradation when coal is burned. Sulfur dioxide is produced as a gaseous by-product of coal combustion.

Surface mine . A mine in which the coal lies at or near the surface and can be extracted by removing the covering layer of soil (see “Overburden”) without tunneling underground. According to the World Coal Association, approximately 67% percent of total U.S. coal production comes from surface mines.

Ton or tonnage. See “metric ton” above.

Thermal coal. Coal used by power plants and industrial steam boilers to produce electricity, steam or both. It generally is lower in Btu heat content and higher in volatile matter than met coal.

Unassigned reserves. Coal that is likely to be mined in the future, but which is not considered “assigned reserves.”

Underground mine. Also known as a “deep” mine, it is usually located several hundred feet or more below the earth’s surface. An underground mine’s coal is typically removed mechanically and transferred by shuttle car, conveyor and hoist to the surface. According to the World Coal Association, underground mines account for about one-third of annual U.S. coal production.

Wood Mackenzie. Wood Mackenzie Inc.

A-3

LOGO

Through and including , 2017 (25 days after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to unsold allotments or subscriptions.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth the estimated fees and expenses paid or payable by the registrant in connection with the issuance and distribution of securities in this offering. All amounts are estimates except for the SEC registration, the Financial Industry Regulatory Authority, Inc. filing and stock exchange listing fees.


SEC registration fee	$	11,590
FINRA filing fee	$	15,500
NYSE listing fees		*
Accounting fees and expenses		*
Legal fees and expenses		*
Blue Sky fees and expenses (including counsel fees)		*
Printing and engraving expenses		*
Transfer Agent and Registrar fees and expenses		*
Miscellaneous expenses		*

Total	$	*

*	To be completed by amendment.

Item 14. Indemnification of Directors and Officers.

Limitation of Liability

Prior to the effectiveness of this registration statement, we will convert into a Delaware corporation pursuant to a statutory conversion and be renamed Warrior Met Coal, Inc. In connection with this conversion, we will adopt a certificate of incorporation and bylaws and be governed by the Delaware General Corporation Law (the “DGCL”), forms of which have been filed as an exhibit to this registration statement. Section 102(b)(7) of the DGCL permits a corporation, in its certificate of incorporation, to limit or eliminate, subject to certain statutory limitations, the liability of directors to the corporation or its stockholders for monetary damages for breaches of fiduciary duty, except for liability:

•

for any breach of the director’s duty of loyalty to the company or its stockholders;

•

for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;

•

in respect of certain unlawful dividend payments or stock redemptions or repurchases; and

•

for any transaction from which the director derives an improper personal benefit.

In accordance with Section 102(b)(7) of the DGCL, Section of our certificate of incorporation that will be in effect at the closing of this offering will provide that that no director shall be personally liable to us or any of our stockholders for monetary damages resulting from breaches of their fiduciary duty as directors, except to the extent such limitation on or exemption from liability is not permitted under the DGCL. The effect of this provision of our certificate of incorporation will be to eliminate our rights and those of our stockholders (through stockholders’ derivative suits on our behalf) to recover monetary damages against a director for breach of the fiduciary duty of care as a director, including breaches resulting from negligent or grossly negligent behavior, except, as restricted by Section 102(b)(7) of the DGCL. However, this provision will not limit or eliminate our rights or the rights of any stockholder to seek non-monetary relief, such as an injunction or rescission, in the event of a breach of a director’s duty of care.

II-1

If the DGCL is amended to authorize corporate action further eliminating or limiting the liability of directors, then, in accordance with our certificate of incorporation, the liability of our directors to us or our stockholders will be eliminated or limited to the fullest extent authorized by the DGCL, as so amended. Any repeal or amendment of provisions of our certificate of incorporation limiting or eliminating the liability of directors, whether by our stockholders or by changes in law, or the adoption of any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective only, except to the extent such amendment or change in law permits us to further limit or eliminate the liability of directors on a retroactive basis.

Indemnification

Section 145 of the DGCL permits a corporation, under specified circumstances, to indemnify its directors, officers, employees or agents against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlements actually and reasonably incurred by them in connection with any action, suit or proceeding brought by third parties by reason of the fact that they were or are directors, officers, employees or agents of the corporation, if such directors, officers, employees or agents acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reason to believe their conduct was unlawful. In a derivative action, i.e., one by or in the right of the corporation, indemnification may be made only for expenses actually and reasonably incurred by directors, officers, employees or agents in connection with the defense or settlement of an action or suit, and only with respect to a matter as to which they shall have acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made if such person shall have been adjudged liable to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine upon application that the defendant directors, officers, employees or agents are fairly and reasonably entitled to indemnity for such expenses despite such adjudication of liability.

Our certificate of incorporation that will be in effect at the closing of this offering will provide that we will, to the fullest extent authorized or permitted by applicable law, indemnify our current and former directors and officers, as well as those persons who, while directors or officers of our corporation, are or were serving as directors, officers, employees or agents of another entity, trust or other enterprise, including service with respect to an employee benefit plan, in connection with any threatened, pending or completed proceeding, whether civil, criminal, administrative or investigative, against all expense, liability and loss (including, without limitation, attorney’s fees, judgments, fines, ERISA excise taxes and penalties and amounts paid in settlement) reasonably incurred or suffered by any such person in connection with any such proceeding. Notwithstanding the foregoing, a person eligible for indemnification pursuant to our certificate of incorporation will be indemnified by us in connection with a proceeding initiated by such person only if such proceeding was authorized by our board of directors, except for proceedings to enforce rights to indemnification.

The right to indemnification to be conferred by our certificate of incorporation is a contract right that will include the right to be paid by us the expenses incurred in defending or otherwise participating in any proceeding referenced above in advance of its final disposition, provided, however, that if the DGCL requires, an advancement of expenses incurred by our officer or director (solely in the capacity as an officer or director of our corporation) will be made only upon delivery to us of an undertaking, by or on behalf of such officer or director, to repay all amounts so advanced if it is ultimately determined that such person is not entitled to be indemnified for such expenses under our certificate of incorporation or otherwise.

The rights to indemnification and advancement of expenses will not be deemed exclusive of any other rights which any person covered by our certificate of incorporation may have or hereafter acquire under law, our certificate of incorporation, our bylaws that will be in effect at the closing of this offering, an agreement, vote of stockholders or disinterested directors, or otherwise.

Any repeal or amendment of provisions of our certificate of incorporation affecting indemnification rights, whether by our stockholders or by changes in law, or the adoption of any other provisions inconsistent therewith,

II-2

will (unless otherwise required by law) be prospective only, except to the extent such amendment or change in law permits us to provide broader indemnification rights on a retroactive basis, and will not in any way diminish or adversely affect any right or protection existing at the time of such repeal or amendment or adoption of such inconsistent provision with respect to any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision. Our certificate of incorporation will also permit us, to the extent and in the manner authorized or permitted by law, to indemnify and to advance expenses to persons other that those specifically covered by our certificate of incorporation.

Our bylaws will include the provisions relating to advancement of expenses and indemnification rights consistent with those to be set forth in our certificate of incorporation. In addition, our bylaws will provide for a right of indemnitee to bring a suit in the event a claim for indemnification or advancement of expenses is not paid in full by us within a specified period of time. Our bylaws will also permit us to purchase and maintain insurance, at our expense, to protect us and/or any director, officer, employee or agent of our corporation or another entity, trust or other enterprise against any expense, liability or loss, whether or not we would have the power to indemnify such person against such expense, liability or loss under the DGCL.

Any repeal or amendment of provisions of our bylaws affecting indemnification rights, whether by our board of directors, stockholders or by changes in applicable law, or the adoption of any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective only, except to the extent such amendment or change in law permits us to provide broader indemnification rights on a retroactive basis, and will not in any way diminish or adversely affect any right or protection existing thereunder with respect to any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision.

We will enter into indemnification agreements with each of our current directors and executive officers. These agreements will require us to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. We also intend to enter into indemnification agreements with our future directors and executive officers.

Under the Underwriting Agreement, the underwriters are obligated, under certain circumstances, to indemnify directors and officers of the registrant against certain liabilities, including liabilities under the Securities Act. Reference is made to the form of Underwriting Agreement to be filed as Exhibit 1.1 to this Registration Statement.

Item 15. Recent Sales of Unregistered Securities.

In connection with the Walter Energy Restructuring, effective March 31, 2016, Warrior Met Coal, LLC issued an aggregate of 990,378 Class A Units to holders of Walter Energy, Inc.’s first lien debt obligations in exchange for the credit bid of such first lien debt obligations and release by such holders of the liens related to such debt obligations. This transaction did not involve any underwriters or any public offering, and we believe that this transaction was exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act.

Upon consummation of the Asset Acquisition, Warrior Met Coal, LLC issued 2,475,004 Class B Units to holders of Walter Energy, Inc.’s first lien debt obligations who participated in a rights offering for aggregate consideration of $198 million in cash. In connection with this rights offering, Warrior Met Coal, LLC issued an aggregate of 278,438 Class A Units to certain holders of Walter Energy, Inc.’s first lien debt obligations as a commitment premium for backstopping the rights offering. These transactions did not involve any underwriters or any public offering, and we believe that these transactions were exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act.

II-3

On April 16, 2016, Warrior Met Coal, LLC issued 25,000 Class B Units to certain qualified unsecured creditors of Walter Energy’s pre-petition debt participating in a rights offering for aggregate consideration of $2 million in cash. This transaction did not involve any underwriters or any public offering, and we believe that this transaction was exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act.

In connection with certain issued and outstanding letters of credit arising under the first lien debt obligations of Walter Energy, Inc., which letters of credit were undrawn as of the closing of the Asset Acquisition, but were subsequently drawn and funded by the revolving lenders on April 14, 2016, April 22, 2016, May 11, 2016 October 19, 2016 and February 23, 2017, Warrior Met Coal, LLC issued an aggregate of 4,563 Class A Units to such revolving lenders. These transactions did not involve any underwriters or any public offering, and we believe that these transactions were exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act.

On April 1, 2016, April 20, 2016, December 9, 2016 and January 1, 2017, Warrior Met Coal, LLC issued an aggregate of 52,438 Class C Units to members of senior management pursuant to the Warrior Met Coal, LLC 2016 Equity Incentive Plan. These transactions did not involve any underwriters and we believe that these transactions were exempt from the registration requirements pursuant to Section 4(a)(2) and/or Rule 701 of the Securities Act.

Item 16. Exhibits and Financial Statement Schedules.

(A) Exhibits:


Exhibit Number		Description
1.1*		Form of Underwriting Agreement.

2.1#		Amended and Restated Asset Purchase Agreement, dated as of March 31, 2016, by and among Warrior Met Coal, LLC and the other purchasers party thereto, as buyers, and Walter Energy, Inc. and certain subsidiaries of Walter Energy, Inc., as sellers.

2.2*		Form of Certificate of Conversion of Warrior Met Coal, LLC.

3.1*		Form of Certificate of Incorporation of Warrior Met Coal, Inc.

3.2*		Form of Bylaws of Warrior Met Coal, Inc.

4.1*		Specimen Certificate for shares of common stock, par value $0.01 per share, of the Company.

4.2*		Form of Rights Plan, by and between Warrior Met Coal, Inc. and Computershare Trust Company, N.A., as Rights Agent (including the form of Certificate of Designations of Series A Junior Participating Preferred Stock, the form of Rights Certificate and Summary of Rights).

5.1*		Form of Opinion of Akin Gump Strauss Hauer & Feld LLP as to the legality of the securities being registered.

10.1		Asset-Based Revolving Credit Agreement, dated as of April 1, 2016, by and among Warrior Met Coal, LLC and certain of its subsidiaries, as borrowers, the guarantors party thereto, Citibank, N.A., as administrative agent and swingline agent, Citibank N.A. and Credit Suisse AG, Cayman Islands Branch, as letter of credit Issuers, the other lenders party thereto, and Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC, as joint lead arrangers and joint bookrunners.

10.2		Amendment No. 1 to Asset-Based Revolving Credit Agreement, dated as of January 23, 2017, to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016, among Warrior Met Coal, LLC and certain of its subsidiaries, as borrowers, the guarantors party thereto, Citibank, N.A. as administrative agent and collateral agent, each lender providing additional commitment pursuant to the Amendment, as commitment increase lenders, and the other lenders party to the Credit Agreement, as existing lenders.

10.3*		Form of Registration Rights Agreement.

10.4*†		Form of Warrior Met Coal, Inc. Equity Incentive Plan.

II-4


Exhibit Number		Description
10.5*†		Form of Restricted Stock Award Agreement.

10.6*†		Form of Director and Officer Indemnification Agreement.

10.7†		Employment Agreement, dated March 31, 2016 by and between Warrior Met Coal, LLC and Walter J. Scheller, III.

10.8†		Employment Agreement, dated March 31, 2016 by and between Warrior Met Coal, LLC and Michael T. Madden.

10.9†		Employment Agreement, dated March 31, 2016 by and between Warrior Met Coal, LLC and Jack K. Richardson.

10.10†		Employment Agreement, dated January 1, 2017, by and between Warrior Met Coal, LLC and Dale W. Boyles.

21.1		List of Subsidiaries of the Company.

23.1		Consent of Ernst & Young LLP.

23.2		Consent of Marshall Miller & Associates, Inc.

23.3		Consent of Norwest Corporation.

23.4		Consent of McGehee Engineering Corp.

23.5		Consent of Wood Mackenzie Inc.

23.6*		Consent of Akin Gump Strauss Hauer & Feld LLP (included in Exhibit 5.1).

23.7*		Consent of Director Nominee.

23.8*		Consent of Director Nominee.

24.1		Power of Attorney (included on signature page).

*	To be filed by amendment.

†	Management contract, compensatory plan or arrangement.

#	The schedules to this agreement have been omitted for this filing pursuant to Item 601(b)(2) of Regulation S-K. The Company will furnish copies of such schedules to the SEC upon request.

(B) Financial Statement Schedules.

All schedules are omitted because the required information is (i) not applicable, (ii) not present in amounts sufficient to require submission of the schedule or (iii) included in our financial statements and the accompanying notes thereto included in the prospectus to this Registration Statement.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification by the Registrant for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered

II-5

hereunder, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

For the purpose of determining liability under the Securities Act of 1933 to any purchaser, if the Registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

For the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this Registration Statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(1)

Any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424;

(2)

Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred to by the undersigned Registrant;

(3)

The portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and

(4)

Any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser.

II-6

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Brookwood, Alabama, on March 7, 2017.


Warrior Met Coal, LLC

By:		/s/ Walter J. Scheller, III
		Walter J. Scheller, III Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENT, that each person whose signature appears below constitutes and appoints Walter J. Scheller, III and Dale W. Boyles, and each of them, as his or her true and lawful attorney-in-fact and agents, with full power of substitution and resubstitution, from such person and in each person’s name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to the Registration Statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission and to sign and file any other registration statement for the same offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done as fully to all said attorneys-in-fact and agents, or any of them, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on March 7, 2017.


Signature		Title

/s/ Walter J. Scheller, III Walter J. Scheller, III		Chief Executive Officer (Principal Executive Officer) and Manager

/s/ Dale W. Boyles Dale W. Boyles		Chief Financial Officer (Principal Financial and Accounting Officer)

/s/ Stephen D. Williams Stephen D. Williams		Manager

/s/ Keith Luh Keith Luh		Manager

/s/ Blaine MacDougald Blaine MacDougald		Manager

/s/ Matthew R. Michelini Matthew R. Michelini		Manager

/s/ Darren L. Richman Darren L. Richman		Manager

/s/ Gareth Turner Gareth Turner		Manager

S-1

EXHIBIT INDEX


Exhibit Number		Description
1.1*		Form of Underwriting Agreement.

2.1#		Amended and Restated Asset Purchase Agreement, dated as of March 31, 2016, by and among Warrior Met Coal, LLC and the other purchasers party thereto, as buyers, and Walter Energy, Inc. and certain subsidiaries of Walter Energy, Inc., as sellers.

2.2*		Form of Certificate of Conversion of Warrior Met Coal, LLC.

3.1*		Form of Certificate of Incorporation of Warrior Met Coal, Inc.

3.2*		Form of Bylaws of Warrior Met Coal, Inc.

4.1*		Specimen Certificate for shares of common stock, par value $0.01 per share, of the Company.

4.2*		Form of Rights Plan, by and between Warrior Met Coal, Inc. and Computershare Trust Company, N.A., as Rights Agent (including the form of Certificate of Designations of Series A Junior Participating Preferred Stock, the form of Rights Certificate and Summary of Rights).

5.1*		Form of Opinion of Akin Gump Strauss Hauer & Feld LLP as to the legality of the securities being registered.

10.1		Asset-Based Revolving Credit Agreement, dated as of April 1, 2016, by and among Warrior Met Coal, LLC and certain of its subsidiaries, as borrowers, the guarantors party thereto, Citibank, N.A., as administrative agent and swingline agent, Citibank N.A. and Credit Suisse AG, Cayman Islands Branch, as letter of credit Issuers, the other lenders party thereto, and Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC, as joint lead arrangers and joint bookrunners.

10.2		Amendment No. 1 to Asset-Based Revolving Credit Agreement, dated as of January 23, 2017, to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016, among Warrior Met Coal, LLC and certain of its subsidiaries, as borrowers, the guarantors party thereto, Citibank, N.A. as administrative agent and collateral agent, each lender providing additional commitment pursuant to the Amendment, as commitment increase lenders, and the other lenders party to the Credit Agreement, as existing lenders.

10.3*		Form of Registration Rights Agreement.

10.4*†		Form of Warrior Met Coal, Inc. Equity Incentive Plan.

10.5*†		Form of Restricted Stock Award Agreement.

10.6*†		Form of Director and Officer Indemnification Agreement.

10.7†		Employment Agreement, dated March 31, 2016 by and between Warrior Met Coal, LLC and Walter J. Scheller, III.

10.8†		Employment Agreement, dated March 31, 2016 by and between Warrior Met Coal, LLC and Michael T. Madden.

10.9†		Employment Agreement, dated March 31, 2016 by and between Warrior Met Coal, LLC and Jack K. Richardson.

10.10†		Employment Agreement, dated January 1, 2017, by and between Warrior Met Coal, LLC and Dale W. Boyles.

21.1		List of Subsidiaries of the Company.

23.1		Consent of Ernst & Young LLP.

23.2		Consent of Marshall Miller & Associates, Inc.

23.3		Consent of Norwest Corporation.

23.4		Consent of McGehee Engineering Corp.

23.5		Consent of Wood Mackenzie Inc.

E-1


Exhibit Number		Description
23.6*		Consent of Akin Gump Strauss Hauer & Feld LLP (included in Exhibit 5.1).

23.7*		Consent of Director Nominee.

23.8*		Consent of Director Nominee.

24.1		Power of Attorney (included on signature page).

*	To be filed by amendment.

†	Management contract, compensatory plan or arrangement.

#	The schedules to this agreement have been omitted for this filing pursuant to Item 601(b)(2) of Regulation S-K. The Company will furnish copies of such schedules to the SEC upon request.

E-2

Exhibit 2.1

A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT

DATED AS OF M ARCH 31, 2016

BY AND AMONG

W ARRIOR M ET C OAL , LLC ( F / K / A C OAL A CQUISITION LLC),

AND

THE B UYER D ESIGNEES ( AS DEFINED HEREIN ), AS B UYER

AND

W ALTER E NERGY , I NC .,

AND

C ERTAIN S UBSIDIARIES OF W ALTER E NERGY , I NC ., AS S ELLERS

T ABLE OF C ONTENTS


ARTICLE 1

D EFINITIONS

1.1	Definitions	2
1.2	Other Definitions and Interpretive Matters	23

ARTICLE 2

P URCHASE AND S ALE

2.1	Purchase and Sale	25
2.2	Excluded Assets	29
2.3	Assumed Liabilities	31
2.4	Excluded Liabilities	32
2.5	Assignment and Assumption of Contracts	34
2.6	Further Assurances	37

ARTICLE 3

P URCHASE P RICE

3.1	Consideration	38
3.2	Limitation on Buyer Liability	38
3.3	Withholding	39

ARTICLE 4

C LOSING AND D ELIVERIES

4.1	Closing Date	39
4.2	Buyer’s Deliveries	39
4.3	Sellers’ Deliveries	41
4.4	Buyer Designees	42

ARTICLE 5

R EPRESENTATIONS AND W ARRANTIES OF S ELLERS

5.1	Organization and Good Standing	43
5.2	Authority; Validity; Consents	43
5.3	No Conflict	44
5.4	Real Property	44
5.5	Environmental Matters	45
5.6	Title to Acquired Assets	47
5.7	Taxes	47


5.8	Legal Proceedings	48
5.9	Compliance with Legal Requirements; Permits	48
5.10	Labor Matters	50
5.11	Employee Benefits	51
5.12	Sellers’ Intellectual Property	54
5.13	Contracts	54
5.14	Insurance	54
5.15	Brokers or Finders	55
5.16	Affiliate Interests	55
5.17	Bank Accounts	55
5.18	Undue Influence	55
5.19	Financial Statements	56
5.20	Absence of Certain Changes	56
5.21	Seller SEC Documents	57
5.22	Mining	58
5.23	MSHA; OSHA	58
5.24	Coal Act; Black Lung Act	59
5.25	Warranties Exclusive	59

ARTICLE 6

R EPRESENTATIONS AND W ARRANTIES OF B UYER

6.1	Organization and Good Standing	60
6.2	Authority; Validity; Consents	60
6.3	No Conflict	60
6.4	Brokers or Finders	61
6.5	Legal Proceedings	61
6.6	Financing	61
6.7	Qualification	61
6.8	No Other Representations or Warranties; Condition of the Business; Buyer’s Reliance	62
6.9	Information	62

ARTICLE 7

A CTIONS P RIOR TO THE C LOSING D ATE

7.1	Access and Reports; Confidentiality	62
7.2	Operations Prior to the Closing Date	64
7.3	Regulatory Matters; Cooperation	66
7.4	Tax Cooperation	67
7.5	Bankruptcy Court Matters	68
7.6	Expense Reimbursement	69
7.7	Update of Disclosure Schedules; Notice of Developments	69
7.8	Certain Excluded Assets	69
7.9	Surety Bonds; Permits	72


7.10	Overlapping Permits	76
7.11	Transition of Business	77
7.12	Sale Free and Clear	77
7.13	Acquisition Proposals	77
7.14	SEC Filings	78
7.15	Other Actions	78

ARTICLE 8

A DDITIONAL A GREEMENTS

8.1	Taxes	78
8.2	Bulk Sales	79
8.3	Payments Received	79
8.4	Assumed Contracts: Adequate Assurance and Performance	79
8.5	Employee Matters	79
8.6	Post-Closing Books and Records; Properties; and Personnel	82
8.7	Casualty Loss	82
8.8	Change of Name	82
8.9	No Successor Liability	83
8.10	Liens	83
8.11	Other Agreements	84
8.12	Insurance	85
8.13	Union Retiree Escrow Account	85
8.14	Active Employee Runoff Claims Escrow Account	86

ARTICLE 9

C ONDITIONS P RECEDENT TO O BLIGATIONS OF B UYER TO C LOSE

9.1	Accuracy of Representations	86
9.2	Sellers’ Performance	87
9.3	No Order	87
9.4	Governmental Authorizations	87
9.5	Sellers’ Deliveries	87
9.6	Sale Order	87
9.7	Assumed Contracts	88
9.8	Material Adverse Effect	88
9.9	UMWA; USW	88

ARTICLE 10

C ONDITIONS P RECEDENT TO THE O BLIGATION OF S ELLERS TO C LOSE

10.1	Accuracy of Representations	89
10.2	Buyer’s Performance	89
10.3	No Order	89

iii


10.4	Governmental Authorizations	89
10.5	Buyer’s Deliveries	89
10.6	Sale Order	89
10.7	Release	90
10.8	Global Settlement	90

ARTICLE 11

T ERMINATION

11.1	Termination Events	90
11.2	Effect of Termination	92

ARTICLE 12

G ENERAL P ROVISIONS

12.1	Survival	94
12.2	Confidentiality	94
12.3	Public Announcements	95
12.4	Notices	95
12.5	Waiver	96
12.6	Entire Agreement; Amendment	97
12.7	Assignment	97
12.8	Severability	97
12.9	Expenses	97
12.10	Governing Law; Consent to Jurisdiction and Venue; Jury Trial Waiver	97
12.11	Counterparts	98
12.12	Parties in Interest; Third Party Beneficiaries; No Amendment	98
12.13	Remedies	99
12.14	Specific Performance	99
12.15	Sellers’ Representative; Reliance	99
12.16	No Liability; Releases	100


SCHEDULES

Schedule 1.1(a)		Sellers’ Knowledge Persons
Schedule 1.1(b)		Miscellaneous Real Property Assets
Schedule 2.1(b)		Equipment
Schedule 2.1(g)		Transferred Permits
Schedule 2.1(l)		Claims and Causes of Action
Schedule 2.1(m)		Acquired Actions
Schedule 2.1(r)		Equity Interests Acquired
Schedule 2.1(s)		Other Acquired Assets
Schedule 2.2(a)		Certain Excluded Assets
Schedule 2.2(d)		Excluded Capital Stock and Equity
Schedule 2.2(o)		Financial Assurances
Schedule 2.3(e)		Employee Liabilities
Schedule 2.3(m)		Assumed Reclamation Liabilities
Schedule 2.5(a)		Available Contracts
Schedule 5.2		Required Consents
Schedule 5.3		Conflicts
Schedule 5.4(a)(i)		Owned Real Property
Schedule 5.4(a)(ii)		Options and Rights of First Refusal
Schedule 5.4(b)		Lessor Leases
Schedule 5.4(c)		Leases (for Leased Real Property)
Schedule 5.5		Environmental Matters
Schedule 5.5(i)		Assumed Liabilities - Environmental
Schedule 5.5(k)		Underground Storage Tanks and Related Matters
Schedule 5.7(a)		Taxes
Schedule 5.7(b)		Tax Deficiencies
Schedule 5.7(c)		Tax Incentive Defaults
Schedule 5.7(d)		Withholding Taxes
Schedule 5.7(e)		Tax Allocation or Sharing Agreements
Schedule 5.8		Legal Proceedings
Schedule 5.9(a)		Permits
Schedule 5.9(b)		Compliance with Legal Requirements, Orders and Permits
Schedule 5.9(c)		Adverse Environmental Actions
Schedule 5.10(a)		Collective Bargaining Agreements and Other Contracts
Schedule 5.10(b)		Labor Matters
Schedule 5.10(c)		WARN Act and Other Proceedings
Schedule 5.11(a)		Title IV Plans
Schedule 5.11(d)		Termination of Title IV Plans
Schedule 5.11(i)		Welfare Plans
Schedule 5.11(j)		Payments Becoming Due
Schedule 5.12(a)		Patents, Trademarks and Copyrights
Schedule 5.12(b)		Claims Relating to Intellectual Property Rights
Schedule 5.13(i)		Material Contracts
Schedule 5.13(ii)		Effectiveness of Material Contracts
Schedule 5.13(iii)		Breaches and Defaults
Schedule 5.14		Insurance


Schedule 5.16		Affiliate Interests
Schedule 5.17		Bank Accounts
Schedule 5.20(b)		Certain Changes
Schedule 5.23		MSHA; OSHA
Schedule 6.2		Buyer Consents
Schedule 7.2		Operations Prior to Closing
Schedule 8.5(c)		Buyer Benefit Plans

A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT

T HIS A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT (this “ Agreement ”), dated as of March 31, 2016, is made and entered into by and among Warrior Met Coal, LLC (f/k/a Coal Acquisition LLC), a Delaware limited liability company (“ WMC ”), the Buyer Designees (as defined herein) (collectively with WMC, the “ Buyer ”), Walter Energy, Inc., a Delaware corporation (the “ Company ”), and the Additional Sellers (together with the Company, “ Sellers ” and each entity individually a “ Seller ”). Capitalized terms used herein and not otherwise defined herein have the meanings set forth in Article 1 .

R ECITALS

W HEREAS , Sellers are engaged in the business of producing metallurgical coal, thermal coal, anthracite, metallurgical coke and coal bed methane gas;

W HEREAS , on November 5, 2015 (the “ Execution Date ”), Buyer and Sellers entered into an asset purchase agreement, which was amended by that certain First Amendment to Asset Purchase Agreement, dated as of December 9, 2015, that certain Second Amendment to Asset Purchase Agreement, dated as of January 12, 2016, that certain Third Amendment to Asset Purchase Agreement, dated as of January 26, 2016, and that certain Fourth Amendment to Asset Purchase Agreement, dated as of February 19, 2016 (as amended to date, the “ Original Asset Purchase Agreement ”);

W HEREAS , this Agreement amends, restates, and supersedes, in its entirety, the Original Asset Purchase Agreement;

W HEREAS , on July 15, 2015, Sellers filed voluntary petitions (the “ Bankruptcy Case ”) under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Alabama (the “ Bankruptcy Court ”);

W HEREAS , in accordance with the Bidding Procedures and subject to the terms and conditions set forth in this Agreement and the entry of the Sale Order, Sellers desire to sell to Buyer all of the Acquired Assets and to assign to Buyer all of the Assumed Liabilities, Buyer desires to purchase from Sellers all of the Acquired Assets and assume all of the Assumed Liabilities, and the Parties intend to effectuate the transactions contemplated by this Agreement, upon the terms and conditions hereinafter set forth;

W HEREAS , the Acquired Assets and Assumed Liabilities shall be purchased and assumed by Buyer pursuant to the Sale Order, free and clear of all Encumbrances (other than Permitted Encumbrances), pursuant to Sections 105, 363 and 365 of the Bankruptcy Code, and Rules 6004 and 6006 of the Federal Rules of Bankruptcy Procedure;

W HEREAS , Sellers’ ability to consummate the transactions set forth in this Agreement is subject to, among other things, the entry of the Sale Order by the Bankruptcy Court; and

W HEREAS , the board of directors (or similar governing body) of each Seller has determined that it is advisable and in the best interests of such Seller and its constituencies to enter into this Agreement and to consummate the transactions provided for herein, subject to entry of the Sale Order, and each has approved the same.

N OW , T HEREFORE , in consideration of the premises and the mutual promises herein made, and in consideration of the foregoing and of the representations, warranties, covenants, agreements and conditions herein contained, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:

ARTICLE 1

D EFINITIONS

1.1 Definitions .

For purposes of this Agreement, the following terms have the meanings specified or referenced below.

“ Accounts Receivable ” means, with respect to each Seller, all accounts receivable, notes receivable, purchase orders, negotiable instruments, completed work or services that has not been billed, chattel paper, notes and other rights to payment, including those consisting of all accounts receivable in respect of services rendered or products sold to customers by such Seller, any other miscellaneous accounts receivable of such Seller, and any claim, remedy or other right of such Seller related to any of the foregoing, together with all unpaid financing charges accrued thereon and any payments with respect thereto.

“ Accrued Claims ” has the meaning set forth in Section 8.13 .

“ Accrued Payroll ” means all wages and other related obligations that have accrued since the end of the last payroll period immediately prior to the Closing Date.

“ Accrued Runoff Claims ” has the meaning set forth in Section 8.14 .

“ Acquired Actions ” has the meaning set forth in Section 2.1(m) .

“Acquired Assets ” has the meaning set forth in Section 2.1 .

“ Acquired Non-Core Assets ” means Non-Core Assets (excluding the Walter Coke Assets and the Blue Creek Assets and excluding any real property, improvements, or other assets or types of assets designated by Buyer) that are not sold to a Successful Bidder (excluding Buyer) in accordance with the Bidding Procedures.

“ Acquisition Proposal ” has the meaning set forth in Section 7.13 .

“ Action ” means any action, suit, petition, plea, charge, claim, demand, hearing, inquiry, arbitration, complaint, grievance, summons, litigation, mediation, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding), prosecution, contest, inquest, audit, examination, investigation or similar matter by or before any Governmental Authority.

“ Active Employee Runoff Claims Escrow Account ” has the meaning set forth in Section 8.14 .

“ Active Employee Runoff Claims Escrow Termination Date ” has the meaning set forth in Section 8.14 .

“ Active Employees ” has the meaning set forth in Section 8.14 .

“ Additional Sellers ” means:

(i)

Atlantic Development and Capital, LLC, Atlantic Leaseco, LLC, Maple Coal Co., LLC, Walter Black Warrior Basin LLC, Walter Energy Holdings, LLC, Walter Exploration & Production LLC, Walter Natural Gas, LLC, each a Delaware limited liability company;

(ii)

Blue Creek Energy, Inc., J.W. Walter, Inc., SP Machine, Inc., V Manufacturing Company, Walter Coke, Inc., Walter Land Company, Walter Minerals, Inc., each a Delaware corporation;

(iii)

Blue Creek Coal Sales, Inc., Jefferson Warrior Railroad Company, Inc., Jim Walter Resources, Inc., Sloss-Sheffield Steel & Iron Company, Taft Coal Sales & Associates, Inc., Tuscaloosa Resources, Inc., each an Alabama corporation; and

(iv)

Jim Walter Homes, LLC and Walter Home Improvement, Inc., each a Florida corporation.

“ Affiliate ” has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Exchange Act.

“ Agreement ” has the meaning set forth in the introductory paragraph.

“ Alabama Contract Mining Agreement ” has the meaning set forth in Section 7.9(a)(iv) .

“ Alabama Mining License ” has the meaning set forth in Section 7.9(a)(ii)(1) .

“ Alabama Mining Permits ” has the meaning set forth in Section 7.9(a)(iii)(1) .

“ Alternative Outside Date ” has the meaning set forth in Section 11.1(b)(iii)

“ Alternative Transaction ” means (i) any investment in, financing of, capital contribution or loan to, or restructuring or recapitalization of all or a substantial portion of Sellers (including any exchange of all or a substantial portion of Sellers’ outstanding debt obligations for equity securities of any Seller), (ii) any merger, consolidation, share exchange or other similar transaction to which any Seller is a party that has the effect of transferring, directly or indirectly, all or a substantial portion of the assets of, or any issuance, sale or transfer of equity interests in, Sellers, the Acquired Assets or the Business (iii) any direct or indirect sale of all or a substantial

portion of the assets of, or any issuance, sale or transfer of equity interests in, Sellers, the Acquired Assets or the Business or (iv) any other transaction, including a plan of liquidation or reorganization, that transfers or vests ownership of, economic rights to, or benefits in all or a substantial portion of the assets of Sellers, the Acquired Assets or the Business to any party other than Buyer or one or more Buyer Designees, in each case excluding the transactions contemplated under this Agreement; provided , that, in no event shall a sale or liquidation of the Blue Creek Assets, the Walter Coke Assets, the Miscellaneous Real Property Assets or any other Non-Core Asset, in each case pursuant to the Bidding Procedures or a sale of any of the direct or indirect Bermuda, Canadian or United Kingdom Subsidiaries of Sellers (or any of the assets of such Subsidiaries) constitute an Alternative Transaction.

“ Antitrust Law ” means, collectively, the HSR Act, Title 15 of the United States Code §§ 1-7 (the Sherman Act), Title 15 of the United States Code §§ 12-27 and Title 29 of the United States Code §§ 52-53 (the Clayton Act), the Federal Trade Commission Act (15 U.S.C.§ 41 et seq.), and the rules and regulations promulgated thereunder, and any other Legal Requirements that are designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade or lessening of competition through merger or acquisition, as such of the foregoing are enacted and in effect as of the date hereof.

“ Applicable Rate ” means, for a particular day, the prime rate as reported in The Wall Street Journal published for such day or, if such rate is regularly reported in The Wall Street Journal, but is not reported on such day, such rate as most-recently reported in The Wall Street Journal (or, if such rate is no longer reported in The Wall Street Journal, a comparable rate), calculated on a daily basis based on a 365-day year.

“ Applicant Violator System ” has the meaning set forth in Section 5.9(c) .

“ Approved Budget ” has the meaning set forth in the Cash Collateral Orders.

“ Approved Retention Payments ” means payments owing to Sellers’ employees that have been approved by the Steering Committee in connection with a key employee retention program approved by the Bankruptcy Court.

“ Assumed Benefits ” has the meaning set forth in Section 2.3(e) .

“ Assumed Contracts ” has the meaning set forth in Section 2.5(a)(i) .

“ Assumed Liabilities ” has the meaning set forth in Section 2.3 .

“ Assumed SMCRA Permit ” has the meaning set forth in Section 7.10(a) .

“ Assumption Agreement ” means an Assignment and Assumption Agreement in customary form reasonably acceptable to the Parties.

“ Audited Financial Statements ” has the meaning set forth in Section 5.19 .

“ Available Contracts ” has the meaning set forth in Section 2.5(a)(i) .

“ Avoidance Action ” means any claim, right or cause of action of any Seller arising under chapter 5 of the Bankruptcy Code and any analogous state law claims.

“ Backup Bidder ” has the meaning set forth in the Bidding Procedures.

“ Bankruptcy Case ” has the meaning set forth in the recitals.

“ Bankruptcy Code ” means Title 11 of the United States Code, Sections 101 et seq .

“ Bankruptcy Court ” has the meaning set forth in the recitals.

“ Benefit Plan ” means any (i) “employee benefit plan” within the meaning of Section 3(3) of ERISA or (ii) other employee benefit plans, agreements, programs, policies, arrangements or payroll practices, whether or not subject to ERISA (including any funding mechanism therefor now in effect or required in the future as a result of the transactions contemplated by this Agreement or otherwise), including any plan, program, arrangement or agreement that is a pension, profit-sharing, savings, retirement, employment, consulting, severance pay, termination, executive compensation, incentive compensation, deferred compensation, bonus, stock purchase, stock option, phantom stock or other equity-based compensation, change in control, retention, salary continuation, vacation, sick leave, disability, death benefit, group insurance, hospitalization, medical, dental, life (including all individual life insurance policies as to which any Seller(s) is the owner, the beneficiary, or both), Code Section 125 “cafeteria” or “flexible” benefit, employee loan, educational assistance or fringe benefit plan, program, arrangement or agreement, whether written or oral, in each case, that (x) is sponsored, maintained or contributed to by Sellers, or for which Sellers have any obligation to sponsor, maintain or contribute to, or for which Sellers have any direct or indirect liability, whether contingent or otherwise and (y) under which any current or former officer, director, employee, consultant (or their respective beneficiaries) of Sellers has any present or future right to benefits, except for any Multiemployer Plan.

“ Bid Deadline ” has the meaning set forth in Section 7.5(c).

“ Bidding Procedures ” means the bid procedures in the form attached to the Bidding Procedures Order (with other changes approved by Buyer and Sellers).

“ Bidding Procedures Order ” means the Order of the Bankruptcy Court dated November 25, 2015 approving the Bidding Procedures [Docket No. 1119].

“ Bill of Sale ” means a bill of sale in customary form reasonably acceptable to the Parties.

“ Black Lung Act ” means the Federal Coal Mine Safety and Health Act of 1969, the Black Lung Benefits Act of 1972, the MSHA, the Black Lung Benefits Reform Act of 1977, and the Black Lung Benefits Amendments of 1981, in each case as amended.

“ Black Lung Assumed Liabilities ” means all Black Lung Liability of the Sellers whether now existing or hereafter arising and all Black Lung Liability of the Buyer arising after the Closing.

“ Black Lung Liability ” means any liability or benefit obligations related to black lung claims and benefits under the Black Lung Act, and liabilities and benefits related to pneumoconiosis, silicosis, exposure to isocyanates or other lung disease arising under any federal or state law.

“ Blue Creek Assets ” means the Acquired Assets owned by Blue Creek Energy, Inc.

“ Blue Creek Bid Protections ” has the meaning set forth in Section 7.8(b)(ii) hereof.

“ Bradley ” has the meaning set forth in Section 2.1(n) .

“ Business ” means the business and operations of Sellers (wherever such business and operations are situated or conducted) related to the Acquired Assets, including the business and operations related to (i) metallurgical coal, thermal coal, anthracite, hard coking coal, metallurgical coke and coal bed methane gas drilling, exploration and related operations and (ii) the selling, marketing, purchasing and blending of coal and gas and related operations, in each case of the foregoing clauses (i) and (ii), other than with respect to such business and operations to the extent they relate to any Excluded Assets or Excluded Liabilities.

“ Business Day ” means any day of the year on which national banking institutions in New York or Alabama are open to the public for conducting business and are not required or authorized to close.

“ Buyer ” has the meaning set forth in the introductory paragraph and shall also include any Buyer Designee.

“ Buyer Benefit Plans ” has the meaning set forth in Section 8.5(c) .

“ Buyer Designee ” has the meaning set forth in Section 4.4 .

“ Buyer Employees ” has the meaning set forth in Section 8.5(a) .

“ Buyer Group ” means (1) any of Buyer and its directors, officers, control persons (as defined in Section 15 of the Securities Act or Section 20 of the Exchange Act), members, employees, agents, attorneys, financial advisors, consultants, legal representatives, shareholders, partners, estates, successors and assigns, (2) the First Lien Lenders, the First Lien Noteholders and members of the Steering Committee, in each case, in such capacity, (3) the Credit Agreement Agent and the Indenture Trustee and (4) any of the respective agents, attorneys, financial advisors, legal advisors, affiliates, directors, managers, officers, control persons, shareholders, members or employees of the foregoing (1) through (3), in each case, in such capacity.

“ Buyer Released Claims ” has the meaning set forth in Section 12.16(c) .

“ Canadian Borrowers ” has the meaning set forth in the definition of “Credit Agreement.”

“ Canadian Partnership Vendors ” has the meaning set forth in Section 2.1(bb) .

“ Canadian Sale Agreement ” has the meaning set forth in Section 2.1(bb) .

“ Cash Collateral Orders ” means, collectively, the (i) Interim Order (A) Authorizing Postpetition Use of Cash Collateral, (B) Granting Adequate Protection to Prepetition Secured Parties, (C) Scheduling a Final Hearing Pursuant to Bankruptcy Rule 4001(b) and (D) Granting Related Relief Docket No. 59 and (ii) Amended Final Order (A) Authorizing Postpetition Use of Cash Collateral, (B) Granting Adequate Protection to Prepetition Secured Parties, and (C) Granting Related Relief Docket No. 797, as may be further extended or amended.

“ Cash Consideration ” has the meaning set forth in Section 3.1(a) .

“ Claim ” means a “claim” as defined in Section 101(5) of the Bankruptcy Code, against any Seller.

“ Closing ” has the meaning set forth in Section 4.1 .

“ Closing Date ” means the date and time as of which the Closing occurs as set forth in Section 4.1 .

“ Closing Required Permits ” means all Governmental Authorizations (including Permits) that are necessary for the operation and conduct of the Business or the Acquired Assets as of the Closing Date, other than any Governmental Authorizations or Permits the absence of which would be immaterial to the operation of the Business as of and after the Closing.

“ Coal Act ” means the Coal Industry Retiree Health Benefit Act of 1992, 26 U.S.C. §§ 9701, et seq.

“ COBRA ” means the Consolidated Omnibus Budget Reconciliation Act of 1985.

“ Code ” means the Internal Revenue Code of 1986.

“ Collective Bargaining Agreement ” has the meaning set forth in Section 5.10(a) .

“ Committee Member and Indenture Trustees Fees Escrow Amount ” means the aggregate amount of reasonable, documented, accrued and unpaid fees and out-of-pocket expenses incurred by each of the members of the UCC, the indenture trustees for the Unsecured Notes, and their retained professionals in connection with their membership on the UCC through the Closing Date, in an amount not to exceed $1,200,000 in the aggregate.

“ Company ” has the meaning set forth in the introductory paragraph.

“ Confidential Information ” has the meaning set forth in Section 12.2 .

“ Contract ” means any legally binding agreement, contract, obligation, promise, undertaking, lease (including Leases and Lessor Leases), sublease, purchase order, arrangement, license, commitment, or other binding arrangement or understanding (in each case whether written or oral), and any amendments, modifications or supplements thereto.

“ Copyrights ” means all United States and foreign copyright rights in any original works of authorship, whether registered or unregistered, including all copyright registrations and applications.

“ Credit Agreement ” means that certain Credit Agreement dated as of April 1, 2011, by and among the Company, as the U.S. borrower, Western Coal Corp. ¹ and Walter Energy Canada Holdings, Inc., as the Canadian borrowers (the “ Canadian Borrowers ”), the lenders from time to time party thereto, and Morgan Stanley Senior Funding, Inc., as administrative agent, as amended, restated, amended and restated, waived, supplemented or otherwise modified from time to time prior to the date hereof.

“ Credit Agreement Agent ” means Morgan Stanley Senior Funding, Inc., in its capacity as administrative agent and collateral agent.

“ Credit Bid and Release ” has the meaning set forth in Section 3.1(c) .

“ Cure Costs ” means all monetary liabilities, including pre-petition monetary liabilities, of Sellers that must be paid or otherwise satisfied to cure all of Sellers’ monetary defaults under the Assumed Contracts pursuant to Section 365 of the Bankruptcy Code at the time of the assumption thereof and assignment to Buyer as provided hereunder as such amounts are determined by the Bankruptcy Court or approved pursuant to the assignment and assumption procedures provided for in the Bidding Procedures Order.

“ Cure Notice ” means, with respect to each Available Contract, the notice submitted by Sellers to the counterparty or counterparties thereto pursuant to the Bidding Procedures Order setting forth, among other things, the Cure Cost amount with respect thereto as calculated by Sellers.

“ Dataroom ” or “ Data Room ” means that certain Sapphire Data Room of the Company.

“ Deeds ” means special (or limited) warranty deeds, or jurisdictional equivalents, as the case may be, in recordable form for the appropriate jurisdiction, reasonably acceptable to Buyer, transferring title to the Real Property other than Leased Real Property and Improvements thereon (subject only to Permitted Encumbrances).

“ Determination Date ” has the meaning set forth in Section 2.5(a)(i) .

Western Coal Corp. was a Canadian Borrower at the time of entry into the Credit Agreement and related documents. In connection with a 2012 restructuring, substantially all of Western Coal Corp.’s assets were transferred to Walter Canadian Coal Partnership, and Western Coal Corp. was dissolved, with its remaining assets (including its partnership interest in Walter Canadian Coal Partnership) distributed to Walter Energy Canada Holdings, Inc.

“ DIP Credit Agreement ” means that certain debtor-in-possession credit agreement to be executed on or around February 4, 2016 by and among the Sellers, the agent named therein, and the lenders named therein and the other parties thereto, as the same may be subsequently modified, amended or supplemented, together with all instruments and agreements related thereto.

“ DIP Order ” means that certain Order of the Bankruptcy Court approving, among other things, the DIP Credit Agreement.

“ Disclosure Schedules ” means the disclosure schedules attached hereto, dated as of the date hereof, delivered or made available by Sellers to Buyer in connection with the execution of this Agreement, as the same may be supplemented and amended pursuant to Section 7.7 .

“ Disclosure Statement ” means the Disclosure Statement for the Debtors’ Joint Plan of Reorganization filed under Chapter 11 of the Bankruptcy Code, filed by Sellers with the Bankruptcy Court on August 26, 2015, as the same may be amended, supplemented, or restated from time to time prior to the Execution Date.

“ Documents ” means all of the documents that are used or useful in, or held for use in, the Business.

“ DOL ” has the meaning set forth in Section 5.11(b) .

“ Employees ” means all of the employees of Sellers on the Execution Date, as well as any additional persons who become employees of Sellers during the period from the Execution Date through and including the Closing Date.

“ Encumbrance ” means any “interest” as that term is used in Section 363(f) of the Bankruptcy Code, mortgage, deed of trust, pledge, security interest, encumbrance, easement, condition, reservation, lien (statutory or otherwise), mechanics lien, Claim, covenant, encroachment, lease, right of use or possession, or other similar third party interest, or other survey defect, charge, hypothecation, deemed trust, action, easement, right-of-way or covenant on real property, other than any license of Intellectual Property, whether imposed by Contract, Legal Requirement, equity or otherwise.

“ Environmental Laws ” means any and all current and future Legal Requirements concerning or relating to (a) public health and safety as may be affected by the Release of, or exposure to, Hazardous Substances or (b) pollution or protection of the environment, including those relating to (i) the presence, use, manufacturing, refining, production, generation, handling, transportation, treatment, recycling, storage, disposal, distribution, importing, labeling, testing, processing, discharge, Release, threatened Release, control, cleanup, or other action or failure to act involving pollutants, contaminants, chemicals, or industrial, toxic or hazardous materials, substances or wastes; (ii) human health as affected by hazardous or toxic substances; and (iii) acid mine drainage, but not including any and all Legal Requirements concerning or relating to environmental provisions of any applicable Mining and Safety Law.

“ Environmental Permit ” means any and all permits, licenses, approvals, consents, waivers, franchises, filings, accreditations, registrations, certifications, notifications, exemptions, clearances and any other authorization required under any applicable Environmental Law or the environmental provisions of any applicable Mining and Mining Safety Law.

“ Equipment ” means all furniture, fixtures, equipment, computers, machinery, vehicles, apparatus, appliances, implements, telephone systems, signage, supplies and all other tangible personal property of every kind and description, and Improvements and tooling used, or held for use, in connection with the operation of the Business, wherever located, including communications equipment, information technology assets, and any attached and associated hardware, routers, devices, panels, cables, manuals, cords, connectors, cards, and vendor documents, and including all warranties of the vendor applicable thereto.

“ Equity Trust ” means a trust established pursuant to a trust agreement in form and substance satisfactory to Buyer and Sellers which shall be funded by Buyer with the Equity Trust Amount to hold common equity of Buyer or its ultimate parent for the benefit of the equity holders of the Equity Trust; provided that such trust agreement shall provide that any funds in the Equity Trust remaining from the Equity Trust Amount shall be remitted to Buyer on the date on which the Equity Trust no longer holds any such common equity.

“ Equity Trust Amount ” means $200,000.

“ ERISA ” means the Employee Retirement Income Security Act of 1974.

“ ERISA Affiliate ” means any Person that would be considered a single employer with Sellers under Sections 414(b), (c), (m) or (o) of the Code.

“ Escrow Agent ” means one or more escrow agents acceptable to Buyer and Sellers.

“ Escrow Termination Date ” has the meaning set forth in Section 8.13 .

“ Estate Retained Professional Fees ” has the meaning set forth in the definition of “Estate Retained Professional Fees Escrow Amount”.

“ Estate Retained Professional Fees Escrow Amount ” means (x) a reasonable estimate of the aggregate amount of reasonable and documented fees and out-of-pocket expenses of, or incurred by, Professionals retained by Sellers pursuant to Section 327 of the Bankruptcy Code or retained by a statutory committee (other than the UCC, the fees of which are covered by clause (y) below) appointed in the Bankruptcy Case (subject to and limited by the Committee Monthly Cap (as defined in the Cash Collateral Orders, as modified to implement and effectuate the terms of the Global Settlement)) and the fees and expenses of the Bankruptcy Administrator (as defined in the Cash Collateral Orders), in each case, that are (i) are accrued and unpaid as of the Closing Date, or (ii) are transaction-based fees owed to PJT Partners LP provided for in an engagement letter in effect as of the Execution Date, which engagement letter has been disclosed to the Buyer prior to the Execution Date, so long as the payment of such transaction-based fees are authorized to be paid by the Bankruptcy Court either before or after the Closing; and (y) a

reasonable estimate of the aggregate amount of all reasonable and documented fees and out-of-pocket expenses of, or incurred by, the UCC’s retained Professionals through the Closing Date that are accrued and unpaid as of the Closing Date in an amount not to exceed $5,200,000 in the aggregate (the actual amount of the fees and out-of-pocket expenses in (x) and (y) being the “ Estate Retained Professional Fees ”).

“ Estate Retained Professional Fees Escrow ” means an escrow established pursuant to the Estate Retained Professional Fees Escrow Agreement.

“ Estate Retained Professional Fees Escrow Agreement ” means an escrow agreement reasonably acceptable to the Parties for the disbursement of the Estate Retained Professional Fees Escrow Amount and the Committee Member and Indenture Trustees Fees Escrow Amount; provided , that such escrow agreement shall expressly provide that any funds not actually used for the Estate Retained Professional Fees shall be remitted to Buyer on the day that is one hundred and eighty (180) days after the Closing Date.

“ Exchange Act ” means the Securities Exchange Act of 1934.

“ Excluded Assets ” has the meaning set forth in Section 2.2 .

“ Excluded Benefit Plans ” means all Benefit Plans other than the Buyer Benefit Plans set forth on Schedule 8.5(c) .

“ Excluded Contracts ” has the meaning set forth in Section 2.5(a)(i) .

“ Excluded Insurance Claims ” has the meaning set forth in Section 8.12(a) .

“ Excluded Liabilities ” has the meaning set forth in Section 2.4 .

“ Excluded NPDES Permit ” has the meaning set forth in Section 7.10(a) .

“ Execution Date ” has the meaning set forth in the introductory paragraph.

“ Expense Reimbursement ” means an amount equal to the reasonable out-of-pocket costs, fees and expenses of Buyer, the Steering Committee, the Credit Agreement Agent and the Indenture Trustee (including reasonable expenses of legal, financial advisory, accounting and other similar costs, fees and expenses and all filing fees under the HSR Act) related to the formation and operation of Buyer and the transactions contemplated by this Agreement but only to the extent such reasonable out-of-pocket costs, fees and expenses are not otherwise paid or reimbursed by Sellers under the Cash Collateral Orders promptly upon the terms and conditions set forth in Section 11.2(b) and the Bidding Procedures Order, which amount, upon entry of the Bidding Procedures Order, shall constitute a super priority administrative expense of Sellers with priority over any and all administrative expenses of any kind, including those specified in Sections 503(b) or 507(b) of the Bankruptcy Code, but shall be subject to the Carve-Out (as defined in the Cash Collateral Orders), in each case, with the priority that is provided for in the Cash Collateral Orders.

“ Extended Contract Period ” has the meaning set forth in Section 2.5(a)(i) .

“ FASB 410 ” has the meaning set forth in Section 5.22(b) .

“ FCPA ” has the meaning set forth in Section 5.18 .

“ Final Order ” means a judgment or Order of the Bankruptcy Court (or any other court of competent jurisdiction) entered by the clerk of the Bankruptcy Court (or such other court) on the docket in the Bankruptcy Case (or the docket of such other court), which has not been modified, amended, reversed, vacated or stayed (other than such modifications or amendments that are consented to by Buyer) and as to which (A) the time to appeal, petition for certiorari, or move for a new trial, stay, reargument or rehearing has expired and as to which no appeal, petition for certiorari or motion for new trial, stay, reargument or rehearing shall then be pending or (B) if an appeal, writ of certiorari, new trial, stay, reargument or rehearing thereof has been sought, such Order or judgment of the Bankruptcy Court (or other court of competent jurisdiction) shall have been affirmed by the highest court to which such order was appealed, or certiorari shall have been denied, or a new trial, stay, reargument or rehearing shall have expired, as a result of which such Action or Order shall have become final in accordance with Bankruptcy Rule 8002; provided that the possibility that a motion under Rule 60 of the Federal Rules of Civil Procedures, or any analogous rule under the Bankruptcy Rules, may be filed relating to such Order, shall not cause an Order not to be a Final Order.

“ First Lien Adequate Protection Obligations ” has the meaning set forth in the Cash Collateral Orders.

“ First Lien Lenders ” has the meaning set forth in the Cash Collateral Orders.

“ First Lien Noteholders ” has the meaning set forth in the Cash Collateral Orders.

“ First Lien Obligations ” has the meaning set forth in the Cash Collateral Orders.

“ Financial Statements ” has the meaning set forth in Section 5.19 .

“ FLSA ” means Fair Labor Standards Act of the United States Department of Labor, and any state or local laws governing wages, hours, and/or overtime pay.

“ GAAP ” has the meaning set forth in Section 5.19 .

“ Gas Well ” means a coal bed methane gas well operated by any Seller.

“ Global Settlement ” has the meaning set forth in Section 10.8.

“ Governmental Authority ” means any United States federal, state or local or any foreign government, multi-national organization, quasi-governmental authority, or other similar recognized governmental authority or regulatory or administrative authority, agency or commission or any court, tribunal or judicial body having jurisdiction.

“ Governmental Authorization ” means any approval, consent, license, Permit, waiver or other authorization issued, granted or otherwise made available by or under the authority of any Governmental Authority.

“ Hazardous Substance ” means any “pollutant,” “contaminant,” “hazardous waste,” “hazardous material” or “hazardous substance” under any Environmental Law or Mining and Mining Safety Law, or any other substance, pollutant, contaminant, waste or related material, or combination thereof, whether solid, liquid, or gaseous in nature, subject to regulation, investigation, remediation, control or corrective action under any Environmental Laws.

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and the rules and regulations promulgated thereunder.

“ Improvements ” means the buildings, plants, structures, fixtures, systems, facilities, infrastructure and other improvements affixed or appurtenant to the Owned Real Property or Leased Real Property.

“ Incorporated Information ” means and includes any and all matters disclosed in (i) the Company’s filings with the SEC, including, its annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, (ii) the Statements of Financial Affairs filed by each of Sellers with the Bankruptcy Court on August 28, 2015, as the same may be amended or supplemented from time to time, (iii) the Schedules of Assets and Liabilities filed by each of Sellers with the Bankruptcy Court on August 28, 2015, (iv) the Disclosure Statement and (v) any and all other filings made by or on behalf of any Seller(s) with the Bankruptcy Court in connection with the Bankruptcy Case, in each case prior to the Execution Date.

“ Indebtedness ” means, at any time and with respect to any Person: (a) all indebtedness of such Person for borrowed money; (b) all indebtedness of such Person for the deferred purchase price of property or services (other than trade payables, other expense accruals and deferred compensation items arising in the Ordinary Course of Business); (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments (other than performance, surety and appeal bonds arising in the Ordinary Course of Business in respect of which such Person’s liability remains contingent); (d) all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), other than inventory or other property purchased by such Person in the Ordinary Course of Business; (e) all obligations of such Person under leases which have been or should be, in accordance with GAAP, recorded as capital leases, to the extent required to be so recorded; (f) all reimbursement, payment or similar obligations of such Person, contingent or otherwise, under acceptance, letter of credit or similar facilities, in each case only to the extent drawn; (g) all Indebtedness of others referred to in clauses (a) through (f) above guaranteed directly or indirectly by such Person, or in effect guaranteed directly or indirectly by such Person through an agreement (i) to pay or purchase such Indebtedness or to advance or supply funds for the payment or purchase of such Indebtedness; (ii) to purchase, sell or lease (as lessee or lessor) property, or to purchase or sell services, primarily for the purpose of enabling the debtor to make payment of such Indebtedness; (iii) to supply funds to or in any other manner invest in the debtor (including any agreement to pay for property or services irrespective of whether such property is received or such services are rendered); or (iv) otherwise to assure a creditor against loss in respect of such Indebtedness; and (h) all Indebtedness referred to in clauses (a) through (g) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any lien upon or in property owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness.

“ Indenture ” means that certain Indenture, dated as of September 27, 2013, among the Company, as issuer, each of the guarantors party thereto, and the Indenture Trustee, relating to the 9.500% Senior Secured Notes Due 2019.

“ Indenture Trustee ” means Wilmington Trust, National Association, as successor trustee and collateral agent under the Indenture.

“ Intellectual Property ” means all intellectual property, including all Copyrights, Patents, Trademarks and Trade Secrets, owned by Sellers and used or held for use in the Business or the Acquired Assets.

“ Inventory ” has the meaning set forth in Section 2.1(a) .

“ IRS ” has the meaning set forth in Section 5.11(b) .

“ Knowledge ” means, with respect to any matter in question, in the case of Sellers, the actual knowledge of any of the individuals listed on Schedule 1.1(a) .

“ Lease ” has the meaning set forth in the definition of “ Leased Real Property .”

“ Leased Real Property ” means, specifically excluding any Excluded Asset, the interests in real property let, leased or subleased by Sellers, as tenant, subtenant, lessee or sublessee, or in which a Seller has been granted a possessory interest or right to use or occupy all or any portion of the same including, as the same are evidenced by any and all mining leases, coal leases, coal mining leases, underground coal mining and gob gas leases, coal land leases, coal degasification leases, use agreements, or other occupancy agreements and all short form leases, memoranda and amendments relating to the foregoing, together with, to the extent let, leased, used or occupied by Sellers in connection with the Business or the Acquired Assets, any and all underground and surface coal reserves, mineral rights, oil and gas rights and interests, mining rights, surface rights, water rights, rights of way, unrecouped minimum, advance or pre-paid production royalties, all buildings and other structures, facilities or Improvements located thereon (and any present or future rights, title and interests arising from or related to the foregoing) (each such lease, a “ Lease ,” and collectively, the “ Leases ”).

“ Legal Requirement ” means any federal, state, provincial, local, municipal, foreign, international, or multinational law (statutory, common or otherwise), constitution, treaty, convention, ordinance, equitable principle, code, rule, regulation or Order enacted, adopted, promulgated, issued or applied by any Governmental Authority or other similar authority, including for the avoidance of doubt, OSHA and any Mining and Mining Safety Law.

“ Lessor Leases ” has the meaning set forth in Section 5.4(b) .

“ Liability ” means a Claim or Encumbrance of any kind or nature whatsoever (whether known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, or due or to become due).

“ Material Adverse Effect ” means any change, event, state of facts or occurrence that individually or in the aggregate (taking into account all other such changes, events, states of fact or occurrences) has had, or would be reasonably expected to have, a material adverse change in or material adverse effect on (1) the Acquired Assets or the assets, properties, prospects, financial condition or results of operations of the Business (excluding the Excluded Assets and the Excluded Liabilities), in each case taken as a whole or (2) the ability of Sellers to consummate the transactions contemplated by this Agreement or to perform any of their obligations under this Agreement, but excluding any change or effect to the extent that it results from or arises out of (i) any reasonably anticipated effects of the commencement or prosecution of the Bankruptcy Case; (ii) the execution and delivery of this Agreement or the announcement thereof or consummation of the transactions contemplated hereby, including the effects of the transactions hereby on business relationships with suppliers and customers; (iii) changes in Legal Requirements or accounting regulations (including GAAP); (iv) any specific action required to be taken (or omitted) by this Agreement or taken (or omitted) at the written request of Buyer; (v) general industry changes in the industries in which Sellers compete; (vi) acts of God (including earthquakes, storms, severe weather, fires, floods and natural catastrophes); (vii) any failure of the Business to achieve external or internal forecasts or financial projections; (viii) any breach of this Agreement by Buyer; or (ix) any change or effect of economic or political conditions (including acts of terrorism, hostilities, sabotage, military actions or war, or any material worsening of such acts of terrorism, hostilities, sabotage, military actions or war), in each case of clauses (iii), (v) and (ix) to the extent that such conditions do not disproportionately affect Sellers, taken as a whole, as compared to other companies that are principally engaged in the same Business as Sellers.

“ Material Contract ” means any Contract pursuant to which any Seller is reasonably expected to incur potential aggregate Liabilities in an amount greater than or equal to $3,000,000 per annum and has a term of greater than one year.

“ Mining ” means the exploration, extraction, processing, storage and transportation of coal and non-coal minerals and to the Reclamation of lands used for such activities.

“ Mining Financial Assurances ” has the meaning set forth in Section 5.22(a) .

“ Mining and Mining Safety Law ” means all Legal Requirements relating to Mining and Mining safety, including (i) SMCRA (including its implementing regulations and any state analogs); (ii) MSHA; (iii) OSHA; (iv) acid and toxic mine drainage requirements; and (v) regulations relating to Mining operations and activities, including Reclamation.

“ Mining Permits ” means all applicable Permits related to Mining or otherwise required by Mining and Mining Safety Law.

“ Miscellaneous Real Property Assets ” means the assets of Sellers set forth on Schedule 1.1(b) .

“ MSHA ” means the Federal Mine Safety and Health Act of 1977, 30 U.S.C. § § 801 et. seq.

“ Multiemployer Plan ” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA.

“ New NPDES Permit ” has the meaning set forth in Section 7.10(a) .

“ Non-Core Assets ” has the meaning set forth in the Bidding Procedures; provided , that (a) the Walter Coke Assets shall constitute “Non-Core Assets” solely to the extent that the Walter Coke Election is made or there is a sale of the Walter Coke Assets to a Successful Bidder (other than Buyer or a Buyer Designee), (b) the Blue Creek Assets shall constitute “Non-Core Assets” solely to the extent that there is a sale of the Blue Creek Assets to a Successful Bidder (other than Buyer or a Buyer Designee) and (c) the Miscellaneous Real Property Assets shall constitute “Non-Core Assets” solely to the extent that the Miscellaneous Real Property Assets are designated by Buyer as “Excluded Assets” or there is a sale of the Miscellaneous Real Property Assets to a Successful Bidder (other than Buyer or a Buyer Designee).

“ Non-Union Retiree Escrow Amount ” means an amount in cash equal to $400,000, which amount shall be deposited on the Closing Date in an escrow account established pursuant to an escrow agreement, dated as of the Closing Date, that is in form and substance satisfactory to Buyer, Sellers and the Section 1114 Committee of Retired Employees, which amount shall be distributed in accordance with and as set forth in that certain Stipulation and Order by the Bankruptcy Court, dated December 16, 2015, resolving Debtors’ Motion Pursuant to 11 U.S.C. §§ 105(A), 1113(C) and 1114(G).

“ NPDES Interim Period ” has the meaning set forth in Section 7.10(a) .

“ Order ” means any award, writ, injunction, judgment, order, ruling, decision, subpoena, precept, directive, consent, approval, award, decree or similar determination or finding entered, issued, made or rendered by any Governmental Authority or an arbitrator, mediator or other judicially sanctioned Person or body.

“ Ordinary Course of Business ” means, with respect to any Person, the ordinary and usual course of normal day-to-day operations of such Person and its business, consistent with its past practice; provided that in the case of Sellers, “Ordinary Course of Business” shall take into account the business and operating practices that have been utilized by Sellers since the commencement of the Bankruptcy Case.

“ Original Asset Purchase Agreement ” has the meaning set forth in the recitals.

“ OSHA ” means the Occupational Safety and Health Act of 1970, 29 U.S.C. §§ 651 et. seq.

“ Outside Date ” has the meaning set forth in Section 11.1(b)(ii) .

“ Overlapping NPDES Areas ” has the meaning set forth in Section 7.10(a) .

“ Owned Real Property ” means, specifically excluding any Excluded Asset, all real property owned by any Seller, and all right, title and interest of such Seller therein, together with all of such Seller’s right, title and interest in and to the following: (i) all buildings,

structures, systems, hereditaments and Improvements located on such real property owned by such Seller; (ii) all Improvements owned by such Seller; and (iii) all easements, if any, in or upon such real property owned by such Seller, licenses and all rights-of-way, beneficial easements, licenses, and other rights, privileges and appurtenances belonging or in any way pertaining to such real property owned by such Seller (including the right, title and interest of such Seller in and to any coal reserves, mineral rights, underground and surface coal and mining rights, royalty rights, support rights and waivers of the same, subsidence rights, water and water rights relating or appurtenant to such real property owned by such Seller).

“ Party ” or “ Parties ” means, individually or collectively, as applicable, Buyer and Sellers.

“ Payroll Amount ” means a reasonable estimate of the amount necessary to fund Accrued Payroll, the Ratification Bonus, Approved Retention Payments to the extent not assumed by Buyer or paid at Closing and payroll taxes related thereto, which estimate shall be provided by Sellers to Buyer on or prior to March 30, 2016, which amount shall be deposited on the Closing Date in one or more escrows established pursuant to escrow agreements, dated as of the Closing Date, that are in form and substance satisfactory to Buyer and Sellers and which escrow agreements expressly provide for any unused funds to be remitted to Buyer within ninety (90) days of the Closing Date (or such later date as shall be agreed to by the Buyer and the Company).

“ Patents ” means United States and foreign patents and patent applications, as well as any continuations, continuations-in-part, divisions, extensions, reexaminations, reissues, renewals and patent disclosures related thereto.

“ PBGC ” has the meaning set forth in Section 5.11(c) .

“ Permits ” means any and all permits (including Environmental Permits and Mining Permits), licenses, approvals, consents, waivers, franchises, filings, accreditations, registrations, certifications, certificates of occupancy, easements, rights of way, notifications, exemptions, clearances, and authorizations, together with all modifications, renewals, amendments, supplements and extensions thereof and applications therefor, of or from any Governmental Authority.

“ Permitted Encumbrances ” means Encumbrances specifically permitted by the Sale Order.

“ Person ” means any individual, corporation (including any non-profit corporation), partnership, limited liability company, joint venture, unincorporated organization, estate, trust, association, organization or other legal entity or group (as defined in Section 13(d)(3) of the Exchange Act) or Governmental Authority.

“ Petition Date ” means July 15, 2015.

“ Pre-Closing Tax Period ” means a Tax period or year, or portion thereof, that ends on or before the Closing Date.

“ Pre-Closing Walter Coke Election ” has the meaning set forth in Section 7.8(f) .

“ Pre-Paid Expenses ” means all deposits (including customer deposits and security deposits (whether maintained in escrow or otherwise) for rent, electricity, telephone or otherwise), advances, pre-paid expenses, prepayments, rights under warranties or guarantees, vendor rebates and other refunds of every kind and nature (whether or not known or unknown or contingent or non-contingent), except that professional fee retainers and pre-paid deposits related thereto shall not be included in the definition of “Pre-Paid Expenses.”

“ Previously Omitted Contract ” has the meaning set forth in Section 2.5(b)(i) .

“ Previously Omitted Contract Designation ” has the meaning set forth in Section 2.5(b)(i) .

“ Previously Omitted Contract Notice ” has the meaning set forth in Section 2.5(b)(ii) .

“ Prior Event ” means any transaction, event, circumstances, action, failure to act or occurrence of any sort or type, including any approval or acceptance given or denied, whether known or unknown, which occurred, existed, was taken or begun prior to the consummation of the transactions contemplated hereunder. For the avoidance of doubt, “ Prior Event ” shall include but not be limited to any transaction, event, circumstances, action, failure to act or occurrence of any sort or type which occurred, existed, was taken or begun in accordance with, pursuant to or by virtue of: (i) any terms of this Agreement, (ii) the transactions referred to herein, (iii) the First Lien Obligations, (iv) the Credit Agreement, (v) the Indenture (vi) the Bankruptcy Case or the events leading to the commencement thereof, or (vii) any oral or written agreement relating to the foregoing (i) to (vi) of this sentence.

“ Proceeding ” means any Action, arbitration, audit, hearing, investigation, litigation, or suit (whether civil, criminal, administrative or investigative) commenced, brought, conducted, or heard by or before any Governmental Authority.

“ Professional ” means any Person retained by Sellers, including any ordinary course professionals and a fee examiner, or a statutory committee of unsecured creditors in the Bankruptcy Case pursuant to an Order of the Bankruptcy Court under Section 327, 363 or 1103 of the Bankruptcy Code.

“ Protection Event ” has the meaning set forth in Section 11.2(b)

“ Purchase Price ” has the meaning set forth in Section 3.1 .

“ Qualified Bid ” has the meaning set forth in the Bidding Procedures.

“ Ratification Bonus ” means a sum equal to: (i) the number of UMWA members who were eligible to and did vote on the initial collective bargaining agreement between Warrior Met Coal Mining, LLC and the UMWA, which was ratified on February 16, 2016 (the “ UMWA Agreement ”), regardless of whether such UMWA member voted to approve or reject the UMWA Agreement, multiplied by (ii) $1,000, subject to appropriate withholdings and deductions, which sum shall be funded by Buyer as of the Closing Date and distributed to such UMWA members within sixty (60) days thereafter.

“ Real Property ” and “ Real Properties ” means (i) the Owned Real Property; (ii) the Leased Real Property; (iii) all Improvements; (iv) all strips and gores and any land lying in the bed of any public road, highway or other access way, open or proposed, adjoining any Owned Real Property; and (v) all easements, licenses, rights and appurtenances relating to the foregoing to the extent that any Seller has a legally recognized interest therein.

“ Reclamation ” means reclamation, revegetation, recontouring, abatement, control or prevention of adverse effects of mining activities.

“ Related Party ” and, collectively, the “ Related Parties ” have the meaning set forth in Section 11.2(c) .

“ Release ” means, except as authorized by a valid Permit issued under Environmental Law, (a) any releasing, spilling, discharging, disposing, leaking, pumping, injecting, pouring, depositing, emitting, leaching of any Hazardous Substance into the outdoor environment, including ambient air, surface water, groundwater and surface or subsurface strata, and (b) migration of Hazardous Substances into or out of any of the Real Property through soil, surface water, or groundwater.

“ Representative ” means, with respect to a particular Person, any director, officer, employee, agent, consultant, advisor or other representative of such Person, including legal counsel, accountants and financial advisors.

“ Sale Hearing ” means the hearing to consider the entry of the Sale Order.

“ Sale Motion ” means the motion filed by Sellers pursuant to, inter alia , Sections 363 and 365 of the Bankruptcy Code to obtain the Bidding Procedures Order and the Sale Order and approve the transactions contemplated by this Agreement.

“ Sale Order ” means an Order of the Bankruptcy Court, in form and substance satisfactory to Buyer and Sellers, pursuant to, inter alia , Sections 105, 363 and 365 of the Bankruptcy Code authorizing and approving, inter alia , the sale of the Acquired Assets to Buyer on the terms and conditions set forth herein, free and clear of all Encumbrances (other than Permitted Encumbrances), and the assumption and assignment of the Assumed Contracts and the Assumed Liabilities by and to Buyer, and containing findings of fact and conclusions of law that Buyer has acted in “good faith” within the meaning of Section 363(m) of the Bankruptcy Code, which order shall in any event provide that, on the Closing Date and concurrently with the Closing, the Acquired Assets shall be transferred to Buyer free and clear of all then existing Encumbrances (including, for the avoidance of doubt, all successor liability, including any successorship obligations under any Collective Bargaining Agreement, and/or with respect to any Benefit Plan that is not a Buyer Benefit Plan), other than Permitted Encumbrances and Assumed Liabilities.

“ SEC ” means the Securities and Exchange Commission.

“ Second Lien Noteholders ” has the meaning set forth in the Cash Collateral Orders.

“ Second Lien Trustee ” has the meaning set forth in the Cash Collateral Orders.

“ Secured Taxes ” means (i) Taxes that if unpaid would give rise to a statutory lien on the Acquired Assets and (ii) taxes that if unpaid could impose liability on Buyer or a responsible person of any Seller under Code Section 6672 (or any similar provision of state, local or foreign law), or could subject any Seller to criminal penalties for failure to pay such taxes, including, for the avoidance of doubt, the following Taxes to the extent they qualify for such description: sales and use Taxes, ad valorem and property Taxes, severance Taxes, black lung excise Taxes, Reclamation fees or Taxes, and payroll, employment, withholding, unemployment insurance, social security or similar taxes.

“ Securities Act ” means the Securities Act of 1933.

“ Seller Released Claims ” has the meaning set forth in Section 12.16(b) .

“ Seller SEC Documents ” has the meaning set forth in Section 5.21 .

“ Sellers ” and “ Seller ” have the meaning set forth in the introductory paragraph.

“ Sellers Group ” means (1) each of the Sellers and their respective directors, officers, control persons (as defined in Section 15 of the Securities Act or Section 20 of the Exchange Act), members, employees, agents, attorneys, financial advisors, consultants, legal representatives, shareholders, partners, estates, successors and assigns solely in their capacity as such, and (2) any of their respective agents, attorneys, financial advisors, legal advisors, affiliates, directors, managers, officers, control persons, shareholders, members or employees.

“ Services Termination Date ” has the meaning set forth in Section 8.14 .

“ Shared Insurance Policies ” has the meaning set forth in Section 8.12(a) .

“ SMCRA ” means the Surface Mining Control and Reclamation Act of 1977, 30 U.S.C. §§1201 et seq.

“ Steering Committee ” has the meaning set forth in the Cash Collateral Orders.

“ Subsidiary ” means any legal entity with respect to which a specified Person (or a subsidiary thereof) owns, directly or indirectly, more than 50% of the voting stock or other equity or partnership interests, the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such legal entity, or of which the specified Person controls the management.

“ Successful Bid ” has the meaning set forth in the Bidding Procedures.

“ Successful Bidder ” has the meaning set forth in the Bidding Procedures.

“ Tax ” or “ Taxes ” (and with correlative meaning, “ Taxable ” and “ Taxing ”) means (i) any federal, state, provincial, local, foreign or other income, alternative, minimum, add-on minimum, accumulated earnings, personal holding company, franchise, capital stock, net worth, capital, profits, intangibles, windfall profits, gross receipts, value added, sales, use, goods and services, excise, customs duties, transfer, conveyance, mortgage, registration, stamp, documentary, recording, premium, severance, environmental (including taxes under Section 59A of the Code), natural resources, real property, personal property, ad valorem, intangibles, rent, occupancy, license, occupational, employment, unemployment insurance, social security, disability, workers’ compensation, payroll, health care, withholding, estimated or other similar tax, duty, levy or other governmental charge or assessment or deficiency thereof (including all interest and penalties thereon and additions thereto whether disputed or not) and (ii) any liability for any items described in clause (i) payable by reason of contract, transferee liability or operation of law (including Treasury Regulation Section 1.1502-6) or otherwise.

“ Tax Return ” means any return, declaration, report, claim for refund, information return or other document (including any related or supporting estimates, elections, schedules, statements, or information) filed or required to be filed in connection with the determination, assessment or collection of any Tax or the administration of any laws, regulations or administrative requirements relating to any Tax.

“ Termination Date ” has the meaning set forth in Section 8.13 .

“ Title IV Plan ” means any Benefit Plan subject to Title IV of ERISA (which, for the avoidance of doubt, excludes any Multiemployer Plan).

“ Trade Payables ” means trade obligations and accrued operating expenses incurred in the ordinary course of business of Sellers to the extent that such obligations relate to the Acquired Assets or the Business and are approved to be paid pursuant to the Approved Budget.

“ Trade Secrets ” means trade secrets and other confidential and proprietary information and know-how.

“ Trademarks ” means United States, state and foreign trademarks, service marks, logos, slogans, trade dress and trade names, Internet domain names and any other similar designations of source of goods or services, whether registered or unregistered, and registrations and pending applications to register the foregoing, and all goodwill related to or symbolized by the foregoing.

“ Transaction Documents ” means this Agreement, the Assumption Agreement, the Bill of Sale, the Estate Retained Professional Fees Escrow Agreement, the Transition Services Agreement, the other agreements contemplated by Section 4.2 and any other agreements, instruments or documents entered into at the Closing pursuant to this Agreement.

“ Transfer Taxes ” means any real property transfer Tax, sales Tax, use Tax, real property recording Tax or fee, intangible Tax, documentary stamp Tax or similar Tax attributable to the sale or transfer of the Acquired Assets (and the perfecting or recording of evidence thereof) and not exempted under the Sale Order, by Section 1146(c) of the Bankruptcy Code or applicable state or municipal law.

“ Transferred Permits ” has the meaning set forth in Section 2.1(g) .

“ Transition Services Agreement ” means a transition services agreement pursuant to which Sellers and/or their designee(s) shall provide certain services to Buyer after Closing and vice versa on terms mutually acceptable to Sellers and Buyer.

“ Treasury Regulations ” means the Treasury regulations promulgated under the Code.

“ Trustee ” means one or more trustees acceptable to Buyer and Sellers.

“ UCC ” means the Official Committee of Unsecured Creditors appointed in the Bankruptcy Case.

“ UMWA ” means the United Mine Workers of America.

“ UMWA Agreement ” has the meaning set forth in the definition of “Ratification Bonus.”

“ UMWA Collective Bargaining Agreements ” means all Collective Bargaining Agreements between the UMWA and any Seller.

“ Unaudited Financial Statements ” has the meaning set forth in Section 5.19 .

“ Union ” and “ Unions ” have the meanings set forth in Section 5.10(a) .

“ Union Retiree Escrow Account ” has the meaning set forth in Section 8.13 .

“ Unsecured Notes ” means the Company’s 9.875% Senior Notes due 2020 and 8.5% Senior Notes due 2021.

“ USW ” means the United Steelworkers.

“ USW Collective Bargaining Agreements ” means all Collective Bargaining Agreements between the USW and any Seller.

“ Waiver ” means a written waiver in form and substance acceptable to Buyer and Sellers signed by Buyer at the Closing waiving on behalf of Buyer all potential and existing Avoidance Actions and any other causes of action available to Sellers or their estates as set forth in Section 2.1(m)(2)(B) and other Persons as set forth therein.

“ Walter Coke Assets ” means the assets owned, leased, licensed, used or held for use by Walter Coke, Inc., a Delaware corporation and a subsidiary of the Company.

“ Walter Coke Election ” has the meaning set forth in Section 7.8(a) .

“ Walter Coke Trust ” means a trust established pursuant to a trust agreement in form and substance satisfactory to Buyer and Sellers pursuant to which the Walter Coke Working Capital Assets shall be transferred by the Buyer in the event that the Walter Coke Election or the Pre-Closing Walter Coke Election is made and there is no Successful Bidder for the Walter Coke Assets as determined in accordance with the Bidding Procedures or the sale of the Walter Coke Assets to a Successful Bidder or Backup Bidder (if any) does not close and the relevant sale agreement is terminated.

“ Walter Coke Trust Amount ” means $1,400,000.

“ Walter Coke Working Capital Assets ” means the inventory, accounts receivable and mobile equipment of Walter Coke (including passenger vehicles, trucks, trailers, crushers, loaders, shield cars, locomotives, rail cars, forklifts and other heavy transportation equipment).

“ WARN Act ” has the meaning set forth in Section 5.10(c) .

“ WC Loan ” has the meaning set forth in Section 7.8(a) .

“ West Virginia Assets ” has the meaning set forth in the Bidding Procedures.

“ Wind Down Trust ” means a trust established pursuant to a trust agreement in form and substance satisfactory to Buyer and Sellers which shall be funded by Buyer with the Cash Consideration.

“ WMC ” has the meaning set forth in the introductory paragraph.

1.2 Other Definitions and Interpretive Matters .

(a) Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply:

Calculation of Time Period. When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded. If the last day of such period is a day other than a Business Day, the period in question shall end on the next succeeding Business Day.

Contracts, Agreements and Orders . Any reference in this Agreement to any contract, license, agreement or order means such contract, license, agreement or order as amended, supplemented or modified from time to time in accordance with the terms thereof.

Day . Any reference in this Agreement to “ days ” (but not Business Days) means to calendar days.

Dollars. Any reference in this Agreement to “ $ ” means United States dollars.

Exhibits/Schedules. All Exhibits and Schedules attached or annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Schedule or Exhibit but not otherwise defined therein shall be defined as set forth in this Agreement.

Gender and Number. Any reference in this Agreement to gender includes all genders, and words imparting the singular number include the plural and vice versa.

Headings. The provision of a table of contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect or be utilized in the construction or interpretation of this Agreement. All references in this Agreement to any “ Section ,” “ Article ” or “ Schedule ” are to the corresponding Section, Article or Schedule of this Agreement unless otherwise specified.

Herein. Words such as “ herein ,” “ hereof ” and “ hereunder ” refer to this Agreement as a whole and not merely to a subdivision in which such words appear.

Including. The word “ including ” or any variation thereof means “ including, without limitation, ” and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it.

Law . Any reference to any law in this Agreement means such law as amended, modified, codified, reenacted, supplemented or superseded in whole or in part, and in effect from time to time.

Other . The words “ to the extent ” shall be interpreted to mean “ to the extent (but only to the extent) ”.

Person . Any reference to a Person shall include such Person’s successors and permitted assigns.

Made Available . Any reference in this Agreement to “ made available ” shall mean (i) the Incorporated Information and (ii) with respect to any other documents or information, that such documents or information referenced shall have been provided in the Dataroom for Buyer and its Representatives prior to the Execution Date or shall have been provided directly to Buyer prior to the Execution Date.

(b) No Strict Construction . Buyer, on the one hand, and Sellers, on the other hand, participated jointly in the negotiation and drafting of this Agreement, and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by Buyer, on the one hand, and Sellers, on the other hand, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement. Without limiting the foregoing, no rule of strict construction construing ambiguities against the draftsperson shall be applied against any Person with respect to this Agreement.

ARTICLE 2

P URCHASE AND S ALE

2.1 Purchase and Sale .

Subject to the entry of the Sale Order and upon the terms and subject to the conditions of this Agreement, on the Closing Date, Sellers shall unconditionally sell, transfer, assign, convey and deliver, or cause to be sold, transferred, assigned, conveyed and delivered, to Buyer and/or to one or more Buyer Designees, and Buyer and/or such Buyer Designees shall purchase, acquire and accept from Sellers, free and clear of all Encumbrances (other than Permitted Encumbrances), all of Sellers’ right, title and interest in, to or under the Business and all of Sellers’ properties, rights, claims and assets (in each case, other than the Excluded Assets), wherever situated or located, whether real, personal or mixed, whether tangible or intangible, whether identifiable or contingent, whether owned, leased, licensed, used or held for use in or relating to the Business, and whether or not reflected on the books and records of Sellers, as the same shall exist on the Closing Date, or as otherwise set forth in this Section 2.1 , including the following (collectively, the “ Acquired Assets ”):

(a) all inventory of any kind or nature, merchandise and goods, related to the Business or the Acquired Assets and maintained, held or stored by or for Sellers on the Closing Date, whether or not prepaid, and wherever located, held or owned, and any prepaid deposits for any of the same, including all coal inventory located upon or within Sellers’ Real Property or belonging to Sellers, disposables and consumables used, or held for use, in connection with the Business, including any goods in transit, other than any such items to the extent related to the Excluded Assets (“ Inventory ”);

(b) all Equipment, including the Equipment set forth on Schedule 2.1(b) , except to the extent primarily used in connection with the Excluded Assets;

(d) all (i) Real Property (other than the Leased Real Property to the extent the Leases related thereto are not Assumed Contracts) and (ii) the Lessor Leases (to the extent that a Lessor Lease is an Assumed Contract);

(e) all rights to subside lands associated with mining operations and all rights to the waiver of and release from subsidence liability and indemnity rights under any and all conveyances, representations and instruments or agreements of any kind and nature applicable to Sellers’ coal mining activities and interests, except to the extent related to the Excluded Assets or the Excluded Liabilities;

(f) except to the extent prohibited by law, any rights of Sellers to the warranties and licenses received from manufacturers and Sellers of the Equipment, Improvements or any component thereof, except to the extent related to the Excluded Assets or the Excluded Liabilities;

(g) subject to Section 2.5(c) and Section 7.9 and obtaining the consents set forth on Schedule 5.2 , all Permits and licenses held by Sellers, including those identified on Schedule 2.1(g) (the “ Transferred Permits ”); provided , that Schedule 2.1(g) and the definition of “Transferred Permits” shall be deemed updated and amended to exclude, without further action by either Party, any Permit that relates to an Excluded Asset;

(h) all Intellectual Property, except to the extent related to the Excluded Assets or the Excluded Liabilities;

(i) all Accounts Receivable, except to the extent related to the Excluded Assets or the Excluded Liabilities;

(j) all Pre-Paid Expenses, except to the extent related to the Excluded Assets or the Excluded Liabilities;

(k) to the extent not prohibited by Legal Requirements and not subject to attorney-client privilege or other work product privilege, all Documents and other books and records (financial, accounting, personnel files of Buyer Employees, and other), except to the extent related to the Excluded Assets or the Excluded Liabilities, and correspondence, and all customer sales, marketing, advertising, packaging and promotional materials, files, data, software (whether written, recorded or stored on disk, film, tape or other media, and including all computerized data), drawings, engineering and manufacturing data and other technical information and data, and all other business and other records, in each case, that are used or useful in, held for use in, or that arise in any way out of or are related to, the Acquired Assets, the Assumed Liabilities or the Business; provided , that Sellers shall be permitted to keep copies of all of the foregoing to the extent necessary or required by the Bankruptcy Court or in connection with the Bankruptcy Case or related to the Excluded Assets or the Excluded Liabilities, subject to Section 12.2 ;

(l) except as set forth on Schedule 2.1(l) or to the extent related to the Excluded Assets or the Excluded Liabilities, all claims (other than Avoidance Actions which shall be addressed solely by Section 2.1(m)), interests, rights, rebates, abatements, remedies, recoveries, goodwill, customer and referral relationships, other intangible property and all privileges, set-offs and benefits of Sellers, and all claims, demands, indemnification rights, causes of action, arising under or relating to any of the Acquired Assets (including Intellectual Property to the extent transferrable or assignable), the Assumed Liabilities or the Business, including those arising out of Assumed Contracts, express or implied warranties, representations and guarantees from suppliers, manufacturers, contractors or others to the extent relating to the operation of the Business or affecting the Equipment, Inventory or other tangible Acquired Assets;

(m) (1) all Avoidance Actions and (2) any other causes of action belonging or available to any of the Sellers or their estates (A) relating to the Business or the Acquired Assets (including the Actions set forth on Schedule 2.1(m) ) or (B) against the Sellers, the First Lien Lenders, the First Lien Noteholders, the Second Lien Noteholders, the Credit Agreement Agent, the Indenture Trustee, the Second Lien Trustee, and the directors, officers, managers, employees, shareholders, members and advisors of the First Lien Lenders, the First

Lien Noteholders, the Second Lien Noteholders, the Credit Agreement Agent, the Indenture Trustee, the Second Lien Trustee, any of the Sellers and other Persons set forth in the Waiver ((1) and (2) collectively, the “ Acquired Actions ”); provided , that (x) all Avoidance Actions and (y) any Acquired Actions set forth in clause (2)(B) above will be waived effective as of the Closing Date by execution of the Waiver;

(n) all cash and cash equivalents, including checks, cash on deposit (including cash on deposit from Cardem Insurance Co., Ltd., but excluding reasonable wind down costs incurred by Cardem Insurance Co., Ltd. in Bermuda), commercial paper, treasury bills, certificates of deposit, bank accounts (to the extent transferrable) and other bank deposits, instruments and investments of Sellers and the balance of any unused professional fee retainers returned to the Debtors’ estate (other than the portion of the Paul, Weiss, Rifkind, Wharton & Garrison LLP retainer that will be transferred to Bradley Arant Boult Cummings LLP (“ Bradley ”) to supplement Bradley’s retainer upon approval of such transfer by the Bankruptcy Court), regardless of whether such cash and cash equivalents is received by the Sellers prior to, on or after the Closing (except to the extent constituting an Excluded Asset); provided , however , that other Cash Collateral solely to the extent securing Approved Collateralized Obligations (as defined in the Cash Collateral Orders) shall not be included; provided , further , that cash in an amount necessary and sufficient to cover checks in transit relating to items that were permitted to be paid, but have not been paid, pursuant to the Cash Collateral Orders as of the Closing Date shall not be included;

(o) all third party business interruption, property, life, key man and accident liability or casualty insurance proceeds and cash surrender value of all such policies, to the extent receivable by Sellers in respect of the Business or the Acquired Assets or the Assumed Liabilities after the Closing Date;

(p) all rights under non-disclosure or confidentiality, non-compete, or non-solicitation agreements (in each case, to the extent transferrable) or key employee retention plans or similar arrangements with (or for the benefit of) Employees and agents of Sellers or with third parties (including any non-disclosure or confidentiality, non-compete, or non-solicitation agreements (in each case, to the extent transferrable) or any key employee retention plans or similar arrangements entered into in connection with or in contemplation of the auction contemplated by the Bidding Procedures), to the extent included as an Assumed Contract;

(q) all telephone, telex and telephone facsimile numbers and other directory listings, except to the extent they relate to the Excluded Assets;

(r) all shares of capital stock or other equity interests in the entities listed on Schedule 2.1(r);

(s) all assets, if any, listed on Schedule 2.1(s) (regardless of whether such assets are covered by any of the foregoing);

(t) (i) with respect to any Buyer Benefit Plan that is funded by a trust (other than a so called “rabbi trust”), the assets of such related trust or proceeds of such related trust upon the trust’s termination; (ii) with respect to any Buyer Benefit Plan that is funded by an

insurance policy, the related insurance policy (to the extent transferrable); (iii) with respect to any Buyer Benefit Plan, to the extent applicable and subject to conformity with Legal Requirements, the administrative service agreements and other contracts, files and records in respect thereof; and (iv) with respect to any so called “rabbi trust”, the assets of such trust or proceeds from such trust upon the trust’s termination (regardless of whether the trust related to a Buyer Benefit Plan), in each case regardless of whether received by the Sellers prior to, on or after the Closing;

(u) all Contracts (i) between any of the Sellers with either of Black Warrior Methane Corp. and Black Warrior Transmission Corp. (or both) or (ii) set forth on Schedule 5.16 , all of which shall be Assumed Contracts;

(v) all proceeds and products of any and all of the foregoing Acquired Assets, except to the extent related to the Excluded Assets or the Excluded Liabilities;

(w) (i) any tax assets or attributes that carryover to Buyer or are deemed the property of Buyer pursuant to subchapter C of the Code and (ii) all rights to refunds of Taxes; provided that Buyer shall be entitled, at its sole cost and expense, to prosecute or defend any claims, suits or proceedings (including any pending adversary proceedings) relating to any rights to refunds of Taxes paid by Sellers (including Buyer’s rights to receive such refunds), and to the extent of any offsets applied or proposed to be applied to such refunds at any time after the Closing Date, whether in such suit or proceedings or otherwise, Buyer shall be entitled to take such actions as it deems necessary or appropriate to defend or contest such offsets;

(x) to the extent not prohibited by Legal Requirements and not subject to attorney-client privilege or other work product privilege, the Tax records and work papers of Sellers (other than those that relate to the Excluded Assets); provided , however , that Sellers can retain copies of the foregoing items;

(y) subject to Section 8.12 , any insurance policies of Sellers (to the extent transferrable and subject to the receipt of any requisite consents) relating to the Acquired Assets or the Assumed Liabilities solely to the extent Buyer has provided written notice to Sellers prior to the Bid Deadline of its intention to acquire such insurance policies;

(z) the balance remaining after the Closing in the segregated account formed for the purpose of providing adequate assurance to the Sellers’ utility service providers returned to the Debtors’ estate by the professional holding the same in respect of the Business or the Acquired Assets or the Assumed Liabilities after the Closing Date;

(aa) all of the Sellers’ right and interest in and right to manage that certain 501(c)(21) Black Lung Benefit Trust funded by the Sellers in respect of Black Lung Liability of the Sellers;

(bb) two tractors and one wheel dozer to the extent purchased by a Seller from Willow Creek Coal Partnership and Brule Coal Partnership, subsidiaries of a Canadian Borrower, (collectively the “ Canadian Partnership Vendors ”) pursuant to a bill of sale dated December 2015 (the “ Canadian Sale Agreement ”) on credit for approximately $1.2 million (or such other higher amount as may be agreed by the Canadian Partnership Vendors and such

Seller and the Buyer), subject to the charges and security interests granted to the Canadian Partnership Vendors or one or more of their affiliates to secure payment of the purchase price, and all of the Seller’s rights and obligations in respect of the Canadian Sale Agreement, including the obligation to pay the purchase price in connection therewith; and

(cc) all dividends or rights to dividends payable to Seller.

2.2 Excluded Assets .

Notwithstanding anything to the contrary in this Agreement, nothing herein shall be deemed to sell, transfer, assign, convey or deliver any of the Excluded Assets to Buyer, and Sellers shall retain all right, title and interest to, in and under, and all Liabilities with respect to, the Excluded Assets. For all purposes of and under this Agreement, the term “ Excluded Assets ” shall consist of only the following items, assets and properties (whether or not such assets are otherwise described in Section 2.1 ):

(a) the Non-Core Assets and the assets, if any, listed on Schedule 2.2(a) ;

(b) any and all Collective Bargaining Agreements;

(c) any (i) Employee personnel files or records and (ii) Excluded Benefit Plan and any assets, trust agreements, insurance policies, administrative service agreements and other contracts, files and records in respect thereof, other than as set forth in Sections 2.1(p) and 2.1(t) ;

(d) other than as set forth on Schedule 2.1(r) , any shares of capital stock or other equity interest in or issued by any Seller or any securities convertible into, exchangeable or exercisable for shares of capital stock or other equity interest in or issued by any Seller, and any shares of capital stock or other equity interest in or issued by any Subsidiary of any Seller (including, for the avoidance of doubt, any foreign Subsidiary) or other entity in which any Seller holds an equity interest, or any securities convertible into, exchangeable or exercisable for shares of capital stock or other equity interest in or issued by any Subsidiary of any Seller or other entity in which any Seller holds an equity interest, including the capital stock or equity interest set forth on Schedule 2.2(d) ;

(e) the limited liability company, partnership and corporate books and records of internal limited liability company, partnership and corporate proceedings, minute books, organizational or governing documents, stock ledgers, and, to the extent not set forth in Section 2.1(x) , other records of Sellers; provided, however , that copies of the foregoing items have been made available by Sellers to Buyer;

(f) Documents that Sellers are required by Legal Requirements to retain and documents subject to attorney-client privilege or other work product privilege; provided , that such documents shall remain subject to Section 12.2 , if applicable;

(g) any Contract that is not an Assumed Contract;

(h) insurance policies and all rights under or arising out of insurance policies to the extent not set forth in Sections 2.1(n) , 2.1(o) and 2.1(y) ;

(i) except to the limited extent provided in Section 2.1(n) , any prepaid deposits related to professional fee retainers and Cash Collateral securing Approved Collateralized Obligations;

(j) the Cash Consideration set forth in Section 3.1(a)(i) ;

(k) all current and prior director and officer insurance policies of Sellers and all rights of any nature with respect thereto, including all insurance recoveries thereunder and rights to assert claims with respect to any such insurance recoveries;

(l) any rights, claims or causes of action of Sellers under this Agreement or any other Transaction Document;

(m) subject to Section 2.5(c) , any Permits and licenses held by Sellers that are not assignable or transferrable;

(n) any surety bonds or other financial assurances, placed by any Seller with the Alabama Surface Mining Commission, the Alabama Oil and Gas Board, or any other Governmental Authority to the extent primarily related to and in connection with any of the Permits held by Sellers or the Reclamation or other Liabilities related thereto, any cash placed by any Seller with the Alabama Surface Mining Commission, the Alabama Oil and Gas Board, or any other Governmental Authority to the extent primarily related to and in connection with any such Permits held by Sellers or Liabilities that are not Transferred Permits or Assumed Liabilities and any cash of any Seller (wherever held) that secures or otherwise supports letters of credit serving as, securing or supporting financial assurances in connection with any of the Permits held by Sellers or Liabilities that are not Transferred Permits or Assumed Liabilities;

(o) any deposits, escrows, surety bonds or other financial assurances and any cash or cash equivalents securing any surety bonds or financial assurances, in each case, to the extent relating to the Excluded Assets or Excluded Liabilities and the amounts, deposits and other financial assurances described on Schedule 2.2(o) ;

(p) cash in an amount necessary and sufficient to cover checks in transit as of the Closing;

(q) any intercompany receivables between one or more of the Sellers and any Debtor (as defined in the Cash Collateral Orders) (for the avoidance of doubt, any intercompany receivables owed to any Seller by the Canadian Borrowers or any of their Subsidiaries are not covered by this Section 2.2(q) ); and

(r) for the avoidance of doubt (i) if the Walter Coke Election or the Pre-Closing Walter Coke Election is made or if the Walter Coke Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), the Walter Coke Assets, (ii) if the Blue Creek Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), the Blue Creek Assets and (iii) if any Miscellaneous Real Property Assets are designated by Buyer as “Excluded Assets” or if any Miscellaneous Real Property Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), such Miscellaneous Real Property Assets.

2.3 Assumed Liabilities .

Subject to entry of the Sale Order, upon the terms and subject to the conditions of this Agreement, on the Closing Date, Buyer and/or each relevant Buyer Designee, shall, effective at the time of the Closing, assume and agree to discharge and perform when due, the Liabilities of Sellers (and only those Liabilities of Sellers) which are enumerated in this Section 2.3 (the “ Assumed Liabilities ”). The following Liabilities of Sellers (and only the following Liabilities) shall constitute, without duplication, the Assumed Liabilities:

(a) all Liabilities under the Assumed Contracts;

(b) all Cure Costs;

(d) (1) Liabilities arising out of the operation of the Acquired Assets or the Business for periods following the Closing Date, including with respect to workers’ compensation or occupational health claims relating to any Buyer Employee arising out of an event that occurs on or after the Closing Date and (2) any and all Black Lung Assumed Liabilities;

(e) (i) those specific Liabilities of Sellers (if any) related to Employees as identified on Schedule 2.3(e) (such schedule to be provided to Sellers by Buyer not later than five (5) Business Days prior to the Bid Deadline) and (ii) the sponsorship of, and Liabilities under, each Buyer Benefit Plan (collectively, the “ Assumed Benefits ”);

(f) all unpaid fees and expenses of the Steering Committee, the Credit Agreement Agent, the Indenture Trustee or Buyer to the extent not paid at or prior to the Closing;

(g) all Liabilities of Sellers to the extent arising out of or relating to the Transferred Permits, including (i) all Liabilities for Reclamation and post-mining and post-Gas Well operation Liabilities; (ii) compliance with performance obligations or standards under the Transferred Permits and associated Legal Requirements; and (iii) obligations to replace and/or increase bonds or other financial assurance instruments associated with the Transferred Permits;

(h) regulatory violations and obligations on or in relation to the Transferred Permits arising post-Closing;

(i) all Liabilities to the extent arising out of or relating to: (i) compliance with any Mining and Mine Safety Law, and any mine or Gas Well operating or safety compliance matters, related to the Acquired Assets or the acquired Gas Wells and mining areas of the Business; (ii) the Acquired Assets’ or the Business’ compliance with Environmental Laws; and (iii) the remediation or corrective action required to resolve any environmental, safety or health conditions present at, under or migrating from the Acquired Assets, including any

arising from or related to a Release resulting from the operation of the Acquired Assets, excluding, in each of the preceding cases (i)-(iii), any monetary fines and penalties imposed by any Governmental Authority for which Sellers or any of their Affiliates have received a written notice of violation or notice of claim (or other written notice of similar legal intent or meaning) on or prior to the Closing Date (whether or not disclosed on the Disclosure Schedules);

(j) all Liabilities and obligations of Sellers under non-disclosure or confidentiality, non-compete or non-solicitation agreements (in each case, to the extent transferrable) or key employee retention plans or similar arrangements with (or for the benefit of) employees and agents of Sellers or with third parties, to the extent Sellers’ rights under such agreements, plans or arrangements are Acquired Assets;

(k) (i) Transfer Taxes and (ii) the Secured Taxes;

(l) all Liabilities of Sellers as a result of any action taken by Sellers at Buyer’s or its Affiliates’ request pursuant to Sections 7.9(a)(iv) , 7.9(a)(v) and 7.9(a)(vi) ;

(m) all Liabilities of Sellers for Reclamation (and, if applicable, post-mining and post-Gas Well operation Liabilities) set forth on Schedule 2.3(m) to the extent that such Liabilities are not funded by the issuers of Sellers’ surety bonds, unless such Liabilities are assumed by any Successful Bidder of the relevant Non-Core Assets in which case Schedule 2.3(m) shall be automatically amended to remove such Liabilities to the extent assumed by any such Successful Bidder; provided , that Schedule 2.3(m) may also be amended by the Buyer from and after the Execution Date in its sole discretion to add Liabilities to (but not remove Liabilities from) Schedule 2.3(m) ; and

(n) all Liabilities under the Canadian Sale Agreement as provided in Section 2.1(bb) .

2.4 Excluded Liabilities .

Notwithstanding any provision in this Agreement to the contrary, Buyer shall not assume and shall not be obligated to assume or be obliged to pay, perform or otherwise discharge any Liability of, or Liability against, Sellers, Sellers’ Subsidiaries, the Business or the Acquired Assets, of any kind or nature, whether or not direct or indirect, and Sellers shall be solely and exclusively liable with respect to all Liabilities of Sellers, other than the Assumed Liabilities (such Liabilities other than Assumed Liabilities, collectively, the “ Excluded Liabilities ”). Without limiting the generality of the foregoing, the Excluded Liabilities shall include each of the following Liabilities of Sellers and Sellers’ Subsidiaries, except to the extent they are set forth in Sections 2.3(a) - (m) :

(a) all Liabilities with respect to any Taxes that are not expressly assumed by the Buyer pursuant to Section 2.3(k) ;

(b) all Liabilities with respect to Actions and Proceedings pending on or before the Closing Date or to the extent against or giving rise to Liability against the Business or the Acquired Assets prior to the Closing Date even if instituted after the Closing Date other than the Acquired Actions;

(c) all Liabilities to any owner or former owner of capital stock or warrants with respect to such capital stock or warrants, holder of Indebtedness for borrowed money, or current or former officer or director of, in each case, any Seller or Subsidiary of any Seller in such capacities;

(d) except as expressly provided herein, all Liabilities with respect to any Excluded Asset, including any and all Collective Bargaining Agreements, Excluded Benefit Plans and liabilities in respect of the benefit plans, programs and arrangements of any ERISA Affiliate;

(e) all Liabilities under any futures contracts, options on futures, swap agreements or forward sale agreements;

(f) other than Trade Payables and the Estate Retained Professional Fees Escrow Amount, all Liabilities for: (i) costs and expenses incurred or owed in connection with the administration of the Bankruptcy Case (including all Estate Retained Professional Fees); and (ii) all costs and expenses incurred by Sellers in connection with the negotiation, execution and consummation of the transactions contemplated under this Agreement;

(g) except as set forth in Section 2.3(d) , all workers’ compensation claims and occupational health claims related to the Acquired Assets, including and with respect to Buyer Employees and former employees of Sellers who worked or who were employed at the Acquired Assets;

(h) any Liability or other obligations of Sellers or any ERISA Affiliate arising under, relating to or with respect to any multiemployer pension plan, single employer pension plan or Multiemployer Plan;

(i) except for the Assumed Benefits, all Liabilities with respect to Employees, or former Employees, or both (or their representatives or beneficiaries) or employees of any ERISA Affiliate, for any action or inaction of any Seller (or any predecessor of any Seller) occurring prior to or on the Closing Date, including with respect to vacation, payroll, sick leave, unemployment benefits, retirement benefits, pension benefits, employee stock option, equity compensation, employee stock purchase, or profit sharing plans, health care and other welfare plans or benefits (including COBRA or the Coal Act), or any other employee plans or arrangements or benefits or other compensation of any kind to any employee, including under any Excluded Benefit Plan or benefit plans, programs and arrangements of an ERISA Affiliate, and Liabilities of Sellers and their predecessors pursuant to the WARN Act;

(j) except for the Assumed Benefits, any Liability arising under any employment agreement, Collective Bargaining Agreement or arrangement, severance, retention or termination agreement or other similar arrangement with any employee, consultant or contractor (or its representatives) of any Seller;

(k) all Liabilities (other than Assumed Liabilities) accruing, arising out of, or relating to any federal, state or local investigations of any Seller or any Employee, agents, vendors or representatives of any Seller arising out of actions prior to the Closing (other than rights of setoff and recoupment claims); and

(l) except as set forth in Section 2.3(m), (i) if the Walter Coke Election or the Pre-Closing Walter Coke Election is made or if the Walter Coke Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), Liabilities to the extent related to the Walter Coke Assets, (ii) if the Blue Creek Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), Liabilities to the extent related to the Blue Creek Assets, (iii) if any Miscellaneous Real Property Assets are designated by Buyer as “Excluded Assets” or if any Miscellaneous Real Property Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), Liabilities to the extent related to such Miscellaneous Real Property Assets and (iv) to the extent that there are Acquired Non-Core Assets, Liabilities to the extent related to such Acquired Non-Core Assets.

2.5 Assignment and Assumption of Contracts .

(a)

(i) Schedule 2.5(a) sets forth a list of all executory Contracts (including all supply agreements, joint venture agreements, operating and joint operating agreements, participation agreements, exploration agreements (including minerals and coalbed gas exploration agreements), Leases and Lessor Leases) relating to the Business or the Acquired Assets to which one or more of Sellers are party (the “ Available Contracts ”) which Schedule 2.5(a) may be updated from time to time to add or remove any Contracts inadvertently included or excluded from such schedule. On or before January 4, 2016 (such date, the “ Determination Date ”), Buyer shall designate in writing which Available Contracts from Schedule 2.5(a) relating to the Business or the Acquired Assets that Buyer wishes to “Assume” (the “ Assumed Contracts ”). All Contracts of Sellers that are listed on Schedule 2.5(a) and which Buyer does not designate in writing for assumption shall not be considered Assumed Contracts or Acquired Assets and shall automatically be deemed “ Excluded Contracts ” (and for the avoidance of doubt, Buyer shall not be responsible for any related Cure Costs); provided , however , that if an Available Contract is subject to a cure dispute or other dispute as to the assumption or assignment of such Available Contract that has not been resolved to the mutual satisfaction of Buyer and Sellers prior to the Determination Date, then the Determination Date shall be extended (but only with respect to such Available Contract) to no later than the earlier of (A) the date on which such dispute has been resolved to the mutual satisfaction of Buyer and Sellers, (B) one hundred and twenty (120) days following the Closing Date, (C) the date on which such Available Contract is deemed rejected by operation of 11 U.S.C. § 365(d)(4) and (D) the date required by the Bankruptcy Court and set forth in either the Bidding Procedures Order or the Sale Order (the “ Extended Contract Period ”). If such Available Contract is not expressly assumed by Buyer in writing by the end of such Extended Contract Period, such Available Contract shall be automatically deemed an Excluded Contract. Buyer shall be responsible for any obligations or Liabilities arising during any Extended Contract Period relating to any Available Contract that has not been assumed or rejected as of the Determination Date as provided in this Section 2.5(a) . For the avoidance of doubt, except as set forth in Section 2.3 and other than as provided in the preceding sentence, (x) Buyer shall not assume or otherwise have any Liability with respect to any Excluded Contract and (y) each Collective Bargaining Agreement to which any Seller is bound or party to shall be an

Excluded Contract. Notwithstanding the foregoing, from and after the Determination Date until March 31, 2016, Buyer shall be permitted to designate in writing any Contracts previously designated as Assumed Contracts to be Excluded Contracts, and upon any such designation such Contracts shall be automatically deemed to be Excluded Contracts.

(ii) Each of Sellers and Buyer, as applicable, shall use commercially reasonable efforts to assign, or cause to be assigned, the Assumed Contracts to Buyer or to the applicable Buyer Designee, including taking all actions required by the Bankruptcy Court to obtain an Order containing a finding that the proposed assumption and assignment of the Assumed Contracts to Buyer satisfies all applicable requirements of Section 365 of the Bankruptcy Code. Buyer and/or each Buyer Designee shall use commercially reasonable efforts to comply with all of the requirements of Section 365 of the Bankruptcy Code necessary to permit such assumption and assignment.

(iii) If, prior to the Closing Date, there are Available Contracts that have not been designated as an Assumed Contract or an Excluded Contract, Sellers shall not assume or reject any such Available Contract pursuant to Section 365 of the Bankruptcy Code and any order of the Bankruptcy Court, until the earlier of (x) the date Buyer so directs Sellers and (y) the end of the Extended Contract Period, if applicable (which assumption shall be at Buyer’s sole cost and expense); provided , that Buyer shall be responsible for any obligations or Liabilities arising during any Extended Contract Period.

(iv) At Closing, (x) Sellers shall, pursuant to the Sale Order and the Assumption Agreement, assume and assign, or cause to be assigned, to Buyer or to the applicable Buyer Designee (the consideration for which is included in the Purchase Price) each of the Assumed Contracts that is capable of being assumed and assigned and (y) Buyer shall pay promptly all Cure Costs (if any) in connection with such assumption and assignment (as agreed to among Buyer and Sellers or as determined by the Bankruptcy Court) and assume and perform and discharge the Assumed Liabilities (if any) under the Assumed Contracts, pursuant to the Sale Order and the Assumption Agreement.

(b) Previously Omitted Contracts .

(i) If prior to or following Closing, it is discovered that a Contract should have been listed on Schedule 2.5(a) but was not listed on Schedule 2.5(a) and has not been rejected by Sellers (any such Contract, a “ Previously Omitted Contract ”), Sellers shall, promptly following the discovery thereof (but in no event later than two (2) Business Days following the discovery thereof), notify Buyer in writing of such Previously Omitted Contract and all Cure Costs (if any) for such Previously Omitted Contract. Buyer shall thereafter deliver written notice to Sellers, no later than five (5) Business Days following notification of such Previously Omitted Contract from Sellers, designating such Previously Omitted Contract as “Assumed” or “Rejected” (a “ Previously Omitted Contract Designation ”). A Previously Omitted Contract designated in accordance with this Section 2.5(b)(i) as “Rejected,” or with respect to which Buyer fails to timely deliver a Previously Omitted Contract Designation, shall be an Excluded Contract.

(ii) If Buyer designates a Previously Omitted Contract as “Assumed” in accordance with Section 2.5(b)(i) , Sellers shall serve a notice (the “ Previously Omitted Contract Notice ”) on the counterparties to such Previously Omitted Contract notifying such counterparties of the Cure Costs with respect to such Previously Omitted Contract and Sellers’ intention to assume and assign such Previously Omitted Contract in accordance with this Section 2.5 . The Previously Omitted Contract Notice shall provide the counterparties to such Previously Omitted Contract with ten (10) Business Days to object, in writing to Sellers and Buyer, to the Cure Costs or the assumption of its Contract. If the counterparties, Sellers and Buyer are unable to reach a consensual resolution with respect to the objection, Sellers shall seek an expedited hearing before the Bankruptcy Court to determine the Cure Costs and approve the assumption. If no objection is served on Sellers and Buyer, Sellers shall obtain an order of the Bankruptcy Court fixing the Cure Costs and approving the assumption of the Previously Omitted Contract. Buyer shall be responsible for all Cure Costs relating to such “Assumed” Previously Omitted Contracts and for any obligations or Liabilities relating to such “Assumed” Previously Omitted Contracts arising during the Extended Contract Period.

(c) Non-Assignment of Contracts and Permits . Notwithstanding anything contained in this Agreement to the contrary, this Agreement shall not constitute an agreement to assign or transfer any Contract or any Permit, if, notwithstanding the provisions of Sections 363 and 365 of the Bankruptcy Code, an attempt at assignment or transfer thereof, without the consent or approval required or necessary for such assignment or transfer, would constitute a violation of a Legal Requirement or a breach of such Contract or Permit. If, notwithstanding the provisions of Sections 363 and 365 of the Bankruptcy Code and the commercially reasonable efforts of Sellers, such consent or approval is required but not obtained with respect to an Assumed Contract or a Permit, neither Sellers nor Buyer shall be in breach of this Agreement nor shall the Purchase Price be adjusted nor (but subject to Buyer’s termination right set forth in Section 11.1 ) shall the Closing be delayed in respect of the Assumed Contracts or the Permits; provided , however , if the Closing occurs, then, with respect to any Assumed Contract or Permit for which consent or approval is required but not obtained, from and after the Closing for a period of no more than six (6) months, Sellers shall reasonably cooperate, at Buyer’s sole cost and expense, with Buyer in any reasonable arrangement that Buyer may request to provide Buyer with all of the benefits of, or under, the applicable Assumed Contract or Transferred Permit, including enforcement for the benefit of Buyer of any and all rights of Sellers against any party to the applicable Assumed Contract or Transferred Permit arising out of the breach or cancellation thereof by such party; provided , however , to the extent that any such arrangement has been made to provide Buyer with the benefits of, or under, the applicable Assumed Contract or Transferred Permit, from and after the Closing, Buyer shall be responsible for, and shall promptly pay and perform all payment and other obligations under such Assumed Contract or Permit (all of which shall constitute, and shall be deemed to be, Assumed Liabilities hereunder) to the same extent as if such Assumed Contract or Permit had been assigned or transferred at Closing with respect to Assumed Contracts and Permits, and at such applicable later date specified in this Section 2.5(c) with respect to any additional Assumed Contracts. Any

assignment to Buyer of any Assumed Contract or Permit that shall, notwithstanding the provisions of Sections 363 and 365 of the Bankruptcy Code, require the consent or approval of any Person for such assignment as aforesaid shall be made subject to such consent or approval being obtained. Notwithstanding anything to the contrary contained herein, Buyer shall reimburse, indemnify and hold harmless Sellers and/or their Affiliates from any and all Liabilities incurred by Sellers and/or their Affiliates in connection with any action taken by Sellers at Buyer’s or its Affiliates’ request pursuant to this Section 2.5(c) .

2.6 Further Assurances .

(a) Except as otherwise provided herein and subject to the terms and conditions of this Agreement, the Bankruptcy Code and any orders of the Bankruptcy Court, from and after the Execution Date, Sellers and Buyer shall use commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary or desirable under applicable Legal Requirements to consummate the transactions contemplated by this Agreement, including (i) preparing and filing as promptly as practicable with any Governmental Authority or other third party all documentation to effect all necessary filings, notices, petitions, statements, registrations, submissions of information, applications and other documents and (ii) obtaining and maintaining all approvals, consents, registrations, permits, authorizations and other confirmations required to be obtained from any Governmental Authority or other third party that are necessary, proper or advisable to consummate the transactions contemplated by this Agreement, in each case, after giving effect to the Sale Order.

(b) At and after the Closing, Sellers shall execute and deliver to Buyer such further instruments and certificates as reasonably requested by Buyer and Buyer will reimburse Sellers for any out-of-pocket expenses incurred by Sellers in connection with actions taken by Sellers (i) to vest, perfect or confirm ownership (of record or otherwise) in Buyer and/or one or more Buyer Designees, Sellers’ right, title or interest in, to or under any or all of the Acquired Assets and Business, including the Real Property, free and clear of all Encumbrances (other than Permitted Encumbrances and Assumed Liabilities) or (ii) to otherwise effectuate the purposes and intent of this Agreement and the other Transaction Documents. From and after the Closing Date, Buyer will reimburse Sellers for any out-of-pocket expenses incurred by Sellers in connection with actions taken by Sellers and each of the Parties shall take, or cause to be taken, and cooperate with the other Parties to take, or cause to be taken, all actions, do or cause to be done all things as may be reasonably requested by the other Parties in order to promptly transfer, vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in Buyer or one of more Buyer Designees or otherwise to carry out this Agreement, and shall execute and deliver all deeds, bills of sale, instruments of conveyance, powers of attorney, assignments, assumptions and assurances, and as may be required to consummate the transactions contemplated by this Agreement, it being specifically understood that, notwithstanding anything to the contrary herein, no Seller shall have any obligation to (i) record or pay any recording fees and Taxes in connection with the foregoing (except to the extent Buyer agrees to reimburse Sellers for any out-of-pocket expenses incurred by Sellers in connection with such recordation or payment), or (ii) pay any title insurance fee or premium in connection with any title insurance commitment or policy Buyer may obtain, in each case, included any related costs and expenses (except to the extent Buyer agrees to reimburse Sellers for any out-of-pocket expenses incurred by Sellers in connection with such commitment or policy). From and after the

Closing Date, any Seller that receives or has in its possession any Acquired Asset shall immediately upon receipt transfer, assign or pay such Acquired Asset (including any proceeds therefrom) to Buyer or one or more Buyer Designees.

ARTICLE 3

P URCHASE P RICE

3.1 Consideration .

The aggregate consideration (the “ Purchase Price ”) for the purchase, sale, assignment and conveyance of the Acquired Assets shall consist of:

(a) cash (the “ Cash Consideration ”) in an aggregate amount equal to (i) $5,400,000, plus (ii) the total amount of any outstanding Liabilities under the DIP Credit Agreement on the Closing Date;

(b) the assumption by Buyer or a Buyer Designee, as applicable, of the Assumed Liabilities from Sellers, including the assumption of the obligation to pay to the applicable counterparties of the applicable Assumed Contracts the Cure Costs payable by Buyer under Section 2.5 ; and

(c) the release of Sellers that are borrowers or guarantors under the Credit Agreement and the Indenture of the First Lien Obligations arising under, or otherwise relating to the Credit Agreement and the Indenture, and the First Lien Adequate Protection Obligations, in an aggregate amount equal to $ 1,250,000,000 (the “ Credit Bid and Release ”) under Section 363(k) of the Bankruptcy Code, as the same may be (w) decreased or increased in accordance with Section 7.8(a) , (x) decreased in accordance with Section 7.8(b) , (y) increased in accordance with Section 7.8(d) , and/or (z) increased by Buyer in its sole discretion (including with respect to all or any portion of the Credit Bid and Release) at any time during the auction contemplated by the Bidding Procedures (or, if there is no such auction, prior to the Closing Date).

At the option of Buyer, Sellers shall retain a designated amount of unrestricted cash that would otherwise be included in the Acquired Assets, and such unrestricted cash so retained shall reduce, on a dollar for dollar basis, the cash amounts that would otherwise be required to be included in the Purchase Price pursuant to this Section 3.1 .

3.2 Limitation on Buyer Liability .

For the avoidance of doubt, except for amounts deposited at Closing pursuant to Section 4.2 (to the extent such amounts are required to be deposited pursuant to this Agreement) or as otherwise expressly provided in this Agreement, Buyer shall have no liability with respect to the Estate Retained Professional Fees Escrow, Estate Retained Professional Fees Escrow Amount (and any other estate professional fees), the Payroll Amount (and any trust established pursuant thereto), the Wind Down Trust, the Walter Coke Trust, the Walter Coke Trust Amount, the Committee Member and Indenture Trustees Fees Escrow Amount, the Non-Union Retiree Escrow Amount, the Union Retiree Escrow Account, the Active Employee Runoff Claims Escrow Account, the Equity Trust or the Equity Trust Amount.

3.3 Withholding .

Buyer shall be entitled to deduct and withhold from the Purchase Price otherwise payable pursuant to this Agreement to Sellers such amounts as Buyer is required to deduct and withhold under applicable Legal Requirements. To the extent that amounts are so deducted and withheld, such amounts shall be treated for all purposes of this Agreement as having been paid to Sellers.

ARTICLE 4

C LOSING AND D ELIVERIES

4.1 Closing Date .

Upon the terms and subject to the conditions hereof, the closing of the sale of the Acquired Assets and the assumption of the Assumed Liabilities (other than those pertaining to Previously Omitted Contracts pursuant to Section 2.5(b) and Assumed Contracts subject to a cure dispute pursuant to Section 2.5(a)(i) contemplated hereby) (the “ Closing ”) shall take place at the offices of Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, NY 10019, no later than two (2) Business Days following the date on which all the conditions set forth in Article 9 and Article 10 have been satisfied or (if permissible) waived by the Party entitled to waive such condition (other than the conditions which by their nature are to be satisfied at the Closing, but subject to the satisfaction or (if permissible) waiver of such conditions), or on such other date and time as Sellers and Buyer may mutually agree in writing. The date and time at which the Closing actually occurs is hereinafter referred to as the “ Closing Date .” Upon consummation of the Closing, the purchase and sale of the Acquired Assets and the assumption of the Assumed Liabilities hereunder, and the Closing, shall be deemed to have occurred as of 11:59:59 p.m. (Alabama time) on the Closing Date.

4.2 Buyer’s Deliveries .

Subject to satisfaction or (if permissible) waiver of the other conditions set forth in Article 9 and Article 10 , at the Closing, Buyer shall deliver (and/or cause one or more of its Affiliates or Buyer Designees to deliver):

(a) to Sellers, the Cash Consideration in cash by wire transfer of immediately available funds as follows:

(i) an aggregate amount equal to $5,400,000 shall be delivered to (A) the Trustee on behalf of the Wind Down Trust and/or (B) one or more escrow accounts designated in writing by the Debtors prior to the Closing Date, which amounts may be utilized in the Debtors’ reasonable business judgment to wind down the Debtors’ estates prior to (or in lieu of) the conversion of the Chapter 11 Cases to cases under Chapter 7, including to fund an escrow account to pay run off claims not otherwise covered by Section 8.13 or 8.14 ; and

(ii) an amount equal to the outstanding Liabilities under the DIP Credit Agreement on the Closing Date into the account specified by the agent under the DIP Credit Agreement which shall be used to immediately repay the Obligations (as defined in the DIP Credit Agreement) pursuant to the DIP Order;

(b) to Sellers, the Assumption Agreement, duly executed by Buyer and/or the Buyer Designees, as applicable;

(d) to Sellers, the Transition Services Agreement, duly executed by Buyer and/or the Buyer Designees, as applicable;

(e) to Sellers, each other Transaction Document to which Buyer or a Buyer Designee is a party, duly executed by Buyer or such Buyer Designee, as applicable;

(f) to Sellers, the certificates of Buyer to be received by Sellers pursuant to Sections 10.1 and 10.2 ;

(g) to Sellers, releases and termination statements sufficient for Buyer to receive the Acquired Assets free and clear of all Encumbrances (other than Permitted Encumbrances);

(h) to Sellers, a Waiver, duly executed by Buyer or any Buyer Designee, as applicable;

(i) to Sellers, a payoff letter, release letter or other similar document, duly executed by Buyer and the other applicable parties, regarding the Credit Bid and Release;

(j) to Sellers, evidence, in form and substance reasonably acceptable to Sellers, of receipt of the Alabama Mining License;

(k) to Sellers, evidence, in form and substance reasonably acceptable to Sellers, that one or more credit bids have been properly authorized with respect to the First Lien Obligations on behalf of Buyer in payment of, in the aggregate, all of the Purchase Price as set forth in Section 3.1 (other than the Assumed Liabilities and the cash portion of the Purchase Price) has been authorized;

(l) to Sellers, evidence reasonably satisfactory to Sellers of performance of the matters required to be performed prior to, by, or as of, the Closing Date in Section 7.9; and

(m) to Sellers, such other documents as Sellers may reasonably request that are customary for a transaction of this nature and necessary to evidence or consummate the transactions contemplated by this Agreement.

(n) to the applicable Escrow Agent, a cash amount equal to the Estate Retained Professional Fees Escrow Amount;

(o) to the applicable Escrow Agent, a cash amount equal to the Payroll Amount;

(p) to the applicable Escrow Agent, a cash amount equal to the Committee Member and Indenture Trustees Fees Escrow Amount;

(q) to the applicable Trustee, a cash amount equal to the Equity Trust Amount;

(r) to the applicable Trustee, a cash amount equal to the Walter Coke Trust Amount, if the Walter Coke Election or the Pre-Closing Walter Coke Election is made and, in any event, the sale of the Walter Coke Assets to a Successful Bidder or Backup Bidder for the Walter Coke Assets does not close;

(s) to the applicable Escrow Agent, a cash amount equal to the Non-Union Retiree Escrow Amount;

(t) subject to the satisfaction of the conditions set forth in that certain Letter Agreement dated February 3, 2016 by and between the UMWA and Buyer, to the applicable Escrow Agent for the Union Retiree Escrow Account, a cash amount equal to $2,600,000; and

(u) to the applicable Escrow Agent for the Active Employee Runoff Claims Escrow Account, a cash amount equal to $2,000,000.”

4.3 Sellers’ Deliveries .

At the Closing, Sellers shall deliver to Buyer:

(a) the Bills of Sale, Deeds and the Assumption Agreement (in each case, relating to the Acquired Assets), the Alabama Contract Mining Agreement, the Transition Services Agreement, and each other Transaction Document to which any Seller is a party, duly executed by the applicable Sellers;

(b) short form instruments of assignment of the Patents and Trademarks and other Intellectual Property that are owned by Sellers and included in the Acquired Assets, if any, duly executed by the applicable Sellers, in form for recordation with the appropriate United States Governmental Authorities, and in customary form reasonably acceptable to the Parties;

(c) with respect to the Real Property included in the Acquired Assets, possession of such Real Property, together with copies (and originals in Sellers’ possession) of all instruments, Leases and agreements evidencing Sellers’ interest in the same, and any existing surveys, legal descriptions and title policies concerning such Real Property that are in the possession of Sellers which shall be deemed to be delivered to the extent located at any of the Real Property;

(d) a certified copy of the Sale Order;

(e) the certificates of Sellers to be received by Buyer pursuant to Sections 9.1 and 9.2 ;

(f) certificates executed by each Seller, in the form prescribed under Treasury Regulation Section 1.1445-2(b), that such Seller is not a foreign person within the meaning of Section 1445(f)(3) of the Code;

(g) such other bills of sale, Deeds, endorsements, assignments and other good and sufficient instruments of conveyance and transfer, in form reasonably satisfactory to Buyer, as Buyer may reasonably request to vest in Buyer all of the right, title and interest of Sellers in, to or under any or all of the Acquired Assets, including all Real Property, subject only to Permitted Encumbrances and Assumed Liabilities;

(h) such ordinary and customary documents (including affidavits) as may be required by a title insurance company to issue owners’ title insurance policies (or “pro formas” or marked up commitments having the same effect of a title insurance policy), at Buyer’s sole election and Buyer’s sole cost and expense, insuring title to any or all of the Real Property included in the Acquired Assets (in any event, subject to Permitted Encumbrances and Assumed Liabilities); and

(i) such other documents as Buyer may reasonably request that are customary for a transaction of this nature and necessary to evidence or consummate the transactions contemplated by this Agreement.

4.4 Buyer Designees .

At least three (3) Business Days prior to the Sale Hearing, Buyer shall be entitled to designate, in accordance with the terms and subject to the limitations set forth in this Section 4.4 , one or more Affiliates of Buyer to (i) purchase specified Acquired Assets; (ii) assume specified Assumed Liabilities; and/or (iii) employ Buyer Employees, in each case, as of the Closing Date (any Person that shall be properly designated by Buyer in accordance with this clause, a “ Buyer Designee ”); it being understood and agreed, however, that any such right of Buyer to designate a Buyer Designee is conditioned upon (x) such Buyer Designee being able to perform the applicable covenants under this Agreement and, as applicable, any other transaction agreement to which Buyer is party and demonstrate satisfaction of the requirements of Section 365 of the Bankruptcy Code (to the extent applicable), including the provision of adequate assurance for future performance with respect to the Acquired Assets and Assumed Liabilities, (y) any such designation not creating any Liability (including any Liability relating to Taxes other than Taxes for which Buyer is liable pursuant to Section 2.3(k) ) for Sellers or their Affiliates that would not have existed had Buyer purchased the Acquired Assets, assumed the Assumed Liabilities and/or employed the Buyer Employees, and which Liability is not fully reimbursed by or on behalf of Buyer and (z) such designation not being reasonably expected to cause a delay, or prevent or hinder the consummation of the transactions contemplated by this

Agreement. As soon as reasonably practicable and in no event later than three (3) Business Days prior to the Sale Hearing, Buyer shall make any such designations of Buyer Designees by way of a written notice to be delivered to Sellers, and Buyer Designees shall deliver a signed counterpart to this Agreement or joinder agreement to this Agreement and each other Transaction Document to which Buyer is party. No such designation shall relieve Buyer of any of its obligations hereunder and any breach hereof by a Buyer Designee shall be deemed a breach by Buyer. Buyer and Buyer Designees shall be jointly and severally liable for any obligations of Buyer and such Buyer Designees hereunder. For the avoidance of doubt, and notwithstanding anything to the contrary herein, all Buyer Designees appointed in accordance with this Section 4.4 shall be included in the definition of “Buyer” for all purposes under this Agreement and all such Buyer Designees shall be deemed to have made all of the representations and warranties of Buyer set forth in this Agreement.

ARTICLE 5

R EPRESENTATIONS AND W ARRANTIES OF S ELLERS

Sellers hereby jointly and severally represent and warrant to Buyer as of the date hereof as follows, except as disclosed in the Disclosure Schedules or, except with respect to the representations and warranties set forth in Sections 5.5 and 5.9 with respect to material environmental matters, contained in the Incorporated Information:

5.1 Organization and Good Standing .

Each Seller is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. Subject to the applicable provisions of the Bankruptcy Code, each Seller has all requisite corporate or limited liability company power and authority to own or lease and to operate and use its properties and to carry on its business as now conducted. Sellers are duly qualified or licensed to do business and are in good standing in each jurisdiction where the character of their Business or the nature of their properties makes such qualification or licensing necessary, except for such failures to be so qualified or licensed or in good standing as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

5.2 Authority; Validity; Consents .

Each Seller has, subject to entry of the Sale Order, the requisite corporate or limited liability company power and authority necessary to enter into and perform its obligations under this Agreement and the other Transaction Documents to which such Seller is a party and to consummate the transactions contemplated hereby and thereby, and, subject to entry of the Sale Order, the execution, delivery and performance of this Agreement and such other Transaction Documents by such Seller and the consummation by such Seller of the transactions contemplated herein and therein have been duly and validly authorized by all requisite corporate or limited liability company action on the part of Sellers. Subject to entry of the Sale Order, this Agreement has been duly and validly executed and delivered by each Seller and each other Transaction Document required to be executed and delivered by a Seller at the Closing will be duly and validly executed and delivered by such Seller at the Closing. Subject to entry of the Sale Order,

this Agreement and the other Transaction Documents constitute, with respect to each Seller that is party thereto, the legal, valid and binding obligations of such Seller, enforceable against such Seller in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws now or hereafter in effect relating to creditors’ rights generally or general principles of equity. Subject to entry of the Sale Order, except (a) as required to comply with the HSR Act and the antitrust legislation of any other relevant jurisdiction applicable to the purchase of the Acquired Assets or the Business, (b) for entry of the Sale Order, (c) for notices, filings and consents required in connection with the Bankruptcy Case, including the requirements of the Bidding Procedures Order, and (d) for the notices, filings and consents set forth on Schedule 5.2 , Sellers are not required to give any notice to, make any registration, declaration or filing with or obtain any consent, waiver or approval from, any Governmental Authority in connection with the execution and delivery of this Agreement and the other Transaction Documents to which a Seller is a Party or the consummation or performance of any of the transactions contemplated hereby and thereby, except for such notices, registrations, declarations or filings, the failure of which to make or obtain would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

5.3 No Conflict .

Except as a result of the Bankruptcy Case or as set forth in Schedule 5.3 , neither the execution and delivery by any Seller of this Agreement or any other Transaction Document to which it is (or will be) a party nor after giving effect to the Sale Order, the consummation of the transactions contemplated hereby or thereby nor, after giving effect to the Sale Order and the Bidding Procedures Order, compliance by it with any of the provisions hereof or thereof will, (a) conflict with or result in a violation of (i) any provision of the certificate of incorporation or bylaws (or other organizational or governing documents) of such Seller or (ii) any material Order binding upon such Seller or by which the Business or any Acquired Assets are subject or bound, (b) (i) violate, conflict with, or result in a material breach of any of the terms of, or constitute a material default under, or give rise to any right of termination, modification, cancellation or acceleration under any material license or Permit held by Sellers, authorization, consent, order or approval of, or registration, declaration or filings with, any Governmental Authority or (ii) result in a material breach of or constitute a default under or give rise to any right of termination, modification, cancellation or acceleration under any Material Contract which is an Available Contract, or (c) result in the creation of any Encumbrance (other than a Permitted Encumbrance or Assumed Liability) upon the properties or assets of such Seller being sold or transferred hereunder.

5.4 Real Property .

(a) Owned Real Property . Schedule 5.4(a)(i) sets forth an accurate and complete list of the Owned Real Property. Except for Permitted Encumbrances, Sellers have good and marketable title in the Owned Real Property set forth on Schedule 5.4(a)(i) . Except for the Lessor Leases, none of the Owned Real Property is subject to any lease or grant to any third-party of any right to the use, purchase, occupancy or enjoyment of such Owned Real Property or any material portion thereof required to conduct the Business. Except for Permitted Encumbrances and the applicable terms of Permits held by Sellers and their Affiliates, the

Owned Real Property is not subject to any Encumbrances (other than liens that will be removed pursuant to the Sale Order), which in any material respect interfere with or impair the present and continued use thereof in the Ordinary Course of Business. There are no pending or, to Sellers’ Knowledge, threatened condemnation proceedings relating to any of the Owned Real Property except those which do not materially impair or restrict the current use of the Owned Real Property subject thereto. Other than as set forth on Schedule 5.4(a)(ii) hereto, there are no outstanding options or rights of first refusal to purchase any of the Owned Real Property or any interest therein.

(b) Lessor Leases . Schedule 5.4(b) lists, as of the Execution Date, all material unexpired leases, subleases, licenses, sublicenses, occupancy or other agreements whereby any Seller leases, subleases, licenses or grants an interest in any Owned Real Property or Leased Real Property to a third party (the “ Lessor Leases ”). Sellers have made available, to the extent that they are in Sellers’ possession or control, true, complete and correct copies of the Lessor Leases to Buyer, including any amendments thereto. Other than as set forth on Schedule 5.4(b) or as a result of the Bankruptcy Case, Sellers are not in material breach of or in default under the Lessor Leases and, to Sellers’ Knowledge, no party to any Lessor Lease has given Sellers written notice of or, to Sellers’ Knowledge, made a claim with respect to any material breach or material default by Sellers thereunder (other than as a result of the Bankruptcy Case).

(c) Leased Real Property . Schedule 5.4(c) contains a list of all Leased Real Property held or used for, or necessary to the operation of the Business. Sellers have made available, to the extent that they are in Sellers’ possession or control, true and complete copies of all Leases to Buyer. Other than as set forth on Schedule 5.4(c) or other than as a result of the Bankruptcy Case, Sellers are not in material (x) breach of any material term or (y) “default” under any Lease and, to Sellers’ Knowledge, no party to any Lease has given Sellers written notice of or made a claim with respect to any material breach or material default thereunder. To Sellers’ Knowledge or other than as a result of the Bankruptcy Case, there are no conditions that currently exist or which with the passage of time will result in a material default or material breach of any material term by any party to a Lease. Except as set forth on Schedule 5.4(c) , to Sellers’ Knowledge, none of the Leased Real Property is subject to any sublease or grant to any third-party of any right to the use, occupancy or enjoyment of the Leased Real Property or any portion thereof that would materially impair the use of the Leased Real Property in the operation of the Business. Sellers have not received written notice of any pending or threatened condemnation or other proceedings or claims relating to Seller’s interest in any of the Leased Real Property, except those which do not materially impair or restrict the current use of the Leased Real Properties subject thereto.

5.5 Environmental Matters .

Except as set forth on Schedule 5.5 and except as would not reasonably be expected to be material to the Business or the Acquired Assets:

(a) Sellers’ operation of the Business, and Real Properties related thereto, have complied during the previous three (3) years and are in compliance with all applicable Environmental Law;

(b) Sellers have not received any written or other notice, report or other information alleging any pending or threatened material violation, non-compliance, liability or potential liability regarding Environmental Laws with regard to any of the Real Properties or the Business, or any prior business for which Sellers have retained liability under any Contract or Environmental Law, nor do Sellers have any unresolved claims alleging any violations of Environmental Law;

(c) the Real Properties do not contain any Hazardous Substances in amounts or concentrations which (i) constitute a violation of, or (ii) would reasonably be expected to give rise to liability, including liability for response costs, corrective action costs, personal injury, property damage or natural resources damage, under any applicable Environmental Law;

(d) no Seller or, to Sellers’ Knowledge, other Person, has treated, recycled, stored, disposed of, arranged for or permitted the disposal of, transported, handled, or Released any Hazardous Substances, or owned or operated any property or facility in a manner that has given or could reasonably be expected to give rise to liability, including liability for response costs, corrective action costs, personal injury, property damage or natural resources damage, under any applicable Environmental Law;

(e) no Action is pending or, to Sellers’ Knowledge, threatened under any Environmental Law or environmental provision of any Mining and Mining Safety Law against Sellers or with respect to the Real Properties or the Business, nor are there any Orders outstanding under any Environmental Law or environmental provision of any Mining and Mining Safety Law with respect to the Real Properties or the Business;

(f) Sellers (i) hold and are in compliance with all Permits required under Environmental Law (each of which is in full force and effect and is not subject to appeal, except in such instances where the requirement to hold an Environmental Permit is being contested in good faith by Sellers by appropriate proceedings diligently conducted) for any of their current operations or for the current ownership, operation or use of the Real Properties, including all Environmental Permits required for the coal mining-related operations of Sellers or, to the extent currently required, any pending construction or expansion related thereto; (ii) are, or have been, in compliance with all Environmental Permits, except in such instances where the requirement of a Permit required under Environmental Law is being contested in good faith by Sellers by appropriate proceedings diligently conducted; (iii) have used commercially reasonable efforts to cause all contractors, lessees and other Persons occupying, operating or using the Real Properties to comply with Environmental Law and obtain all necessary Permits required under Environmental Law; and (iv) have not received any written notice that the Permits required under Environmental Law will not be renewed;

(g) to Sellers’ Knowledge, none of the Real Properties have any associated direct or indirect acid mine drainage which (i) constitutes or constituted a violation of or (ii) could reasonably be expected to give rise to liability under, any applicable Environmental Law or environmental provision of any Mining and Mining Safety Law;

(h) to Sellers’ Knowledge, neither the Transaction Documents nor the consummation or performance of any of the transactions contemplated hereby will result in any

additional material liabilities for site investigation or cleanup pursuant to any Environmental Law or environmental provision of any Mining and Mining Safety Law, including any so-called “transaction-triggered” or “responsible property transfer” requirements;

(i) Except as set forth on Schedule 5.5(i) and in Section 2.3 , Sellers have not, since January 1, 2005, contractually assumed any liabilities, including any obligation for corrective or remedial action, of any other Person relating to Environmental Laws;

(j) Sellers have made available copies of all material environmental assessments, audits (including compliance audits), evaluations, studies, and tests from the past five (5) years within their possession, relating to the Owned Real Property or the Leased Real Property, whether generated by Sellers or others, including environmental audits and environmental site assessments; and

(k) except as listed on Schedule 5.5(k) , to Seller’s Knowledge, none of the Acquired Assets contains underground storage tanks, above ground storage tanks, transformers or other equipment containing PCBs, underground injection wells, non-naturally occurring radioactive materials or septic tanks or waste disposal pits (to the extent such tanks or pits constitute Acquired Assets).

5.6 Title to Acquired Assets .

Sellers have good, valid and marketable title to, or, in the case of property leased or licensed by Sellers, a valid leasehold or licensed interest in, all of the Acquired Assets, free and clear of all Encumbrances, except (a) for the Assumed Liabilities and (b) for Permitted Encumbrances.

5.7 Taxes .

(a) Sellers have each timely filed all material Tax Returns required to be filed with the appropriate Governmental Authorities (taking into account any extension of time to file granted to Sellers). All such Tax Returns are true and correct in all material respects and were prepared in substantial compliance with all applicable law, and, except as set forth on Schedule 5.7(a) , all material Taxes, including those relating to the Business and/or the Acquired Assets, that are due and payable, whether or not shown to be payable on such Tax Returns, have been timely paid, except for any unpaid Taxes to be paid at Closing or expressly assumed by Buyer herein and paid after Closing. Except as set forth on Schedule 5.7(a) , (i) no examination of any such Tax Return of Sellers is currently in progress by any Governmental Authority and no Seller has received notice of any contemplated examination of any such Tax Return; and (ii) no material adjustment has been proposed in writing with respect to any such Tax Returns for the previous five (5) fiscal years by any Governmental Authority.

(b) Except as set forth in Schedule 5.7(b) , Sellers have not received written notice of any material Tax deficiency outstanding, proposed or assessed against or allocable to Sellers and have not executed any waiver of any statute of limitations in respect of Taxes nor agreed to any extension of time with respect to a Tax assessment or deficiency with respect to the Acquired Assets. Except as set forth in Schedule 5.7(b) , there are no pending or threatened audits, investigations, disputes, notices of deficiency, claims or other actions for or relating to any Liability for Taxes, and there is no dispute or claim concerning any Tax liability of Sellers claimed or raised by any Governmental Authority in writing.

(c) Except as set forth on Schedule 5.7(c) , Sellers are not in default under, nor to Sellers’ Knowledge does there exist any condition which, with the giving of notice or passage of time would constitute a default by Sellers under, any agreement with any Governmental Authority that provides for or results in a reduction, rebate or exemption from Taxes or any other form of Tax incentive applicable to the Business, except for such defaults or conditions which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(d) Except as set forth on Schedule 5.7(d) , each Seller has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder, or other third party and all IRS Forms W-2 and Forms 1099 (or any other applicable form) required with respect thereto have been properly and timely distributed.

(e) Except as set forth on Schedule 5.7(e) , no Seller is a party to any Tax allocation or sharing agreement. No Seller (i) has been a member of an affiliated group filing a consolidated federal income Tax Return (other than a consolidated group in which the Company is the parent of such group) or (ii) has any liability for the Taxes of any Person (other than a Seller) under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local, or non-U.S. law), as a transferee or successor, by contract, or otherwise.

(f) No Seller is or has been a party to any “listed transaction,” as defined in Code Section 6707A(c)(2) and Treasury Regulation Section 1.6011-4(b)(2).

(g) No claim has been made in writing by any Governmental Authority in a jurisdiction where Sellers do not file Tax Returns that Sellers are or may be subject to taxation by that jurisdiction.

5.8 Legal Proceedings .

Except (x) for the Bankruptcy Case (and proceedings related thereto) and (y) as set forth on Schedule 5.8 , there is no Proceeding or Order pending, outstanding or, to Sellers’ Knowledge, threatened in writing against or related to the Business, whether at law or in equity, whether civil or criminal in nature or by or before any arbitrator or Governmental Authority, nor, to Sellers’ Knowledge, are there any investigations relating to the Business pending or, to Sellers’ Knowledge, threatened in writing by or before any arbitrator or any Governmental Authority, which would reasonably be expected to be material to the Business or the Acquired Assets, taken as a whole.

5.9 Compliance with Legal Requirements; Permits .

(a) Except as set forth in Schedule 5.9(a), and, with respect to Permits required under any Environmental Law or environmental provision of any Mining and Mining Safety Law, which Permits are addressed in Section 5.5 , Sellers hold all of the Permits necessary for the current operation and conduct of the Business and the Acquired Assets in compliance

with Legal Requirements, including Mining and Mining Safety Law, the absence of which would be immaterial to the operation of the Business or the Acquired Assets from and after the Closing. The Permits set forth on Schedule 2.1(g) are all of the Permits held by Sellers with respect to the current operation and conduct of the Business and the Acquired Assets, the absence of which would be reasonably expected to adversely affect the operation of the Business or the Acquired Assets from and after the Closing.

(b) Except (x) as set forth on Schedule 5.9(b) , and, with respect to compliance with Environmental Law or environmental provision of any Mining and Mining Safety Law, Schedule 5.5 , (y) for fully paid, discharged and finally settled citations and notices of violations issued by MSHA, the Alabama Surface Mining Commission, the Alabama Department of Environmental Management, the West Virginia Department of Environmental Protection, or other Governmental Authorities and (z) as would not reasonably be expected to be material to the Business or the Acquired Assets, Sellers have conducted the Business for the past three (3) years and currently own and operate the Acquired Assets in accordance, in all material respects, with all Legal Requirements, Orders and Permits applicable to Sellers and the Acquired Assets during such period, and the Business is in compliance in all material respects with all applicable Legal Requirements, Orders and Permits (including any anti-bribery Legal Requirements) and has obtained all approvals necessary for owning and operating its assets and has made all necessary filings with all Governmental Authorities having jurisdiction necessary for owning and operating its assets, and there are no Orders outstanding under any Mining and Mining Safety Law with respect to the Real Properties or the Business.

(c) Except (x) as set forth on Schedule 5.9(c) and, with respect to actions under Environmental Law, which are covered under Section 5.5 , (y) for fully paid, discharged and finally settled citations and notices of violations issued by MSHA, the Alabama Surface Mining Commission, the Alabama Department of Environmental Management, the West Virginia Department of Environmental Protection, or other Governmental Authorities, and (z) as would not reasonably be expected to be material to the Business or the Acquired Assets neither Sellers, nor to Sellers’ Knowledge, any of their Representatives have received within the past three (3) years any written notice or other communication from a Governmental Authority that alleges that the Business is not in compliance with any Legal Requirement, Order or Permit applicable to the Business or the operations or properties of the Business or the Acquired Assets or that threatens or states the intention on the part of any issuing authority to revoke, cancel, suspend or modify any Permit necessary for the current operation and conduct of the Business and the Acquired Assets (except with respect to regular periodic expirations and renewals thereof). Except as would not reasonably be expected to be material to the Business or the Acquired Assets: (i) no Seller has had any Permits that are necessary for the operation and conduct of the Business and the Acquired Assets appealed, denied, revoked, restricted or suspended during the past three (3) years; (ii) no Seller is currently a party to any proceedings involving the possible appeal, denial, revocation, restriction or suspension of any Permits that are necessary for the current operation and conduct of the Business and the Acquired Assets or any of the privileges granted thereunder (except where the obligation to hold such a Permit is being contested in good faith by appropriate proceedings diligently conducted or is excused by the Bankruptcy Court); and (iii) no Seller nor any officer or director of any Seller is “permit blocked” on the Applicant Violator System established pursuant to the SMCRA (or any applicable state system) (the “ Applicant Violator System ”) by any Governmental Authority.

5.10 Labor Matters .

(a) Except as set forth on Schedule 5.10(a) , none of Sellers are party to or subject to any collective bargaining agreements, works council agreements, labor union contracts, trade union agreements, and other similar agreements (each a “ Collective Bargaining Agreement ”) with any union, works council, or labor organization (each a “ Union ” and collectively “ Unions ”).

(b) Except as set forth on Schedule 5.10(b) , to Sellers’ Knowledge, in the past three (3) years, other than pursuant to procedures established in connection with the Bankruptcy Case, (i) no Union or group of Employees or former Employees has organized any employees for purposes of collective bargaining, sought to bargain collectively with any of Sellers, made a demand for recognition or certification as an employee representative for purposes of collective bargaining or filed a petition for recognition with any Governmental Authority; (ii) as of this date, no Collective Bargaining Agreement is being negotiated by any of Sellers, other than pursuant to procedures established in connection with the Bankruptcy Case; and (iii) in the past three (3) years, there have been no material strikes, lockouts, slowdowns, work stoppages, boycotts, handbilling, picketing, walkouts, demonstrations, leafleting, sit-ins, sick-outs, or other material forms of organized labor disruption with respect to any of Sellers.

(c) Except as set forth on Schedule 5.10(c) within the past three (3) years, Sellers have not failed to provide advance notice of layoffs or terminations as required by, or incurred any material Liability under, the Worker Adjustment and Retraining Notification Act of 1988, and including any similar state or local Legal Requirement (the “ WARN Act ”), or any applicable Legal Requirement for employees outside the United States regarding the termination or layoff of employees. Except as set forth on Schedule 5.10(c) or as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or pursuant to procedures established in connection with the Bankruptcy Case, (i) within the past three (3) years, Sellers have been in compliance with all applicable Legal Requirements relating to labor and employment, including all Legal Requirements relating to employment practices; the hiring, promotion, assignment, and termination of employees; discrimination; equal employment opportunities; disability; labor relations; wages and hours; FLSA, classification of independent contractors, hours of work; payment of wages; immigration; workers’ compensation; employee benefits; background and credit checks; working conditions; occupational safety and health; family and medical leave; employee terminations; and data privacy and data protection; (ii) there are no pending, or to Sellers’ Knowledge, threatened, lawsuits, grievances, unfair labor practice charges, arbitrations, charges, investigations, hearings, actions, claims, or proceedings (including any administrative investigations, charges, claims, actions, or proceedings), against Sellers brought by or on behalf of any applicant for employment, any current or former Employee, any person alleging to be a current or former employee, any representative, agent, consultant, independent contractor, subcontractor, or leased employee, volunteer, or “temp” of Sellers, or any group or class of the foregoing, or any Governmental Authority, alleging violation of any labor or employment Legal Requirements, breach of any Collective Bargaining Agreement, breach of any express or implied contract of employment, wrongful termination of employment, or any other discriminatory, wrongful, or tortious conduct in connection with the employment relationship; (iii) each of the Employees has all work permits, immigration permits, visas, or other authorizations required by any Legal Requirement for such Employee given the duties and nature of such Employee’s employment; and (iv) no individual has been improperly excluded from, or wrongly denied benefits under, any Benefit Plan.

5.11 Employee Benefits .

(a) Except as set forth in Schedule 5.11(a) , (i) no Benefit Plan (or any benefit plans, programs or arrangements of an ERISA Affiliate that would be a Benefit Plan if such ERISA Affiliate were a Seller) (A) is, or has been within the past six (6) years, a Title IV Plan or subject to Section 412 of the Code; (B) is maintained by more than one employer within the meaning of Section 413(c) of the Code; (C) is subject to Sections 4063 or 4064 of ERISA; (ii) no Benefit Plan is (A) a “multiple employer welfare arrangement” as defined in Section 3(40) of ERISA; or (B) an “employee pension benefit plan” (within the meaning of Section 3(2) of ERISA) that is not intended to be qualified under Section 401(a) of the Code; and (iii) none of the Sellers or any of their respective ERISA Affiliates contributes to, or is obligated to contribute to, or within the six (6) years preceding this Agreement contributed to or was obligated to contribute to, a Multiemployer Plan.

(b) (i) Each Buyer Benefit Plan has been established and administered by Sellers in all material respects in accordance with its terms and in compliance with the applicable provisions of ERISA, the Code and all other Legal Requirements; (ii) with respect to each Buyer Benefit Plan, except as would not reasonably be expected to be material, all reports, returns, notices and other documentation that are required to have been filed with or furnished to the Internal Revenue Service (the “ IRS ”), the United States Department of Labor (“ DOL ”) or any other Governmental Authority, or to the participants or beneficiaries of such Buyer Benefit Plan in the past three (3) years have been filed or furnished on a timely basis; (iii) each Buyer Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code has received a favorable opinion or determination letter from the IRS (covering all required Tax laws) to the effect that such Buyer Benefit Plan satisfies the requirements of Section 401(a) of the Code and that its related trust is exempt from taxation under Section 501(a) of the Code and, to Sellers’ Knowledge, there are no facts or circumstances that could reasonably be expected to cause the loss of such qualification or the imposition of any material liability, penalty or tax under ERISA, the Code or any other Legal Requirements; (iv) no Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code has been partially or completely terminated; (v) other than routine claims for benefits, no material liens, lawsuits or complaints to or by any person or Governmental Authority have been filed in the past three (3) years against any Buyer Benefit Plan or against Sellers with respect to any Buyer Benefit Plan and, to Sellers’ Knowledge, no such material liens, lawsuits or complaints are contemplated or threatened with respect to any Buyer Benefit Plan; and (vi) there are no corrections, audits or proceedings initiated pursuant to the IRS Employee Plans Compliance Resolution System (currently set forth in Revenue Procedure 2013-12) or similar proceedings pending with the IRS or DOL with respect to any Buyer Benefit Plan or any tax qualified Benefit Plan from which distributions are eligible to be rolled over.

(c) Within the past three (3) years, there has been no “reportable event” (as defined in Section 4043 of ERISA and the regulations thereunder) with respect to any Title IV Plan set forth in Schedule 5.11(a) that would require the giving of notice to the Pension Benefit Guaranty Corporation (the “ PBGC ”) under Section 4041(c)(3)(C) or 4063(a) of ERISA.

(d) Except as set forth in Schedule 5.11(d) , (i) no Seller has terminated any Title IV Plan within the last six (6) years or incurred any outstanding liability under Section 4062 of ERISA to the PBGC, or to a trustee appointed under Section 4042 of ERISA; (ii) all premiums due the PBGC with respect to the Title IV Plans set forth in Schedule 5.11(a) have been paid; (iii) no Seller has filed a notice of intent to terminate any Title IV Plan set forth in Schedule 5.11(a) and has not adopted any amendment to treat such Title IV Plan as terminated; (iv) the PBGC has not instituted, or to Sellers’ Knowledge, threatened to institute, proceedings to treat any Title IV Plan set forth in Schedule 5.11(a) as terminated; and (v) no event has occurred or circumstance exists that may constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Title IV Plan set forth in Schedule 5.11(a) .

(e) No Seller or ERISA Affiliate has, within the past six (6) years, withdrawn from a Multiemployer Plan in a “complete withdrawal” or a “partial withdrawal” as defined in Sections 4203 and 4205 of ERISA, respectively, so as to result in an unsatisfied liability, contingent or otherwise (including the obligations pursuant to an agreement entered into in accordance with Section 4204 of ERISA), of such Seller or ERISA Affiliate.

(f) No Seller or any organization to which such Seller is a successor or parent corporation, within the meaning of Section 4069(b) of ERISA, has engaged in any transaction described in Sections 4069 or 4212(c) of ERISA.

(g) Neither Sellers nor, to Sellers’ Knowledge, any other “party in interest” or “disqualified person” with respect to any Buyer Benefit Plan has engaged in a non-exempt “prohibited transaction” within the meaning of Section 406 of ERISA or Section 4975 of the Code involving such Buyer Benefit Plan which, individually or in the aggregate, could reasonably be expected to subject Sellers to Liability, tax or penalty imposed by Section 4975 of the Code or Sections 501, 502 or 510 of ERISA. To Sellers’ Knowledge, no fiduciary has incurred any liability for breach of fiduciary duty or any other failure to act or comply with the requirements of ERISA, the Code or any other Legal Requirements in connection with the administration or investment of the assets of any Buyer Benefit Plan.

(h) Except as would not, individually or in the aggregate, reasonably be expected to result in a material Liability, (i) all liabilities or expenses of Sellers in respect of any Buyer Benefit Plan which are due and payable but have not been paid, have been properly accrued on the applicable Financial Statements; and (ii) all contributions (including all employer contributions and employee salary reduction contributions) or premium payments required to have been made to or in respect of any Buyer Benefit Plan under the terms of such Buyer Benefit Plan or in accordance with Legal Requirements, as of the Execution Date have been timely made or reflected on the applicable Financial Statements.

(i) Except as set forth in Schedule 5.11(i) , Sellers have no obligation to provide or make available post-employment benefits under any Buyer Benefit Plan which is a “welfare plan” (as defined in Section 3(1) of ERISA), except as may be required under COBRA or similar Legal Requirements, and at the sole expense of such individual.

(j) Except as set forth in Schedule 5.11(j) or expressly provided herein or in the Approved Budget or if the payment thereof is otherwise excused as a result of the

Bankruptcy Case, neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will (either alone or in combination with another event) (i) result in any payment becoming due and payable, or increase the amount of any compensation due and payable, to any current or former officer, director, employee, leased employee, consultant or agent (or their respective beneficiaries) of Sellers; (ii) increase any benefits otherwise payable under any Buyer Benefit Plan; or (iii) result in the acceleration of the time of payment or vesting of any compensation or benefits under any Buyer Benefit Plan.

(k) To the extent applicable, each Buyer Benefit Plan that is a “nonqualified deferred compensation plan” within the meaning of Section 409A(d)(1) of the Code (i) complies and has been operated in all material respects in compliance with the requirements of Section 409A of the Code and the final regulations and official guidance promulgated thereunder, or (ii) is exempt from compliance under the “grandfather” provisions of IRS Notice 2005-1 and applicable regulations and has not been “materially modified” (within the meaning of IRS Notice 2005-1 and Treasury Regulation §1.409A-6(a)(4)) subsequent to October 3, 2004.

(l) With respect to each Buyer Benefit Plan, except with respect to such Buyer Benefit Plans copies of which have been publicly filed under the Exchange Act, Sellers have made available to Buyer, true, correct (in all material respects) and materially complete copies of, to the extent applicable: (i) all documents constituting such Buyer Benefit Plans and all amendments thereto (or, to the extent no such copies exist or the Buyer Benefit Plan is not in writing, a materially accurate written description); (ii) any related trust agreement or other funding instrument and all other material contracts currently in effect with respect to such Buyer Benefit Plans (including all administrative agreements, group insurance contracts and group annuity contracts); (iii) the most recent IRS determination letter and/or opinion letter for each such Buyer Benefit Plan, if applicable; (iv) the most recent summary plan description, summary of material modifications and any other written communication (or a written description of any material oral communication) by Sellers to Employees within the two (2) years immediately preceding the Execution Date concerning the extent of benefits provided under a Buyer Benefit Plan; (v) to the extent not publicly available, the three most recent (A) Forms 5500 and schedules thereto, and (B) audited financial statements; (vi) for the past three (3) years, all material correspondence with the IRS, the DOL and any other Governmental Authority regarding the operation or the administration of such Buyer Benefit Plans; and (vii) all discrimination tests for the most recent plan year.

(m) Sellers have no direct or indirect material liability, whether absolute or contingent, under any Buyer Benefit Plan, with respect to any misclassification of any person as an independent contractor rather than as an employee, or with respect to any employee leased from another employer.

(n) Except in connection with the Bankruptcy Case, Sellers have no plan, contract or commitment, whether legally binding or not, to create any new employee benefit or compensation plans, policies or arrangements for any Buyer Employee or, except as may be required by applicable Legal Requirements, to modify any Buyer Benefit Plan.

5.12 Sellers’ Intellectual Property .

(a) Schedule 5.12(a) sets forth a true and complete list of all U.S. and foreign (i) issued Patents and pending applications for Patents; (ii) registered Trademarks and pending applications for Trademarks; and (iii) registered Copyrights and pending applications for Copyrights, in each case which are owned by a Seller as of the Execution Date and which are material to the Acquired Assets. Except as set forth on Schedule 5.12(a) , Sellers are the sole owners of all of the applications and registrations set forth on Schedule 5.12(a) , and all such applications and registrations are in effect and subsisting.

(b) Except as disclosed on Schedule 5.12(b) , and except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, to Sellers’ Knowledge, (i) the conduct of the Business by Sellers as currently conducted (including the products and services currently sold or provided by Sellers) does not infringe or otherwise violate any Person’s intellectual property rights, and no such claims are pending or threatened in writing against Sellers, and (ii) no Person is infringing or otherwise violating any Intellectual Property owned by Sellers, and no such claims are pending or threatened in writing against any Person by Sellers.

(c) To Sellers’ Knowledge, the Acquired Assets and any rights provided to Buyer pursuant to the Transaction Documents include all material third party intellectual property rights licensed to Sellers that are required to conduct the Business in a substantially similar manner as it is presently being conducted by Sellers, except such intellectual property rights as exist under the Excluded Contracts.

5.13 Contracts . Schedule 5.13(i) sets forth a complete list, as of the date hereof, of all Material Contracts to which any Seller is a party. Each Material Contract is in full force and effect and is a valid and binding obligation of each Seller party thereto in accordance with its terms and conditions, in each case except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws now or hereafter in effect relating to creditors’ rights generally or general principles of equity, (y) as set forth on Schedule 5.13(ii) and (z) as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as set forth on Schedule 5.13(iii) , upon entry of the Sale Order, other than the payment of Cure Costs (i) no Seller will be in breach or default of its obligations under any Material Contract; (ii) no condition exists that with notice or lapse of time or both would constitute a default by any Seller under any Material Contract; and (iii) to Sellers’ Knowledge, no other party to any Material Contract is in breach or default thereunder, except in the case of clauses (i), (ii) and (iii) for any breaches or defaults that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

5.14 Insurance .

Schedule 5.14 sets forth all insurance policies held by Sellers covering the property, assets, Employees and operations of the Business (including policies providing property, casualty, liability and workers’ compensation coverage). Such policies are in full force and effect (subject to periodic renewals thereof). Except as set forth on Schedule 5.14 , Sellers have paid all premiums on such policies due and payable prior to the Execution Date, or, if not

yet due, have properly accrued for such payables. Since the Petition Date, to Sellers’ Knowledge, Sellers have not done anything by way of action or inaction that invalidates any such policies in whole or in part.

5.15 Brokers or Finders .

Other than the Estate Retained Professional Fees, Sellers have not incurred any obligation or liability, contingent or otherwise, for brokerage or finders’ fees or agents’ commissions or other similar payment in connection with this Agreement, the other Transaction Documents or the transactions contemplated hereby or thereby for which Buyer is or will become liable, and, except as otherwise contemplated hereby with respect to Estate Retained Professional Fees, Sellers shall indemnify and hold harmless Buyer from any claims with respect to any such fees or commissions.

5.16 Affiliate Interests .

Other than any Benefit Plan and travel advances entered into the Ordinary Course of Business, all Contracts between any Seller and any Affiliate of any Seller (but not including another Seller or a Subsidiary of a Seller) are listed on Schedule 5.16 . Other than employment arrangements, compensation benefits and travel advances entered into in the Ordinary Course of Business, and other than arrangements or relationships that would not be required to be disclosed in the Company’s SEC filings pursuant to Regulation S-K of the Securities Act, to Sellers’ Knowledge, no such Affiliate of any Seller controls or is a director, officer, employee or partner of, or consultant to, or lender to or borrower from or has the right to participate in the profits of, other than through the ownership of any publicly traded entity, (i) any Person which does business with any Seller or is competitive with the Business in any material respect, or (ii) any material property, asset or right which is used by any Seller. All Indebtedness of any such Affiliate to any Seller, and all Indebtedness of any Seller to any Affiliate of any Seller, is listed on Schedule 5.16 .

5.17 Bank Accounts .

Schedule 5.17 sets forth a complete list of all bank accounts (including any deposit accounts, securities accounts and any sub-accounts) of Sellers.

5.18 Undue Influence .

In connection with the operation of the Business, no Seller or, to Sellers’ Knowledge, any director, officer, agent, employee or Affiliate of Sellers, has taken any action, directly or indirectly, with respect to the Business that would result in a violation of the Foreign Corrupt Practices Act of 1977 and the rules and regulations thereunder (the “ FCPA ”). Sellers, and, to Sellers’ Knowledge, their Affiliates, have conducted the Business in compliance with the FCPA in all material respects and maintain procedures which are reasonably expected to ensure compliance therewith.

5.19 Financial Statements .

Sellers have made available to Buyer the consolidated balance sheets of the Company and its Subsidiaries as of, and consolidated statements of operations, comprehensive income, changes in stockholder’s equity and cash flows for, the fiscal year ended December 31, 2014 (collectively, the “ Audited Financial Statements ”). The Audited Financial Statements have been prepared in accordance with generally accepted accounting principles (“ GAAP ”) consistently applied in accordance with the Company’s past practice throughout the periods indicated. Sellers have made available to Buyer unaudited condensed consolidated balance sheets for the Company and its Subsidiaries as of June 30, 2015 and the condensed consolidated statements of operations, stockholder’s equity (deficit) and cash flows for the six-month period ending June 30, 2015 (collectively, the “ Unaudited Financial Statements ”). The Unaudited Financial Statements have been prepared in accordance with GAAP consistently applied in accordance with Sellers’ past practice except for the absence of footnotes and customary year-end adjustments. The Audited Financial Statements and the Unaudited Financial Statements (together the “ Financial Statements ”) (i) were prepared based on the books and records of Sellers and (ii) fairly present in all material respects the financial position of Sellers at and as of the dates specified and the results of their operations for the period covered, subject to customary year-end adjustments. The copies of the Financial Statements made available to Buyer are true and complete copies of such Financial Statements.

5.20 Absence of Certain Changes .

(a) Since the Petition Date through the date hereof, there has not been a Material Adverse Effect.

(b) Except as set forth on Schedule 5.20(b) , or as expressly contemplated by this Agreement, the Approved Budget or the Cash Collateral Orders or any other orders entered in the Bankruptcy Case from and after the Petition Date through the date hereof, Sellers have not:

(i) except for executory contracts and unexpired leases rejected by Sellers with the prior written consent of Buyer or the Steering Committee, terminated, modified or amended any Available Contract that is a Material Contract other than due to the expiration of the term or automatic renewals, in each case, in accordance with the terms of any such Available Contract that is a Material Contract;

(ii) purchased or otherwise acquired any material properties or assets (tangible or intangible) or sold, leased, transferred or otherwise disposed of any Acquired Assets, except for purchases of materials and sales of coal, coke and surplus equipment Inventory in the Ordinary Course of Business, (A) permitted, allowed or suffered any of the Acquired Assets to be subjected to any Encumbrance (other than Permitted Encumbrances), or (B) removed any (non-surplus) Equipment or other material assets (other than Inventory) from the Real Property other than in the Ordinary Course of Business; provided , that, any such action with respect to any asset previously identified in the Disclosure Statement as an asset held for sale shall be considered Ordinary Course of Business;

(iii) suffered any material damage or destruction to or loss of any material assets or properties whether or not covered by insurance;

(iv) other than the Approved Retention Payments, (A) increased the annual rate of base salary or any target bonus opportunity of any Employee whose annual rate of base salary prior to such increase was in excess of $200,000; (B) paid any bonus, benefit, or other direct or indirect incentive compensation (other than any such payments authorized pursuant to any first or second day orders in the Bankruptcy Case); (C) awarded any equity compensation awards (whether phantom or equity) with respect to the equity of the Company or its Affiliates; (D) modified, amended or terminated any Benefit Plan; (E) entered into any employment, compensation, severance, non-competition, or similar contract (or amended any such contract) to which any Seller is a party; or (F) adopted any new severance pay, termination pay, deferred compensation, bonus, or other employee benefit plan with respect to Employees that would be a Benefit Plan if it existed on the Execution Date (including any employment agreement, severance agreement, change in control agreement, or transaction or retention bonus agreements), except, in the case of each of clauses (A) through (F), (i) to the extent permitted by any order of the Bankruptcy Court or as required by applicable Legal Requirements (including to avoid the imposition of Taxes or to conform to the requirements of Tax qualification); (ii) pursuant to the terms of any Benefit Plan, as in effect on the date hereof; or (iii) for immaterial changes to Benefit Plans available to all employees generally (other than changes that materially increase the amount, or accelerate the timing, of the payment of benefits);

(v) changed in any material respect Sellers’ accounting methods, principles or practices other than required by changes in GAAP;

(vi) allowed any material Permit held by any Seller to terminate, expire or lapse; or

(vii) agreed or committed in writing to do any of the foregoing.

5.21 Seller SEC Documents .

Each Seller has filed or furnished with the SEC all filings it has been required to make since January 1, 2014 (collectively the “ Seller SEC Documents ”). As of their respective filing dates, the Seller SEC Documents complied in all material respects with the requirements of the Securities Act or the Exchange Act, as applicable. None of the Seller SEC Documents filed under the Exchange Act as of their filing dates contained any untrue statement of material fact or omitted to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances in which they were made, not misleading, except to the extent corrected by a subsequently filed document with the SEC. None of the Seller SEC Documents filed under the Securities Act contained an untrue statement of material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein in light of the circumstances in which they were made not misleading at the time such Seller SEC Documents became effective under the Securities Act.

5.22 Mining .

(a) Sellers have, in the amounts and forms required pursuant to applicable Mining and Mining Safety Laws, obtained all performance bonds and surety bonds, or otherwise provided any financial assurance as (i) required under the applicable Mining Permits or Mining and Mining Safety Laws for Reclamation of land, water or other natural resources at any current mines, (ii) required pursuant to any applicable Mining Permit or Mining and Mining Safety Law to mitigate any actual or potential environmental impact of such mines, or (iii) otherwise obtained in the Ordinary Course of Business (collectively, “ Mining Financial Assurances ”), except for such Mining Financial Assurances that do not exceed $1,000,000 in the aggregate. The Company has posted or otherwise provided all Mining Financial Assurances that have been requested in writing by the applicable Governmental Authorities in respect of any applicable Permits and Legal Requirements having to do with Reclamation in connection with Sellers’ mining operations as currently conducted, subject to the discretion of any applicable Governmental Authority to require additional or supplemental Mining Financial Assurances from time to time.

(b) All Reclamation performed by or on behalf of any Seller meets in all material respects the requirements of the applicable Mining Permit and any associated mine Reclamation requirements of any applicable Governmental Authority. The liability for mine closing and Reclamation obligations recorded on the most recent balance sheet of Sellers provided to Buyer has been properly accrued in accordance with the requirements of Financial Accounting Standards Board Codification Topic 410, Asset Retirement and Environmental Obligations, formerly known as Financial Accounting Standard No. 143 (“ FASB 410 ”), and the amount of such liability is equal to or in excess of the amount of such obligations, determined on the basis of Sellers’ actual historic Reclamation and closure costs and currently planned mine life and escalated for inflation, in accordance with FASB 410 and applicable Legal Requirements.

5.23 MSHA; OSHA . For the past three (3) years, except as set forth on Schedule 5.23 and except for fully paid, discharged and settled citations and notices of violation issued by MSHA, the Alabama Surface Mining Commission, the West Virginia Office of Miners’ Health, Safety and Training or other Governmental Authority, Sellers have conducted their respective business and operations, and their respective assets have been maintained, in compliance in all material respects with MSHA or OSHA, as applicable. Except as set forth on Schedule 5.23 , there are no investigations pending or, to Sellers’ Knowledge, threatened by any Governmental Authority or other third Person that would result in the imposition of any material Liability on any Seller pursuant to MSHA or OSHA. Except as set forth on Schedule 5.23 , Sellers do not owe any material assessments, penalties, fines, liens, charges, surcharges, nor are there any other material amounts due or owing pursuant to MSHA or OSHA, and there have been no imminent danger orders, unwarrantable failure orders, failure to abate orders, or cessation orders, notices of a pattern of violations, or material assessments, under MSHA or OSHA during the past three (3) years. Schedule 5.23 sets forth all material reports of any MSHA or OSHA audits with respect to the Business of which Sellers have Knowledge performed within the past three (3) years by any Person (including Sellers). Schedule 5.23 sets forth all orders issued under MSHA or OSHA, together with any appeals thereof, with respect to the Business within the past three (3) years by any Governmental Authority. Sellers have made available to Buyer copies of all orders and reports under MSHA or OSHA within their possession, together with the minutes of all joint health and safety committee meetings within their possession, with respect to Sellers for the past three (3) years.

5.24 Coal Act; Black Lung Act .

(a) Sellers and their “related persons” (as defined in the Coal Act) are in compliance in all material respects with the Coal Act and any regulations promulgated thereunder, except which compliance is being contested in good faith by appropriate proceedings diligently conducted or excused by the Bankruptcy Court or the Bankruptcy Code, and none of Sellers or their “related persons” (as defined in the Coal Act) has any liability under the Coal Act, except as disclosed in the Financial Statements or which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or with respect to premiums or other material payments required thereunder which have been paid when due, or which liability is being contested in good faith by appropriate proceedings diligently conducted or the current payment of which is excused by the Bankruptcy Court or the Bankruptcy Code.

(b) Sellers are in compliance in all material respects with the Black Lung Act, except which compliance is being contested in good faith by appropriate proceedings diligently conducted or excused by the Bankruptcy Court or the Bankruptcy Code, and Sellers have not incurred any Black Lung Liability or assumed any other Black Lung Liability, except as disclosed in the Financial Statements or which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or with respect to premiums, contributions or other material payments required thereunder which have been paid when due or which Black Lung Liability is being contested in good faith by appropriate proceedings diligently conducted or the current payment of which is excused by the Bankruptcy Court or the Bankruptcy Code.

5.25 Warranties Exclusive .

EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE 5 (AS MODIFIED BY THE DISCLOSURE SCHEDULES) OR IN THE BILL OF SALE AND THE ASSUMPTION AGREEMENT, SELLERS MAKE NO REPRESENTATION OR WARRANTY, STATUTORY, EXPRESS OR IMPLIED, WRITTEN OR ORAL, AT LAW OR IN EQUITY, IN RESPECT OF ANY OF THEIR ASSETS (INCLUDING THE ACQUIRED ASSETS), LIABILITIES (INCLUDING THE ASSUMED LIABILITIES) OR THE BUSINESS, INCLUDING, WITH RESPECT TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, OR NON-INFRINGEMENT, AND ANY SUCH OTHER REPRESENTATIONS OR WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED AND NONE SHALL BE IMPLIED AT LAW OR IN EQUITY. NEITHER SELLERS NOR ANY OTHER PERSON, DIRECTLY OR INDIRECTLY, HAS MADE OR IS MAKING, ANY REPRESENTATION OR WARRANTY, WHETHER WRITTEN OR ORAL, REGARDING THE PRO-FORMA FINANCIAL INFORMATION, FINANCIAL PROJECTIONS OR OTHER FORWARD-LOOKING STATEMENTS OF SELLERS.

ARTICLE 6

R EPRESENTATIONS AND W ARRANTIES OF B UYER

Buyer represents and warrants to Sellers as follows:

6.1 Organization and Good Standing .

Buyer is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of Delaware. Buyer has the requisite power and authority to own or lease and to operate and use its properties and to carry on its business as now conducted.

6.2 Authority; Validity; Consents .

Buyer has the requisite power and authority necessary to enter into and perform its obligations under this Agreement and the other Transaction Documents to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement and the other Transaction Documents by Buyer and the consummation by Buyer of the transactions contemplated herein and therein have been duly and validly authorized by all requisite limited liability company or corporate actions in respect thereof. This Agreement has been duly and validly executed and delivered by Buyer and each other Transaction Document to which Buyer is a Party will be duly and validly executed and delivered by Buyer, as applicable, at the Closing. This Agreement and the other Transaction Documents to which Buyer is a party constitute the legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with their respective terms, except in each case as such enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or similar laws now or hereafter in effect relating to creditors’ rights generally or general principles of equity. Except as required to comply with the HSR Act or as set forth on Schedule 6.2 , Buyer is not or will be required to give any notice to, make any registration, declaration or filing with or obtain any consent, waiver or approval from any Person in connection with the execution and delivery of this Agreement and the other Transaction Documents to which it is a Party or the consummation or performance of any of the transactions contemplated hereby or thereby, except for such notices, registrations, declarations or filings and consents, the failure of which to provide, make or obtain, would not, individually or in the aggregate, materially affect Buyer’s ability to perform its obligations under this Agreement or any other Transaction Documents or to consummate the transactions contemplated hereby or thereby.

6.3 No Conflict .

Neither the execution and delivery by Buyer of this Agreement or the other Transaction Documents to which it is a party nor the consummation of the transactions contemplated hereby or thereby nor compliance by it with any of the provisions hereof or thereof (a) conflict with or result in a violation of (i) any provision of the organizational documents of Buyer or (ii) any judgment, order, writ, injunction, decree, statute, law, ordinance, rule or regulation in any material respect binding upon Buyer or (b) violate, conflict with, or result in a breach of any of the terms of, or constitute a default under, or give rise to any right of termination, modification, cancellation or acceleration under (i) any note, bond, mortgage,

indenture, deed of trust, contract, commitment, arrangement, license, agreement, lease or other instrument or obligation to which Buyer is a party or by which Buyer may be bound or to which any of Buyer’s assets may be subject or affected in any material respect and that, in each case, is material to the business of Buyer, or (ii) any material license, permit, authorization, consent, order or approval of, or registration, declaration or filings with, any Governmental Authority.

6.4 Brokers or Finders .

Neither Buyer nor any Person acting on behalf of Buyer has paid or become obligated to pay any fee or commission to any broker, finder, investment banker, agent or intermediary for or on account of the transactions contemplated by this Agreement for which any Seller is or will become liable, and Buyer shall hold harmless and indemnify Sellers from any claims with respect to any such fees or commissions.

6.5 Legal Proceedings .

There is no Proceeding or Order pending against, or to Buyer’s Knowledge, threatened against or affecting, Buyer before any arbitrator or any Governmental Authority which in any manner challenges or seeks to prevent, enjoin, alter or materially delay the transactions contemplated by this Agreement and the other Transaction Documents or which would or would reasonably be expected to impair Buyer’s ability to consummate the transactions contemplated by this Agreement and the other Transaction Documents.

6.6 Financing .

Buyer shall, on the Execution Date and at the Closing, have the ability to make the Credit Bid and Release and, at the Closing, shall have sufficient available funds to permit Buyer to pay the Cash Consideration and all other amounts to be paid or repaid by Buyer under the Transaction Documents to the extent payable on or about the Closing Date, including amounts to be paid for the Cure Costs and including all requisite financial assurances to be provided by Buyer pursuant to Section 7.9 .

6.7 Qualification .

(a) To Buyer’s Knowledge, there exist no facts or circumstances that would cause, or be reasonably expected to cause, Buyer and/or its Affiliates not to qualify as “good faith” purchasers under Section 363(m) of the Bankruptcy Code.

(b) As of the Closing, Buyer and/or each relevant Buyer Designee, as applicable, will be capable of satisfying the conditions contained in Sections 365(b)(1)(C) and 365(f)(2)(B) of the Bankruptcy Code with respect to the Assumed Contracts.

(c) As of the Closing, Buyer and/or each relevant Buyer Designee, as applicable, will be capable of taking transfer of, or obtaining replacement or overlapping permits for, the Closing Required Permits held by Sellers and, to Buyer’s Knowledge, as of the date hereof and as of the Closing, there exists no reason why approval for any application for any Mining Permit or other Governmental Authorization should be denied, other than any denial for violations that may reasonably be expected to be cured by the time of such transfer or obtaining

of Permits as contemplated by Section 7.9 and Section 7.10 , and no Buyer, relevant Buyer Designee, or any officer or director thereof, as applicable, is or will be “permit blocked” on the Applicant Violator System by any Governmental Authority.

6.8 No Other Representations or Warranties; Condition of the Business; Buyer ’ s Reliance .

Buyer acknowledges that neither Sellers nor any other Person is making, and Buyer is not relying on, any representations or warranties whatsoever, statutory, expressed or implied, written or oral, at law or in equity, beyond those expressly made by Sellers in Article 5 hereof (as modified by the Disclosure Schedules). Buyer acknowledges that, except as expressly set forth in Article 5 (as modified by the Disclosure Schedules), neither Sellers nor any other Person has, directly or indirectly, made any representation or warranty, statutory, expressed or implied, written or oral, at law or in equity, as to the accuracy or completeness of any information that Sellers furnished or made available to Buyer and its Representatives in respect of the Business, and Sellers’ operations, assets, stock, Liabilities, condition (financial or otherwise) or prospects. Buyer acknowledges that neither Sellers nor any other Person, directly or indirectly, has made, and Buyer has not relied on, any representation or warranty, whether written or oral, regarding the pro-forma financial information, financial projections or other forward-looking statements of Sellers, and Buyer will make no claim with respect thereto. Buyer acknowledges that the Acquired Assets are being transferred on an “AS IS, WHERE IS” basis.

6.9 Information .

Buyer has conducted such investigations of the Company and its Subsidiaries as it deems necessary and appropriate in connection with the execution and delivery of this Agreement and the other Transaction Documents to which Buyer is a party and the consummation of the transactions contemplated hereby and thereby. Buyer acknowledges that it and its Representatives have been permitted full and complete access to the books and records, facilities, equipment, Tax Returns, Contracts, insurance policies (or summaries thereof) and other properties and assets of Sellers, that it and its Representatives have desired or requested to see or review, and that it and its Representatives have had a full opportunity to meet with the officers and employees of Sellers to discuss the Business. Neither Sellers nor any other Person (including any officer, director, member or partner of Sellers or any of their Affiliates) shall have or be subject to any liability to Buyer, or any other Person, resulting from Buyer’s use of any information, documents or material made available to Buyer in any “data rooms,” management presentations, due diligence or in any other form in expectation of the transactions contemplated hereby or by the other Transaction Documents.

ARTICLE 7

A CTIONS P RIOR TO THE C LOSING D ATE

7.1 Access and Reports; Confidentiality .

(a) From and after the Execution Date through and including the Closing Date or the earlier termination of this Agreement in accordance with the provisions of

Article 11 , Sellers shall (i) afford Buyer and its Representatives reasonable access, upon reasonable notice, to its personnel, properties, books, Permits, Contracts and records, and furnish promptly to Buyer all reasonable information concerning the Acquired Assets, the Business, properties, any Benefit Plans and personnel as may be reasonably requested; (ii) furnish to Buyer such financial and operating data and other information relating to Sellers, the Business and the Acquired Assets as may be reasonably requested; (iii) permit Buyer, to make such reasonable inspections and, at Buyer’s sole cost and expense, copies thereof as Buyer may require; and (iv) instruct the executive officers and senior business managers, counsel, auditors and financing advisors of Sellers to reasonably cooperate with Buyer and its Representatives regarding the same; provided , that any such access shall be conducted consistent with and not in violation of the Bidding Procedures Order and in a manner not to unreasonably interfere with the Business. All requests for information made pursuant to this Section 7.1 shall be directed to Adam Schlesinger, PJT Partners LP, 280 Park Avenue, 16 ^th Floor, New York, NY 10017 or other person as designated by such person or Sellers. Notwithstanding the foregoing, Buyer and its Representatives shall not (A) have access to personnel records of Sellers relating to individual performance or evaluation records, medical histories or other information which in Sellers’ good faith opinion is sensitive or the disclosure of which could subject a Seller to risk of liability and (B) have any right to perform or conduct, or cause to be performed or conducted, any environmental sampling or testing at, in, on or underneath any of Sellers’ properties without written consent from the Company. No investigation pursuant to this Section 7.1 or by Buyer or its Representatives at any time prior to or following the date hereof shall affect or be deemed to modify any representation or warranty made by Sellers herein.

(b) Notwithstanding the foregoing but subject in all respects to the Bidding Procedures Order, this Section 7.1 shall not require Sellers to permit any access to, or to disclose (i) any information that, in the reasonable, good faith judgment (after consultation with counsel, which may be in-house counsel) of the Company, is reasonably likely to result in any violation of any Legal Requirement or any Contract to which the Company or any Seller is a party or cause any privilege (including attorney-client privilege) or work product protection that Sellers would be entitled to assert to be waived or (ii) if the Company or any Seller, on the one hand, and Buyer or any of its Affiliates, on the other hand, are adverse parties in a litigation, any information that is reasonably pertinent thereto; provided , that, in the case of clause (i), the Parties shall reasonably cooperate in seeking to find a way to allow disclosure of such information to the extent doing so (A) would not (in the good faith belief of the Company (after consultation with counsel, which may be in-house counsel)) be reasonably likely to result in the violation of any such Legal Requirement or Contract or be reasonably likely to cause such privilege or work product protection to be undermined with respect to such information or (B) could reasonably (in the good faith belief of the Company (after consultation with counsel, which may be in-house counsel)) be managed through the use of customary “clean-room” arrangements pursuant to which non-employee Representatives of Buyer could be provided access to such information.

(c) Buyer shall, and shall use its best efforts to cause its Affiliates and Representatives to, hold all confidential documents and information concerning the Business furnished to Buyer or its Affiliates in connection with the transactions contemplated by this Agreement and the other Transaction Documents in accordance with the provisions of the confidentiality agreement attached to the Bidding Procedures Order which Buyer shall execute in accordance with the Bidding Procedures Order.

7.2 Operations Prior to the Closing Date .

Sellers covenant and agree that, except (v) as expressly contemplated by this Agreement, (w) as disclosed in Schedule 7.2 , (x) with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed), (y) as otherwise required by Legal Requirements or (z) to the extent not inconsistent with the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, any orders entered by the Bankruptcy Court in the Bankruptcy Case, or as permitted under the Cash Collateral Orders, after the Execution Date and prior to the Closing Date:

(a) Sellers shall:

(i) carry on the Business in the Ordinary Course of Business and use commercially reasonable efforts to maintain, preserve and protect the Acquired Assets in the condition in which they exist on the date hereof, except for ordinary wear and tear and except for replacements, modifications or maintenance in the Ordinary Course of Business;

(ii) maintain their books, accounts and records in the Ordinary Course of Business;

(iii) use commercially reasonable efforts to pay all post-petition Trade Payables and collect all Accounts Receivable after the Petition Date (subject to the Budget Covenant (as defined in the Cash Collateral Orders));

(iv) use commercially reasonable efforts to (A) retain the services of its current executive officers (or their successors) who are in good standing and who are necessary to conduct the Business as it is currently being conducted in all material respects and (B) maintain their relationships with and preserve for the Business the goodwill of their key suppliers and customers in all material respects (it being understood that no increases to any payments or compensation, including any incentive, retention or similar compensation, shall be required in respect of either clause (A) or (B) hereof or other expenditures of funds (other than pursuant to the existing terms of any Contracts) or modification of Contract terms);

(v) (A) comply in all material respects with all Legal Requirements applicable to them or having jurisdiction over the Business or any Acquired Asset, (B) comply in all material respects with contractual obligations applicable to or binding upon them pursuant to any Material Contracts (other than those obligations the compliance with which is excused during the Bankruptcy Case), and (C) maintain in full force and effect all material Permits and comply with the terms of each such Permit (but only to the extent such Permits are necessary for the Business and the Acquired Assets in the Ordinary Course of Business);

(vi) cause any of their current property insurance policies with respect to the Business or any of the other Acquired Assets not to be canceled or terminated or any of the coverage thereunder to lapse unless, simultaneously with such termination, cancellation or lapse, replacement, policies providing coverage equal to or greater than the coverage under the canceled, terminated or lapsed policies are in full force and effect, to the extent such coverage is reasonably available;

(vii) maintain each Buyer Benefit Plan in accordance with their terms and Legal Requirements;

(viii) maintain, preserve and protect in full force and effect the existence of all material Intellectual Property owned by Sellers and included in the Acquired Assets, except for abandonment of Intellectual Property that is de minimis to the Business in Sellers’ reasonable business judgment; and

(ix) use commercially reasonable efforts not to take or agree to or commit to assist any other Person in taking any action (i) that would reasonably be expected to result in a failure of any of the conditions to the Closing or (ii) that would reasonably be expected to impair the ability of Sellers or Buyer to consummate the Closing in accordance with the terms hereof or to materially delay such consummation.

(b) Sellers shall not:

(i) take any action enumerated in Section 5.20(b) , except as set forth on Schedule 5.20(b) ;

(ii) assume, reject or assign any Material Contract, other than pursuant to Section 2.5 ;

(iii) enter into or renew any Material Contract (other than automatic renewals of Material Contracts in the Ordinary Course of Business in accordance with the terms thereof as in effect on the Execution Date) without the consent of Buyer; or

(iv) other than the Approved Retention Payments, (A) hire any Employees having annual base or guaranteed compensation in excess of $200,000; (B) increase the annual rate of base salary or any target bonus opportunity of any Employee whose annual rate of base salary prior to such increase was in excess of $200,000; (C) pay or award any bonus, benefit, or other direct or indirect incentive compensation (other than any such payments authorized pursuant to any first or second day orders in the Bankruptcy Case); (D) award any equity compensation awards (whether phantom or equity) with respect to the equity of the Company or its Affiliates; (E) modify, amend or terminate any Benefit Plan; (F) enter into any employment, compensation, severance, non-competition, or similar contract (or amended any such contract) to which any Seller is a party; or (G) adopt any new severance pay, termination pay, deferred compensation, bonus, or other employee benefit plan with respect to Employees that would be a Benefit Plan if it existed on the Execution Date (including any employment

agreement, severance agreement, change in control agreement, or transaction or retention bonus agreements), except, in the case of each of clauses (A) through (G), (i) to the extent permitted by any order of the Bankruptcy Court or as required by applicable Legal Requirements (including to avoid the imposition of Taxes or to conform to the requirements of Tax qualification); (ii) pursuant to the terms of any Benefit Plan, as in effect on the date hereof; or (iii) for immaterial changes to Benefit Plans available to all employees generally (other than changes that materially increase the amount, or accelerate the timing, of the payment of benefits).

7.3 Regulatory Matters; Cooperation .

(a) Subject to Section 7.3(c) , as soon as reasonably practicable following entry of the Bidding Procedures Order but in any event on or before January 12, 2016 (or such later date as agreed in writing by all of the Parties hereto), Sellers, on the one hand, and Buyer, on the other hand, shall each prepare and file, or cause to be prepared and filed, any notifications required to be filed under the HSR Act with the United States Federal Trade Commission and the Antitrust Division of the United States Department of Justice, and request early termination of the waiting period under the HSR Act. Buyer, on the one hand, and Sellers, on the other hand, shall promptly respond to any requests for additional information or documentary materials in connection with such filings and shall take all other actions necessary to cause the waiting periods under the HSR Act to terminate or expire at the earliest practicable date after the date of filing. Buyer shall be responsible for payment of the applicable filing fee under the HSR Act, and each Party shall be responsible for any other payment of its own respective costs and expenses incurred by such Party (including attorneys’ fees and other legal fees and expenses) associated with the preparation of its portion of any antitrust filings.

(b) Sellers, on the one hand, and Buyer, on the other hand, shall use commercially reasonable efforts to obtain (and Buyer shall cause its Subsidiaries to use commercially reasonable efforts to obtain), at the earliest practicable date, all necessary Governmental Authorizations and all necessary registrations, declarations and filings (including registrations, declarations and filings with Governmental Authorities, if any) and take all reasonable steps as may be necessary to avoid any Proceeding by any Governmental Authority. In addition to such actions and the actions to be taken under Section 7.3(a) , Sellers, on the one hand, and Buyer, on the other hand, shall use commercially reasonable efforts to take (and Buyer shall cause its Subsidiaries to use commercially reasonable efforts to take), or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the transactions contemplated hereby, including using commercially reasonable efforts to accomplish the following: (i) taking all reasonable acts necessary to cause the conditions precedent set forth in Article 9 and Article 10 to be satisfied; (ii) defending of any Proceedings challenging this Agreement or the consummation of the transaction contemplated hereby, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Authority vacated or reversed; (iii) taking all reasonable acts necessary in connection with meeting with any Governmental Authority regarding the transferring of the Permits held by Sellers; and (iv) executing and delivering any additional instruments necessary to consummate the transactions contemplated hereby and to fully carry out the purposes of this Agreement.

(c) Sellers, on the one hand, and Buyer, on the other hand, shall, (i) promptly inform each other of any communication from any Governmental Authority concerning this Agreement, the transactions contemplated hereby, and any filing, notification or request for approval and (ii) permit the other to review in advance any proposed written or material oral communication or information submitted to any such Governmental Authority in response thereto. In addition, none of Parties shall agree to participate in any meeting with any Governmental Authority in respect of any filings, investigation or other inquiry with respect to this Agreement or the transactions contemplated hereby, unless such Party consults with the other Parties in advance and, to the extent permitted by any such Governmental Authority, gives the other Parties the opportunity to attend and participate thereat, in each case to the maximum extent practicable. Subject to restrictions under any Legal Requirements, Buyer, on the one hand, and Sellers, on the other hand, shall furnish the other with copies of all correspondence, filings and communications (and memoranda setting forth the substance thereof) between it and its Affiliates and their respective Representatives on the one hand, and the Governmental Authority or members of its staff on the other hand, with respect to this Agreement, the transactions contemplated hereby (excluding documents and communications which are subject to preexisting confidentiality agreements or to the attorney-client privilege or work product doctrine or which refer to valuation of the Business) or any such filing, notification or request for approval. Each Party shall also furnish the other Party with such necessary information and assistance as such other Party and its Affiliates may reasonably request in connection with their preparation of necessary filings, registration or submissions of information to the Governmental Authority in connection with this Agreement, the transactions contemplated hereby and any such filing, notification or request for approval.

(d) Subject to the terms and conditions of this Agreement, Buyer shall, and shall cause its Subsidiaries to, take any and all steps reasonably necessary to avoid or eliminate impediments under any Antitrust Law that may be asserted by any Governmental Authority with respect to the transactions contemplated hereby so as to enable the Closing to occur as soon as reasonably possible, including, proposing, negotiating, committing to and effecting, by consent decree or otherwise, the sale, divestiture or disposition of such assets or businesses of Buyer or any of its Subsidiaries as may be required in order to avoid the entry, or to effect the dissolution, of any injunction, temporary restraining order or other order in any suit or proceeding, which would otherwise have the effect of preventing, delaying or restricting the consummation of the transactions contemplated by this Agreement; provided , that (i) Sellers shall not take any such action without the prior written consent of Buyer and (ii) Buyer shall not be obligated to take any such action if such action would have a Material Adverse Effect on the Business or the Acquired Assets, taken as a whole.

7.4 Tax Cooperation .

Sellers and Buyer agree that for U.S. federal income tax purposes, the transactions contemplated by this Agreement shall be treated as one or more tax-free reorganizations as contemplated by Section 368(a) of the Code.

7.5 Bankruptcy Court Matters .

(a) Sale Motion . In connection with the transactions contemplated by this Agreement, Sellers shall have filed with the Bankruptcy Court on or within three (3) Business Days of the Execution Date (or such later date as agreed in writing by all of the Parties hereto), the proposed Sale Motion, including a proposed form of the Bidding Procedures Order and appropriate supporting declarations, in each case, in form and substance acceptable to Sellers and Buyer. Sellers shall affix a true and complete copy of this Agreement (without Disclosure Schedules) to the Sale Motion filed with the Bankruptcy Court.

(b) Bankruptcy Procedures Hearing and Bidding Procedures Order . On or prior to November 25, 2015 (or such later date as agreed in writing by all of the Parties hereto), the Bankruptcy Court shall have (i) held a hearing to consider approval of the Bidding Procedures and (ii) entered the Bidding Procedures Order in form and substance acceptable to Sellers and Buyer.

(c) Qualified Bids . Pursuant to the Bidding Procedures Order, any and all Qualified Bids shall have been submitted on or prior to January 5, 2016 (or such later date as agreed in writing by all of the Parties hereto) (the “ Bid Deadline ”). If any Qualified Bid is submitted prior to the Bid Deadline, Sellers shall have commenced the auction contemplated by the Bidding Procedures on or prior to January 7, 2016 (or such later date as agreed in writing by all of the Parties hereto).

(d) Sale Order . On or prior to January 12, 2016 (or such later date as agreed in writing by all of the Parties hereto), the Bankruptcy Court shall have entered the Sale Order, which shall be in form and substance acceptable to Sellers and Buyer (solely to the extent Buyer is the Successful Bidder or the Backup Bidder).

(e) Contracts . Sellers shall serve on all non-debtor counterparties to all of their Available Contracts a Cure Notice stating that Sellers are or may be seeking the assumption and assignment of such Available Contracts and shall notify such non-debtor counterparties of the deadline for objecting to the Cure Costs, if any, which deadline shall not be later than December 17, 2015 or as otherwise provided in the Bidding Procedures Order.

(f) Bankruptcy Filings . From and after the Execution Date and until the Closing Date, Sellers shall deliver to Buyer, at least two (2) Business Days in advance of Sellers’ filing or submission thereof, drafts of any and all material pleadings, motions, notices, statements, schedules, applications, reports and other papers to be filed or submitted in connection with this Agreement for Buyer’s prior review and comment by Sellers, and such filings shall be acceptable to Buyer in its reasonable discretion to the extent they relate to the Acquired Assets, any Assumed Liabilities or any of Buyer’s obligations hereunder. Sellers agree to diligently prosecute the entry of the Bidding Procedures Order and the Sale Order as provided herein. In the event the entry of the Bidding Procedures Order or the Sale Order shall be appealed, Sellers and Buyer shall use their reasonable efforts to defend such appeal. Sellers shall comply with all notice requirements (i) of the Bidding Procedures Order or (ii) imposed by the Sale Order, in each case, in connection with any pleading, notice or motion to be filed in connection herewith.

7.6 Expense Reimbursement .

Notwithstanding anything in this Agreement to the contrary, from and after entry of the Bidding Procedures Order, Sellers agree to pay to Buyer the Expense Reimbursement (less any amount of the Expense Reimbursement to the extent already paid in respect of the Blue Creek Assets pursuant to Section 7.8(b)(ii) ) in the event this Agreement is terminated if and to the extent provided in Section 11.2 . The Parties acknowledge and agree that the terms and conditions set forth in Section 11.2 with respect to the payment of the Expense Reimbursement shall become operative only if and to the extent that the Bankruptcy Court enters the Bidding Procedures Order.

7.7 Update of Disclosure Schedules; Notice of Developments .

(a) Seller Supplements and Amendments . From the Execution Date until the Closing Date, Sellers shall as promptly as reasonably practicable deliver any new schedules or supplement or amend the Disclosure Schedules with respect to any matter that, if existing, occurring or known at the Execution Date, would have been required to be set forth or described in the Disclosure Schedules. Any such supplement or amendment shall be deemed to modify the Disclosure Schedules for purposes of this Agreement except to the extent the matters set forth in such supplement or amendment are material to the Acquired Assets or the Business. Notwithstanding anything in this Section 7.7 to the contrary, in no event will Sellers be permitted to supplement or amend any Disclosure Schedules other than Disclosure Schedules required under Article 5 without the prior written consent of Buyer and any such supplements or amendments will not be deemed to modify any Schedules other than the Disclosure Schedules required under Article 5 .

(b) Notice of Developments . Sellers shall promptly notify Buyer of, and furnish Buyer any information it may reasonably request with respect to, any event that would reasonably be expected to cause any of the conditions set forth in Article 9 not to be fulfilled by the Outside Date.

(c) Schedule 2.3(m) . Schedule 2.3(m) shall be amended at any time before or after Closing pursuant to and in accordance with Section 2.3(m) .

(d) Buyer may supplement or amend Schedule 2.1(l) at any time in its sole discretion (except that no Avoidance Actions shall be added to Schedule 2.1(l) at any time).

7.8 Certain Excluded Assets .

(a) From and after the date hereof until one (1) Business Day prior to the Bid Deadline, upon prior written notice to Sellers, Buyer shall have the right to amend Schedule 2.2(a) to designate the Walter Coke Assets to be an Excluded Asset (the “ Walter Coke Election ”). Whether or not the Walter Coke Election or the Pre-Closing Walter Coke Election is made, if there is a Successful Bidder (other than the Buyer or a Buyer Designee) for the Walter Coke Assets and such sale closes, the Credit Bid and Release shall be reduced by $100,000,000. In the event that the Walter Coke Election is made and there is no Successful Bidder for the Walter Coke Assets or the sale of the Walter Coke Assets to a Successful Bidder or Backup Bidder (if any) for the Walter Coke Assets does not close: (1) the Credit Bid and Release shall be

reduced by $100,000,000, and Buyer shall credit bid for the Walter Coke Working Capital Assets in an amount equal to $22,000,000; (2) at the Closing, or as soon thereafter as is practicable, the Walter Coke Working Capital Assets shall be transferred by Buyer free and clear of all Liens and Encumbrances to the Walter Coke Trust; (3) the Walter Coke Working Capital Assets shall be liquidated by the trustee of the Walter Coke Trust and the proceeds of the Walter Coke Working Capital Assets net of liquidation costs shall be deposited in the Walter Coke Trust as provided in the applicable trust agreement; and (4) the Credit Agreement Agent and the Indenture Trustee shall be directed to release their respective Liens on the remaining Walter Coke Assets. The funds in the Walter Coke Trust will be used by the trustee of the Walter Coke Trust to fund the fees and expenses of the trustee of the Walter Coke Trust, the fees of a Chapter 7 trustee if one is appointed for Walter Coke, payment of professional fees for any professionals retained by such Chapter 7 trustee, payment to employees for services rendered in connection with the liquidation of the Walter Coke Assets, any accrued and unpaid payroll and benefits incurred by Walter Coke prior to conversion to Chapter 7 under the Bankruptcy Code, environmental remediation costs for the Walter Coke Assets, and plant decommissioning costs for the Walter Coke Assets, including any necessary technical professional services in connection therewith. No dollar amounts set forth in this Section 7.8(a) shall be construed as a minimum amount required to be bid by a Qualified Bidder (as defined in the Bidding Procedures) for all or any part of the Walter Coke Assets; it being acknowledged and agreed by the parties hereto, that, any minimum bid requirements shall be as provided in the Bidding Procedures. If a Walter Coke Election is made and there is no Successful Bidder for the Walter Coke Assets or the sale of the Walter Coke Assets to a Successful Bidder or Backup Bidder (if any) for the Walter Coke Assets does not close, at the Closing, or as soon thereafter as is practicable, Buyer shall provide, if requested by the Trustee of the Walter Coke Trust, the Walter Coke Trust with a short term (sixty (60) to ninety (90) day) loan of up to $5,500,000, which loan shall bear interest at an annual rate not to exceed LIBOR plus 3.00%, and which loan shall be secured by the Walter Coke Working Capital Assets and shall be repaid by the trustee of the Walter Coke Trust from the proceeds of such collateral ahead of any and all other expenses, debts or other liabilities or obligations of the Walter Coke Trust (the “ WC Loan ”). The Walter Coke Trust may disburse the proceeds from such loan based on a budget prepared by the Sellers’ estates or the trustee of the Walter Coke Trust, subject to Buyer’s reasonable approval.

(b)

(i) From and after the date hereof until the Closing Date, upon prior written notice to Sellers, Buyer shall have the right to amend Schedule 2.2(a) to designate one or more of the Miscellaneous Real Property Assets to be an Excluded Asset.

(ii) If the Blue Creek Assets are sold to a Successful Bidder (other than Buyer or a Buyer Designee) pursuant to the Bidding Procedures, (A) the Credit Bid and Release shall be reduced by $50,000,000 and (B) notwithstanding anything in this Agreement to the contrary (but without limiting Buyer’s rights and remedies under Section 11.2 ), Sellers shall promptly pay to Buyer in cash an amount equal to (x) the fees and expenses incurred by the Buyer, the Steering Committee, the Credit Agreement Agent and the Indenture Trustee, including reasonable attorney fees, (that are not otherwise paid by the Sellers under the Cash Collateral Orders) with regard

to the Blue Creek Assets in an aggregate amount up to $250,000, plus (y) a break-up fee payable to Buyer equal to $1,500,000 (the amounts payable under the preceding clauses (x) and (y) are collectively referred to herein as the “ Blue Creek Bid Protections ”), by wire transfer of immediately available funds immediately upon the closing of such sale of the Blue Creek Assets.

(c) Notwithstanding anything in this Agreement to the contrary, effective automatically upon (i) the Walter Coke Election (or the sale of the Walter Coke Assets to a Successful Bidder other than the Buyer or a Buyer Designee), (ii) the designation of any Miscellaneous Real Property Assets as “Excluded Assets” or if any Miscellaneous Real Property Assets are sold to a Successful Bidder (other than the Buyer or a Buyer Designee), or (iii) the sale of the Blue Creek Assets to a Successful Bidder other than Buyer or a Buyer Designee, in each case, pursuant to the Bidding Procedures, (1) any “Acquired Assets” to the extent relating to the Walter Coke Assets, such Miscellaneous Real Property Assets or Blue Creek Assets, as applicable, shall no longer constitute “Acquired Assets” and shall instead constitute “Excluded Assets” for all purposes hereunder (including for purposes of the representations and warranties set forth in Article 5 and the conditions to Closing set forth in Article 9 and Article 10 ) to the extent relating to the Walter Coke Assets, such Miscellaneous Real Property Assets or Blue Creek Assets, as applicable, and (2) any “Assumed Liabilities” to the extent relating to the Walter Coke Assets, Miscellaneous Real Property Assets or Blue Creek Assets, as applicable, shall no longer constitute “Assumed Liabilities” and shall instead constitute “Excluded Liabilities” for all purposes hereunder to the extent relating to the Walter Coke Assets, Miscellaneous Real Property Assets or Blue Creek Assets, as applicable (including for purposes of Article 4 , Article 7 , Article 9 and Article 10 ), and shall be rendered inapplicable and inoperative to the extent that such provisions relate to “Excluded Assets” or “Excluded Liabilities” after giving effect to clauses (i) and (ii) of this Section 7.8(c) , including the Walter Coke Assets, such Miscellaneous Real Property Assets or Blue Creek Assets, as the case may be. Notwithstanding the foregoing, (x) the Acquired Assets set forth in Section 2.1(m) , (n) or (p) shall not constitute “Excluded Assets” as a result of the Walter Coke Assets, such Miscellaneous Real Property Assets or Blue Creek Assets being designated “Excluded Assets” and (y) the Walter Coke Working Capital Assets shall not constitute “Excluded Assets” as a result of the Walter Coke Assets being designated “Excluded Assets”, other than on account of the sale of the Walter Coke Assets to a Successful Bidder other than the Buyer or a Buyer Designee.

(d) To the extent that there is no Successful Bidder for any of the Non-Core Assets (excluding the Walter Coke Assets and the Blue Creek Assets) or the sale of the Non-Core Assets (excluding the Walter Coke Assets and the Blue Creek Assets) to a Successful Bidder or Backup Bidder (if any) for such Non-Core Assets does not close, (1) Buyer shall credit bid for the Acquired Non-Core Assets and the Credit Bid and Release shall be increased by $49,000,000; provided , that such amount may be allocated among the Non-Core Assets (excluding the Walter Coke Assets and the Blue Creek Assets) by Buyer or Buyer Designee within forty five (45) days after the Execution Date but in no event later than five (5) Business Days prior to the Bid Deadline in Buyer’s sole discretion, (2) at the Closing, such Acquired Non-Core Assets shall be transferred to the Buyer free and clear of all Liens and Encumbrances other than Permitted Encumbrances; and (3) the Credit Agreement Agent and the Indenture Trustee shall be directed to release their respective Liens on such Non-Core Assets (other than Liens on the Acquired Non-Core Assets, the Walter Coke Assets and the Blue Creek Assets, the release of

which is provided for in Section 8.10 ). For the avoidance of doubt, if there is no Successful Bidder (other than Buyer or a Buyer Designee) for the Blue Creek Assets or the sale of the Blue Creek Assets to a Successful Bidder or Backup Bidder (if any) for the Blue Creek Assets does not close, the Blue Creek Assets shall constitute “Acquired Assets” for all purposes under this Agreement.

(e) The Wind Down Trust will be used to fund the fees and expenses of the trustee of the Wind Down Trust, the fees of a Chapter 7 trustee if one is appointed, payment of professional fees for any professionals engaged in the wind down of the Sellers’ estates or retained by a Chapter 7 trustee, payment to employees for services rendered in connection with the liquidation or wind down, any necessary technical professional services in connection with the wind down of the Non-Core Assets (excluding the Walter Coke Assets and the Blue Creek Assets) including, for the avoidance of doubt, technical professional services relating to remediation and Reclamation of such assets, and any accrued and unpaid payroll and benefits incurred and any other costs or expenses contemplated by the Wind Down Trust or Wind Down Trust agreement prior to conversion to Chapter 7 under the Bankruptcy Code. Any funds remaining in the Wind Down Trust after payment of the expenses described in this Section 7.8(e) shall be transferred to Buyer.

(f) If (x) the Walter Coke Election is not made, (y) there is no Successful Bidder (other than the Buyer or a Buyer Designee) for the Walter Coke Assets or the sale of the Walter Coke Assets to a Successful Bidder or Backup Bidder (if any) for the Walter Coke Assets does not close and (z) the condition to Closing set forth in Section 9.9(b) has not been satisfied, then on the date that is two weeks prior to the projected Closing Date (which shall be agreed upon in advance by the Parties), Buyer shall elect to either (1) designate the Walter Coke Assets to be an Excluded Asset, (a “ Pre-Closing Walter Coke Election ”) or (2) waive the condition to Closing set forth in Section 9.9(b) . If a Pre-Closing Walter Coke Election occurs, Sections 7.8(a) and (c) shall apply as if a Walter Coke Election had occurred.

7.9 Surety Bonds; Permits

(a) Business and Acquired Assets in Alabama .

(i) Promptly, but in no event later than ten (10) Business Days following the Execution Date, Sellers shall make available to Buyer a true and complete list of (A) all Permits held by Sellers or any of their Affiliates in the operation of the Business and Acquired Assets in the State of Alabama, together with a description of the permitted property, facility or operation, together with a true and complete list of all pending applications for additional Permits, renewals of existing Permits, or amendments to existing Permits held by Sellers, which have been submitted to any Governmental Authority or other entity by any Seller or any of its Subsidiaries applicable to the operation of the Business and Acquired Assets in Alabama and (B) the applicable surety bonds (or other financial assurances) and the amount of the surety bonds (or other financial assurances) under such Permits, in each case, as amended, supplemented and modified through the Execution Date. Sellers shall as promptly as practicable deliver to Buyer any updates, modifications or corrections to the foregoing information.

(ii) As promptly as reasonably practicable after the Execution Date:

(1) Buyer shall file an application with the Alabama Surface Mining Commission for a license to engage in coal mining operations in the State of Alabama (“ Alabama Mining License ”), in a format and manner acceptable to the Alabama Surface Mining Commission, along with all applicable fees, and shall have obtained such Alabama Mining License, and continue to hold the same, on and as of the Closing Date and thereafter until the transfer to Buyer of all of the Alabama Mining Permits (as hereinafter defined) is completed;

(2) Buyer shall use commercially reasonable efforts to provide, not later than the Bid Deadline, evidence of appropriate financial commitments, in form, manner and amount acceptable to Sellers and the Alabama Surface Mining Commission, for replacement surety bonds or other financial assurances necessary to allow the transfer of the Alabama Mining Permits from Sellers to Buyer, and in any event, Buyer shall provide such evidence at or before Closing; and

(3) Buyer shall use commercially reasonable efforts to provide, no later than the Bid Deadline, evidence of appropriate financial commitments, in form, manner and amount acceptable to Sellers and the Alabama Oil and Gas Board, for replacement surety bonds or other financial assurances necessary to allow the transfer of the Permits for the Gas Wells from Sellers to Buyer, and in any event, Buyer shall provide such evidence at or before Closing.

(iii) As promptly as reasonably practicable after the Execution Date:

(1) Buyer and Sellers shall file an application for a transfer of all Transferred Permits to engage in mining operations at particular locations in the State of Alabama with the Alabama Surface Mining Commission (“ Alabama Mining Permits ”), in a format and manner acceptable to the Alabama Surface Mining Commission, along with all applicable fees and shall publish notice of such applications in accordance with the applicable Legal Requirements;

(2) Buyer and Sellers shall file with the Alabama Department of Environmental Management an application for a transfer of Transferred Permits issued to Sellers by the Alabama Department of Environmental Management, in a format and manner acceptable to the Alabama Department of Environmental Management, along with all applicable fees;

(3) Buyer and Sellers shall file with the Jefferson County Department of Health an application for a transfer of any Transferred Permits relating to the emission of pollutants into the air, in a format and manner acceptable to the Jefferson County Department of Health, along with all applicable fees;

(4) Buyer and Sellers shall file with the Alabama Department of Environmental Management an application for a transfer of any Transferred Permits relating to the emission of pollutants into the air, in a format and manner acceptable to the Alabama Department of Environmental Management, along with all applicable fees;

(5) Buyer and Sellers shall file with the State Oil and Gas Board of Alabama written notification of the execution of this Agreement for Buyer to become the new operator for any applicable well or wells, and all associated facilities and equipment, in a format and manner acceptable to the State Oil and Gas Board of Alabama, along with all applicable fees;

(6) Buyer shall file with the Federal Explosives Licensing Center an application for each applicable Federal Explosives license or Permits, in a format and manner acceptable to the Federal Explosives Licensing Center, along with all applicable fees; and

(7) Sellers, on the one hand, and Buyer, on the other hand, shall use commercially reasonable efforts to properly file all documents or applications required to transfer, to amend, or to acquire all other Transferred Permits necessary for the operation and conduct of the Business or Acquired Assets in Alabama, and Buyer and Sellers shall reasonably cooperate in all actions necessary to seek and obtain approval for the transfer thereof.

(iv) Buyer and Sellers shall, and shall cause their Subsidiaries to, (A) take all actions and do, or cause to be done, all things necessary or desirable under the applicable Legal Requirements with the appropriate Governmental Authority to put in place, to transfer, to amend, or to acquire all Transferred Permits that are necessary for the operation and conduct of the Business or Acquired Assets in Alabama by or on the Closing Date, unless the applicable Legal Requirements regarding such a Permit require certain actions to be taken upon or after Closing, and, in that event, Buyer, at Buyer’s sole cost and expense from and after the Closing, shall take, or cause its Subsidiaries to take, all actions and do, or cause to be done, all things necessary or desirable under the applicable Legal Requirements with the appropriate Governmental Authority which can only be taken or done after the Closing to put in place, to transfer, to amend, or to acquire such remaining Permits as promptly as reasonably practicable after the Closing; and (B) take all actions and do, or cause to be done, all things necessary or desirable under the applicable Legal Requirements to put in place with the Alabama Surface Mining Commission as promptly as commercially reasonably possible after the Closing, financial assurances necessary to transfer the Alabama Mining Permits from Sellers and to Buyer and to obtain the release to Sellers of the financial assurances previously placed by Sellers with respect thereto. Sellers agree to provide, at Buyer’s sole cost and expense from and after Closing, any reasonable cooperation as reasonably

requested by Buyer to bring about the transfer of the Alabama Mining Permits or the issuance of new such permits to Buyer, as applicable. From and after the Closing, Buyer shall use commercially reasonable efforts to pursue the transfer of the Alabama Mining Permits or issuances of new Alabama Mining Permits to Buyer as promptly as possible, and Buyer shall operate under the Alabama Mining Permits as the designated operator and contract miner until the Alabama Mining Permits are transferred or new Permits are issued to Buyer, which contract mining operation shall be pursuant to the terms of a contract mining agreement in form mutually agreeable to Buyer and Sellers and executed and delivered by the Parties at Closing (the “ Alabama Contract Mining Agreement ”). To the fullest extent allowed by and in accordance with the applicable Legal Requirements, Sellers grant Buyer the right to conduct, at the sole cost and expense of Buyer, mining operations following the Closing on the Real Property under the Alabama Mining Permits, pursuant to and on the terms and conditions of the Alabama Contract Mining Agreement, as the designated operator until such time as the Alabama Mining Permits are transferred to, or new Permits are issued to, Buyer. Sellers shall take all steps that are reasonably necessary to maintain the Alabama Mining Permits prior to transfer thereof to Buyer and shall have (and Buyer grants) all rights of entry onto the Real Property that are reasonably necessary therefor. Notwithstanding anything to the contrary contained herein, Buyer shall reimburse, indemnify and hold harmless Sellers and/or their Affiliates from any and all Liabilities incurred by Sellers and/or their Affiliates as a result of any action taken by Sellers at Buyer’s or its Affiliates’ request pursuant to this Section 7.9(a)(iv) .

(v) As promptly as practicable after the Closing (or such earlier time as may be permitted by the Alabama Oil and Gas Board), Buyer and Sellers shall execute and deliver to the Alabama Oil and Gas Board one or more applications to change operator (Form OGB 1E) and such other forms that may be necessary or required by the Alabama Oil and Gas Board to change the operator of the Gas Wells to Buyer or Buyer Designee, and Buyer shall post replacement surety bonds or other financial assurances necessary to allow the transfer of the applicable Permits for the Gas Wells from Sellers to Buyer or Buyer Designee. If required by the Alabama Oil and Gas Board, Sellers shall leave in place any bonds or other financial assurances in connection with the applicable Permits for the Gas Wells, subject to the provisions of subsection 7.9(a)(vii) below, until the transfer of the applicable Permits for the Gas Wells from Sellers to Buyer or Buyer Designee. Notwithstanding anything to the contrary contained herein, Buyer shall reimburse, indemnify and hold harmless Sellers and/or their Affiliates from any and all Liabilities incurred by Sellers and/or their Affiliates as a result of any action taken by Sellers at Buyer’s or its Affiliates’ request pursuant to this Section 7.9(a)(v) .

(vi) Sellers shall use commercially reasonable efforts (at Buyer’s sole cost and expense from and after the Closing) to cause any surety bonds (or other financial assurances) in place as of the Closing with respect to applicable Transferred Permits to remain in place and to maintain current levels of surety bond coverage with respect to their Permits that are not Transferred Permits until such time as the final approval for the transfer of such applicable Transferred Permits to Buyer is received. At all times from and after Closing and prior to the transfer to Buyer of the Alabama Mining Permits and any other Permits not acquired by Buyer before the Closing

Date (including the Permits relating to the Gas Wells in Alabama), Buyer shall, and shall cause its Subsidiaries to, at Buyer’s sole cost and expense comply with all of the applicable Legal Requirements governing, and all conditions and requirements of, or pertaining to, any such Permits. Buyer shall promptly deliver to Sellers written notice of any incidents, violations or occurrences, which Sellers shall have the right, but not the obligation, to cure (including right of entry onto the applicable Real Property), and Buyer shall promptly reimburse Sellers for the reasonable costs of any such cure. Notwithstanding anything to the contrary contained herein, Buyer shall reimburse, indemnify and hold harmless Sellers and/or their Affiliates from any and all Liabilities incurred by Sellers and/or their Affiliates as a result of any action taken by Sellers at Buyer’s or its Affiliates’ request pursuant to this Section 7.9(a)(vi) .

(vii) Notwithstanding anything in this Agreement to the contrary, from and after the Closing, Buyer shall, at its sole cost and expense, (x) until such time as Buyer has posted replacement surety bonds or other required financial assurances, pay or reimburse Sellers (within five (5) Business Days of receipt of notice from Sellers’ Representative, which such notice shall contain the applicable surety bond numbers and corresponding premium amounts, or other appropriate references as to other forms of financial assurance) for the cost of any premiums that become due after the Closing Date with respect to such surety bonds or the cost of other financial assurances, (y) post any addition to the principal amount of any such surety bond or other financial assurance required by the Alabama Surface Mining Commission, the Alabama Oil and Gas Board or any Governmental Authority after the Closing Date as a result of any action taken by Buyer with respect to the Business and Acquired Assets in Alabama and (z) Buyer shall reimburse Sellers for all out-of-pocket costs and expenses incurred by Sellers in connection with any action taken by Sellers at the request of Buyer.

(viii) Until such time as the Alabama Mining Permits are transferred to Buyer, Buyer shall, and shall cause its Subsidiaries to, take all reasonable and necessary actions such that Buyer will not have been denied, or be made subject to denial of, any application for any Permit or other Governmental Authorization due to application of the Applicant Violator System established pursuant to the SMCRA or any similar applicable state system.

(b) All fees, bonds or financial assurances required to be paid or provided in connection with the actions to be taken under this Section 7.9 shall be paid or provided by Buyer.

7.10 Overlapping Permits

(a) To the extent that the permitted areas and outfalls covered by any National Pollutant Discharge Elimination System permit which is an Excluded Asset (each, an “ Excluded NPDES Permit ”) overlaps with the permitted areas and outfalls covered by one or more Transferred Permits issued pursuant to the Surface Mining Reclamation and Control Act (each, an “ Assumed SMCRA Permit ”), Buyer and Sellers shall cooperate and use commercially reasonable efforts to remove, as soon as commercially practicable after the Closing, the permitted areas and outfalls covered by such Assumed SMCRA Permit(s) from such Excluded

NPDES Permit. Without limiting the generality of the foregoing, as soon as commercially practicable after the Closing, (i) Buyer shall, and shall cause its Subsidiaries to, file with the appropriate Governmental Authority an application for a new National Pollutant Discharge Elimination System permit (each, a “ New NPDES Permit ”) with respect to the areas and outfalls covered by such Assumed SMCRA Permit(s) and (ii) the applicable Seller shall, at Buyer’s sole cost and expense, take all actions reasonably necessary or desirable under applicable Legal Requirements to modify such Excluded NPDES Permit to remove from such Excluded NPDES Permit the outfalls and areas covered by such Assumed SMCRA Permit(s) (the “ Overlapping NPDES Areas ”). Sellers shall have (and Buyer grants) all rights of entry onto the Overlapping NPDES Areas necessary for Sellers to maintain the applicable Excluded NPDES Permit at all times following the Closing until Buyer’s application for the applicable New NPDES Permit with respect to such Overlapping NPDES Areas is approved by the applicable Governmental Authority (the “ NPDES Interim Period ”) and thereafter until final release of each Excluded NPDES Permit.

(b) During the NPDES Interim Period, Buyer shall, and shall cause its Subsidiaries to, (i) comply with all of the Legal Requirements governing, and all conditions and requirements of, or pertaining to, any Excluded NPDES Permit with respect to any Overlapping NPDES Areas and (ii) be solely responsible for all incidents of violation, non-compliance, and similar occurrences related to the Overlapping NPDES Areas covered by an Excluded NPDES Permit that arise following the Closing. Buyer shall promptly deliver to Sellers written notice of any such incidents, violations or occurrences, which Sellers shall have the right, but not the obligation, to cure (including right of entry onto the applicable Overlapping NPDES Areas) in the event Buyer does not timely cure, and Buyer shall promptly reimburse Sellers for the reasonable costs of any such cure.

7.11 Transition of Business .

From and after the Execution Date, Sellers shall use commercially reasonable efforts to assist Buyer in accomplishing a smooth transition of the Business from Sellers to Buyer, including, holding discussions with respect to personnel policies and procedures, and other operational matters relating to the Business; provided , that Buyer shall reimburse Sellers for their out of pocket expenses in connection therewith for periods following the Closing.

7.12 Sale Free and Clear .

On the Closing Date, the Acquired Assets shall be transferred to Buyer and/or one or more Buyer Designees, as applicable, free and clear of all Encumbrances and Liabilities (including, for the avoidance of doubt, all successor liability, including any successorship obligations under any Collective Bargaining Agreement, and/or with respect to any Benefit Plan that is not an Buyer Benefit Plan), other than the Permitted Encumbrances and the Assumed Liabilities, including any Reclamation obligations that are Assumed Liabilities.

7.13 Acquisition Proposals .

Other than in accordance with the Bidding Procedures, Sellers shall not, and shall not authorize or permit any of their Affiliates or their respective Representatives to, directly or

indirectly, (i) encourage, solicit, initiate, facilitate or continue inquiries regarding an Acquisition Proposal; (ii) enter into discussions or negotiations with, or provide any information to, any Person concerning a possible Acquisition Proposal; or (iii) enter into any agreements or other instruments (whether or not binding) regarding an Acquisition Proposal. “ Acquisition Proposal ” shall mean any inquiry, proposal or offer from any Person (other than Buyer or any of its Affiliates) concerning an Alternative Transaction, in each case, other than pursuant to the Bidding Procedures.

7.14 SEC Filings .

From and after the Execution Date until the earlier of (x) the Closing Date and (y) February 29, 2016, Sellers shall cause to be filed with the SEC all annual, quarterly and current reports and other filings or furnishings as are required to be filed with the SEC under Section 13 or 15(d) of the Exchange Act.

7.15 Other Actions .

Buyer covenants and agrees that, except (w) as expressly contemplated by this Agreement, (x) with the prior written consent of Sellers (which consent shall not be unreasonably withheld, conditioned or delayed), (y) as otherwise required by Legal Requirements or (z) to the extent not inconsistent with the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, any orders entered by the Bankruptcy Court in the Bankruptcy Case, or as permitted under the Cash Collateral Orders, after the Execution Date and prior to the Closing Date, Buyer shall use commercially reasonable efforts not to take or agree to or commit to assist any other Person in taking any action (i) that would reasonably be expected to result in a failure of any of the conditions to the Closing or (ii) that would reasonably be expected to impair the ability of Buyer or Sellers to consummate the Closing in accordance with the terms hereof or to materially delay such consummation.

ARTICLE 8

A DDITIONAL A GREEMENTS

8.1 Taxes .

Sellers and Buyer agree to furnish or cause to be furnished to each other, upon request, as promptly as practicable, such information and assistance relating to the Business and the Acquired Assets (including access to books and records and Tax Returns and related working papers dated before Closing) as is reasonably necessary for the filing of all Tax Returns, the making of any election relating to Taxes, the preparation for any audit by any taxing authority, the prosecution or defense of any claims, suit or proceeding relating to any Tax, and the claiming by Buyer of any federal, state or local business tax credits or incentives that Buyer may qualify for in any of the jurisdictions in which any of the Acquired Assets are located; provided , however , that neither Buyer nor any Seller shall be required to disclose the contents of its income Tax Returns to any Person other than the Parties. Any expenses incurred in furnishing such information or assistance pursuant to this Section 8.1 shall be borne by Buyer. Notwithstanding the foregoing but subject in all respects to the Bidding Procedures Order, this Section 8.1 shall not require Sellers to permit any access to, or to disclose (i) any information that, in the

reasonable, good faith judgment (after consultation with counsel, which may be in-house counsel) of the Company, is reasonably likely to result in any violation of any Legal Requirement or any Contract to which the Company or any Seller is a party or cause any privilege (including attorney-client privilege) or work product protection that Sellers would be entitled to assert to be waived or (ii) if the Company or any Seller, on the one hand, and Buyer or any of its Subsidiaries, on the other hand, are adverse parties in a litigation, any information that is reasonably pertinent thereto; provided , that, in the case of clause (i), the Parties shall reasonably cooperate in seeking to find a way to allow disclosure of such information to the extent doing so (A) would not (in the good faith belief of the Company (after consultation with counsel, which may be in-house counsel)) be reasonably likely to result in the violation of any such Legal Requirement or Contract or be reasonably likely to cause such privilege or work product protection to be undermined with respect to such information or (B) could reasonably (in the good faith belief of the Company (after consultation with counsel, which may be in-house counsel)) be managed through the use of customary “clean-room” arrangements pursuant to which non-employee Representatives of Buyer could be provided access to such information.

8.2 Bulk Sales .

The Sale Order shall provide either that (i) Sellers have complied with the requirements of any Legal Requirement relating to bulk sales and transfer or (ii) compliance with the Legal Requirements relating to bulk sales and transfers is not necessary or appropriate under the circumstances.

8.3 Payments Received .

Sellers, on the one hand, and Buyer, on the other hand, each agree that, after the Closing, each will hold and will promptly transfer and deliver to the other, from time to time as and when received by them, any cash, checks with appropriate endorsements (using commercially reasonable efforts not to convert such checks into cash) or other property that they may receive on or after the Closing which belongs to the other and will account to the other for all such receipts.

8.4 Assumed Contracts: Adequate Assurance and Performance .

Buyer shall, and shall cause its Subsidiaries to, use commercially reasonable efforts to provide adequate assurance of the future performance by Buyer of each Assumed Contract as required under Section 365 of the Bankruptcy Code. Buyer and Sellers agree that they will promptly take all actions reasonably required to assist in obtaining a Bankruptcy Court finding that there has been an adequate demonstration of adequate assurance of future performance under the Assumed Contracts pursuant to Section 365 of the Bankruptcy Code, such as furnishing timely requested and factually accurate affidavits, non-confidential financial information and other documents or information for filing with the Bankruptcy Court and making Buyer’s and Sellers’ Representatives available to testify before the Bankruptcy Court.

8.5 Employee Matters

(a) Employees. Prior to the Closing Date, Buyer shall set initial terms and conditions of employment, including wages, benefits, job duties and responsibilities and

work assignment. Buyer shall determine which Employees, if any, to offer employment to, in its sole discretion. Only Employees who are offered and accept such offers of employment with Buyer based on the initial terms and conditions set by Buyer and further then actually commence employment with Buyer will become “ Buyer Employees ” after the Closing. Sellers shall terminate, or shall cause to be terminated, on or prior to the Closing Date the employment of all Employees who are offered and accept offers of employment with Buyer pursuant to this Section 8.5(a) . Notwithstanding the foregoing, nothing herein will, after the Closing Date, impose on Buyer any obligation to retain any Buyer Employee in its employment for any amount of time or on any terms and conditions of employment. The employment of each such Buyer Employee with Buyer (including any Buyer Employee who may be on leave of absence) will commence immediately after the Closing Date. Except as otherwise required by Legal Requirement, specified in this Agreement, or otherwise agreed in writing by Buyer, Buyer shall not be obligated to provide any severance, separation pay, or other payments or benefits, including any key employee retention payments, to any Employee on account of any termination of such Employee’s employment on or before the Closing Date, and such benefits (if any) shall remain obligations of Sellers.

(b) Access to Information . Subject to Section 7.11 , after the Execution Date, Sellers shall provide Buyer, its Affiliates, and their Representatives with reasonable access to the Employees and with information, including employee records and Benefit Plan data, reasonably requested by Buyer and such Affiliates, except as otherwise prohibited by Legal Requirements.

(c) Benefit Plans . Buyer shall assume all obligations under, and Liabilities with respect to, any Benefit Plans set forth on Schedule 8.5(c) (such schedule to be provided to Sellers by Buyer not later than five (5) Business Days prior to the Bid Deadline) (such plans, the “ Buyer Benefit Plans ”) consistent with Section 2.3(e) of this Agreement as Assumed Liabilities. The Buyer Benefit Plans shall be assumed by and assigned to Buyer as of the Closing Date (or such Buyer Affiliates as Buyer so directs) in the manner described in this Agreement. To the extent that service is relevant for purposes of eligibility and vesting, but not accrual under any employee benefit plan, program, policy or arrangement of Buyer or its Subsidiaries, Buyer shall credit (or cause to be credited) the Buyer Employees for service earned prior to the Closing with Sellers in addition to service earned with Buyer on and after the Closing. To the extent the Buyer Employees and their eligible dependents enroll in any welfare benefit plan of Buyer or its Subsidiaries, subject to the terms of any such plan, Buyer shall undertake commercially reasonable efforts to waive, or cause such waiver of, any preexisting condition limitations applicable to such Buyer Employees to the extent that Buyer Employee’s or eligible dependent’s condition would not have operated as a preexisting condition under the applicable corresponding welfare benefit plan as maintained by Sellers. In addition, subject to the terms the applicable welfare benefit plan of Buyer or its Subsidiaries, Buyer shall undertake commercially reasonable efforts to (i) waive all waiting periods under such welfare benefit plan otherwise applicable to the Buyer Employees and their eligible dependents, other than waiting periods that are in effect with respect to such individuals as of the Closing to the extent not satisfied under Sellers’ applicable Benefit Plans, and (ii) provide each Buyer Employee and his or her dependents with corresponding credit under such welfare benefit plan for any co-payments and deductibles paid by them under Sellers’ applicable corresponding Benefit Plans during the portion of the respective plan year prior to the Closing. At any time and from time to time after the Execution Date, Sellers and Buyer shall take, or cause to be taken, any and all actions

necessary to effectuate the terms of this Section 8.5(c) , including taking all action necessary to assign and assume and adopt each Buyer Benefit Plan in the manner contemplated by this Agreement effective as of the Closing. Prior to the Closing, Sellers shall reasonably cooperate with Buyer and its Affiliates and give commercially reasonable assistance as Buyer may reasonably request in order to effectuate the foregoing. Nothing herein shall prohibit Buyer or its Affiliates, as applicable, from terminating, amending, or otherwise affecting any Buyer Benefit Plan, at any time and from time to time following the Closing.

(d) Change in Control, Severance or Similar Benefits . Prior to the Closing Date, and to the extent necessary to implement this sentence, Sellers shall to the extent permitted by applicable Legal Requirements and, provided that the terms of the applicable Buyer Benefit Plan or any other agreement with the beneficiary under such Buyer Benefit Plan and any other applicable agreement or arrangement with the affected participant or beneficiary permit such amendments and other actions to be made unilaterally and without the consent of any other party, amend all Buyer Benefit Plans and take or cause to be taken all other actions as may be required or necessary to provide that (i) the transactions contemplated hereunder shall not constitute a “change in control” (or similar transaction) for purposes of providing or accelerating benefits or payments under any such Buyer Benefit Plans, and (ii) severance or separation payments and/or benefits (including payments of accrued vacation) shall not be payable to any Buyer Employee on account of the termination of such employee’s employment with Sellers, and that the termination by Sellers of any Buyer Employee shall not constitute a “separation from service” under Treasury Regulations Section 1.409A-1(h).

(e) Payroll Taxes . For purposes of payroll taxes with respect to the Buyer Employees, Sellers shall treat the transactions contemplated by this Agreement, as a transaction described in Treasury Regulation Sections 31.3121(a)(1)-1(b)(2) and 31.3306(b)(1)-(b)(2) (i.e., Buyer shall be treated as a successor for payroll tax purposes); and as such, Sellers and Buyer shall report on a predecessor/successor basis as set forth under the “Standard Procedure” provided in Section 4 of Revenue Procedure 2004-53, 2004-2 C.B. 320.

(f) WARN Act . With respect to Buyer Employees, Buyer will have full responsibility under the WARN Act relating to (i) any act or omission of Buyer after the Closing Date. With respect to the Employees, Sellers will have full responsibility under the WARN Act relating to any act or omission of Sellers prior to and on the Closing Date. Sellers shall be responsible for all other WARN Act Liabilities relating to the periods prior to and on the Closing Date, including any such Liabilities that result from Employees’ separation of employment from Sellers and/or Employees not becoming Buyer Employees pursuant to this Section 8.5 . Unless otherwise agreed to by Sellers and Buyer, Sellers agree to issue, no later than sixty (60) days prior to the Closing Date, all WARN Act notices, in a form acceptable to Buyer, to the Employees and all other parties required to receive notice under the WARN Acts.

(g) Collective Bargaining Agreements; Employee Benefits . Buyer does not accept or assume any Collective Bargaining Agreements to which any Seller is a party to or subject to, and expressly declines to be bound by or accept the terms of any such Collective Bargaining Agreements. Other than the Assumed Benefits, Buyer shall not be obligated to, and does not, accept or adopt any wage rates, employee benefits, employee policies, or any other terms and conditions of employment.

(h) No Third-Party Beneficiaries; Employment Status . All provisions contained in this Agreement with respect to employee benefit plans or compensation of Buyer Employees are included for the sole benefit of the respective parties hereto. Nothing contained herein (i) shall confer upon any former, current or future employee of Sellers or Buyer or any legal representative or beneficiary thereof any rights or remedies, including any right to employment or continued employment, of any nature, for any specified period; (ii) shall cause the employment status of any former, present or future Employee to be other than terminable at will; or (iii) shall confer any third party beneficiary rights upon any Buyer Employee or any dependent or beneficiary thereof or any heirs or assigns thereof.

8.6 Post-Closing Books and Records; Properties; and Personnel .

From and after the Closing Date for a period of one (1) year, each Party shall provide the other Parties (and their respective Representatives) with access, at reasonable times and in a manner so as not to unreasonably interfere with their normal business, to the assets, books, records, systems and other property and any employees of the other Parties so as to enable Buyer and Sellers to prepare Tax, financial or court filings or reports, to respond to court orders, subpoenas or inquiries, investigations, audits or other proceedings of Governmental Authorities, to prosecute and defend legal Actions or for other like purposes, including Claims, objections and resolutions, and to enable Sellers to wind down the Business. During such one (1) year period, each Party (and their respective Representatives) shall be permitted to make copies of any books and records described in this Section 8.6 , subject to the confidentiality requirements set forth in Section 7.1 . If any Party desires to dispose of any such books and records, such Party shall, thirty (30) days prior to such disposal, provide the other Party with a reasonable opportunity to remove or copy such records to be disposed of at the removing Party’s expense. Buyer shall retain such books and records for a period of six (6) years following the Closing.

8.7 Casualty Loss .

Notwithstanding any provision in this Agreement to the contrary, if, before the Closing, all or any portion of the Acquired Assets is condemned or taken by eminent domain, or is damaged or destroyed by fire, flood or other casualty, Sellers shall notify Buyer promptly in writing of such fact, and (a) in the case of condemnation or taking, Sellers shall assign or pay, as the case may be, any condemnation or taking proceeds thereof (of which are payable to Sellers) to Buyer at the Closing, and (b) in the case of fire, flood or other casualty to the Acquired Assets, Sellers shall, at Buyer’s option, either use insurance proceeds to restore such damage, or to the extent such proceeds were not previously applied, assign the insurance proceeds therefrom to Buyer at Closing.

8.8 Change of Name .

Promptly following the Closing, each Seller shall, and shall cause its direct and indirect Subsidiaries to, discontinue the use of its current name (and any other trade names or “d/b/a” names currently utilized by each Seller or its direct or indirect Subsidiaries) and shall not subsequently change its name to or otherwise use or employ any name which includes the words “Walter” without the prior written consent of Buyer, and each Seller shall cause the names of Sellers in the caption of the Bankruptcy Case to be changed to the new names of each Seller as

provided in the last sentence of this Section 8.8 ; provided , however , that each Seller and each of its direct and indirect Subsidiaries may use its current name (and any other trade name or “d/b/a” names currently utilized by each Seller or its direct or indirect Subsidiaries) included on any business cards, stationery and other similar materials following the Closing for a period of up to one hundred and eighty (180) days solely for purposes of winding down the affairs of each Seller, provided that when utilizing such materials, other than in incidental respects, each Seller and each of its direct and indirect Subsidiaries shall use commercially reasonable efforts to indicate its new name and reference its current name (and any other trade names or “d/b/a” names currently utilized by each Seller or its direct Subsidiaries) as “formally known as” or similar designation. From and after the Closing, except as otherwise set forth in this Agreement (including this Section 8.8 ), each Seller covenants and agrees not to use or otherwise employ any of the trade names, corporate names, “d/b/a” names or any mark that is confusingly similar to the Trademarks that (i) are rights utilized in the conduct of the Business and (ii) are Acquired Assets. Buyer acknowledges and agrees that, as of the Execution Date, it is not Buyer’s intention to use or otherwise use or employ any name which includes the words “Walter” in its conduct and operation of the Business and the Acquired Assets other than with respect to a transition period. Within ninety (90) days following the Closing, Sellers shall file, and shall cause its direct and indirect Subsidiaries to file, all necessary organizational amendments with the applicable Secretary of State of each Seller’s jurisdiction of formation and in each State in which each such Seller is qualified to do business and with the Bankruptcy Court to effectuate the foregoing.

8.9 No Successor Liability .

The Parties intend that, except as included in the Assumed Liabilities, upon the Closing, Buyer shall not be deemed to: (a) be the successor of or successor employer (as described under COBRA and applicable regulations thereunder) to Sellers, including with respect to any Collective Bargaining Agreements and any Benefit Plans (except for Buyer Benefit Plans), under the Coal Act, and any common law successor liability in relation to the UMWA 1974 Pension Plan, including with respect to withdrawal liability; (b) have, de facto , or otherwise, merged with or into Sellers; (c) be a mere continuation or substantial continuation of Sellers or the enterprise(s) of Sellers; or (d) be liable for any acts or omissions of Sellers in the conduct of the Business or arising under or related to the Acquired Assets other than as set forth in this Agreement. Without limiting the generality of the foregoing, and except as otherwise provided in this Agreement, the Parties intend that Buyer shall not be liable for any Encumbrances (other than Assumed Liabilities and Permitted Encumbrances) against any Seller or any of its predecessors or Affiliates, and that Buyer have no successor or vicarious liability of any kind or character whether known or unknown as of the Closing Date or whether fixed or contingent, existing or hereafter arising, with respect to the Business, the Acquired Assets or any Liabilities of any Seller arising prior to the Closing Date. The Parties agree that the provisions substantially in the form of this Section 8.9 shall be reflected in the Sale Order.

8.10 Liens .

Buyer agrees to direct that the liens securing the First Lien Obligations and the First Lien Adequate Protection Obligations and any debtor-in-possession financing liens be released and terminated with respect solely to (a) the Acquired Assets (or the Walter Coke Assets, the Blue Creek Assets or any other Non-Core Assets upon the closing of the sale thereof

to a Successful Bidder in accordance with the Sale Motion and Bidding Procedures, provided that such release and termination shall be solely with respect to such assets and such liens shall continue to attach to the proceeds from such sale in accordance with the Bankruptcy Code), (b) any Walter Coke Assets, upon the transfer of the Walter Coke Working Capital Assets to the Walter Coke Trust, if the Walter Coke Election or the Pre-Closing Walter Coke Election is made and there is no Successful Bidder for the Walter Coke Assets as determined in accordance with the Bidding Procedures or the sale of the Walter Coke Assets to a Successful Bidder or Backup Bidder (if any) for the Walter Coke Assets does not close and (c) any Non-Core Assets (excluding the Walter Coke Assets and the Blue Creek Assets), upon the transfer of Non-Core Assets to Buyer or the sale of such Non-Core Assets to a Successful Bidder or Backup Bidder (if any). For the avoidance of doubt, following payment of the Cash Consideration pursuant to Section 3.1(a) , Buyer acknowledges and agrees that none of the First Lien Lenders, the First Lien Noteholders, the Indenture Trustee or the Credit Agreement Agent may assert any Lien on or superpriority administrative claim against the Cash Consideration, notwithstanding anything in the Cash Collateral Orders to the contrary, and Buyer and Sellers hereby direct that the Cash Consideration, as a permitted use of Cash Collateral under and as defined in the Cash Collateral Orders, shall be deposited at Closing into the Wind Down Trust and utilized in accordance with Section 7.8(e) , including by any Chapter 7 trustee.

8.11 Other Agreements .

(a) Unless otherwise consented to in writing by Buyer in its sole discretion, Sellers shall not cause or permit any Non-Core Assets to be sold, assigned, transferred or otherwise conveyed to any Person other than Buyer, unless such Person assumes (and is capable of assumption and performance of) all Liabilities for Reclamation relating to any such Non-Core Assets to be sold.

(b) From and after the Closing, the Sellers shall irrevocably waive any right to use, utilize or otherwise access any funds or monies pursuant to any provisions of the Cash Collateral Orders relating to the “Carve-Out.” The Sellers shall use best efforts to cause the Cash Collateral Orders to be modified to reflect the terms of this section, including by eliminating the Carve-Out.

(c) After Closing, Sellers agree to wind down their Chapter 11 estates in a process reasonably acceptable to Buyer and Buyer Designees. In particular, Sellers shall cause such wind down to be in the manner set forth in the Wind Down Trust Agreement and in substantial compliance with the Wind Down Budget (as defined in the Wind Down Trust Agreement) and for the periods contemplated thereby and thereafter such wind down may include conversion of their Chapter 11 cases to Chapter 7 cases, a dissolution of each of the Sellers under applicable state law or other actions; provided that any such conversion, dissolution or other actions shall not result in adverse tax consequences to Buyer and Buyer Designee. Notwithstanding the foregoing, nothing herein shall preclude the Sellers from acting in a manner consistent with their fiduciary obligations and available resources.

8.12 Insurance .

(a) With respect to any insurance policy included in the Acquired Assets pursuant to Section 2.1(y) , that, immediately prior to the Closing, by its terms provides coverage with respect to acts, omissions and events relating to the Acquired Assets and Assumed Liabilities, on the one hand, and Excluded Assets and/or Excluded Liabilities, on the other hand, (such insurance policies, the “ Shared Insurance Policies ”), Buyer shall use commercially reasonable efforts to provide Sellers and any applicable Affiliate of any Seller with access to coverage under such Shared Insurance Policies from and after the Closing for claims relating to acts, omissions, and events respecting any Excluded Assets and Excluded Liabilities (such claims, “ Excluded Insurance Claims ”). Buyer and Sellers agree that any Excluded Insurance Claims by Sellers and any applicable Affiliate of any Seller under any Shared Insurance Policy shall receive the same priority and be subject to any deductibles and retentions with all claims by Buyer under such Shared Insurance Policies (whether or not such Excluded Insurance Claims are made before or after any claims made by Buyer under the Shared Insurance Policies). Claims made by Sellers and any applicable Affiliate of any Seller and Buyer under the Shared Insurance Policies shall be treated on a pari passu basis.

(b) With respect to claims made under the Shared Insurance Policies, whether or not known or reported prior to the Closing, each of Sellers and Buyer shall report such claims directly to the applicable insurer (with a copy to the other Parties) and the reporting Party shall individually, and not jointly, assume and be responsible for the reimbursement liability (i.e., deductible or retention) and/or any retrospective premium charges associated with the claim so submitted by it, unless otherwise agreed in writing by the other Parties.

(c) Without limiting the provisions in this Section 8.12 , no Party shall be liable to any Person for claims, or portions of claims, not reimbursed by insurers under any insurance policy for any reason, including coinsurance provisions, deductibles, quota share deductibles, self-insured retentions, bankruptcy or insolvency of any insurance carrier(s), policy limitations or restrictions (including exhaustion of limits), any coverage disputes, any failure to timely file a claim, or any defect in such claim or its processing.

8.13 Union Retiree Escrow Account . Subject to the satisfaction of the conditions set forth in that certain Letter Agreement dated February 3, 2016 by and between the UMWA and Buyer, as of the Closing Date, the Sellers shall establish an escrow account (the “ Union Retiree Escrow Account ”) which shall be funded by the Buyer in the amount of $2.6 million. The Union Retiree Escrow Account shall be used to satisfy claims for retiree benefits (as defined in section 1114 of the Bankruptcy Code) of the Sellers’ UMWA retirees incurred up to and including the Closing Date (the “ Termination Date ”), which claims are unpaid as of the Closing Date. The claims funded by the Union Retiree Escrow Account shall include any claims that are submitted by the Sellers’ UMWA retirees for processing by any third party providers after the Closing Date for services provided to Sellers prior to and including on the Termination Date (collectively, the “ Accrued Claims ”). A retiree benefit is deemed an Accrued Claim on the date of the provision of such health services, drugs, materials, or supplies. All costs associated with the maintenance and administration of the Union Retiree Escrow Account shall be paid with funds in the Union Retiree Escrow Account. From and after the Closing Date and until the date which is one hundred eighty (180) days after the Closing Date (the “ Escrow Termination Date ”), the Union Retiree Escrow Account shall be used to satisfy Accrued Claims. The Sellers shall request that American Behavioral Benefits Managers, Inc., Blue Cross and Blue Shield of

Alabama, CaremarkPCS Health, LLC and Silverscript Insurance Company provide notice to the providers in its systems that all retiree benefits claims must be submitted in this 180-day time period. Upon the Escrow Termination Date, any remaining funds in the Union Retiree Escrow Account shall be paid to the Buyer.

8.14 Active Employee Runoff Claims Escrow Account . The Sellers shall establish an escrow account (the “ Active Employee Runoff Claims Escrow Account ”) which shall be funded by the Buyer in the amount of $2.0 million. The Active Employee Runoff Claims Escrow Account shall be used to satisfy the claims of employees of the Sellers who are employed as of the Closing Date in the Business and employees of Black Warrior Methane Corp. and Black Warrior Transmission Corp. who are employed as of the Closing Date, together with their eligible spouses and dependents, and former employees who were employed in the Business, Black Warrior Methane Corp. or Black Warrior Transmission Corp. and who are qualified beneficiaries under COBRA entitled to coverage as of the date that their Accrued Runoff Claims were incurred or otherwise entitled to coverage under the applicable Benefit Plan as of the date that their Accrued Runoff Claims were incurred, together with their eligible spouses and dependents (collectively, the “ Active Employees ”) incurred up to and including the Closing Date (the “ Services Termination Date ”) and which Active Employee claims are unpaid as of the Closing Date, including any claims that are submitted by the Active Employees for processing to Blue Cross and Blue Shield of Alabama after the Closing Date for medical and dental services provided to the Active Employees prior to and including on the Services Termination Date (collectively, the “ Accrued Runoff Claims ”). All costs associated with the maintenance and administration of the Active Employee Runoff Claims Escrow Account shall be paid with funds in the Active Employee Runoff Claims Escrow Account. From and after the Closing Date and until the date which is one hundred eighty (180) days after the Closing Date (the “ Active Employee Runoff Claims Escrow Termination Date ”), the Active Employee Runoff Claims Escrow Account shall be used to satisfy Accrued Runoff Claims. The Sellers shall request that Blue Cross and Blue Shield of Alabama provide notice to the providers in its systems that all Accrued Runoff Claims must be submitted in this 180-day time period. Upon the Active Employee Runoff Claims Escrow Termination Date, any funds remaining in the Active Employee Runoff Claims Escrow Account shall be paid to the Buyer.

ARTICLE 9

C ONDITIONS P RECEDENT TO O BLIGATIONS OF B UYER TO C LOSE

The obligations of Buyer to consummate the transactions contemplated by this Agreement are subject to fulfillment, at or prior to the Closing, of each of the following conditions, any one or more of which may be waived by Buyer in writing, in its sole and absolute discretion:

9.1 Accuracy of Representations .

The representations and warranties of Sellers set forth in Article 5 shall be true and correct in all respects (without giving effect to any qualification as to materiality or Material Adverse Effect) on and as of the Closing Date with the same effect as though such

representations and warranties had been made on and as of the Closing Date (provided that representations and warranties which are confined to a specified date shall speak only as of such date); provided , however , that in the event of a breach of a representation or warranty, the condition set forth in this Section 9.1 shall be deemed satisfied unless the effect of all such breaches of representations and warranties taken together results in a Material Adverse Effect. Buyer shall have received a certificate of Sellers to such effect signed by a duly authorized officer of each Seller.

9.2 Sellers’ Performance .

The covenants and agreements that Sellers are required to perform or to comply with pursuant to this Agreement at or prior to the Closing shall have been performed and complied with in all material respects and Buyer shall have received a certificate of Sellers to such effect signed by a duly authorized officer thereof.

9.3 No Order .

No Governmental Authority shall have enacted, issued, promulgated, decreed or entered any Order from and after the Execution Date, which is in effect and has the effect of prohibiting (or delaying beyond the Outside Date) the consummation of the transactions contemplated by this Agreement.

9.4 Governmental Authorizations .

(a) To the extent that the HSR Act is applicable, any waiting period (and any extension thereof) under the HSR Act and the antitrust legislation of any other relevant jurisdiction applicable to the purchase of the Acquired Assets or the Business contemplated by this Agreement shall have expired or shall have been terminated; and

(b) Subject to Section 2.5 , (i) all of the Closing Required Permits shall have been transferred to, or obtained by, Buyer or (ii) with respect to any Transferred Permits that have not been transferred at or prior to Closing, Buyer shall have the right to conduct, pursuant to Section 7.9 , mining operations following the Closing on the applicable Real Property.

9.5 Sellers’ Deliveries .

Each of the deliveries required to be made to Buyer pursuant to Section 4.3 shall have been so delivered.

9.6 Sale Order .

Subject to Section 2.5 , the Bankruptcy Court shall have entered the Sale Order in form and substance, including with respect to all findings of fact and conclusions of law, acceptable to Sellers and Buyer, and the Sale Order shall have become a Final Order.

9.7 Assumed Contracts .

The Bankruptcy Court shall have approved and authorized, other than with respect to Cure Costs, the assumption and assignment of each Assumed Contract, except as would not have a material effect on the Business from and after the Closing.

9.8 Material Adverse Effect .

Since the Execution Date, no Material Adverse Effect shall have occurred.

9.9 UMWA; USW .

(a) (i) the Bankruptcy Court shall have determined that Sellers can sell the Acquired Assets free and clear of any successor clause in the UMWA Collective Bargaining Agreements, (ii) the UMWA shall have agreed to waive or remove the successor clause in the UMWA Collective Bargaining Agreements, or (iii) the Bankruptcy Court shall have granted a motion acceptable to Buyer filed by the applicable Seller pursuant to Section 1113(c) of the Bankruptcy Code authorizing the applicable Seller to reject the UMWA Collective Bargaining Agreements; and

(b) Prior to Closing the USW will have successfully ratified and executed an initial Collective Bargaining Agreement with Buyer, with all terms and conditions therein being acceptable to Buyer as determined by Buyer in its sole discretion; and

(c) (i) the Bankruptcy Court shall have determined that Sellers can sell the Acquired Assets free and clear of any successor clause in the USW Collective Bargaining Agreements, (ii) the USW shall have agreed to waive or remove the successor clause in the USW Collective Bargaining Agreements, or (iii) the Bankruptcy Court shall have granted a motion acceptable to Buyer filed by the applicable Seller pursuant to Section 1113(c) of the Bankruptcy Code authorizing the applicable Seller to reject the USW Collective Bargaining Agreements.

(d) In the event that (i) the Walter Coke Election or the Pre-Closing Walter Coke Election is made by Buyer or (ii) there is a Successful Bidder (other than Buyer or a Buyer Designee) for the Walter Coke Assets and such sale closes, Section 9.9(b) shall not be applicable. In addition, if there is a Successful Bidder (other than Buyer or a Buyer Designee) for the Walter Coke Assets and such sale closes, upon the final closing date of such sale Buyer agrees at that time to waive Section 9.9(c) ; provided however, Sellers take all steps to satisfy Section 9.9(c) until Buyer waives Section 9.9(c) .

ARTICLE 10

C ONDITIONS P RECEDENT TO THE O BLIGATION OF S ELLERS TO C LOSE

The obligations of Sellers to consummate the transactions contemplated by this Agreement are subject to fulfillment, at or prior to the Closing, of each of the following conditions, any one or more of which may be waived by Sellers in writing, in their sole and absolute discretion:

10.1 Accuracy of Representations .

The representations and warranties of Buyer set forth in Article 6 shall be true and correct in all respects (without giving effect to any qualification as to materiality or Material Adverse Effect) on and as of the Closing Date with the same effect as though such representations and warranties had been made on and as of the Closing Date (provided that representations and warranties which are confined to a specified date shall speak only as of such date); provided , however , that in the event of a breach of a representation or warranty, the condition set forth in this Section 10.1 shall be deemed satisfied unless the effect of all such breaches of representations and warranties taken together results in a material adverse effect on the ability of Buyer to consummate the transactions contemplated by this Agreement. Sellers shall have received a certificate of Buyer to such effect signed by a duly authorized officer of Buyer.

10.2 Buyer’s Performance .

The covenants and agreements that Buyer is required to perform or to comply with pursuant to this Agreement at or prior to the Closing shall have been performed and complied with in all material respects, and Sellers shall have received a certificate of Buyer to such effect signed by a duly authorized representative thereof.

10.3 No Order .

No Governmental Authority shall have enacted, issued, promulgated, decreed, or entered any Order from and after the Execution Date, which is in effect and has the effect of prohibiting (or delaying beyond the Outside Date) the consummation of the transactions contemplated by this Agreement.

10.4 Governmental Authorizations .

(b) Subject to Section 2.5 , (i) all of the Closing Required Permits shall have been transferred to, or obtained by, Buyer or (ii) with respect to any Transferred Permits that have not been transferred at or prior to Closing, Buyer shall have the right to conduct, pursuant to Section 7.9 , mining operations immediately following the Closing on the Real Property.

10.5 Buyer’s Deliveries .

Each of the deliveries required to be made to Sellers pursuant to Section 4.2 shall have been so delivered.

10.6 Sale Order . Subject to Section 2.5 , the Bankruptcy Court shall have entered the Sale Order in form and substance, including with respect to all findings of fact and conclusions of law, acceptable to Sellers and Buyer, and the Sale Order shall have become a Final Order.

10.7 Release . Sellers shall have received a release on substantially the same terms as the release provided by the Buyer as set forth in Section 12.16(a) , (c) and (d) executed by each of the members of the Steering Committee, the Credit Agreement Agent (on behalf of itself) and the Indenture Trustee (on behalf of itself) as of the Closing Date.

10.8 Global Settlement . The Buyer shall have complied in all material respects with all obligations required to be performed by the Buyer on or prior to the Closing Date pursuant to the Global Settlement (as defined in the Debtors ’ Motion for an Order Approving Global Settlement Among the Debtors, Official Committee of Unsecured Creditors, Steering Committee and Stalking Horse Purchaser Pursuant to Fed. R. Bankr. P. 9019 ).

ARTICLE 11

T ERMINATION

11.1 Termination Events .

Notwithstanding anything to the contrary in this Agreement, this Agreement may be terminated at any time prior to the Closing only as follows (for the avoidance of doubt, if the auction contemplated by the Bidding Procedures has occurred and Buyer is not the Successful Bidder but has been declared the Backup Bidder, Buyer agrees that it will not exercise its termination rights hereunder pursuant to Section 11.1(b)(ii) or (iii) , until the earliest of (x) the Alternative Outside Date (as defined below), if applicable, (y) the closing of the sale to either the Successful Bidder or Buyer) or (z) the Outside Date, if applicable.

(a) by mutual written consent of Sellers and Buyer;

(b) by written notice from either Sellers or Buyer:

(i) if a Governmental Authority issues a final, non-appealable ruling or Order permanently restraining, enjoining or otherwise prohibiting consummation of the transactions contemplated hereby where such ruling or Order was not requested, encouraged or supported by any of Sellers or Buyer; provided that the right to terminate this Agreement under this Section 11.1(b)(i) shall not be available to any Party whose willful failure to fulfill any obligation under this Agreement shall have been the cause of, or shall have resulted in, the failure of the Closing to occur on or prior to the Outside Date;

(ii) if the Closing shall not have occurred on or prior to April 1, 2016 (the “ Outside Date ”);

(iii) if at the end of the auction contemplated by the Bidding Procedures, Buyer is not determined by Sellers to be the (A) Successful Bidder or (B) Backup Bidder with respect to the Acquired Assets; provided that in the event Buyer is determined to be the Backup Bidder with respect to the Acquired Assets, then,

this Agreement will terminate automatically without further action by any Party upon the earlier to occur of (X) the closing of a Successful Bid and (Y) the date that is sixty (60) days after the date of the sale hearing contemplated by the Bidding Procedures (the “ Alternative Outside Date ”);

(iv) if the Bankruptcy Court shall have entered an Order dismissing, or converting into cases under chapter 7 of the Bankruptcy Code, any of the cases commenced by Sellers under chapter 11 of the Bankruptcy Code and comprising part of the Bankruptcy Case;

(v) upon the occurrence of any Termination Event (as defined in the Cash Collateral Orders);

(vi) upon the date that is fourteen (14) days prior to the Bid Deadline, unless Buyer and Sellers shall have reached agreement in their sole discretion on the Sale Order;

(vii) March 30, 2016, unless Buyer and Sellers shall have reached agreement in their sole discretion on the Transition Services Agreement; or

(viii) upon the final, non-appealable ruling or denial of the Governmental Authorizations described in Sections 9.4 and 10.4 and required to be obtained by Closing.

(i) if any of the events set forth in clauses (a) through (d) of Section 7.5 shall not have occurred by the respective dates set forth therein;

(ii) other than as contemplated by the Sale Motion or Bidding Procedures Order, if any Seller seeks to have the Bankruptcy Court enter an Order dismissing, or converting into cases under chapter 7 of the Bankruptcy Code, any of the cases commenced by Sellers under chapter 11 of the Bankruptcy Code and comprising part of the Bankruptcy Case, or if a responsible officer or an examiner with enlarged powers is appointed (other than a fee examiner) relating to the operation of Sellers’ businesses pursuant to Section 1104 of the Bankruptcy Code and the order of appointment is not vacated or reversed within fourteen (14) days after the entry thereof;

(iii) in the event of any breach of, or failure to perform, by Sellers of any of their agreements, covenants, representations or warranties contained herein or in the Sale Order, which breach or failure to perform (A) would result in a condition set forth in Article 9 not to be satisfied and (B) cannot be cured within ten (10) Business Days after Buyer notifies Sellers of such breach in writing; provided that Buyer shall not have a right of termination pursuant to this Section 11.1(c)(iii) if it is then in material breach of any of its agreements, covenants, representations or warranties contained herein or in the Sale Order; or

(iv) if, Buyer (other than as a result of (1) Buyer’s own breach of this Agreement or (2) the disallowance or avoidance of a substantial portion of the First Lien Obligations and/or the Prepetition First Priority Liens (as defined in the Cash Collateral Orders)) is unable, pursuant to Section 363(k) of the Bankruptcy Code, to credit bid in payment of all or any portion of the Purchase Price as set forth in Section 3.1 (other than the Assumed Liabilities and the cash portion of the Purchase Price); provided , that the inability to credit bid post-petition interest payable under Section 506(b) of the Bankruptcy Code or any other amount not in excess of $1,000,000 shall not give rise to a termination right under this Section 11.1(c)(iv) .

(d) by written notice from Sellers:

in the event of any breach of, or failure to perform, by Buyer of any of its agreements, covenants, representations or warranties contained herein or in the Sale Order, which breach or failure to perform (A) would result in a condition set forth in Article 10 not to be satisfied and (B) cannot be cured within ten (10) Business Days after Sellers notify Buyer of such breach in writing; provided that Sellers shall not have a right of termination pursuant to this Section 11.1(d) if Sellers are then in material breach of any of their agreements, covenants, representations or warranties contained herein or in the Sale Order.

Each condition set forth in this Section 11.1 shall be considered separate and distinct from each other such condition. If more than one of the termination conditions set forth in this Section 11.1 are applicable, the applicable party shall have the right to choose the termination condition pursuant to which this Agreement is to be terminated.

11.2 Effect of Termination .

(a) In the event of termination of this Agreement by Buyer or Sellers pursuant to this Article 11 , this Agreement shall become null and void and have no effect, and all rights and obligations of the Parties under this Agreement shall terminate without any Liability of any Party to any other Party (other than as expressly provided herein); provided , that the provisions of Sections 7.1(c) (Access and Reports; Confidentiality), 7.6 (Expense Reimbursement), 12.9 (Expenses), 12.10 (Governing Law, Consent to Jurisdiction and Venue; Jury Trial Waiver), and 12.16 (No Liability) and this Section 11.2 (and, to the extent applicable to the interpretation or enforcement of such provisions, Article 1), shall expressly survive the termination of this Agreement.

(b) Subject in all respects to the Bidding Procedures Order, Sellers shall pay to Buyer the Expense Reimbursement by wire transfer of immediately available funds immediately upon the first to occur of: (i) the earlier of (x) the consummation by Sellers of an Alternative Transaction and (y) the date that is 60 days following Bankruptcy Court approval of an Alternative Transaction, in each case, following termination of this Agreement pursuant to Section 11.1(b)(iii) ; (ii) termination of this Agreement (other than a termination pursuant to Section 11.1(b)(i) or (iii) ) if, as of such termination, any Seller (but not Buyer) was in breach of any of its representations, warranties, covenants or other agreements under this Agreement so as to cause any of the conditions set forth in Article 9 not to be satisfied; or (iii) if this Agreement is

terminated (other than as set forth in clauses (i) and (ii) above or as a result of Buyer’s breach of any of its representations, warranties, covenants or other agreements under this Agreement so as to cause any of the conditions set forth in Article 10 not to be satisfied), then upon consummation by Sellers of an Alternative Transaction within nine (9) months of such termination (any such event, a “ Protection Event ”); provided that under no circumstances shall Sellers be obligated to pay the Expense Reimbursement more than once; and provided , further that, if Sellers fail to pay any amounts due to Buyer pursuant to this Section 11.2(b) within the time period specified herein, Sellers shall pay the costs and expenses (including reasonable legal fees and expenses) incurred by Buyer in connection with any Action or Proceeding taken to collect payment of such amounts, together with interest on such unpaid amounts at the Applicable Rate, calculated on a daily basis from the date such amounts were required to be paid until the date of actual payment. Notwithstanding anything herein, upon payment by Sellers of the Expense Reimbursement pursuant to this Section 11.2(b) , Buyer shall be precluded from any other remedy against Sellers, at law or in equity or otherwise, and Buyer shall not seek to obtain any other recovery, judgment or damages of any kind against Sellers in connection with this Agreement, the other Transaction Documents or the transactions contemplated hereby or thereby.

(c) The Parties acknowledge and agree that any payment of the Blue Creek Bid Protections pursuant to Section 7.8(b)(ii) and the Expense Reimbursement described in this Section 11.2 shall constitute liquidated damages (and not a penalty) and shall be deemed to be the sole and exclusive remedy of Buyer and any other Person against Sellers in connection with this Agreement and the transactions contemplated hereby, and each Seller’s respective former, current or future equity holders, controlling persons, directors, officers, employees, agents, general or limited partners, managers, management companies, members, stockholders, Affiliates or assignees and any and all former, current or future equity holders, controlling persons, directors, officers, employees agents, general or limited partners, managers, management companies, members, stockholders, Affiliates or assignees of any of the foregoing, and any and all former, current or future heirs, executors, administrators, trustees, successors or assign of any of the foregoing, and each Affiliate, officer, director, employee, controlling person, advisor, agent, attorney or representatives of any such Person (each, a “ Related Party ” and, collectively, the “ Related Parties ”), and no Related Party of any Seller shall have any Liability or obligation (including any Liability or obligation to pay the Blue Creek Bid Protections and the Expense Reimbursement) for any or all damages suffered or incurred by Buyer or any other Person in connection with this Agreement (and the termination hereof), the transactions contemplated by this Agreement (and the abandonment thereof) or any matter forming the basis for such termination, and, upon payment of the Blue Creek Bid Protections and the Expense Reimbursement under such circumstances to Buyer, neither Buyer nor any other Person shall be entitled to bring or maintain any other legal Action against Sellers or any Related Party of any Seller and none of Sellers or any Related Party of any Seller shall have any further Liability or obligation to Buyer arising out of this Agreement or any of the transactions contemplated hereby or any matters forming the basis for such termination. The Parties acknowledge and agree that (i) the agreements contained in this Section 11.2(c) are an integral part of this Agreement and the transactions contemplated hereby and (ii) in light of the difficulty of accurately determining actual damages with respect to the foregoing, the right to any such payment of the Blue Creek Bid Protections and the Expense Reimbursement constitute a reasonable estimate of the damages that will compensate Buyer in the circumstances in which such fees are payable for the efforts and resources expended and the opportunities foregone while negotiating this Agreement and in reliance on this Agreement and on the expectation of the consummation of the transactions contemplated by this Agreement.

ARTICLE 12

G ENERAL P ROVISIONS

12.1 Survival .

All covenants and agreements contained herein which by their terms are to be performed in whole or in part, or which prohibit actions, subsequent to the Closing shall, solely to the extent such covenants and agreements are to be performed, or prohibit actions, subsequent to the Closing, survive the Closing in accordance with their terms until fully performed or satisfied. All other covenants and agreements contained herein, and all representations and warranties contained herein or in any certificated deliveries hereunder shall not survive the Closing and shall thereupon terminate, including any Actions for damages in respect of any breach thereof.

12.2 Confidentiality .

Following the Closing, each Seller agrees not to, and to cause its Subsidiaries not to, disclose any confidential or non-public information concerning the Acquired Assets, the Business, the negotiation or existence and terms of this Agreement or the business affairs of Buyer or the Assumed Liabilities (“ Confidential Information ”) except disclosure of Confidential Information that (a) was or is lawfully obtained from a source that, to the knowledge of such Seller, was not under an obligation of confidentiality to Buyer with respect to such information, (b) is independently developed by such Seller without violating any of its obligations under this Agreement, (c) is or becomes available to the public, (d) is or may be necessary to wind down any of Sellers’ estates, or in connection with the enforcement of the rights of, or the defense of any Proceeding against or involving, any Seller provided that the Confidential Information is afforded confidential treatment, (e) primarily relates to any Excluded Assets and/or Excluded Liabilities, (f) is or may be necessary in connection with the Bankruptcy Case provided that the Confidential Information is afforded confidential treatment or (g) is disclosed to a bidder in connection with an Alternative Transaction; provided , that the bidder in such Alternative Transaction agrees for the benefit of Buyer to maintain the confidentiality of the Confidential Information. Notwithstanding the foregoing, a Seller may disclose Confidential Information if such Seller believes (upon the advice of counsel) it is legally required to make such disclosure in order to comply with applicable law, regulation, rule or legal, judicial or administrative process (including any rule, regulation or policy statement of (i) any organized securities exchange, market or automated quotation system on which the Company’s securities are listed or quoted, (ii) any self-regulatory organization of which a party is a member) or (iii) in connection with the Bankruptcy Case. If a Seller or any of its Representatives becomes required (including by deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process) or it becomes necessary in connection with the Bankruptcy Case to disclose any of the Confidential Information, such Seller or Representative shall use reasonable efforts to provide Buyer with prompt notice, to the extent allowed by law, rule and regulation, of such requirement. Each Seller agrees to disclose only that portion of the Confidential Information which it believes it is necessary or required to disclose and to use commercially reasonable efforts to obtain confidential treatment of such Confidential Information.

12.3 Public Announcements .

Prior to the Closing, unless otherwise required by applicable Legal Requirement or by obligations of Buyer or Sellers or their respective Affiliates pursuant to any listing agreement with or rules of any securities exchange, Buyer, on the one hand, and Sellers, on the other hand, shall consult with each other before issuing any press release or otherwise making any public statement with respect to this Agreement or the transactions contemplated hereby and shall not issue any such release or make any such statement without the prior written consent of the other (such consent not to be unreasonably withheld, conditioned or delayed). From and after the Closing, the Parties may make public statements with respect to this Agreement or the transactions contemplated hereby so long as such announcements do not disclose the specific terms or conditions of this Agreement except where such terms and conditions have already been disclosed as required by Legal Requirement or by obligations of Buyer or Sellers or their respective Affiliates pursuant to any listing agreement with or rules of any securities exchange; provided , that the issuing party shall use its commercially reasonable efforts to consult with the other party with respect to the text thereof to the extent practicable.

12.4 Notices .

All notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if delivered personally or sent by overnight courier or facsimile transmission:

(a) If to Sellers, then to:

Walter Energy, Inc.

3000 Riverchase Galleria

Suite 1700

Birmingham, AL 35244

Attn: Earl H. Doppelt

Facsimile: (205)776-7859

with a copy (which shall not constitute notice) to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY 10019-6064

Attn: Kelley A. Cornish

Facsimile: 212-757-3990

and

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY 10019-6064

Attn: Ariel J. Deckelbaum

Toby S. Myerson

Facsimile: 212-757-3990

(b) If to Buyer:

Warrior Met Coal, LLC (f/k/a Coal Acquisition LLC)

c/o Daniel Fisher

Akin Gump Strauss Hauer & Feld LLP

1333 New Hampshire Avenue, N.W.

Washington, DC 20036

Facsimile: 202-887-4288

with a copy (which shall not constitute notice) to:

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

New York, NY 10036

Attn: Ira S. Dizengoff

Facsimile: 212-872-1002

and

Akin Gump Strauss Hauer & Feld LLP

1333 New Hampshire Avenue, N.W.

Washington, DC 20036

Attn: James Savin

Facsimile: 202-887-4288

or to such other person or address as any party shall specify by notice in writing to the other party. All such notices, requests, demands, waivers and communications shall be deemed to have been received on the date on which so personally-delivered or faxed or delivered by overnight courier.

12.5 Waiver .

Neither the failure nor any delay by any Party in exercising any right, power, or privilege under this Agreement or the documents referred to in this Agreement shall operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power, or privilege shall preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege. To the maximum extent permitted by Legal Requirements, (a) no waiver that may be given by a Party shall be applicable except in the specific instance for which it is given, and (b) no notice to or demand on one Party shall be deemed to be a waiver of any right of the Party giving such notice or demand to take further action without notice or demand.

12.6 Entire Agreement; Amendment .

This Agreement (including the Disclosure Schedules and the Exhibits), the Sale Order, the Bidding Procedures Order and the other Transaction Documents supersede all prior agreements between Buyer, on the one hand, and Sellers, on the other hand, with respect to its subject matter and constitute a complete and exclusive statement of the terms of the agreements between Buyer, on the one hand, and Sellers, on the other hand, with respect to their subject matter. This Agreement may not be amended, modified or supplements except by a written agreement executed by each of the Parties.

12.7 Assignment .

This Agreement, and the rights, interests and obligations hereunder, shall not be assigned by any Party by operation of law or otherwise without the express written consent of all of the other Parties (which consent may be granted or withheld in the sole discretion of such other Party) and any assignment in contravention of this Section 12.7 shall be null and void ab initio ; provided , however , that, subject to compliance with Section 4.4 , Buyer shall be permitted to assign all or part of its rights or obligations hereunder to one or more Buyer Designees without the prior consent of Sellers; provided , further , that Sellers shall be permitted to assign their rights hereunder in part to one or more Successful Bidders or to the acquiror of any Excluded Assets or Excluded Liabilities without the prior consent of Buyer; provided that no such assignment shall relieve Sellers from their liabilities or obligations hereunder, other than with respect to such Excluded Assets or Excluded Liabilities.

12.8 Severability .

The provisions of this Agreement shall be deemed severable, and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any Person or any circumstance, is invalid or unenforceable, (a) the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible; and (b) the remainder of this Agreement and the application of such provision to other Persons or circumstances shall not be affected by such invalidity or unenforceability.

12.9 Expenses .

Except as otherwise expressly provided in this Agreement, including Section 11.2 , whether or not the transactions contemplated by this Agreement are consummated, the Parties shall bear their own respective expenses (including all compensation and expenses of counsel, financial advisors, consultants, actuaries and independent accountants) incurred in connection with this Agreement and the transactions contemplated hereby.

12.10 Governing Law; Consent to Jurisdiction and Venue; Jury Trial Waiver .

(a) Except to the extent the mandatory provisions of the Bankruptcy Code apply, this Agreement shall be governed by, and construed in accordance with, the laws of

the State of New York applicable to contracts made and to be performed entirely in such state without regard to principles of conflicts or choice of laws or any other law that would make the laws of any other jurisdiction other than the State of New York applicable hereto.

(b) Without limitation of any Party’s right to appeal any Order of the Bankruptcy Court, (i) the Bankruptcy Court shall retain exclusive jurisdiction to enforce the terms of this Agreement and to decide any claims or disputes which may arise or result from, or be connected with, this Agreement, any breach or default hereunder, or the transactions contemplated hereby and (ii) any and all claims relating to the foregoing shall be filed and maintained only in the Bankruptcy Court, and the Parties hereby consent and submit to the exclusive jurisdiction and venue of the Bankruptcy Court and irrevocably waive the defense of an inconvenient forum to the maintenance of any such Action or Proceeding; provided , however , that, if the Bankruptcy Case has been closed pursuant to Section 350(a) of the Bankruptcy Code, all Actions and Proceedings arising out of or relating to this Agreement shall be heard and determined in a New York state court or a federal court sitting in the state of New York, and the Parties hereby irrevocably submit to the exclusive jurisdiction and venue of such courts in any such Action or Proceeding and irrevocably waive the defense of an inconvenient forum to the maintenance of any such Action or Proceeding. The Parties consent to service of process by mail (in accordance with Section 12.4 ) or any other manner permitted by law.

(c) THE PARTIES HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF SELLERS, BUYER OR THEIR RESPECTIVE REPRESENTATIVES IN THE NEGOTIATION OR PERFORMANCE HEREOF.

12.11 Counterparts .

This Agreement and any amendment hereto may be executed in two or more counterparts, each of which shall be deemed to be an original of this Agreement or such amendment and all of which, when taken together, shall constitute one and the same instrument. Notwithstanding anything to the contrary in Section 12.4 , delivery of an executed counterpart of a signature page to this Agreement or any amendment hereto by telecopier, facsimile or email attachment that contains a portable document format (.pdf) file of an executed signature shall be effective as delivery of a manually executed counterpart of this Agreement or such amendment, as applicable.

12.12 Parties in Interest; Third Party Beneficiaries; No Amendment .

This Agreement and the other Transaction Documents shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns. Except with respect to the parties released and/or exculpated pursuant to Section 12.16 , this Agreement and the other Transaction Documents are for the sole benefit of the Parties and their permitted assigns, and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable benefit, claim, cause of action, remedy or right of any kind. Notwithstanding anything to the contrary, nothing in this Agreement shall constitute an amendment to any Benefit Plan.

12.13 Remedies.

Neither the exercise of nor the failure to exercise a right of set-off or to give notice of a claim under this Agreement will constitute an election of remedies or limit Sellers or Buyer in any manner in the enforcement of any other remedies that may be available to any of them, whether at law or in equity.

12.14 Specific Performance.

Each Party recognizes that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed by them in accordance with the terms hereof or were otherwise breached, and that monetary damages alone would not be adequate to compensate the non-breaching Party or Parties for their injuries. Accordingly, a non-breaching Party shall be entitled to injunctive relief to enforce the terms and provisions of this Agreement. If any Action or Proceeding is brought by the non-breaching Party or Parties to enforce any of the terms or provisions of this Agreement pursuant to this Section 12.14 , the Party in breach shall waive the defense that there is an adequate remedy at law. Each Party agrees to waive any requirement for the security or posting of any bond in connection with any Action or Proceeding seeking specific performance of such terms or provisions and that the only permitted objection that it may raise in response to any action for specific performance of such terms or provisions is that it contests the existence of a breach or threatened breach of such provisions. The rights set forth in this Section 12.14 shall be in addition to any other rights which a Party may have at law or in equity pursuant to this Agreement.

12.15 Sellers’ Representative; Reliance.

Subject to entry of the Sale Order, Sellers, jointly and severally, hereby represent and warrant that the statements in this Section 12.15 are true and correct as of the Execution Date:

(a) The Company has been appointed, and is authorized, and empowered to act, in connection with, and to facilitate the consummation of, the transactions contemplated by this Agreement and the other Transaction Documents and in connection with any activities to be performed by Sellers under this Agreement and the other Transaction Documents, for the purposes and with the powers, and authority set forth in this Agreement, which will include the sole power and authority:

(i) to receive and distribute the Purchase Price or any other amount paid in connection with this Agreement or the other Transaction Documents to Sellers or to the Persons legally entitled thereto;

(ii) to enforce and protect the rights and interests of Sellers arising out of or under or in any manner relating to this Agreement and the other Transaction Documents (including in connection with any claims related to the transactions contemplated hereby and thereby) and, in connection therewith, to (A) assert any claim or institute any action, (B) investigate, defend, contest or litigate any action initiated by Buyer or any other Person pursuant to this Agreement and the other Transaction Documents and receive process on behalf of each Seller in any such action and compromise or settle on such terms as the Company will determine to be appropriate,

give receipts, releases and discharges on behalf of all or any Seller with respect to any such action, (C) file any proofs, debts, claims and petitions as the Company may deem advisable or necessary, (D) settle or compromise any claims related to the transactions contemplated by this Agreement and the other Transaction Documents, (E) assume, on each Sellers’ behalf, the defense of any claims related to the transactions contemplated by this Agreement and the other Transaction Documents, and (F) file and prosecute appeals from any decision, judgment or award rendered in any of the foregoing actions;

(iii) to enforce or refrain from enforcing any right of any Seller (prior to the Closing) and/or of the Company arising out of or under or in any manner relating to this Agreement or the other Transaction Documents;

(iv) to take any action to be taken by one or more Sellers under or in connection with this Agreement or the other Transaction Documents; or

(v) to make, execute, acknowledge and deliver all such other Contracts, guarantees, orders, receipts, endorsements, notices, requests, instructions, certificates, stock powers, letters and other writings, and, in general, to do any and all things and to take any and all action that the Company, in its sole and absolute discretion, may consider necessary or proper or convenient in connection with or to carry out the activities described in Section 12.15(a)(i) through Section 12.15(a)(iii) and the transactions contemplated by this Agreement and the Transaction Documents.

(b) The Company’s power and grant of authority is (i) coupled with an interest and is irrevocable and survives the bankruptcy or liquidation of any Seller and will be binding on any successor thereto; and (ii) may be exercised by the Company acting by signing as the representative of any Seller.

(c) Buyer and its Affiliates and representatives may conclusively and absolutely rely, without inquiry, upon the action of the Company as the action of each Seller (and may ignore any action taken or notice given by any Seller other than the Company) in all matters relating to this Agreement, the Transaction Documents or the transactions contemplated hereby and thereby. Any document delivered or notice delivered by or on behalf of Buyer or its Affiliates to, or action taken by or on behalf of Buyer or its Affiliates with respect to, the Company shall be deemed to have been delivered to, or taken with respect to, all Sellers. Any amounts to be paid by Buyer to Sellers pursuant to this Agreement shall be divided by Sellers among themselves, but may be paid by Buyer to the Company. Sellers shall be jointly and severally liable for any amounts due to be paid or owed by Sellers to Buyer pursuant to this Agreement.

12.16 No Liability; Releases .

(a) (i) No past, present or future director, officer, manager, employee, incorporator, member, partner or equityholder or other Affiliates of (A) Sellers (other than Sellers in their capacities as such), or (B) Buyer (other than any obligations hereunder or assumed herein), and (ii) none of the members of the Steering Committee, the First Lien Lenders,

100

the First Lien Noteholders, the Credit Agreement Agent, or the Indenture Trustee, in any case, shall have any Liability for any obligations or liabilities of Sellers or Buyer, as applicable, under this Agreement or any agreement, document or instrument entered into in connection herewith of or for any claim based on, in respect of, or by reason of, the transactions contemplated hereby and thereby. Any claim or cause of action based upon, arising out of, or related to this Agreement or any agreement, document or instrument contemplated hereby may only be brought against Persons that are expressly named as parties hereto or thereto, and then only with respect to the specific obligations set forth herein or therein. Other than the Parties, no other party shall have any Liability or obligation for any of the representations, warranties, covenants, agreements, obligations or liabilities of any party under this Agreement or the agreements, documents or instruments contemplated hereby or of or for any Legal Proceeding based on, in respect of, or by reason of, the transactions contemplated hereby or thereby (including the breach, termination or failure to consummate such transactions), in each case whether based on contract, tort, fraud, strict liability, other Legal Requirements or otherwise and whether by piercing the corporate veil, by a claim by or on behalf of a Party or another Person or otherwise.

(b) Effective upon the Closing Date, each Seller acknowledges that it has no claim, counterclaim, setoff, recoupment, action or cause of action of any kind or nature whatsoever against any of the individuals or entities within the Buyer Group, any member of the Steering Committee, any of the First Lien Lenders or the First Lien Noteholders, the Credit Agreement Agent, or the Indenture Trustee, that directly or indirectly arises out of, is based upon, or is in any manner connected with any Prior Event (collectively, the “ Seller Released Claims ”); and, should any Seller Released Claims nonetheless exist, each Seller hereby (i) releases and discharges each member of the Buyer Group, any member of the Steering Committee, each of the First Lien Lenders and the First Lien Noteholders, the Credit Agreement Agent and the Indenture Trustee from any liability whatsoever on such Seller Released Claims that directly or indirectly arises out of, is based upon, or is in any manner connected with a Prior Event, and (ii) releases, remises, waives and discharges all such Seller Released Claims against the Buyer Group, any member of the Steering Committee, each of the First Lien Lenders and the First Lien Noteholders, the Credit Agreement Agent and the Indenture Trustee; provided that nothing herein shall release the Buyer or a Seller of its obligations under this Agreement.

(c) Effective upon the Closing Date, Buyer acknowledges that it has no claim, counterclaim, setoff, recoupment, action or cause of action of any kind or nature whatsoever against any of the individuals or entities within the Sellers Group, that directly or indirectly arises out of, is based upon, or is in any manner connected with any Prior Event (collectively, the “ Buyer Released Claims ”); and, should any Buyer Released Claims nonetheless exist, Buyer hereby (i) releases and discharges each member of the Sellers Group from any liability whatsoever on such Buyer Released Claims that directly or indirectly arises out of, is based upon, or is in any manner connected with a Prior Event, and (ii) releases, remises, waives and discharges all such Buyer Released Claims against the Sellers Group.

(d) Without limiting in any way the scope of the release contained in subparagraph (a),(b) or (c) of this Section 12.16 and effective upon the Closing Date, each Seller and Buyer, to the fullest extent allowed under applicable law, hereby waives and relinquishes all statutory and common law protections purporting to limit the scope or effect of a general release, whether due to lack of knowledge of any claim or otherwise, including, waiving and

101

relinquishing the terms of any law which provides that a release may not apply to material unknown Claims. Each Seller and Buyer hereby affirms its intent to waive and relinquish such unknown Claims and to waive and relinquish any statutory or common law protection available in any applicable jurisdiction with respect thereto. Notwithstanding anything set forth herein to the contrary, the releases set forth in this Section 12.16 do not extend to (A) any obligations that are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the willful misconduct, fraud or gross negligence of such Person, (B) any obligations of the Parties under this Agreement or (C) any claims held by the First Lien Lenders, the First Lien Noteholders, the Credit Agreement Agent or the Indenture Trustee against the Sellers which constitute First Lien Obligations and the First Lien Adequate Protection Obligations or are related thereto, including the rights of the Credit Agreement Agent under Section 12.06 and 13.01 of the Credit Agreement and the rights of the Indenture Trustee under Sections 7.06 and 10.02 of the Indenture, but excluding the First Lien Obligations and the First Lien Adequate Protection Obligations which are included in the Credit Bid and Release) and any rights, remedies or causes of action arising out of such claims or Liens and security interests relating to such claims; provided that any claims, including First Lien Obligations and First Lien Adequate Protection Obligations, or any Liens or superpriority claims related thereto that would otherwise attach or be payable out of the Cash Consideration, shall be waived, and the Buyer and Sellers hereby direct that the Cash Consideration, as a permitted use of Cash Collateral under and as defined in the Cash Collateral Orders, be deposited into the Wind Down Trust at Closing and utilized in accordance with Section 7.8(e) , including by any Chapter 7 trustee.

[ Signature pages follow. ]

102

I N W ITNESS W HEREOF , the Parties have caused this Asset Purchase Agreement to be executed and delivered by their duly authorized representatives, all as of the Execution Date.


WARRIOR MET COAL, LLC

By:	/s/ Stephen D. Williams
Name:	Stephen D. Williams
Title:	Authorized Person and Chief Executive Officer

WARRIOR MET COAL GAS, LLC
WARRIOR MET COAL MINING, LLC
WARRIOR MET COAL TRI, LLC
WARRIOR MET COAL BCE, LLC
WARRIOR MET COAL LAND, LLC
WARRIOR MET COAL WV, LLC
WARRIOR MET COAL LA, LLC

By:	Warrior Met Coal Intermediate Holdco, LLC, its sole member

	By: Warrior Met Coal, LLC, its sole member

	By:	/s/ Stephen D. Williams
	Name:	Stephen D. Williams
	Title:	Authorized Person and Chief Executive Officer

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER ENERGY INC.

By:		/s/ Walter J. Scheller
Name:		Walter J. Scheller
Title:		Chief Executive Officer

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


ATLANTIC DEVELOPMENT AND CAPITAL, LLC

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Controller

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


ATLANTIC LEASECO, LLC

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		Vice President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


BLUE CREEK COAL SALES, INC.

By:		/s/ Michael T. Madden
Name:		Michael T. Madden
Title:		President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


BLUE CREEK ENERGY, INC.

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		Vice President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


JEFFERSON WARRIOR RAILROAD COMPANY, INC.

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Controller

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


JIM WALTER HOMES, LLC

By:		/s/ William G. Harvey
Name:		William G. Harvey
Title:		Manager

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


JIM WALTER RESOURCES, INC.

By:		/s/ Richard A. Donnelly
Name:		Richard A. Donnelly
Title:		President and Chief Operating Officer

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


J.W. WALTER, INC.

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


MAPLE COAL CO., LLC

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		Vice President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


SLOSS-SHEFFIELD STEEL AND IRON COMPANY

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Controller

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


SP MACHINE, INC.

By:		/s/ William G. Harvey
Name:		William G. Harvey
Title:		President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


TAFT COAL SALES & ASSOCIATES, INC.

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		Vice President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


TUSCALOOSA RESOURCES, INC.

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		Vice President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


V MANUFACTURING COMPANY

By:		/s/ William G. Harvey
Name:		William G. Harvey
Title:		President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER BLACK WARRIOR BASIN LLC

By:		/s/ William G. Harvey
Name:		William G. Harvey
Title:		Manager

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER COKE, INC.

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Controller

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER ENERGY HOLDINGS, LLC

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Manager

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER EXPLORATION & PRODUCTION LLC

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Manager

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER HOME IMPROVEMENT, INC.

By:		/s/ William G. Harvey
Name:		William G. Harvey
Title:		President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER LAND COMPANY

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER MINERALS, INC.

By:		/s/ Kathy H. Love
Name:		Kathy H. Love
Title:		Vice President

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT


WALTER NATURAL GAS, LLC

By:		/s/ Brian M. Chopin
Name:		Brian M. Chopin
Title:		Manager

S IGNATURE P AGE TO A MENDED AND R ESTATED A SSET P URCHASE A GREEMENT

Exhibit 10.1

ASSET-BASED REVOLVING CREDIT AGREEMENT

Dated as of April 1, 2016

among

WARRIOR MET COAL, LLC

as Holdings

WARRIOR MET COAL, LLC

and certain of its Subsidiaries,

as the Borrowers

THE GUARANTORS PARTY HERETO

CITIBANK, N.A.,

as Administrative Agent

CITIBANK, N.A.,

as Swingline Lender

CITIBANK, N.A.

and

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as L/C Issuers

The Other Lenders Party Hereto

and

CITIGROUP GLOBAL MARKETS INC.

and

CREDIT SUISSE SECURITIES (USA) LLC,

as Joint Lead Arrangers and Joint Bookrunners

TABLE OF CONTENTS


		P AGE

ARTICLE 1	DEFINITIONS AND ACCOUNTING TERMS		2

Section 1.01.	Defined Terms		2

Section 1.02.	Other Interpretive Provisions		44

Section 1.03.	Accounting Terms		45

Section 1.04.	Times of Day		45

Section 1.05.	Timing of Payment or Performance		45

Section 1.06.	Letter of Credit Amounts		45

Section 1.07.	Reserves		45

Section 1.08.	Pro Forma Calculations		46

ARTICLE 2	THE COMMITMENTS AND CREDIT EXTENSIONS		47

Section 2.01.	Loans		47

Section 2.02.	Borrowings, Conversions and Continuations of Loans		47

Section 2.03.	Protective Advances		48

Section 2.04.	Letters of Credit		49

Section 2.05.	Swingline Loans		57

Section 2.06.	Prepayments		59

Section 2.07.	Termination or Reduction of Commitments		61

Section 2.08.	Repayment of Loans		61

Section 2.09.	Interest		61

Section 2.10.	Fees		62

Section 2.11.	Computation of Interest and Fees		62

Section 2.12.	Evidence of Debt		62

Section 2.13.	Payments Generally; Administrative Agent’s Clawback		63

Section 2.14.	Sharing of Payments by Lenders		64

Section 2.15.	Increase in Facility		65

Section 2.16.	Defaulting Lender		66

ARTICLE 3	TAXES, YIELD PROTECTION AND ILLEGALITY		68

Section 3.01.	Taxes		68

Section 3.02.	Illegality		71

Section 3.03.	Inability to Determine Rates		72

TABLE OF CONTENTS

(continued)


		P AGE

Section 3.04.	Increased Costs; Reserves on Eurocurrency Rate Loans		72

Section 3.05.	Compensation for Losses		74

Section 3.06.	Mitigation Obligations; Replacement of Lenders		74

Section 3.07.	Survival		74

ARTICLE 4	CONDITIONS PRECEDENT TO CREDIT EXTENSIONS		75

Section 4.01.	Conditions of Effectiveness		75

Section 4.02.	Conditions to All Credit Extensions		78

ARTICLE 5	REPRESENTATIONS AND WARRANTIES		78

Section 5.01.	Existence, Qualification and Power		78

Section 5.02.	Authorization; No Contravention		78

Section 5.03.	Governmental Authorization; Other Consents		79

Section 5.04.	Binding Effect		79

Section 5.05.	Financial Statements; No Material Adverse Effect		79

Section 5.06.	Litigation		79

Section 5.07.	No Default		80

Section 5.08.	Ownership of Property; Subsidiaries; Equity Interests		80

Section 5.09.	Environmental Compliance		80

Section 5.10.	Mining		81

Section 5.11.	Insurance		81

Section 5.12.	Taxes		82

Section 5.13.	ERISA Compliance		82

Section 5.14.	[Reserved.]		82

Section 5.15.	Margin Regulations; Investment Company Act		82

Section 5.16.	Disclosure		83

Section 5.17.	Compliance with Laws		83

Section 5.18.	Intellectual Property; Licenses, Etc		83

Section 5.19.	Solvency		83

Section 5.20.	Casualty, Etc		84

Section 5.21.	Labor Matters		84

Section 5.22.	Collateral Documents		84

Section 5.23.	Use of Proceeds		84

Section 5.24.	Coal Act; Black Lung Act		84

Section 5.25.	Anti-Terrorism Laws; Anti-Corruption Laws and Sanctions		85

TABLE OF CONTENTS

(continued)


		P AGE

ARTICLE 6	AFFIRMATIVE COVENANTS		85

Section 6.01.	Financial Statements		85

Section 6.02.	Certificates; Other Information		86

Section 6.03.	Notices		88

Section 6.04.	Payment of Obligations		88

Section 6.05.	Preservation of Existence, Etc		89

Section 6.06.	Maintenance of Properties		89

Section 6.07.	Maintenance of Insurance		89

Section 6.08.	Compliance with Laws		89

Section 6.09.	Books and Records		89

Section 6.10.	Inspection Rights; Field Exams; Appraisals		90

Section 6.11.	Use of Proceeds		91

Section 6.12.	Covenant to Guarantee Obligations and Give Security		91

Section 6.13.	Compliance with Environmental Laws		93

Section 6.14.	Preparation of Environmental Reports		93

Section 6.15.	Further Assurances		93

Section 6.16.	Certain Long Term Liabilities and Environmental Reserves		93

Section 6.17.	Mining Financial Assurances		93

Section 6.18.	Administration of Accounts		94

Section 6.19.	Cash Management System		94

Section 6.20.	Post-Closing Obligations		95

ARTICLE 7	NEGATIVE COVENANTS		95

Section 7.01.	Liens		95

Section 7.02.	Indebtedness		97

Section 7.03.	Investments		99

Section 7.04.	Fundamental Changes		100

Section 7.05.	Dispositions		101

Section 7.06.	Restricted Payments		102

Section 7.07.	Change in Nature of Business		102

Section 7.08.	Transactions With Affiliates		102

Section 7.09.	Burdensome Agreements		103

Section 7.10.	Use of Proceeds		103

Section 7.11.	Minimum Fixed Charge Coverage Ratio		103

iii

TABLE OF CONTENTS

(continued)


		P AGE

Section 7.12.	Amendments of Organizational Documents		103

Section 7.13.	Accounting Changes		103

Section 7.14.	Prepayments, Etc. of Indebtedness		103

ARTICLE 8	EVENTS OF DEFAULT AND REMEDIES		104

Section 8.01.	Events of Default		104

Section 8.02.	Remedies Upon Event of Default		106

Section 8.03.	Application of Funds		106

ARTICLE 9	ADMINISTRATIVE AGENT		107

Section 9.01.	Appointment		107

Section 9.02.	Delegation of Duties		108

Section 9.03.	Liability of Agents		109

Section 9.04.	Reliance by the Administrative Agent		110

Section 9.05.	Notice of Default		110

Section 9.06.	Credit Decision; Disclosure of Information by Agents		110

Section 9.07.	Indemnification of the Administrative Agent		111

Section 9.08.	Withholding Tax		111

Section 9.09.	Administrative Agent in Its Individual Capacity		111

Section 9.10.	Resignation by the Administrative Agent		113

Section 9.11.	Administrative Agent May File Proofs of Claim		114

Section 9.12.	Collateral and Guaranty Matters. The Lenders and the L/C Issuer irrevocably agree:		114

Section 9.13.	Arrangers and Bookrunners		115

Section 9.14.	Appointment of Supplemental Collateral Agents		115

Section 9.15.	Reports and Financial Statements. By signing this Agreement, each Lender and each L/C Issuer:		116

Section 9.16.	Posting of Approved Electronic Communications		117

ARTICLE 10	GUARANTEE		118

Section 10.01.	Guarantee		118

Section 10.02.	Right of Contribution		119

Section 10.03.	No Subrogation		119

Section 10.04.	Amendments, etc. with Respect to the Borrower Obligations		119

Section 10.05.	Guarantee Absolute and Unconditional		119

Section 10.06.	Waiver by Guarantors		121

TABLE OF CONTENTS

(continued)


		P AGE

Section 10.07.	Releases		121

Section 10.08.	Subordination of Other Obligations		122

Section 10.09.	Authority of Guarantors or Borrowers		122

Section 10.10.	Financial Condition of Borrowers		122

Section 10.11.	Taxes and Payments		122

Section 10.12.	Assignments		122

Section 10.13.	Reinstatement		123

Section 10.14.	Keepwell		123

ARTICLE 11	MISCELLANEOUS		123

Section 11.01.	Amendments, Etc		123

Section 11.02.	Notices; Effectiveness; Electronic Communications		125

Section 11.03.	No Waiver; Cumulative Remedies		126

Section 11.04.	Expenses; Indemnity; Damage Waiver		127

Section 11.05.	Payments Set Aside		129

Section 11.06.	Successors and Assigns		129

Section 11.07.	Treatment of Certain Information; Confidentiality		132

Section 11.08.	Right of Setoff		133

Section 11.09.	Interest Rate Limitation		133

Section 11.10.	Counterparts; Integration; Effectiveness		134

Section 11.11.	Survival of Representations and Warranties		134

Section 11.12.	Severability		134

Section 11.13.	Replacement of Lenders		134

Section 11.14.	Governing Law; Jurisdiction; Etc		135

Section 11.15.	Waiver of Jury Trial		136

Section 11.16.	Designation of Secured Agreements		136

Section 11.17.	No Advisory or Fiduciary Responsibility		136

Section 11.18.	Joint and Several Liability		137

Section 11.19.	Contribution and Indemnification Among the Borrowers		138

Section 11.20.	Agency of the Administrative Borrower for Each Other Borrower		139

Section 11.21.	USA Patriot Act Notice		139

Section 11.22.	Time of the Essence		139

Section 11.23.	Acknowledgement and Consent to Bail-In of EEA Financial Institutions		139


SCHEDULES

1.01(a)		Guarantors
1.01(b)		Commitments and L/C Sublimit
5.06		Litigation
5.08(a)		Material Leased Real Property
5.08(b)		Material Owned Real Property
5.08(c) 5.09		Subsidiaries Environmental Matters
5.14		Subsidiaries and Other Equity Investments; Loan Parties
5.18		Intellectual Property Matters
5.21		Labor Matters
6.20		Post-Closing Obligations
7.01		Existing Liens
7.02		Existing Indebtedness
7.03		Existing Investments
11.02		Agents’ Offices, Certain Addresses for Notices

EXHIBITS
		Form of
A		Borrowing Notice
B		Notice of Conversion or Continuation
C		Note
D E		Swingline Loan Notice Compliance Certificate
F		Assignment and Acceptance
G		Borrowing Base Certificate
H		Security Agreement
I		Perfection Certificate
J		Perfection Certificate Supplement
K		Assumption Agreement
L		Solvency Certificate

ASSET-BASED REVOLVING CREDIT AGREEMENT

This ASSET-BASED REVOLVING CREDIT AGREEMENT (this “ Agreement ”) is entered into as of April 1, 2016 among WARRIOR MET COAL, LLC, a Delaware limited liability company (“ Holdings ”), WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), WARRIOR MET COAL GAS, LLC, a Delaware limited liability company (“ WMC Gas ”), WARRIOR MET COAL MINING, LLC, a Delaware limited liability company (“ WMC Mining ”), WARRIOR MET COAL TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), WARRIOR MET COAL BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), WARRIOR MET COAL LAND, LLC, a Delaware limited liability company (“ WMC Land ”), WARRIOR MET COAL WV, LLC, a Delaware limited liability company (“ WMC WV ”), and WARRIOR MET COAL LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, the “ Borrowers ”), each Guarantor party hereto, each lender from time to time party hereto, CITIBANK, N.A., as administrative agent and collateral agent (in such capacities, the “ Administrative Agent ”), CITIBANK, N.A., as Swingline Lender, and CITIBANK, N.A. and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as L/C Issuers.

INTRODUCTORY STATEMENT

WHEREAS, on July 15, 2015, Walter Energy, Inc., a Delaware corporation (“ Walter ”), and certain Subsidiaries of Walter (as debtors and debtors-in-possession, collectively, the “ Debtors ” and each individually, a “ Debtor ”), commenced cases under chapter 11 of title 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Alabama;

WHEREAS, Holdings will acquire, directly or indirectly, a material portion of the operating assets of the Debtors in a sale of assets under section 363 of the Bankruptcy Code (the “ Acquisition ”), pursuant to the terms and subject to the conditions set forth in that certain Amended and Restated Asset Purchase Agreement ¹ , dated as of March 31, 2016 (the “ Acquisition Agreement ”), by and among Holdings, the Buyer Designees (as defined therein), Walter and certain subsidiaries of Walter, as sellers, which Acquisition shall be consummated in accordance with the order of the Bankruptcy Court, entered on January 8, 2016 (the “ Sale Order ”), approving the Acquisition;

WHEREAS, pursuant to the terms and subject to the conditions set forth in that certain Rights Offering Commitment Letter, dated as of March 14, 2016 (the “ Equity Commitment Letter ”), by and among the Commitment Parties (as defined therein) and Holdings, Holdings will conduct one or more rights offerings in which it will offer to certain eligible holders of its Equity Interests certain non-transferable, non-certificated rights (i) to purchase, substantially concurrently with the consummation of the Acquisition, the common Equity Interests of Holdings (such rights offering and the purchase of such common Equity Interests pursuant thereto, collectively, the “ Initial Rights Offering ”) having a purchase price in an aggregate amount not less than $197,000,000 (the “ Minimum Rights Offering Amount ”) and (ii) to irrevocably commit to purchase, following the Closing Date, certain additional common Equity Interests of Holdings having a purchase price in an aggregate amount equal to $99,000,000, in one or more capital raising transactions at such date and on the terms and subject to the conditions as determined by a vote of a Board Supermajority (as defined therein); and

WHEREAS, the Borrowers have requested, and the Lenders have agreed to provide, a senior secured asset-based revolving credit facility in an aggregate principal amount of $50,000,000 (the

¹	Subject to review

“ Facility ”) as set forth herein. All of the Borrowers’ obligations under the Facility are to be guaranteed by the Guarantors. The Lenders are willing to extend or continue, as the case may be, such credit to the Borrowers on the terms and subject to the conditions set forth herein.

Accordingly, in consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

ARTICLE 1

D EFINITIONS AND A CCOUNTING T ERMS

Section 1.01. Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below:

“ ABL Priority Collateral ” means all rights, title and interests of each Loan Party in the following Collateral, in each case, whether now owned or existing or hereafter acquired or arising and wherever located, including, without duplication, (a) all rights of each Loan Party to receive moneys due and to become due under or pursuant to the following, (b) all rights of each Loan Party to receive return of any premiums for or Proceeds of any insurance, indemnity, warranty or guaranty with respect to the following or to receive condemnation Proceeds with respect to the following, (c) all claims of each Loan Party for damages arising out of or for breach of or default under any of the following, and (d) all rights of each Loan Party to terminate, amend, supplement, modify or waive performance under any of the following, to perform thereunder and to compel performance and otherwise exercise all remedies thereunder:

(i) all Accounts, but solely for purposes of this clause (i) , excluding rights to payment for any property which specifically constitutes Non-ABL Priority Collateral that has been sold, leased, licensed, assigned or otherwise disposed of; provided , however , that, for the avoidance of doubt, all rights to payment arising from any sale, lease, license, assignment or other disposition of Inventory or Goods (other than Fixtures or Equipment) or the provision of services shall constitute ABL Priority Collateral;

(ii) all Chattel Paper;

(iii) all Deposit Accounts, Securities Accounts and all other demand, deposit, time, savings, cash management, passbook and similar accounts maintained with any bank or other financial institution (other than to the extent any such Deposit Accounts, Securities Accounts or other accounts solely contain identifiable Proceeds of any Non-ABL Priority Collateral) and all cash, money, securities, Instruments and other investments deposited or required to be deposited in any of the foregoing;

(iv) all Inventory and all rights to receive payments, indebtedness and other obligations which arise as a result of the sale, lease or other disposition of Inventory or Goods (in each case other than Fixtures or Equipment) or provision of services, including the right to payment of interest or finance charges;

(v) all cash, Money and Cash Equivalents (other than identifiable Proceeds of any Non-ABL Priority Collateral);

(vi) to the extent evidencing or governing any of the items referred to in the preceding clauses (i) through (v), all General Intangibles (excluding Equity Interests and any Intellectual Property to the extent such Intellectual Property is not attached to or

necessary to sell any item of Inventory), letters of credit (whether or not the respective letter of credit is evidenced by a writing), Letter-of-Credit Rights, Instruments and Documents; provided that to the extent any of the foregoing also relates to Non-ABL Priority Collateral, only that portion related to the items referred to in the preceding clauses (i) through (v) as being included in the ABL Priority Collateral shall be included in the ABL Priority Collateral;

(vii) to the extent relating to any of the items referred to in the preceding clauses (i) through (vi), all insurance; provided that to the extent any of the foregoing also relates to Non-ABL Priority Collateral, only that portion related to the items referred to in the preceding clauses (i) through (vi) as being included in the ABL Priority Collateral shall be included in the ABL Priority Collateral;

(viii) to the extent relating to any of the items referred to in the preceding clauses (i) through (vii), all Supporting Obligations; provided that to the extent any of the foregoing also relates to Non-ABL Priority Collateral, only that portion related to the items referred to in the preceding clauses (i) through (v) as being included in the ABL Priority Collateral shall be included in the ABL Priority Collateral;

(ix) to the extent relating to any of the items referred to in the preceding clauses (i) through (viii), all Commercial Tort Claims; provided that to the extent any of the foregoing also relates to Non-ABL Priority Collateral, only that portion related to the items referred to in the preceding clauses (i) through (viii) as being included in the ABL Priority Collateral shall be included in the ABL Priority Collateral;

(x) all books and records, including all books, databases, customer lists and records related thereto and any General Intangibles at any time evidencing or relating to any of the foregoing; and

(xi) all cash Proceeds and, solely to the extent not constituting Non-ABL Priority Collateral, non-cash Proceeds, products, accessions, rents and profits of or in respect of any of the foregoing (including all insurance proceeds) and all collateral security, guarantees and other collateral support given by any Person with respect to any of the foregoing.

For the avoidance of doubt, no Excluded Asset shall constitute ABL Priority Collateral.

“ Acceptable Credit Support ” means (a) a credit insurance policy satisfactory to the Administrative Agent in its Reasonable Credit Judgment (including, without limitation, as to the creditworthiness of the insurance company issuing such policy, the scope and amount of coverage, any deductibles and any other terms and conditions applicable thereto), so long as the limits and terms of such credit insurance policy are being complied with and for which the Administrative Agent is named as the beneficiary, loss payee or additional insured so as to insure that the Administrative Agent has the right to receive payments thereunder or (b) an irrevocable letter of credit satisfactory to the Administrative Agent in its Reasonable Credit Judgment (including, without limitation, as to the issuer or domestic confirming bank with respect thereto, and the form and substance thereof), that has been delivered to the Administrative Agent and is directly drawable by the Administrative Agent, provided that all such credit insurance policies and letters of credit delivered as of the Closing Date shall constitute Acceptable Credit Support.

“ Accommodation Payment ” has the meaning specified in Section 11.19.

“ Account ” has the meaning specified in the UCC.

“ Account Debtor ” has the meaning given to such term in the UCC.

“ Accounting Change ” means a change in accounting principles required by the promulgation of any rule, regulation, pronouncement or opinion by the Financial Accounting Standards Board of the American Institute of Certified Public Accountants or, if applicable, the SEC.

“ Acquisition ” has the meaning specified in the Introductory Statement.

“ Acquisition Agreement ” has the meaning specified in the Introductory Statement.

“ Activities ” has the meaning specified in Section 9.09(b) .

“ Additional Lender ” has the meaning specified in Section 2.15(b) .

“ Administrative Agent ” has the meaning specified in the preamble hereto.

“ Administrative Agent’s Office ” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 11.02 , or such other address or account of the Administrative Agent as the Administrative Agent may from time to time notify to the Borrowers and the Lenders.

“ Administrative Questionnaire ” means an Administrative Questionnaire in a form reasonably acceptable to the Administrative Agent.

“ Agent Affiliate ” has the meaning specified in Section 9.16(c) .

“ Agent’s Group ” has the meaning specified in Section 9.09(b) .

“ Agent Parties ” has the meaning specified in Section 11.02(c) .

“ Affiliate ” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“ Agreement ” has the meaning assigned in the preamble hereto.

“ Anti-Corruption Laws ” means all Laws of any jurisdiction applicable to Holdings or any of its Subsidiaries from time to time concerning or relating to bribery or corruption, including without limitation the Foreign Corrupt Practices Act of 1977, 15 U.S.C. §§ 78dd-1, et seq.

“ Anti-Money Laundering Laws ” means all Laws of any jurisdiction applicable to Holdings or any of its Subsidiaries from time to time concerning or relating to money laundering, including, without limitation, the Patriot Act.

“ Anti-Terrorism Laws ” means Title III of the USA Patriot Act, the Trading with the Enemy Act, and each of the foreign assets control regulations of the United States Treasury Department (31 C.F.R. Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto.

“ Applicable Percentage ” means, with respect to any Lender, the percentage (carried out to the ninth decimal place) of the Facility represented by such Lender’s Commitment at such time (or, if the

Commitment of each Lender shall have been terminated or expired, then the percentage of Total Outstandings represented by the aggregate Outstanding Amount of such Lender’s Loans and L/C Obligations). The initial Applicable Percentage of each Lender in respect of the Facility is set forth on Schedule 1.01(b) or in the Assignment and Acceptance pursuant to which such Lender becomes a party hereto, as applicable.

“ Applicable Rate ” means, as of any date of determination, a per annum rate equal to (a) for the period commencing on the Closing Date through the last day of the first full fiscal quarter ending after the Closing Date, (i) for Eurocurrency Rate Loans, 3.50% and (ii) for Base Rate Loans, 2.50% and (b) thereafter, the rate set forth below under the applicable Type of Loan and opposite the applicable Availability, based on the average daily Availability during the fiscal quarter most recently ended immediately preceding such date, as a percentage of the Maximum Revolving Credit:


C ATEGORY	A VERAGE Q UARTERLY A VAILABILITY (% O F M AXIMUM R EVOLVING C REDIT )	E UROCURRENCY L OANS	B ASE R ATE L OANS
I	Greater than or equal to 66%	3.00%	2.00%
II	Less than 66% and greater than or equal to 33%	3.25%	2.25%
III	Less than 33%	3.50%	2.50%

Changes in the Applicable Rate resulting from a change in Availability shall become effective as to all Loans, Swingline Loans, L/C Obligations and Protective Advances upon delivery by the Borrowers to the Administrative Agent of a new Borrowing Base Certificate pursuant to Section 6.02(i) in respect of the calendar month ending on the last day of such fiscal quarter. Notwithstanding anything to the contrary set forth in this Agreement (including the then effective Availability), if the Borrowers shall fail to deliver such Borrowing Base Certificate within any of the time periods specified in Section 6.02(i) , the Applicable Rate from and including the 20th day after the end of the applicable month or, during a Liquidity Period, the 3rd Business Day after the end of the applicable week, as the case may be, to but not including the date the Borrowers deliver to the Administrative Agent such Borrowing Base Certificate shall equal the highest possible Applicable Rate provided for by this definition.

“ Appraisal ” means, as applicable, (i) the appraisal delivered to the Administrative Agent on or prior to the Closing Date, or (ii) any appraisal in form and substance reasonably satisfactory to the Administrative Agent delivered to the Administrative Agent pursuant to Section 6.10(b) .

“ Approved Appraiser ” means one of Hilco, Great American or Sector 3, as selected by the Administrative Agent in its sole discretion.

“ Approved Field Examiner ” means one of the Administrative Agent (or any of its Affiliates), FTI, Hilco, WeiserMazars or Riveron, as selected by the Administrative Agent in its sole discretion.

“ Approved Electronic Communications ” means each notice, demand, communication, information, document and other material that any Loan Party is obligated to, or otherwise chooses to, provide to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein, including (a) any supplement to the Agreement, any joinder to any Collateral Document and any other written Contractual Obligation delivered or required to be delivered in respect of any Loan Document or the transactions contemplated therein and (b) any Financial Statement, financial and other

report, notice, request, certificate and other information material; provided, however, that, “Approved Electronic Communication” shall exclude (i) any notice of Borrowing, conversion or continuation, and any other notice, demand, communication, information, document and other material relating to a request for a new, or a conversion of an existing, Borrowing, (ii) any notice pursuant to Section 2.06 and any other notice relating to the payment of any principal or other amount due under any Loan Document prior to the scheduled date therefor, (iii) all notices of any Default or Event of Default and (iv) any notice, demand, communication, information, document and other material required to be delivered to satisfy any of the conditions set forth in Article 4 or any other condition to any Borrowing hereunder or any condition precedent to the effectiveness of this Agreement.

“ Approved Electronic Platform ” has the meaning specified in Section 9.16(a) .

“ Approved Fund ” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“ Arrangement and Agency Fee Letter ” means the Arrangement and Agency Fee Letter, dated as of March 7, 2016, among the Borrowers and Citigroup Global Markets Inc.

“ Arranger ” means each of Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC, in each case, in its respective capacity as joint lead arranger and joint bookrunner.

“ Assignment and Acceptance ” means an assignment and acceptance entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 11.06(b) ), and accepted by the Administrative Agent, substantially in the form of Exhibit F or any other form approved by the Administrative Agent.

“ Attributable Indebtedness ” means, on any date, in respect of any Capital Lease Obligations of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP.

“ Availability ” means, at any time of determination, the Maximum Revolving Credit at such time minus the Total Outstandings at such time.

“ Availability Period ” means the period from and including the Closing Date to but not including the Termination Date.

“ Auto-Extension Letter of Credit ” has the meaning specified in Section 2.04(c)(iii) .

“ Auto-Reinstatement Letter of Credit ” has the meaning specified in Section 2.04(c)(iv) .

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“ Bankruptcy Code ” means The Bankruptcy Reform Act of 1978, as heretofore and hereafter amended, and codified as 11 U.S.C. Section 101 et seq.

“ Base Rate ” means, for any day, in relation to a Loan in Dollars, a rate per annum equal to, the highest of (a) the rate of interest in effect for such day publicly announced from time to time by the Administrative Agent as its “prime rate” in effect in New York, New York; each change in such prime rate shall be effective on the date such change is publicly announced as effective, (b) the Federal Funds Rate for such day plus 0.50% and (c) the Eurocurrency Rate applicable for an Interest Period of one month plus 1.00%.

“ Base Rate Loan ” means a Loan that bears interest based on the Base Rate.

“ Beneficiary ” means the Administrative Agent and each Arranger, Lender and L/C Issuer.

“ Black Lung Act ” means the Black Lung Benefits Act of 1972, 30 U.S.C. §§ 901, et seq., the Federal Mine Safety and Health Act of 1977, 30 U.S.C. §§ 801, et seq., the Black Lung Benefits Reform Act of 1977, Pub. L. No. 95-239, 92 Stat. 95 (1978), and the Black Lung Benefits Amendments of 1981, Pub. L. No. 97-119, Title 11, 95 Stat. 1643, in each case as amended.

“ Black Lung Liability ” means any liability or benefit obligations related to black lung claims and benefits under the Black Lung Act, and liabilities and benefits related to pneumoconiosis, silicosis, exposure to isocyanates or other lung disease arising under any federal or state law.

“ Blocked Account Agreement ” means, with respect to any Deposit Account, Securities Account, Commodities Contract or Commodities Account of any Loan Party, an agreement among the Administrative Agent, such Loan Party and such depository bank, securities intermediary or commodity intermediary, as applicable, sufficient to grant “control” to the Administrative Agent (a) under 9-104 of the UCC with respect to any Deposit Account, (b) under 9-106 of the UCC with respect to any Commodities Contract or Commodities Account or (c) under 8-106 of the UCC with respect to any Securities Account.

“ Borrower Materials ” has the meaning specified in Section 9.16(e) .

“ Borrower Obligations ” means the Obligations of the Borrowers.

“ Borrower Representative ” has the meaning specified in Section 11.20 .

“ Borrowers ” has the meaning specified in the preamble hereto.

“ Borrowing ” means any (a) borrowing consisting of simultaneous Loans of the same Type and, in the case of Eurocurrency Rate Loans, having the same Interest Period made by each of the Lenders, (b) Swingline Loan or (c) Protective Advance.

“ Borrowing Base ” means, at any time:

(a) the sum of:

(i) eighty-five percent (85%) of the Eligible Billed Accounts of the Borrowers, plus

(ii) seventy-five percent (75%) of the Eligible Unbilled Accounts of the Borrowers; provided , in no event shall the aggregate amount included in the Borrowing Base under this clause (ii) exceed either (A) $10,000,000 or (B) an amount equal to 50.0% of the aggregate amount of Eligible Billed Accounts and Eligible Unbilled Accounts included in the Borrowing Base under clauses ( i ) and (ii) , respectively, at such time plus

(iii) the lesser of (A) eighty-five percent (85%) of the remainder of (x) Inventory Value of the Eligible Coal Inventory of the Borrowers minus (y) the Lower of Cost or Market Reserve and any other Reserves established or maintained by the Administrative Agent in its Reasonable Credit Judgment in respect of any Eligible Coal Inventory of the Borrowers and (B) eighty-five percent (85%) of the Net Orderly Liquidation Value of the Eligible Coal Inventory of the Borrowers; provided , in no event shall the aggregate amount included in the Borrowing Base under this clause (iii) exceed 50.0% of the aggregate amount of the Borrowing Base in effect at such time, plus

(iv) eighty-five percent (85%) of the Net Orderly Liquidation Value of any Eligible Supplies Inventory of the Borrowers; provided , in no event shall the aggregate amount included in the Borrowing Base under this clause (iv) exceed 7.5% of the aggregate amount of the Borrowing Base in effect at such time, plus

(v) one hundred percent (100%) of Qualified Cash of the Borrowers, minus

(b) to the extent not included in the calculation of clauses (a)(i) through (a)(v) above, inclusive, any Reserves then in effect.

For the avoidance of doubt, the specified percentage set forth in this definition of “Borrowing Base” will not be reduced without the consent of the Borrowers.

“ Borrowing Base Certificate ” means a certificate substantially in the form of Exhibit G (with such changes therein as may be required by the Administrative Agent, in its Reasonable Credit Judgment, to reflect the components of, and Reserves against, the Borrowing Base from time to time), executed and certified as accurate and complete by a Responsible Officer of Holdings, which shall include detailed calculations as to the Borrowing Base as reasonably requested by the Administrative Agent.

“ Borrowing Base Collateral ” means the Collateral of the Loan Parties of the type included in clauses (a)(i) through (a)(v) , inclusive, of the definition of “Borrowing Base”.

“ Borrowing Notice ” means a notice of a Borrowing, pursuant to Section 2.02(a) , which, if in writing, shall be substantially in the form of Exhibit A .

“ Business ” has the meaning specified in Section 5.09(a) .

“ Business Day ” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located and, if such day relates to any Eurocurrency Rate Loan, means any such day on which dealings in deposits in Dollars are conducted by and between banks in the London interbank eurodollar market.

“ Capital Expenditures ” means, with respect to any Person for any period, any expenditure in respect of the purchase or other acquisition of any fixed or capital asset (excluding normal replacements and maintenance which are properly charged to current operations). For purposes of this definition, the purchase price of equipment that is purchased substantially concurrently with the trade-in of existing

equipment or with insurance proceeds shall be included in Capital Expenditures only to the extent of the gross amount by which such purchase price exceeds the credit granted by the seller of such equipment for the equipment being traded in at such time, the proceeds of such asset sale or the amount of such insurance proceeds, as the case may be.

“ Capital Lease Obligations ” means of any Person as of the date of determination, the aggregate liability of such Person under Financing Leases reflected as liability on a balance sheet of such Person prepared in accordance with GAAP.

“ Cash Collateralize ” or “ Cash Collateralization ” has the meaning specified in Section 2.04(h) .

“ Cash Equivalents ” means any of the following types of Investments:

(a) readily marketable obligations issued or directly and fully guaranteed or insured by the federal government of the United States of America or any agency or instrumentality thereof having maturities of not more than 12 months from the date of acquisition thereof;

(b) time deposits or eurodollar time deposits with, or overnight bank deposits and bankers’ acceptances of, any (i) Lender or (ii) commercial bank that is organized under the laws of the United States of America, any state thereof or the District of Columbia or is the principal banking subsidiary of a bank holding company organized under the laws of the United States of America, any state thereof or the District of Columbia, any foreign bank, or its branches or agencies (fully protected against currency fluctuations) that, at the time of acquisition, are rated at least “ A-1 ” by S&P or “ P-1 ” by Moody’s, in each case with maturities of not more than twelve months from the date of acquisition thereof;

(c) (i) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (a) entered into with any financial institution meeting the qualifications specified in clause (b) above or (ii) repurchase agreements and reverse repurchase agreements relating to marketable direct obligations issued or unconditionally guaranteed by the United States of America, in each case maturing within 12 months or less from the date of acquisition, provided, that the terms of such agreements comply with the guidelines set forth in the Federal Financial Agreements of Depository Institutions With Securities Dealers and Others, as adopted by the Comptroller of the Currency on October 31, 1985;

(d) commercial paper issued by any Person rated at least “ A-1 ” by S&P or “ P-1 ” by Moody’s, in each case with maturities of not more than 270 days from the date of acquisition thereof; and

(e) shares of any money market fund that (i) has at least 95% of its assets invested continuously in the types of investments referred to in clauses (a), (b), (c) and (d) above, (ii) has net assets whose value exceeds $500,000,000 and (iii) is rated at least “A-1” by S&P or “P-1” by Moody’s.

“ Cash Management Agreement ” means any agreement to provide cash management services, including treasury, depository, overdraft, credit or debit card, electronic funds transfer and other cash management arrangements.

“ Cash Management Bank ” means (a) a Lender or an Affiliate of a Lender that is a party to a Cash Management Agreement on the Closing Date or (b) any Person that, at the time it enters into a Cash Management Agreement, is a Lender or an Affiliate of a Lender, in each case, in its capacity as a party to such Secured Cash Management Agreement.

“ CFC ” means a Person that is a controlled foreign corporation under Section 957 of the Code.

“ Change in Law ” means the occurrence, after the date of this Agreement, of any of the following: (a) the enactment, adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority required to be complied with by any Lender (including the Swingline Lender) or any L/C Issuer, or by any office of such Lender or such L/C Issuer or by such Lender’s or such L/C Issuer’s holding company, if any; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub. L.. 111-203, H.r. 4173) and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“ Change of Control ” means the occurrence of any of the following events:

(a) at any time prior to a Qualifying IPO of Holdings, the Permitted Holders shall fail to own, directly or indirectly, beneficially and of record, and have the right to vote, or the right to cause to be voted, Equity Interests in Holdings representing at least a majority of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of Holdings;

(b) at any time after a Qualifying IPO of Holdings, an event or series of events by which any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) (other than Permitted Holders) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934), directly or indirectly, of more than 35% of the equity securities of Holdings entitled to vote for members of the board of directors or equivalent governing body of Holdings on a fully-diluted basis; or

(c) during any period of 12 consecutive months, a majority of the members of the board of directors or other equivalent governing body of Holdings after the date of this Agreement cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body.

“ Chattel Paper ” has the meaning specified in the UCC.

“ Closing Date ” means the first date on which all the conditions precedent in Section 4.01 are satisfied or waived in accordance with Section 11.01.

“ Coal ” means coal owned by Holdings or any of its Subsidiaries, or coal that Holdings or any of its Subsidiaries has the right to extract, in each case located on, under or within, or produced or severed from the Real Property owned by, or leased or licensed to, Holdings or any of its Subsidiaries.

“ Coal Act ” means the Coal Industry Retiree Health Benefit Act of 1992, 26 U.S.C. §§ 9701, et seq., as amended.

“ Coal Inventory ” means any Inventory consisting of coal; provided , that in the case of any such Inventory that constitutes raw coal, such raw coal Inventory shall be converted to the “clean coal equivalent” quantity thereof.

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ Collateral ” means all of the property of the Loan Parties (other than Excluded Assets as defined in the Security Agreement) that is, under the terms of the Collateral Documents, subject to Liens in favor of the Collateral Agent for the benefit of the Secured Parties as security for the Obligations (it being understood and agreed that the Collateral shall include both the ABL Priority Collateral and the Non-ABL Priority Collateral).

“ Collateral Account ” means the account established by, and under the sole dominion and control of, the Administrative Agent maintained with the Administrative Agent or a bank affiliate of the Administrative Agent or any other bank reasonably acceptable to the Administrative Agent and designated by the Borrowers as the “Warrior Met Coal Collateral Account”.

“ Collateral Agent ” means Citibank, N.A., in its capacity as the collateral agent.

“ Collateral Documents ” means, collectively, the Security Agreement, the Mortgages and each of the mortgages, collateral assignments, security agreements, pledge agreements or other similar agreements delivered to the Administrative Agent pursuant to Section 6.12 , and each of the other agreements, instruments or documents that creates or purports to create a Lien in favor of the Administrative Agent for the benefit of the Secured Parties as security for the Obligations.

“ Commercial Tort Claim ” has the meaning specified in the UCC.

“ Commitment ” means, as to each Lender, the amount set forth under the caption “Commitment” opposite such Lender’s name on Schedule 1.01(b) , or, as the case may be, opposite such caption in the Assignment and Acceptance pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement. The aggregate amount of the Commitments as of the Closing Date is $50,000,000.

“ Commodities Account ” has the meaning specified in the UCC.

“ Commodities Contact ” has the meaning specified in the UCC.

“ Commodity Exchange Act ” means the Commodity Exchange Act (7 U.S.C. § 1 et seq .).

“ Commitment Fee ” has the meaning specified in Section 2.10(a) .

“ Company Material Adverse Effect ” means any change, event, state of facts or occurrence that individually or in the aggregate (taking into account all other such changes, events, states of fact or occurrences) has had, or would be reasonably expected to have, a material adverse change in or material adverse effect on (1) the Acquired Assets or the assets, properties, prospects, financial condition or results of operations of the Business (excluding the Excluded Assets and the Excluded Liabilities), in each case taken as a whole or (2) the ability of Sellers to consummate the transactions contemplated by the Acquisition Agreement or to perform any of their obligations under this Agreement, but excluding any change or effect to the extent that it results from or arises out of (i) any reasonably anticipated effects of the commencement or prosecution of the Bankruptcy Case; (ii) the execution and delivery of the Acquisition Agreement or the announcement thereof or consummation of the transactions contemplated hereby, including the effects of the transactions hereby on business relationships with suppliers and customers; (iii) changes in Legal Requirements or accounting regulations (including GAAP); (iv) any specific action required to be taken (or omitted) by the Acquisition Agreement or taken (or omitted) at the written request of Buyer; (v) general industry changes in the industries in which Sellers compete; (vi) acts of God (including earthquakes, storms, severe weather, fires, floods and natural catastrophes); (vii) any failure of the Business to achieve external or internal forecasts or financial projections; (viii) any breach of the Acquisition Agreement by Buyer; or (ix) any change or effect of economic or political conditions (including acts of terrorism, hostilities, sabotage, military actions or war, or any material worsening of such acts of terrorism, hostilities, sabotage, military actions or war), in each case of clauses (iii), (v) and (ix) to the extent that such conditions do not disproportionately affect Sellers, taken as a whole, as compared to other companies that are principally engaged in the same Business as Sellers. Capitalized terms used in this definition of “Company Material Adverse Effect” but not otherwise defined herein shall have the meanings specified for such terms in the Acquisition Agreement in effect on March 15, 2016.

“ Compliance Certificate ” means a certificate substantially in the form of Exhibit E .

“ Connection Income Taxes ” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profit Taxes.

“ Consolidated EBITDA ” means, with respect to Holdings and its Subsidiaries on a consolidated basis, for any period, the sum of:

(a) Consolidated Net Income for such period; plus

(b) to the extent deducted in calculating such Consolidated Net Income, without duplication, (i) all consolidated interest expense, determined in accordance with GAAP, for such period, (ii) all charges against income for such period for federal, state and local Taxes, including franchise and excise Taxes, (iii) depreciation and depletion expenses for such period (including, without limitation, amortization of intangibles, deferred financing fees and any amortization included in pension, other post-employment benefits or other employee benefit expenses, but excluding amortization of prepaid cash expenses that were paid in a prior period), (iv) amortization expenses for such period, (v) non-recurring fees, costs and expenses related to closing of the Facility, (vi) non-cash stock based compensation expense, and non-cash expenses or losses and other non-cash charges incurred during such period (excluding any non-cash charges representing an accrual of, or reserve for, cash charges to be paid within the next twelve months or inventory write downs), (vii) any non-cash losses from foreign currency transactions (including losses related to currency remeasurements of Indebtedness) for such period, to the extent that such losses were deducted in calculating Consolidated Net Income, (viii) non-cash purchase accounting adjustments, including but not limited to, the amortization of inventory, (ix) nonrecurring or unusual losses, business optimization expenses, charges, costs or expenses or any other restructuring charges (which, for the avoidance of doubt, shall include plant closure, retention, severance, systems establishment costs, excess pension charges, other post-employment benefits, black lung settlement,

curtailment or other excess charges and fees, expenses, charges or premiums related to any offering or modification of Indebtedness of such Person permitted to be incurred), (x) any losses attributable to early extinguishment of Indebtedness, (xi) all non-cash impairment charges or non-cash charges resulting from amortization of intangibles, (xii) any net after-Tax loss from disposed, abandoned, transferred, closed or discontinued operations or fixed assets and any net after-Tax losses on disposal or disposed, abandoned, transferred, closed or discontinued operations or fixed assets, (xiii) [reserved], (xiv) the non-cash portion of “straight-line” rent expense, and (xv) accretion of asset retirement obligations in accordance with Accounting Standards Codifications 410 Asset Retirement and Environmental Obligations, and any similar accounting in prior periods; minus

(c) to the extent included in calculating such Consolidated Net Income, without duplication, (i) extraordinary gains, (ii) non-cash gains and other non-cash income, (iii) any non-cash gains from foreign currency transactions (including gains related to currency remeasurements of Indebtedness) for such period, to the extent that such gains were taken into account in computing Consolidated Net Income, (iv) gains attributable to early extinguishment of Indebtedness, (v) any net after-Tax income from disposed, abandoned, transferred, closed or discontinued operations or fixed assets and any net after-Tax gains on disposal or disposed, abandoned, transferred, closed or discontinued operations or fixed assets and (vi) the cash portion of “straight line” rent expense which exceeds the amount expensed in respect of such rent expense.

“ Consolidated Net Income ” means, for any period, in respect of Holdings and its Subsidiaries on a consolidated basis, an amount equal to the sum of the net income (or loss), determined in accordance with GAAP, before any reduction in respect of preferred stock dividends, and excluding the cumulative effect of any change in accounting principles made in such period in accordance with GAAP, which affects Consolidated Net Income.

“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, document, mortgage, deed of trust, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“ Consolidated Total Assets ” means, on any date, the consolidated total assets of Holdings and its Subsidiaries as set forth on the consolidated balance sheet of Holdings at such date, determined in accordance with GAAP.

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “ Controlling ” and “ Controlled ” have meanings correlative thereto.

“ Control Account ” has the meaning specified in Section 6.19 .

“ Credit Extension ” means each of the following: (a) a Borrowing or (b) an L/C Credit Extension.

“ Debtor Relief Laws ” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

“ Debtors ” has the meaning specified in the introductory statement.

“ Default ” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

“ Default Rate ” means, at any time:

(a) when used with respect to any of the Obligations (other than Eurocurrency Rate Loans and Letter of Credit Fees), an interest rate equal to (i) the Base Rate plus (ii) the Applicable Rate applicable to Base Rate Loans (whether or not any Base Rate Loans are outstanding at such time) plus (iii) 2.00% per annum;

(b) when used with respect to any Eurocurrency Rate Loan, an interest rate equal to (i) the interest rate (including any Applicable Rate) otherwise applicable to such Eurocurrency Rate Loan plus (ii) 2.00% per annum; and

(c) when used with respect to Letter of Credit Fees, a rate equal to (i) the Applicable Rate applicable to Base Rate Loans (whether or not any Base Rate Loans are outstanding at such time) plus (ii) 2.00% per annum.

“ Defaulting Lender ” means, subject to Section 2.16(b) , any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrowers in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any L/C Issuer, the Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two Business Days of the date when due, (b) has notified any of the Borrowers, the Administrative Agent, any L/C Issuer or the Swingline Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or any of the Borrowers, to confirm in writing to the Administrative Agent and the Borrowers that it will comply with its prospective funding obligations hereunder ( provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrowers), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-in Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.16(b) ) upon delivery of written notice of such determination to the Borrowers, each L/C Issuer, the Swingline Lender and each Lender.

“ Deposit Account ” has the meaning specified in the UCC.

“ Designated Amount ” has the meaning specified Section 11.16(a) .

“ Designation Notice ” has the meaning specified in Section 11.16(a) .

“ Disposition ” or “ Dispose ” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any Real Property Leases, notes or accounts receivable or any rights and claims associated therewith.

“ Disregarded Domestic Person ” means any direct or indirect Domestic Subsidiary (i) substantially all of the assets of which consist of the Equity Interests of one or more Foreign Subsidiaries or (ii) that is treated as a disregarded entity for U.S. federal income tax purposes that holds Equity Interests of one or more Foreign Subsidiaries.

“ Distribution Conditions ” mean, at any time of determination, with respect to any Restricted Payment, the satisfaction of each of the following conditions:

(a) no Event of Default has occurred and is continuing or would immediately result from the consummation of such Restricted Payment;

(b) a Liquidity Period is not in effect at such time; and

(c) the Borrowers shall have demonstrated compliance at the time of making such Restricted Payment with both (x)(1) pro forma Availability immediately after giving effect to such Restricted Payment (taking into account any Credit Extensions made to finance such Restricted Payment) and (2) pro forma average Availability for the 30-day period immediately preceding the making of such Restricted Payment (assuming such Restricted Payment (and any Credit Extensions made to finance such Restricted Payment) shall have occurred on the first day of such period), shall be, in each case, greater than $15,000,000 and (y) the Fixed Charge Coverage Ratio, on a pro forma basis, as of the last day of the most recently ended Test Period (after giving pro forma effect to such Restricted Payment and each other Restricted Payment that has occurred since the beginning of such Test Period) shall not be less than 1.00 to 1.00.

“ Document ” has the meaning specified in the UCC.

“ Dollar ” and “ $ ” mean lawful money of the United States.

“ Domestic Subsidiary ” means any Subsidiary of Holdings that is organized under the laws of the United States, any state thereof or the District of Columbia.

“ EEA Financial Institution ” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“ EEA Member Country ” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“ EEA Resolution Authority ” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“ EU Bail-In Legislation Schedule ” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

“ Eligible Accounts ” means, at any time of determination, the aggregate amount of all Accounts due to any of the Borrowers; provided , that unless otherwise approved from time to time in writing by the Administrative Agent in its sole discretion, no Account shall constitute an Eligible Account if, without duplication:

(a) except as provided in clause (w) of this definition, such Account does not arise from the sale of goods or the performance of services by any of the Borrowers in the ordinary course of its business;

(b) (i) such Account is contingent in any respect or for any reason, or the applicable Borrower’s right to receive payment with respect to such Account is subject to or contingent upon the satisfaction of any condition whatsoever (other than the preparation and delivery of an invoice) or (ii) as to which the applicable Borrower is prohibited by applicable Law from bringing and maintaining an action in the courts of the state or other jurisdiction where the Account Debtor is located;

(c) the Account Debtor with respect to such Account (i) has or has asserted a right of set-off, offset, deduction, defense, dispute, or counterclaim against any of the Borrowers (unless such Account Debtor has entered into a written agreement reasonably satisfactory to the Administrative Agent to waive such set-off, offset, deduction, defense, dispute, or counterclaim rights), (ii) has disputed its liability (whether by chargeback or otherwise) or made any claim with respect to the Account or any other Account of any of the Borrowers which has not been resolved, in each case of clause (i) and (ii) , without duplication, only to the extent of the amount of such actual or asserted right of set-off, or the amount of such dispute or claim, as the case may be or (iii) is also a creditor or supplier of any of the Borrowers or any of its respective Subsidiaries (but only to the extent of such Borrower’s or such Subsidiary’s obligations to such Account Debtor from time to time), in each case, unless such Account Debtor has executed any non-offset agreement in form and substance reasonably satisfactory to the Administrative Agent;

(d) such Account is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for the sale of goods to or services rendered for the applicable Account Debtor;

(e) except in the case of any Unbilled Accounts, an invoice, in form and substance consistent with such Borrower’s credit and collection policies, or otherwise reasonably acceptable to the Administrative Agent, has not been sent to the applicable Account Debtor in respect of such Account within 30 days of such preparation or otherwise reported to the Administrative Agent as Collateral (including Accounts identified as inactive, warranty or otherwise not attributable to an Account Debtor);

(f) such Account (i) is not owned by a Borrower or (ii) is subject to any Lien, other than Permitted Liens;

(g) such Account is the obligation of an Account Debtor that is (i) a Borrower or any of its Affiliates, or any of their respective directors, officers, employees or agents or (ii) a natural Person;

(h) such Account (i) is subject to a partial payment plan, (ii) was not paid in full, and any Borrower created a new receivable for the unpaid portion of such Account or (iii) constitutes or is subject to chargebacks, debit memos and other adjustments for unauthorized deductions;

(i) such Account is created on cash on delivery terms, or on extended terms and is due and payable more than 90 days from the invoice date thereof;

(j) such Account (i) is not paid within 60 days following the original due date or 90 days following the original invoice date or (ii) has been written off the books of any of the Borrowers or has otherwise been designated on such books as uncollectible;

(k) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due;

(l) any Account Debtor obligated upon such Account is a debtor or a debtor in possession under any bankruptcy law or any other federal, state or foreign (including any provincial or territorial) receivership, insolvency relief or any other Debtor Relief Law, unless the payment with respect to such Account is supported by Acceptable Credit Support;

(m) (i) with respect to such Account (or any other Account due from the applicable Account Debtor), in whole or in part, a check, promissory note, draft, trade acceptance, or other instrument for the payment of money has been received, presented for payment and returned uncollected for any reason or (ii) such Account is otherwise classified as a note receivable and the obligation with respect thereto is evidenced by a promissory note or other debt instrument or agreement;

(n) such Account is the obligation of an Account Debtor from whom 50% or more of the face amount of all Accounts owing by such Account Debtor are ineligible under clause (j) of this definition;

(o) such Account is one as to which the Collateral Agent’s Lien attached thereon, for the benefit of itself and the other Secured Parties, is not a valid first priority perfected Lien (subject to Permitted Liens);

(p) Accounts as to which any of the representations or warranties in the Loan Documents with respect to such Accounts are untrue or inaccurate in any material respect (or, with respect to representations or warranties that are qualified by materiality, any of such representations and warranties are untrue or inaccurate);

(q) such Account is evidenced by a judgment, Instrument or Chattel Paper, other than Instruments or Chattel Paper that are held by any of the Borrowers or that have been delivered to the Administrative Agent;

(r) such Account is payable in any currency other than Dollars;

(s) the Account Debtor with respect to such Account (i) is not organized under laws of the United States, any state thereof or the District of Columbia or (ii) is not located, resident or

domiciled in, or does not maintain its chief executive office in, the United States; unless, in each case, (A) in the case of this clause (A) , subject to the prior written consent of the Administrative Agent in its sole discretion, (x) the jurisdiction of organization of such Account Debtor and its location, residence, domicile and jurisdiction of its chief executive office are satisfactory to the Administrative Agent in its sole discretion and (y) the applicable Borrower (1) has delivered a written notice, in form and substance reasonably acceptable to the Administrative Agent, to such Account Debtor that such Borrower has pledged or assigned to the Collateral Agent a security interest in all or any portion of its rights to such Account and the right to receive payments thereunder (each, a “ Notification ”) and (2) has used commercially reasonable efforts to obtain an acknowledgement, in form and substance reasonably acceptable to the Administrative Agent, to each Notification from each such Account Debtor or (B) payment with respect to such Account is supported by Acceptable Credit Support;

(t) such Account is the obligation of an Account Debtor that is the United States government or a political subdivision thereof, or department, agency or instrumentality thereof, unless the applicable Borrower has duly assigned its rights to payments of such Account to the Administrative Agent pursuant to, and has other complied with, the Federal Assignment of Claims Act of 1940, as amended, and any other applicable state, county or municipal Law restricting assignment thereof, which assignments and any related documents and filings, shall be satisfactory to the Administrative Agent in its Reasonable Credit Judgment;

(u) such Account has been redated, extended, compromised, settled, adjusted or otherwise modified or discounted, except discounts or modifications that are granted by a Borrower in the ordinary course of business and that are reflected in the calculation of the Borrowing Base;

(v) the Account Debtor with respect to such Account is located in a state of the United States of America requiring the filing of a notice of business activities report or similar report in order to permit a Borrower to seek judicial enforcement in such state of payment of such Account, unless such Borrower has qualified to do business in such state or has filed a notice of business activities report or equivalent report for the then-current year or if such failure to file and inability to seek judicial enforcement is capable of being remedied without any material delay or material cost;

(w) such Account was acquired or originated by a Person acquired in a Permitted Acquisition or other Investment (until such time as the Administrative Agent has completed a customary due diligence investigation as to such Accounts and such Person, which investigation may, at the sole discretion of the Administrative Agent, include an appraisal and/or field examination, and the Administrative Agent is satisfied with the results thereof in its Reasonable Credit Judgment);

(x) such Account (i) represents a sale on a bill-and-hold, guaranteed sale, sale and return, ship-and-return, sale on approval, consignment or other similar basis or (ii) was made pursuant to any other agreement providing for repurchases or return of any merchandise which has been claimed to be defective or otherwise unsatisfactory;

(y) any such Account that is the obligation of an Account Debtor that is, to the knowledge of any Borrower or the Administrative Agent, a Sanctioned Person;

(z) any such Account that is subject to a restriction on assignment that is enforceable against third parties and that impairs the Collateral Agent’s Lien on such Account or the Administrative Agent’s ability to enforce the Account;

(aa) such Account is subject to any security deposit (to the extent received from the applicable Account Debtor), progress payment, retainage or other similar advance made by or for the benefit of the applicable Account Debtor, in each case to the extent thereof;

(bb) such Account was invoiced in advance of goods or services provided, (ii) such Account was invoiced twice or more, or (iii) the associated revenue has not been earned;

(cc) except in the case of any Unbilled Accounts, the goods giving rise to such Account have not been shipped and/or title has not been transferred to the Account Debtor, or the Account represents a progress-billing or otherwise does not represent a complete sale; for purposes hereof, “progress-billing” means any invoice for goods sold or leased or services rendered under a contract or agreement pursuant to which the Account Debtor’s obligation to pay such invoice is conditioned upon the completion by a Borrower of any further performance under the contract or agreement; or

(dd) such Account is otherwise unacceptable to the Administrative Agent in its Reasonable Credit Judgment.

In determining the amount of any Account, the face amount of such Account shall be reduced by, without duplication, to the extent not reflected in such face amount, (A) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount that any of the Borrowers may be obligated to rebate to a customer pursuant to the terms of any written agreement or understanding), (B) the aggregate amount of all limits and deductions provided for in this definition and elsewhere in the Loan Documents, if any, and (C) the aggregate amount of all cash received in respect of such Account but not yet applied by a Borrower to reduce the amount of such Account.

Notwithstanding the foregoing, if at any time the aggregate amount of all Accounts of any single Account Debtor and its Affiliates exceeds 25.0% of the aggregate amount of all Eligible Accounts, then the Accounts of such Account Debtor in excess of such percentage shall not be deemed “Eligible Accounts,” unless such Account is supported by Acceptable Credit Support.

“ Eligible Assignee ” means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund that is, in the case of this clause (c) approved by each L/C Issuer; and (d) any other Person (other than a natural person) that is, in the case of this clause (d), approved by (i) the Administrative Agent, (ii) the Swingline Lender, (iii) each L/C Issuer and (iv) unless an Event of Default under Section 8.01(a) , Section 8.01(f) or Section 8.01(g) has occurred and is continuing, the Borrowers (each such approval not to be unreasonably withheld or delayed, provided that the Borrowers shall be deemed to have consented to the assignment to such Person if the Borrowers have not responded within 10 Business Days of a request for such approval); provided, further, that in no event shall any Borrower or its Subsidiaries or Defaulting Lender be an “Eligible Assignee”.

“ Eligible Billed Account ” means, at any time of determination, each Eligible Account of the Borrowers for which an invoice has been sent to the applicable Account Debtor with respect to such Eligible Account.

“ Eligible Coal Inventory ” means any Coal Inventory of the Borrowers that constitutes Eligible Inventory.

“ Eligible Inventory ” means, at any time of determination, without duplication, the Inventory Value of all Coal Inventory and Supplies Inventory of the Borrowers at such time; provided , that unless otherwise from time to time approved in writing by the Administrative Agent in its sole discretion, no Inventory shall constitute Eligible Inventory if, without duplication:

(a) the applicable Borrower does not have good and valid title to such Inventory, free and clear of any Lien (other than Permitted Liens);

(b) the Administrative Agent’s Lien on such Inventory, for the benefit of itself and the other Secured Parties, is not a valid first priority perfected Lien (subject to Permitted Liens);

(c) any of the representations or warranties in the Loan Documents with respect to such Inventory are untrue or inaccurate in any material respect (or, with respect to representations or warranties that are qualified by materiality, any of such representations and warranties are untrue or inaccurate);

(d) such Inventory (i) is either not finished goods (other than raw or unprocessed coal) or which constitutes work-in-process, packaging and shipping material or bill-and-hold goods, (ii) constitutes goods held on consignment (including any goods consigned at the location of a customer, supplier or contractor, but that are accounted for in the Inventory balance of the Borrowers) or (iii) constitutes goods which are not of a type held for sale in the ordinary course of business (other than in respect of Supplies Inventory);

(e) such Inventory is in-transit to or from a location not leased or owned by a Borrower (it being understood that the Borrowers shall provide their best estimate of the value of all such Inventory, which estimate is to be reflected in the Borrowing Base Certificate), other than any Coal Inventory that is physically within the United States and in-transit between the applicable coal mine and the Port of Mobile, Alabama;

(f) such Inventory is not located in the United States of America;

(g) such Inventory is located at any location leased by any of the Borrowers, unless (i) the lessor has delivered to the Administrative Agent a Landlord Lien Waiver as to such location or (ii) a Rent Reserve has been established by the Administrative Agent in its Reasonable Credit Judgment (measured as of the most recent practicable date);

(h) such Inventory is located in any third-party storage facility or is otherwise in the possession of a warehouseman or bailee (including any repairman) and is not evidenced by a Document, unless (i) such third party, warehouseman or bailee has delivered to the Administrative Agent a Landlord Lien Waiver and such other documentation as the Administrative Agent may reasonably require or (ii) a Rent Reserve has been established by the Administrative Agent in its Reasonable Credit Judgment;

(i) such Inventory is being processed or manufactured offsite (unless such processor or manufacturer has delivered to the Administrative Agent a Landlord Lien Waiver and such other documentation as the Administrative Agent may reasonably require);

(j) such Inventory was acquired or originated by a Person acquired in a Permitted Acquisition or other Investment (until such time as the Administrative Agent has completed a customary due diligence investigation as to such Inventory and such person, which investigation may, at the sole discretion of the Administrative Agent, include an inventory appraisal and/or field examination, and the Administrative Agent is satisfied with the results thereof in its Reasonable Credit Judgment);

(k) except in the case of Supplies Inventory, such Inventory consists of operating supplies, labels, packaging or shipping materials, cartons, repair parts, labels or miscellaneous spare parts, nonproductive stores Inventory and other such materials, in each case, not considered used for sale in the ordinary course of business;

(l) such Inventory is obsolete, slow-moving, nonconforming or unmerchantable or is identified as a write-off, overstock or excess by any of the Borrowers;

(m) any such Inventory, to the extent of any portion of the Inventory Value thereof that is attributable to intercompany profit among the Borrowers or any of their respective Affiliates (it being understood and agreed that the applicable Borrower shall provide its best estimate of such Inventory Value to the Administrative Agent, which Inventory Value shall be approved by the Administrative Agent and reflected in the most recent Borrowing Base Certificate);

(n) any such Inventory as to which any of the Borrowers takes an unrecorded book to physical inventory reduction based on the average of the most recent 12 months of physical inventory adjustments; or

(o) such Inventory is otherwise unacceptable to the Administrative Agent in its Reasonable Credit Judgment.

“ Eligible Supplies Inventory ” means any Supplies Inventory of the Borrowers that constitutes Eligible Inventory.

“ Eligible Unbilled Account ” means, at any time of determination, without duplication, each Unbilled Account of the Borrowers which constitutes an Eligible Account at such time; provided , that unless otherwise approved from time to time in writing by the Administrative Agent in its sole discretion, no Eligible Unbilled Account shall constitute an Eligible Unbilled Account if:

(a) the entire amount of the relevant Coal Inventory pertaining to such Unbilled Account has not, at such time, been loaded onto a shipping vessel at the applicable port (or other shipping location used by the applicable Borrower); and

(b) such shipping vessel is scheduled to depart the relevant port or shipping location to deliver such Coal Inventory to the applicable Account Debtor upon completion of loading, and title and risk of loss to such Coal Inventory shall have passed to the Account Debtor at or prior to such time.

“ Environment ” means ambient and indoor air, surface water and groundwater (including potable water, navigable water and wetlands), the land surface or subsurface strata or sediment, natural resources such as flora or fauna.

“ Environmental Laws ” means any and all federal, state, local and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, concessions, grants, franchises, agreements or other governmental restrictions or common law causes of action relating to (a) protection of the Environment or to emissions, discharges, releases or threatened releases of pollutants, contaminants, chemicals, or industrial, toxic or hazardous materials, substances or wastes into the Environment, (b) the SMCRA, (c) the MSHA, (d) human health as affected by hazardous or toxic materials substances or wastes, (e) acid mine drainage and (f) mining operations and activities to the extent relating to protection of the Environment or Reclamation; provided , that “ Environmental Laws ” do not include any laws relating to worker or retiree benefits, including benefits arising out of occupational diseases.

“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrowers, any other Loan Party or any of their respective Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the Environment, (e) Reclamation or (f) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“ Environmental Permits ” means any and all permits, licenses, registrations, certifications, notifications, exemptions and any other authorization required under any applicable Environmental Law (including, without limitation, those necessary under any applicable Environmental Laws for the construction, maintenance and operation of any coal mine or related processing facilities or Reclamation).

“ Equity Commitment Letter ” has the meaning specified in the Introductory Statement.

“ Equity Interests ” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ ERISA Affiliate ” means any trade or business (whether or not incorporated) under common control with any of the Borrowers within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

“ ERISA Event ” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any of the Borrowers or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by any of the Borrowers or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in “endangered” or “critical” status or is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds

under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (f) the imposition of any Lien pursuant to ERISA or the Code with respect to any Pension Plan or any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any of the Borrowers or any of their respective ERISA Affiliates or (g) the failure to meet the minimum funding standard of Section 412 of the Code with respect to a Pension Plan or the filing of a request for a waiver of such standards.

“ Equipment ” has the meaning specified in the UCC.

“ Eurocurrency Base Rate ” means, with respect to any Interest Period for any Eurocurrency Rate Loan, the rate per annum, determined by the Administrative Agent to be the offered rate for deposits in Dollars for the applicable Interest Period, equal to the ICE Benchmark Administration Limited LIBOR Rate (“ ICE LIBOR ”), as published by Reuters (or another commercially available source providing quotations of ICE LIBOR as designated by Administrative Agent from time to time) as of 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.

“ Eurocurrency Liabilities ” has the meaning assigned to that term in Regulation D of the Federal Reserve Board.

“ Eurocurrency Rate ” means, with respect to any Interest Period for any Eurocurrency Rate Loan, an interest rate per annum equal to the rate per annum obtained by dividing (a) the Eurocurrency Base Rate by (b)(i) a percentage equal to 100% minus (ii) the reserve percentage applicable two Business Days before the first day of such Interest Period under regulations issued from time to time by the Federal Reserve Board for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) for a member bank of the Federal Reserve System in New York City with respect to liabilities or assets consisting of or including Eurocurrency Liabilities (or with respect to any other category of liabilities that includes deposits by reference to which the Eurocurrency Rate is determined) having a term equal to such Interest Period; provided , if any such rate is less than zero, the Eurocurrency Base Rate shall be deemed to be zero.

“ Eurocurrency Rate Loan ” means a Loan that bears interest at a rate based on the Eurocurrency Rate.

“ Event of Default ” has the meaning specified in Section 8.01 .

“ Excluded Account ” means (a) any Deposit Account, Securities Account or Commodities Account of any Loan Party holding at all times less than $500,000 individually and $2,000,000 in the aggregate and (b) any other Deposit Account of any Loan Party used exclusively to hold funds (i) to be used to pay payroll and other employee wage and benefit payments to or for the benefit of any Loan Party’s or any of its Subsidiaries’ officers, directors or employees, (ii) to be used to pay Taxes (including sales Tax) required to be collected, remitted or withheld by any Loan Party or any of its Subsidiaries, (iii) zero balance disbursement accounts or (iv) which any Loan Party or any of its Subsidiaries holds on behalf of a third party (other than any Affiliate of such Loan Party or such Subsidiary) as escrow or fiduciary for such third party.

“ Excluded Assets ” has the meaning specified in the Security Agreement.

“ Excluded Subsidiary ” means any Subsidiary of Holdings that is (a) [reserved], (b) prohibited by any applicable requirement of Law or by any Contractual Obligation existing on the Closing Date (or, if later, on the date such Subsidiary is acquired pursuant to an acquisition permitted hereunder (so long as such prohibition is not incurred in contemplation of such acquisition)) from providing a Guarantee of the

Obligations or that would require the consent, approval, license or authorization of any Governmental Authority in order to provide such Guarantee or where the provision of such Guarantee would result in material adverse Tax consequences to the Borrowers and their respective Subsidiaries as reasonably determined by Holdings, (c) a Disregarded Domestic Person, (d) a Domestic Subsidiary that is a Subsidiary of a Foreign Subsidiary, (e) a Domestic Subsidiary that is an indirect Subsidiary of a Disregarded Domestic Person, (f) an Immaterial Subsidiary, (g) a CFC or (h) any other Subsidiary to the extent that the burden or cost of providing a Guarantee of the Obligations outweighs the benefit afforded thereby as reasonably determined by the Administrative Agent and Holdings.

“ Excluded Taxes ” means, with respect to the Administrative Agent, any Lender, any L/C Issuer or any other recipient of any payment to be made by or on account of any obligation of the Borrowers hereunder, (a) branch profits Taxes, Taxes imposed on or measured by its overall net income (however denominated), and franchise Taxes, in each case, (i) imposed on it as a result of the Administrative Agent, such Lender or such L/C Issuer (or such other recipient) being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrowers under Section 11.13 ), United States withholding Taxes that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or any tax that is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law after the date such Foreign Lender becomes a party hereto) to comply with Section 3.01(f) ; except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of the designation of a new Lending Office (or assignment), to receive additional amounts from Borrowers with respect to such withholding tax pursuant to Section 3.01(a), or (c) any United States withholding Taxes imposed under FATCA.

“ Facility ” has the meaning specified in the introductory statement hereto.

“ Facility Increase ” has the meaning specified in Section 2.15.

“ Facility Increase Amount ” has the meaning specified in Section 2.15.

“ Fair Market Value ” means with respect to any asset or group of assets at any date, the value of the consideration obtainable in a sale of such asset at such date assuming a sale by a willing seller to a willing purchaser dealing at arm’s length and arranged in an orderly manner over a reasonable period of time having regard to the nature and characteristics of such asset, as reasonably determined in good faith by the Borrowers or, if such asset shall have been the subject of a relatively contemporaneous appraisal by an independent third party appraiser, the basic assumptions underlying which have not materially changed since its date, the value set forth in such appraisal.

“ FATCA ” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code, and applicable intergovernmental agreements and related legislation or official administrative rules or practices with respect thereto.

“ Federal Funds Rate ” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

“ Federal Reserve Board ” means the Board of Governors of the United States Federal Reserve System, or any successor thereto.

“ Fee Letters ” means, collectively, (i) the Arrangement and Agency Fee Letter and (ii) the Upfront Fee Letters.

“ Financial Statements ” means the financial statements of Holdings and its Subsidiaries, on a consolidated basis, delivered in accordance with Section 6.01 .

“ Financing Lease ” means any lease of property, real or personal, the obligations of the lessee in respect of which are required in accordance with GAAP to be capitalized on a balance sheet of the lessee; provided that for all purposes hereunder, the amount of Indebtedness under any Financing Lease shall be the capitalized amount thereof appearing on such balance sheet in accordance with GAAP.

“ Fixed Charges ” shall mean, for any period, the sum of, without duplication: (a) all scheduled amortization payments of principal paid or due and payable during such period by Holdings or any its Subsidiaries in respect of any Indebtedness under clause (a) of the definition thereof (including scheduled payments of the principal portion of Capital Lease Obligations), plus (b) consolidated interest expense (including the interest component of payments under Capital Lease Obligations) of Holdings and its Subsidiaries for such period, plus (c) the aggregate amount of Federal, state, local and foreign income Taxes and franchise and similar Taxes (net of any benefit or credit) included in the determination of Consolidated Net Income paid in cash during such period, plus (d) all Restricted Payments payable during such period to any Person other than Holdings and its Subsidiaries.

“ Fixed Charge Coverage Ratio ” shall mean, with respect to any period, the ratio of (a) Consolidated EBITDA of Holdings and its Subsidiaries for such period, minus non-financed Capital Expenditures (including Capital Expenditures financed with the proceeds of any Loans) paid or payable currently in cash by Holdings or any of its Subsidiaries for such period to (b) the Fixed Charges of Holdings and its Subsidiaries during such period. For the first three fiscal quarters of Holdings ending after the Closing Date, the Fixed Charge Coverage Ratio shall be calculated on an annualized basis for the period commencing on the Closing Date and ending on the last day of the fiscal quarter ending on such date.

“ Fixtures ” has the meaning specified in the UCC.

“ Foreign Lender ” means, with respect to the Borrowers, any Lender that is organized under the laws of a jurisdiction other than the United States, any state thereof or the District of Columbia.

“ Foreign Subsidiary ” means any Subsidiary of Holdings that is not a Domestic Subsidiary.

“ Fronting Exposure ” means, at any time there is a Defaulting Lender, (a) with respect to any L/C Issuer, such Defaulting Lender’s Ratable Portion of the outstanding L/C Obligations with respect to Letters of Credit issued by such L/C Issuer other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof; and (b) with respect to the Swingline Lender, such Defaulting Lender’s Ratable Portion of outstanding Swingline Loans made by the Swingline Lender other than Swingline Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders in accordance with the terms hereof.

“ Fund ” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

“ GAAP ” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board (or agencies with similar functions and comparable stature and authority within the accounting profession), that are applicable to the circumstances as of the date of determination.

“ General Intangible ” has the meaning set forth in Article 9 of the UCC.

“ Goods ” has the meaning specified in the UCC.

“ Governmental Authority ” means the government of the United States or any other nation, or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“ Guarantee ” means, as to any Person (the “guaranteeing person”), any obligation of (a) the guaranteeing person or (b) another Person (including, without limitation, any bank under any letter of credit) to the extent the guaranteeing person has issued a reimbursement, counterindemnity or similar obligation in order to induce the creation of such obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the “primary obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, reimbursement obligations under letters of credit and any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided , however , that the term Guarantee shall not include (i) ordinary course performance guarantees by any Loan Party of the obligations (other than for the payment of borrowed money) of any other Loan Party and (ii) endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrowers in good faith. The term “Guarantee” as a verb has a corresponding meaning.

“ Guarantor ” means each Guarantor listed on Schedule 1.01(a) , and each of the existing and future, direct or indirect, Domestic Subsidiaries of Holdings (other than any Excluded Subsidiary) that guarantees the Obligations pursuant to Section 6.12 .

“ Hazardous Materials ” means (i) any explosive or radioactive substances or wastes and (ii) any substances, materials or wastes, defined or regulated as “hazardous”, “toxic”, a “pollutant”, a “contaminant” under, or that could reasonably be expected to give rise to liability under, any applicable Environmental Law, including, without limitation, asbestos, polychlorinated biphenyls, urea-formaldehyde insulation, gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any coal ash, coal combustion by-products or waste, boiler slag, scrubber residue or flue desulphurization residue.

“ Hedge Bank ” means (a) a Lender or an Affiliate of a Lender that is a party to a Secured Hedge Agreement on the Closing Date or (b) any Person that, at the time it enters into a Secured Hedge Agreement, is a Lender or an Affiliate of a Lender, in each case, in its capacity as a party to such Secured Hedge Agreement.

“ Honor Date ” shall have the meaning specified in Section 2.04(d)(i) .

“ Immaterial Subsidiary ” means, at any date of determination, each Subsidiary of Holdings that is not a Material Subsidiary.

“ Increase Effective Date ” has the meaning specified in Section 2.15.

“ Indebtedness ” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b) all reimbursement obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, bid, performance and Reclamation bonds, surety and appeal bonds and similar instruments issued for the account of such Person;

(d) all obligations of such Person to pay the deferred purchase price of property or services (other than current trade liabilities incurred in the ordinary course of business and payable in accordance with customary practices and accrued expenses and payroll incurred in the ordinary course of business), including any earn-out obligation to the extent the same would be required to be shown as a liability on the balance sheet of such Person prepared in accordance with GAAP;

(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(f) Capital Lease Obligations; and

(g) all Guarantees of such Person in respect of any of the foregoing Indebtedness of any other Person.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, to the extent such person is liable therefor as a result of such Person’s ownership interest in such entity or otherwise, except (other than in the case of general partner liability) to the extent that the terms of such Indebtedness expressly provide that such person is not liable therefor. The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any Capital Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

“ Indemnified Liabilities ” has the meaning specified in Section 11.04.

“ Indemnified Taxes ” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document, and (b) to the extent not otherwise described in clause (a), Other Taxes.

“ Indemnitees ” has the meaning specified in Section 11.04(b) .

“ Information ” has the meaning specified in Section 11.07 .

“ Initial Rights Offering ” has the meaning specified in the introductory statement hereto.

“ Instrument ” has the meaning specified in the UCC.

“ Intellectual Property ” has the meaning specified in Section 5.18 .

“ Intellectual Property Security Agreements ” has the meaning specified in the Security Agreement.

“ Interest Payment Date ” means, (a) as to any Eurocurrency Rate Loan, the last day of each Interest Period applicable to such Loan, the Termination Date, and in the case of a Eurocurrency Rate Loan with an Interest Period of more than three months’ duration, each day that would have been an Interest Payment Date had successive Interest Periods of three months’ duration been applicable to such Loan; and (b) as to any Base Rate Loan, the last Business Day of each March, June, September and December and the Termination Date.

“ Interest Period ” means, as to each Eurocurrency Rate Loan, the period commencing on the date such Eurocurrency Rate Loan is disbursed or converted to or continued as a Eurocurrency Rate Loan and ending on the date one, two, three or six months (or, to the extent agreed to by all of the Lenders, 12 months) thereafter, as selected by a Borrower in its Borrowing Notice or Notice of Conversion or Continuation, as applicable; provided , that:

(a) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

(b) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

“ Investment ” means, as to any Person, any direct or indirect acquisition or investment by such Person, including by means of (a) the purchase or other acquisition of Equity Interests or other securities of another Person, (b) a loan, advance (excluding intercompany liabilities incurred in the ordinary course of business in connection with the cash management operations of the Loan Parties) or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of all or substantially all of the assets or business of another Person or assets that constitute a business unit, line of business or division of such Person. For purposes of covenant compliance, the amount of any Investment shall be (i) the amount actually invested, as determined immediately prior to the time of each such Investment, without adjustment for subsequent increases or decreases in the value of such Investment minus (ii) the amount of dividends or distributions received in connection with such Investment and any return of capital and any payment of principal received in respect of such Investment that in each case is received in cash, Cash Equivalents or short-term marketable debt securities.

“ Investment Property ” has the meaning specified in the UCC.

“ Inventory ” has the meaning specified in the UCC.

“ Inventory Value ” means, at any time of determination, with respect to any Inventory of any of the Loan Parties (i) with respect to any Coal Inventory, the actual production cost per ton thereof, based on the “clean coal equivalent” thereof and (ii) with respect to any other Inventory, the standard cost determined on a “first in-first out” basis and carried on the general ledger or inventory system of such Loan Party stated on a basis consistent with its current and historical accounting practices, in Dollars, determined in accordance with GAAP, less , without duplication, (x) any markup on Inventory from an Affiliate and (y) in the event variances under GAAP are expensed, a Reserve determined by the Administrative Agent in its Reasonable Credit Judgment as appropriate in order to adjust the standard cost of Eligible Inventory to approximate actual cost.

“ ISP ” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

“ Issuer Documents ” means with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by any L/C Issuer and the Borrowers (or any Subsidiary) or in favor of such L/C Issuer and relating to any such Letter of Credit.

“ Joint Venture ” means any Person (other than a Subsidiary) in which Holdings or any of its Subsidiaries holds an ownership interest.

“ Landlord Lien Waiver ” means any landlord lien waiver, estoppel, warehouseman waiver or other collateral access or similar letter or agreement.

“ Laws ” means, as to any Person, collectively, all international, foreign, Federal, state and local laws, statutes, treaties, rules, regulations, ordinances, codes, and determinations of arbitrators or courts or other Governmental Authorities, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“ L/C Advance ” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Applicable Percentage.

“ L/C Borrowing ” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date when made or refinanced as a Borrowing.

“ L/C Cash Collateral Account ” means the account established by, and under the sole dominion and control of, the Administrative Agent maintained with the Administrative Agent and designated as the “Warrior Met L/C Cash Collateral Account”.

“ L/C Credit Extension ” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

“ L/C Issuer ” means, collectively, each of Citibank, N.A. and Credit Suisse AG, Cayman Islands Branch in its respective capacity as issuer of Letters of Credit hereunder, and any other Lender or Lenders reasonably acceptable to Holdings and the Administrative Agent (such consent not to be unreasonably withheld, delayed or conditioned) that agree to act as L/C Issuer, and any successor issuer of Letters of Credit hereunder.

“ L/C Obligations ” means as at any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts with respect to Letters of Credit, including all L/C Borrowings plus the aggregate amount of Letter of Credit Fees then due and payable.

“ L/C Sublimit ” means, at any time, (a) with respect to all of the L/C Issuers taken as a whole, $50,000,000 and (b) with respect to each L/C Issuer individually, an amount allocated to such L/C Issuer by the Administrative Agent, at the request of the Borrowers, and accepted by such L/C Issuer in its sole discretion. As of the Closing Date, the L/C Sublimit of each L/C Issuer referred to in clause (b) above shall be the amount set forth opposite such L/C Issuer’s name on Schedule 1.01(b) .

“ Lender ” means each financial institution listed on Schedule 1.01(b) , as well as any Person that becomes a “Lender” hereunder pursuant to Section 11.06(b) . Unless the context requires otherwise, the term “Lender” shall include the Swingline Lender.

“ Lending Office ” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire or Assignment and Acceptance by which it became a Lender or such other office or offices as a Lender may from time to time notify the Borrowers and the Administrative Agent.

“ Letter of Credit ” means any letter of credit issued pursuant to Section 2.04(a) .

“ Letter of Credit Application ” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by any L/C Issuer.

“ Letter of Credit Expiration Date ” means the day that is the earlier of (a) 12 months after its date of issuance (or such longer period as may be agreed by the applicable L/C Issuer and the applicable Borrower) and (b) 5 Business Days prior to the Maturity Date; provided that any Letter of Credit may provide for renewal thereof for additional periods of up to 12 months (which in no event shall extend beyond the date referred to be in clause (b) above, except to the extent Cash Collateralized pursuant to arrangements reasonably acceptable to the relevant L/C Issuer).

“ Letter of Credit Fee ” has the meaning specified in Section 2.04(j) .

“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any Financing Lease having substantially the same economic effect as any of the foregoing).

“ Liquidity Period ” means any period commencing on any day that (i) any Event of Default shall have occurred and be continuing, (ii) Availability shall be less than the greater of (x) $11,250,000 and (y) 15% of the Maximum Revolving Credit for a period of five (5) consecutive Business Days or (iii) Availability shall less than the greater of (x) $9,375,000 and (y) 12.5% of the Maximum Revolving Credit on any Business Day, which period shall terminate on the date on which Availability has exceeded $11,250,000 for a period of 30 consecutive calendar days.

“ Loan ” has the meaning specified in Section 2.01 .

“ Loan Documents ” means, collectively, (a) this Agreement, (b) the Notes, (c) the Collateral Documents, (d) each Issuer Document, (e) each Secured Hedge Agreement, and (f) each Secured Cash Management Agreement.

“ Loan Parties ” means, collectively, the Borrowers and each Guarantor.

“ Lower of Cost or Market Reserve ” means any reserve established by the Administrative Agent at any time in respect of the amount by which the Inventory Value of any Coal Inventory exceeds the Market Value thereof.

“ Market Value ” means, with respect to any Coal Inventory, the fair market value thereof, determined based on the actual selling price of coal to third-parties at any time during the period following the last day of any month (or, during a Liquidity Period, any applicable week) and prior to the delivery of the Borrowing Base Certificate with respect to such month or week, as applicable; provided , that if the aggregate volume of Coal Inventory sold at any time during such period is less than the aggregate on-hand volume of Coal Inventory as of the date of such Borrowing Base Certificate, the Market Value shall be reasonably determined in good faith by the Loan Parties consistent with past practices of the Loan Parties and Walter and its Subsidiaries.

“ Material Adverse Effect ” means a material adverse effect upon (a) the business, assets, operations, property or condition (financial or otherwise) of Holdings and its Subsidiaries taken as a whole, (b) the validity or enforceability of this Agreement or any of the other Loan Documents or the rights or remedies of the Administrative Agent or the Secured Parties hereunder or thereunder and (c) the ability of the Loan Parties (taken as a whole) to perform their obligations under the applicable Loan Documents.

“ Material Leased Real Property ” means (a) all Real Property listed on Schedule 5.08(a) (as supplemented in accordance with Schedule 6.20 ) and (b) any other Real Property subject to a Real Property Lease with respect to which a Loan Party acquires an interest with Coal reserves having annual minimum royalties, rents or any similar payment obligations in excess of $1,500,000.

“ Material Owned Real Property ” means (a) all Real Property listed on Schedule 5.08(b) and (b) any other Real Property owned in fee by any Loan Party having a tax assessment value reasonably estimated by the Borrowers (or, at the request of the Administrative Agent, by an independent appraiser acceptable to the Administrative Agent) to be in excess of $1,500,000.

“ Material Subsidiary ” means, at any date of determination, each of the Subsidiaries of Holdings (a) whose total assets at the last day of the most recently ended Test Period were equal to or greater than 2.5% of the Consolidated Total Assets of Holdings and its Subsidiaries at such date or (b) whose gross revenues for such Test Period were equal to or greater than 2.5% of the consolidated gross revenues of Holdings and its Subsidiaries for such Test Period, in each case determined in accordance with GAAP; provided , that if, at any time and from time to time, Subsidiaries that are not Guarantors solely because they do not meet the thresholds set forth in clauses (a) or (b) comprise in the aggregate more than 5.0% of Consolidated Total Assets of Holdings and its Subsidiaries as of the end of the most recently ended fiscal quarter or fiscal year for which financial statements are required to have been delivered pursuant to Section 6.01 or more than 5.0% of the consolidated gross revenues of Holdings and its Subsidiaries for the Test Period ending as of the last day of such fiscal quarter or fiscal year, then the Borrowers shall, not later than 30 days after the date by which financial statements for such fiscal quarter or fiscal year are required to be delivered pursuant to this Agreement, designate in writing to the Administrative Agent one or more of such Subsidiaries as “Material Subsidiaries” to the extent required such that the foregoing condition ceases to be true and comply with the provisions of Section 6.12 applicable to such Subsidiary; provided , further that the Borrowers may designate any other Subsidiary as a “Material Subsidiary” and comply with the provisions of Section 6.12 applicable to such Subsidiary.

“ Maturity Date ” means the date that is 3 years after the Closing Date; provided , that individual Lenders may agree to extend the maturity of their Commitments under the Facility upon the request of the Borrowers and without the consent of any other Lender.

“ Maximum Rate ” has the meaning specified in Section 11.09 .

“ Maximum Revolving Credit ” means, at any time, the lesser of (i) the Borrowing Base at such time and (ii) the aggregate amount of Commitments in effect at such time.

“ Minimum Rights Offering Amount ” has the meaning specified in the Introductory Statement.

“ Mining Financial Assurances ” has the meaning specified in Section 5.10 .

“ Mining Title ” means fee simple title to surface and/or Coal or an undivided interest in fee simple title thereto or a leasehold interest in all or an undivided interest in surface and/or Coal together with (A) for Real Property designated for surface mining, no less than those easements, licenses, privileges, rights and appurtenances as are necessary to mine, remove, and transport Coal by surface mining methods; (B) for Real Property designated for underground mining, no less than those easements, licenses, privileges, rights and appurtenances as are necessary to mine, remove, and transport Coal by underground mining methods; and (C) for Real Property where any Loan Party has facilities currently used in the Coal mining business, including office and administrative buildings, mine openings, air shafts, preparation and processing plants, slurries and gob disposal areas, retention and drainage ponds, unfinished Reclamation areas, coal terminals, and coal loading and storage facilities, no less than those easements, licenses, privileges, rights, and appurtenances as are necessary to operate such facilities in the manner presently operated.

“ Moody’s ” means Moody’s Investors Service, Inc. and any successor thereto.

“ Money ” has the meaning specified in the UCC.

“ Mortgage ” means a deed of trust, trust deed, deed to secure debt, mortgage, leasehold mortgage and leasehold deed of trust in form and substance reasonably satisfactory to the Administrative Agent, in each case as amended, restated, supplemented or otherwise modified from time to time.

“ MSHA ” means the Federal Mine Safety and Health Act of 1977, 30 U.S.C. §§ 801 et seq., as amended.

“ Multiemployer Plan ” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Borrowers or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

“ National Flood Insurance Program ” means any flood insurance available pursuant to the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statute thereto, the National Flood Insurance Reform Act of 1994 (amending 42 USC 4001, et seq.), as the same may be amended or recodified from time to time, or the Flood Insurance Reform Act of 2004 and any regulations promulgated thereunder.

“ Net Cash Proceeds ” means, with respect to any Disposition by the Borrowers or any of their respective Subsidiaries, the excess, if any, of (i) the sum of cash and Cash Equivalents received in connection with such Disposition (including any cash or Cash Equivalents received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) over (ii) the sum of (A) the principal amount, premium or penalty, if any, interest, breakage costs and other amounts on any Indebtedness that is secured by the asset subject to such Disposition and that is required to be repaid or paid in connection with such transaction (other than Indebtedness under, or that is secured by, the Loan Documents), (B) the reasonable out-of-pocket fees and expenses (including reasonable out-of-pocket attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title insurance premiums and related search and recording charges, transfer Taxes, other customary expenses and brokerage, consultant and other customary fees) incurred by the Borrowers or such Subsidiary in connection with such transaction, (C) Taxes reasonably estimated to be actually payable within two years of the date of the relevant transaction as a result of any gain recognized in connection therewith; provided, that if the amount of any estimated Taxes pursuant to subclause (C) exceeds the amount of Taxes actually required to be paid in cash in respect of such Disposition, the aggregate amount of such excess shall constitute Net Cash Proceeds and (E) any reserve for adjustment in respect of (x) the sale price of such asset established in accordance with GAAP and (y) any liabilities associated with such asset and retained by the Borrower or any Subsidiary after such Disposition thereof, including pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction; provided that no net cash proceeds calculated in accordance with the foregoing realized in a single transaction or series of related transactions shall constitute Net Cash Proceeds unless such net cash proceeds shall exceed $1,000,000 and (z) no such net cash proceeds shall constitute Net Cash Proceeds under this definition in any fiscal year of Holdings until the aggregate amount of all such net cash proceeds in such fiscal year shall exceed $2,000,000 (and thereafter only net cash proceeds in excess of such amount shall constitute Net Cash Proceeds under this definition).

“ Net Insurance/Condemnation Proceeds ” means an amount equal to: (a) any cash payments or proceeds (including Cash Equivalents) received by Holdings or any of its Subsidiaries (i) under any casualty insurance policy in respect of a covered loss thereunder of any assets of Holdings or any of its Subsidiaries or (ii) as a result of the taking of any assets of Holdings or any of its Subsidiaries by any Person pursuant to the power of eminent domain, condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power under threat of such a taking, minus (b) (i) any actual out-of-

pocket costs incurred by Holdings or any of its Subsidiaries in connection with the adjustment, settlement or collection of any claims of Holdings or any of its Subsidiaries in respect thereof, (ii) payment of the outstanding principal amount of, premium or penalty, if any, and interest on any Indebtedness (other than the Loans) that is secured by a Lien on the assets in question and that is required to be repaid under the terms thereof as a result of such loss, taking or sale, (iii) in the case of a taking, the reasonable out-of-pocket costs of putting any affected property in a safe and secure position, (iv) any selling costs and out-of-pocket expenses (including reasonable broker’s fees or commissions, legal fees, transfer and similar Taxes and the Borrower’s good faith estimate of income Taxes paid or payable) in connection with any sale or taking of such assets as referred to in clause (a)(ii) of this definition and (v) any amounts provided as a reserve, in accordance with GAAP, against any liabilities under any indemnification obligations or purchase price adjustments associated with any sale or taking of such assets as referred to in clause (a)(ii) of this definition ( provided that to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Insurance/Condemnation Proceeds), provided that no net cash proceeds calculated in accordance with the foregoing realized in a single transaction or series of related transactions shall constitute Net Insurance/Condemnation Proceeds unless such net proceeds shall exceed $1,000,000 and (z) no such net proceeds shall constitute Net Insurance/Condemnation Proceeds under this definition in any fiscal year of Holdings until the aggregate amount of all such net proceeds in such fiscal year shall exceed $2,000,000 (and thereafter only net cash proceeds in excess of such amount shall constitute Net Insurance/Condemnation Proceeds under this definition).

“ Net Orderly Liquidation Value ” means the cash proceeds of Inventory that could be obtained in an orderly liquidation (net of all liquidation expenses, costs of sale, operating expenses and retrieval and related costs), as determined pursuant to the most recent Appraisal delivered to the Administrative Agent.

“ Non-ABL Priority Collateral ” means all Collateral that does not constitute ABL Priority Collateral.

“ Non-Defaulting Lender ” means, at any time, each Lender that is not a Defaulting Lender at such time.

“ Non-Extension Notice Date ” has the meaning specified in Section 2.04(c)(iii) .

“ Non-Reinstatement Deadline ” has the meaning specified in Section 2.04(c)(iv) .

“ Nonconsenting Lender ” has the meaning specified in Section 11.13 .

“ Note ” means a promissory note made by the Borrowers in favor of a Lender evidencing Loans made by such Lender, substantially in the form of Exhibit C .

“ Notice of Conversion or Continuation ” means a notice by the Borrowers to (i) convert Base Rate Loans or any portion thereof to Eurocurrency Rate Loans or (ii) at the end of any applicable Interest Period, convert Eurocurrency Rate Loans or any portion thereof into Base Rate Loans or to continue such Eurocurrency Rate Loans or any portion thereof for an additional Interest Period, in each case, substantially in the form of Exhibit B .

“ Notification ” shall have the meaning given to such term in clause (s) of the definition of “Eligible Accounts.”

“ Obligations ” means all advances to, and debts, liabilities and obligations of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan, Letter of Credit, Swingline Loan or Protective Advance whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising.

“ Obligee Guarantor ” shall have the meaning given to such term in Section 10.08 .

“ OFAC ” means the Office of Foreign Assets Control of the U.S. Department of Treasury.

“ Organization Documents ” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“ Other Connection Taxes ” means, with respect to any Administrative Agent, Lender or L/C Issuer (or any such other recipient) Taxes imposed as a result of a present or former connection between the recipient and the jurisdiction imposing such Tax (other than connections arising from the Administrative Agent, such Lender, or such L/C Issuer (or such other recipient) having executed, delivered, become a party to, performed its obligations under, received a payment under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“ Other Taxes ” means all present or future stamp, court or documentary taxes or any other excise or property taxes, charges or similar levies (and interest, fines, penalties and additions related thereto) arising from any payment made hereunder or under any other Loan Document or from the execution, delivery, performing, enforcement or registration of, from the receipt or perfection of a security interest under or otherwise with respect to, this Agreement or any other Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.06(b).

“ Outstanding Amount ” means (i) with respect to Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Loans occurring on such date; (ii) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by the Borrowers of Unreimbursed Amounts, (iii) with respect to Swingline Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments of such Swingline Loans occurring on such date and (iv) with respect to Protective Advances on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments of such Protective Advances on such date.

“ Overnight Rate ” means, for any day, the greater of (a) the Federal Funds Rate and (b) an overnight rate determined by the Administrative Agent or any L/C Issuer, as the case may be, in accordance with banking industry rules on interbank compensation.

“ Participant ” has the meaning specified in Section 11.06(d) .

“ Participant Register ” has the meaning specified in Section 11.06(d).

“ Payment Conditions ” mean, at any time of determination, with respect to any Indebtedness incurred pursuant to Section 7.02(l) , Investment (including any Permitted Acquisition) or Restricted Subordinated Debt Payment (each such event or transaction, a “ Permitted Transaction ”), the satisfaction of each of the following conditions:

(a) no Event of Default has occurred and is continuing or would immediately result from the consummation of such Permitted Transaction;

(b) a Liquidity Period is not in effect at such time; and

(c) the Borrowers shall have demonstrated compliance at the time of consummation of such Permitted Transaction with either clause (i) or clause (ii) below:

(i) (x) pro forma Availability immediately after giving effect to such Permitted Transaction (taking into account any Credit Extensions made to finance such Permitted Transaction) and (y) pro forma average Availability for the 30-day period immediately preceding the consummation of such Permitted Transaction (assuming such Permitted Transaction (and any Credit Extensions made to finance such Permitted Transaction) shall have occurred on the first day of such period), shall be, in each case, greater than $15,000,000, or

(ii) both (x)(1) pro forma Availability immediately after giving effect to such Permitted Transaction (taking into account any Credit Extensions made to finance such Permitted Transaction) and (2) pro forma average Availability for the 30-day period immediately preceding the consummation of such Permitted Transaction (assuming such Permitted Transaction (and any Credit Extensions made to finance such Permitted Transaction) shall have occurred on the first day of such period), shall be, in each case, greater than $11,250,000 and (y) the Fixed Charge Coverage Ratio, on a pro forma basis, as of the last day of the most recently ended Test Period (after giving pro forma effect to such Permitted Transaction and each other Permitted Transaction that has occurred since the beginning of such Test Period) shall not be less than 1.00 to 1.00.

“ PBGC ” means the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any successor thereto.

“ Pension Plan ” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Borrowers or any ERISA Affiliate or to which the Borrowers or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years.

“ Perfection Certificate ” means a perfection certificate substantially in the form of Exhibit I or any other form approved by the Administrative Agent, as such perfection certificate may be amended, restated, supplemented or otherwise modified from time to time.

“ Perfection Certificate Supplement ” means a supplement to the Perfection Certificate substantially in the form of Exhibit J .

“ Permitted Acquisitions ” has the meaning specified in Section 7.03(k) .

“ Permitted Holders ” means, collectively, (a) Apollo Global Management LLC, together with its Affiliates and funds managed, advised or controlled by it or its Affiliates, (b) Caspian Capital LP, together with its Affiliates and funds managed, advised or controlled by it or its Affiliates, (c) Franklin Mutual Advisers LLC, together with its Affiliates and funds managed, advised or controlled by it or its Affiliates, (d) GSO Capital Partners LP, together with its Affiliates and funds managed, advised or controlled by it or its Affiliates and (e) KKR Credit Advisors (US) LLC, together with its Affiliates and funds managed, advised or controlled by it or its Affiliates.

“ Permitted Liens ” has the meaning specified in Section 7.01.

“ Permitted Transactions ” has the meaning specified in the definition of “Payment Conditions”.

“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“ Plan ” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA) established by the Borrowers or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, by any ERISA Affiliate.

“ Pledged Collateral ” has the meaning specified in Section 1.03 of the Security Agreement.

“ Pledged Stock ” has the meaning specified in Section 1.03 of the Security Agreement.

“ Port Charges Reserve ” means any reserve established by the Administrative Agent at any time in respect of any amounts that are due and payable by any of the Borrowers or any of its respective Subsidiaries to any port authority (including the Alabama State Port Authority) or any vendor providing sampling and/or loading services to any of the Borrowers or any of its respective Subsidiaries.

“ Proceeds ” has the meaning specified in the UCC and, in any event, shall also include, but not be limited to, (i) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to the Administrative Agent or Holdings or any of its Subsidiaries from time to time with respect to any of the Collateral, (ii) any and all payments (in any form whatsoever) made or due and payable to Holdings or any of its Subsidiaries from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any Governmental Authority (or any Person acting under color of Governmental Authority) and (iii) any and all other amounts from time to time paid or payable under or in connection with any of the Collateral.

“ Production Payments ” means with respect to any Person, all production payment obligations and other similar obligations with respect to coal and other natural resources of such Person that are recorded as a liability or deferred revenue on the financial statements of such Person in accordance with GAAP.

“ Pro Forma Financial Statements ” means the financial statements of Holdings and its Subsidiaries, on a consolidated basis, delivered in accordance with Section 4.01(c) .

“ Properties ” means the facilities and properties currently or formerly owned, leased or operated by the Borrowers or any of their respective Subsidiaries.

“ Protective Advances ” has the meaning specified in Section 2.03 .

“ Public Lender ” has the meaning specified in Section 9.16(e) .

“ Qualified Cash ” means unrestricted cash of the Borrowers that is (i) deposited in a cash Deposit Account established and maintained at, and in the name of, the Administrative Agent, and over which the Administrative Agent has sole dominion and control, upon terms reasonably satisfactory to the Administrative Agent and (ii) subject to the valid, enforceable and first priority perfected security interest of the Administrative Agent and not subject to any other Lien or claim, except to the extent that the holder of any of the same has entered into an intercreditor agreement with the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent (other than customary Liens or rights of setoff of with the Administrative Agent in its capacity as a depository bank, provided , that, for purposes of the amount of Qualified Cash included in the calculation of Borrowing Base, such amount may be reduced, at the Administrative Agent’s option, by any obligations owing to it as a depository bank).

“ Qualified ECP Guarantor ” means, in respect of any Swap Contract, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant Guarantee or grant of the relevant security interest becomes effective with respect to such Swap Contract or such other person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“ Qualifying IPO ” means the issuance and sale by a Borrower or Holdings of its common Equity Interests in an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-8) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act (whether alone or in connection with a secondary public offering).

“ Ratable Portion ” or (other than in the expression “equally and ratably”) “ ratably ” means, with respect to any Lender, the percentage obtained by dividing (a) the Commitment of such Lender by (b) the aggregate Commitments of all Lenders (or, at any time after the Termination Date, the percentage obtained by dividing the aggregate outstanding principal balance of the Total Outstandings owing to such Revolving Credit Lender by the aggregate outstanding principal balance of the Total Outstandings owing to all Lenders).

“ Real Property ” shall mean, collectively, all right, title and interest (including any leasehold estate) in and to any and all parcels of or interests in real property owned, leased or operated by any Person, whether by lease, license or other means, together with, in each case, all improvements, fixtures, easements, hereditaments, permits and appurtenances relating thereto, and including, with respect to the Loan Parties, all property listed on Schedule 5.08(a) and Schedule 5.08(b) .

“ Real Property Lease ” means any lease, license, letting, concession, occupancy agreement, sublease, easement or right of way to which such Person is a party and is granted a possessory interest in or a right to use or occupy all or any portion of the Real Property (including, without limitation, the right to extract minerals from any portion of Real Property) and every amendment or modification thereof including with respect to the Loan Parties, without limitation, the leases with respect to Real Property listed on Schedule 5.08(a) and any Contractual Obligation with respect to any of the foregoing.

“ Reasonable Credit Judgment ” means the Administrative Agent’s commercially reasonable credit judgment (from the perspective of a secured asset-based lender), in consultation with the Lenders as of the Closing Date (so long as, at the time of exercising such credit judgment, there are no Lenders other than such Lenders as of the Closing Date or their respective Affiliates), in accordance with customary business practices for comparable asset-based lending transactions exercised in good faith; provided , that as it relates to the establishment of Reserves or the adjustment or imposition of exclusionary criteria, Reasonable Credit Judgment will require that (a) such establishment, adjustment or imposition after the Closing Date be based on the analysis of facts, events, conditions or contingencies first occurring or first

discovered by the Administrative Agent after the Closing Date or that are materially different from facts, events, conditions or contingencies known to the Administrative Agent on the Closing Date, (b) the imposition or increase of any Reserve shall not duplicate (x) the exclusionary criteria set forth in the definitions of “Eligible Account,” “Eligible Unbilled Account” and “Eligible Inventory,” as applicable (and vice versa), or (y) any Reserves deducted in computing book value or Net Orderly Liquidation Value and (c) the amount of any such Reserve so established or the effect of any adjustment or imposition of exclusionary criteria shall bear a reasonable relationship to the effects that form the basis thereunder.

“ Recipient ” means (a) the Administrative Agent, (b) any Lender or (c) any L/C Issuer, as applicable.

“ Reclamation ” means the reclamation and restoration of land, water and any future, current, abandoned or former mines, and of any other Environment affected by such mines, as required pursuant to SMCRA, any other Environmental Law or any Environmental Permit.

“ Register ” has the meaning specified in Section 11.06(c) .

“ Refinancing Indebtedness ” has the meaning specified in Section 7.02 .

“ Related Parties ” means, with respect to any Person, such Person’s Affiliates and such Person’s and such Person’s Affiliates’ respective managers, administrators, trustees, members, partners, directors, officers, employees, agents, attorneys, fund managers, advisors and representatives.

“ Rent Reserve ” means each of (a) any reserve established by the Administrative Agent in respect of all past due rent and other amounts owing by any Borrower to any landlord, warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person who possesses any Inventory of the Borrowers or could assert a Lien on such Inventory or (b) in the case of any property, where the value of any Inventory of the Borrowers is located, stored, used or held at such property exceeds $1,500,000 and with respect to which no Landlord Lien Waiver has been obtained, a one-month reserve against the Eligible Inventory held at such location established by the Administrative Agent.

“ Reportable Event ” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day notice period has been waived.

“ Reports ” has the meaning specified in Section 9.15 .

“ Request for Credit Extension ” means (a) with respect to a Borrowing, conversion or continuation of Loans, a Borrowing Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit Application and (c) with respect to a Swingline Loan, a Swingline Loan Notice.

“ Required Lenders ” means, as of any date of determination, Lenders holding more than 50% of the sum of (a) the Total Outstandings (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations being deemed “held” by such Lender for purposes of this definition) and (b) the aggregate unused Commitments; provided , that (i) if at the time of determination there are two (2) or more Lenders (excluding Affiliates of any such Lenders) holding any Total Outstandings and unused Commitments, the vote or consent of at least two (2) such Lenders (excluding Affiliates of any such Lender) shall be required to constitute “Required Lenders” and (ii) the unused Commitment of, and the portion of the Total Outstandings held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

“ Reserves ” means, without duplication, (i) the Rent Reserve, (ii) the Lower of Cost or Market Reserve, (iii) the Port Charges Reserves, and (iv) other reserves established or maintained by the Administrative Agent in its Reasonable Credit Judgment to the extent such reserves relate to facts, events, conditions or contingencies first occurring or first discovered by the Administrative Agent after the Closing Date (or that are materially different from facts, events, conditions or contingencies known to the Administrative Agent on the Closing Date), and for which no reserves were imposed on the Closing Date, and which have, or could reasonably be expected to have, an adverse effect on the value of the Borrowing Base Collateral or the Liens of the Administrative Agent thereon.

“ Responsible Officer ” means the chief executive officer, president, chief financial officer, the treasurer, any assistant treasurer, any vice president or the controller of a Person, or if such person is a limited partnership, a general partner of such Person or such Person’s or such general partner’s manager or managing member, as applicable, or any officer with substantially equivalent responsibilities, but, in any event, with respect to financial matters, the chief financial officer, the chief executive officer or any other officer with substantially equivalent responsibilities.

“ Restricted Payment ” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests of Holdings or any of its Subsidiaries, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests, or on account of any return of capital to the Borrowers’ stockholders, partners or members (or the equivalent Person thereof).

“ Restricted Subordinated Debt Payment ” has the meaning specified in Section 7.14(a) .

“ S&P ” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and any successor thereto.

“ Sale Order ” has the meaning specified in the Introductory Statement.

“ Sanctioned Person ” means, at any time, any Person with which dealings are prohibited by Sanctions.

“ Sanctions ” means economic or financial sanctions or trade embargoes imposed, administered, or enforced by the U.S. government, including those administered by the OFAC, the U.S. Department of State, and the U.S. Department of Commerce, the United Nations Security Council, the European Union, or Her Majesty’s Treasury of the United Kingdom.

“ SEC ” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

“ Secured Agreement ” means any Secured Cash Management Agreement or Secured Hedge Agreement.

“ Secured Cash Management Agreement ” means (i) any Cash Management Agreement that is entered into by and between the Borrowers and any Cash Management Bank to the extent designated as such by the Borrowers and such Cash Management Bank in writing to the Administrative Agent from time to time in accordance with Section 11.16 and (ii) each Existing Secured Agreement listed on Schedule 7.02 as an “Existing Secured Cash Management Agreement”.

“ Secured Hedge Agreement ” means any Swap Contract permitted under Article 7 that is entered into by and between the Borrowers and any Hedge Bank to the extent designated as such by the Borrowers and such Hedge Bank in writing to the Administrative Agent from time to time in accordance with Section 11.16 and (ii) each Existing Secured Agreement listed on Schedule 7.02 as an “Existing Secured Hedge Agreement”.

“ Secured Parties ” means, collectively, (i) the Lenders, (ii) each L/C Issuer, (iii) the Administrative Agent, (iv) each Hedge Bank that is a counterparty to a Secured Hedge Agreement with a Loan Party, (v) each Cash Management Bank that is party to a Secured Cash Management Agreement with a Loan Party, (vi) the Arrangers, and (vii) beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document.

“ Securities Account ” has the meaning specified in the UCC.

“ Security ” has the meaning specified in the UCC.

“ Security Agreement ” means that certain Pledge and Security Agreement, dated as of the date hereof, by and among the Administrative Agent and each of the Loan Parties party thereto, substantially in the form of Exhibit H , as amended, restated, amended and restated supplemented or otherwise modified from time to time.

“ Similar Business ” means coal production, coal mining, coal gasification, coal liquifaction, other BTU conversions, coal brokering, coal transportation, mine development, coal supply contract restructurings, ash disposal, environmental remediation, Reclamation, coal and coal bed methane exploration, production, marketing, transportation and distribution and other related businesses, and activities of the Borrowers and their Subsidiaries as of the date hereof and any business or activity that is reasonably similar thereto or a reasonable extension, development or expansion thereof or ancillary thereto.

“ SMCRA ” means the Surface Mining Control and Reclamation Act of 1977, 30 U.S.C. §§1201 et seq., as amended.

“ Specified Transaction ” has the meaning specified in Section 1.08 .

“ Subordinated Debt ” has the meaning specified in Section 7.14 .

“ Subordinated Debt Documentation ” means any documentation governing any Subordinated Debt.

“ Subsidiary ” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “ Subsidiary ” or to “ Subsidiaries ” shall refer to a Subsidiary or Subsidiaries of the Borrowers.

“ Supplies Inventory ” means any Inventory consisting of consumables (including, lubricants, fuels, oils, belts and fasteners), large-dollar-value spares, and replacement or repair parts.

“ Supporting Obligation ” has the meaning specified in the UCC.

“ Supplemental Administrative Agent ” has the meaning specified in Section 9.14 .

“ Swap Contract ” means any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement.

“ Swap Termination Value ” means, in respect of any one or more Swap Contracts, after taking into account the effect of any valid netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

“ Swingline ” means the revolving credit facility made available by the Swingline Lender pursuant to Section 2.04 .

“ Swingline Borrowing ” means a borrowing of a Swingline Loan pursuant to Section 2.05 .

“ Swingline Lender ” means Citibank, N.A. or any other Lender that agrees, with the approval of the Administrative Agent and the Borrowers, to act as the Swingline Lender hereunder.

“ Swingline Loan ” has the meaning specified in Section 2.05(a) .

“ Swingline Loan Notice ” means a notice of a Swingline Borrowing pursuant to Section 2.05(b) , which, if in writing, shall be substantially in the form of Exhibit D .

“ Swingline Sublimit ” means an amount equal to $10,000,000. The Swingline Sublimit is part of, and not in addition to, the aggregate Commitments.

“ Taxes ” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“ Termination Date ” means the earliest of (i) the Maturity Date, (ii) the date of termination of the Commitments pursuant to Section 2.07 and (iii) the date of termination of the Commitment of each Lender and of the obligation of the L/C Issuers to make L/C Credit Extensions pursuant to Section 8.02 .

“ Test Period ” means, at any time, the most recently ended period of four consecutive fiscal quarters of Holdings ended on or prior to such time in respect of which financial statements for each quarter or fiscal year in such period have been or are required to be delivered pursuant to Section 6.01 ; provided that, prior to the first date that financial statements have been or are required to be delivered pursuant to Section 6.01 , the Test Period in effect shall be the period of four consecutive fiscal quarters of Holdings ended December 31, 2015.

“ Threshold Amount ” means $10,000,000.

“ Total Outstandings ” means the aggregate Outstanding Amount of all Loans and L/C Obligations.

“ Total Leverage Ratio ” means the ratio, as of any date of determination, of (a) the aggregate outstanding principal amount of all Indebtedness for borrowed money, Capital Lease Obligations and purchase money Indebtedness of Holdings and its Subsidiaries on a consolidated basis as of such date (net of the Unrestricted Cash Amount as of such date) to (b) Consolidated EBITDA of Holdings and its Subsidiaries for the Test Period then most recently ended for which financial statements have been, or were required to have been, delivered pursuant to Section 6.01 .

“ Transactions ” means, collectively, (a) the entering into by the Loan Parties of the Loan Documents to which they are a party, (b) the Acquisition, (c) the Initial Rights Offering and (d) the payment of the Transaction Costs.

“ Transaction Costs ” means, collectively, the costs, fees and expenses payable by Holdings or any of its Subsidiaries in connection with the Facility and the Transactions.

“ Type ” means, with respect to any Loan, its character as a Base Rate Loan or a Eurocurrency Rate Loan.

“ UCC ” means the Uniform Commercial Code as in effect in the State of New York; provided , that if perfection or the effect of perfection or non-perfection or the priority of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, “ UCC ” means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority.

“ UFCA ” has the meaning specified in Section 11.19 .

“ UFTA ” has the meaning specified in Section 11.19 .

“ Unbilled Account ” means, on any date of determination, each Account of the Loan Parties for which (a) the sale represented by such Account was made not more than 23 days prior to such date and (b) an invoice has not yet been sent to the applicable Account Debtor with respect to such Account.

“ Unfunded Pension Liability ” means the excess of a Pension Plan’s accrued benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the actuarial assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

“ United States ” and “ U.S. ” mean the United States of America.

“ Unreimbursed Amount ” has the meaning specified in Section 2.04(d)(i) .

“ Unrestricted Cash Amount ” means, as of any date of determination, the aggregate amount of cash or Cash Equivalents of the Loan Parties that (a) would not appear as “restricted” on a consolidated balance sheet of Holdings and its Subsidiaries or (b) would appear as “restricted” on a consolidated balance sheet of Holdings and its Subsidiaries, but solely in the case of this clause (b) to the extent such cash and Cash Equivalents are restricted in favor of the Administrative Agent or any Lender, in each case of clauses (a) and (b) , determined in accordance with GAAP.

“ Upfront Fee Letters ” means, collectively, each Upfront Fee Letter, dated on or prior to the Closing Date, among the Borrowers and each applicable Lender party thereto.

“ U.S. Person ” means any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

“ Wholly Owned Subsidiary ” of any Person shall mean a direct or indirect Subsidiary of such Person, all of the Equity Interests of which (other than directors’ qualifying shares or nominee or other similar shares required pursuant to applicable law) are owned by such Person or another Wholly Owned Subsidiary or are owned together with another Person that is also a Wholly Owned Subsidiary or are owned together by more than one other Wholly Owned Subsidiary.

“ Withholding Agent ” means any Loan Party and Administrative Agent.

“ Write-Down and Conversion Powers ” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

Section 1.02. Other Interpretive Provisions. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “ include, ” “ includes ” and “ including ” shall be deemed to be followed by the phrase “ without limitation. ” The word “ will ” shall be construed to have the same meaning and effect as the word “ shall. ” Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “ herein, ” “ hereof ” and “ hereunder, ” and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Preliminary Statements, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Preliminary Statements, Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (vi) the words “ asset ” and “ property ” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

(b) In the computation of periods of time from a specified date to a later specified date, the word “ from ” means “ from and including; ” the words “ to ” and “ until ” each mean “ to but excluding; ” and the word “ through ” means “ to and including. ”

(c) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

Section 1.03. Accounting Terms. (a) Generally . All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, except as otherwise specifically prescribed herein.

(b) Changes in GAAP . If at any time any Accounting Change or any other change as permitted by Section 7.13 would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrowers or the Required Lenders shall so request, the Administrative Agent and the Borrowers shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such Accounting Change as if such Accounting Change has not been made; provided , that until so amended, all financial covenants, standards, and terms in this Agreement shall continue to be calculated or construed as if such Accounting Change had not occurred.

Section 1.04. Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

Section 1.05. Timing of Payment or Performance . In the event that any payment of any obligation or the performance of any covenant, duty or obligation is stated to be due or performance required on a day that is not a Business Day, the date of such payment (other than as described in the definition of Interest Period) or performance shall extend to the immediately succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.

Section 1.06. Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided , however , that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

Section 1.07. Reserves. When any Reserve is to be established or a change in any amount, reserve, eligibility criteria or other item in the definitions of the terms “Borrowing Base” and “Eligible Accounts” is to be determined in each case in the Administrative Agent’s Reasonable Credit Discretion, such Reserve shall be implemented or such change shall become effective 3 Business Days following delivery of a written notice thereof to the Borrowers (such notice to include a reasonably detailed description of the Reserve being established), or immediately, without prior written notice, if such change is a result of a mathematical calculation and any Default or Event of Default has occurred and is continuing. During such 3 Business Day period, if applicable, the Administrative Agent will, if requested, discuss any such reserve or change with the Borrowers, and the Borrowers may take such action as may be required so that the event, condition or matter that is the basis for such Reserve or change no longer exists or exists in a manner that would result in the establishment of a lower Reserve or result in a lesser change, in each case, in a manner and to the extent reasonably satisfactory to the Administrative Agent. Notwithstanding the foregoing, the specified percentages set forth in the definition of “Borrowing Base” will not be reduced without the consent of the Borrowers.

Section 1.08. Pro Forma Calculations .

(a) Notwithstanding anything to the contrary herein, the Total Leverage Ratio, the Fixed Charge Coverage Ratio, the Payment Conditions and the Distribution Conditions (and, in each case, any component thereof) shall be calculated in the manner prescribed by this Section. Whenever pro forma effect is to be given to any applicable transaction, the pro forma calculations shall be made in good faith by a Responsible Officer of Holdings.

(b) In the event that any of the Borrowers or any of its respective Subsidiaries incurs, assumes, guarantees, redeems, refinances, repays, retires or extinguishes any Indebtedness subsequent to the end of the Test Period for which the Total Leverage Ratio is being calculated but prior to or simultaneously with the event for which the calculation of any such ratio is made, then the Total Leverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee, redemption, refinancing, repayment, retirement or extinguishment of Indebtedness, as if the same had occurred on the last day of the applicable Test Period.

(c) For purposes of calculating the Total Leverage Ratio and the Fixed Charge Coverage Ratio, any Investment or other acquisition (including any Permitted Acquisition), Disposition, Restricted Payment or Restricted Subordinated Debt Payment (each, a “ Specified Transaction ”) that has been made by any of the Borrowers or any of its respective Subsidiaries during the applicable Test Period or subsequent to such Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is made shall be calculated on a pro forma basis assuming that all such Specified Transactions (and the change in Consolidated EBITDA resulting therefrom) had occurred on the first day of the applicable Test Period. If since the beginning of any such Test Period any Person that subsequently became a Subsidiary or was merged, amalgamated or consolidated with or into any Borrower or any of its Subsidiaries since the beginning of such Test Period shall have made any Specified Transaction that would have required adjustment pursuant to this Section, then the Total Leverage Ratio and the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Specified Transaction occurred at the beginning of the applicable Test Period.

(d) In the event that any of the Borrowers or any of its respective Subsidiaries incurs, assumes, guarantees, redeems, refinances, repays, retires or extinguishes any Indebtedness included in the definition of Fixed Charges subsequent to the commencement of the Test Period but prior to or simultaneously with the event for which the calculation of the Fixed Charge Coverage Ratio is made, then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee, redemption, refinancing, repayment, retirement or extinguishment of Indebtedness as if the same had occurred on the first day of the applicable Test Period.

(e) Any Indebtedness incurred or assumed by any of the Borrowers or any of their respective Subsidiaries in connection therewith shall be deemed to have occurred as of the first day of the applicable Test Period with respect to any test or covenant for which the relevant determination is being made; provided that, if any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of the event for which the calculation of the Fixed Charge Coverage Ratio is made had been the applicable rate for the entire period (taking into account any hedging obligations applicable to such Indebtedness). Interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a Responsible Officer of Holdings to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be determined to have been based upon the rate actually chosen, or if none, then based upon such optional rate chosen as the applicable Borrower may designate.

(f) Any Availability test or condition set forth in the definitions of “Payment Conditions” or “Distribution Conditions” shall be calculated taking into account any Credit Extensions made to finance the applicable Permitted Transaction or Restricted Payment, as applicable.

ARTICLE 2

T HE C OMMITMENTS AND C REDIT E XTENSIONS

Section 2.01. Loans . Subject to Section 11.18 and the other terms and conditions set forth herein, each Lender severally agrees to make loans in Dollars (each such loan, a “ Loan ”) to a Borrower from time to time, on any Business Day during the Availability Period, in an aggregate principal amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided , however , that after giving effect to any Borrowing, (i) the Total Outstandings shall not exceed the Maximum Revolving Credit and (ii) the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations shall not exceed such Lender’s Commitment. Within the limits of each Lender’s Commitment, and subject to the other terms and conditions hereof, any Borrower may borrow under this Section 2.01 , prepay under Section 2.05(f) , and reborrow under this Section 2.01 . The Loans may be Base Rate Loans or Eurocurrency Rate Loans, as further provided herein.

Section 2.02. Borrowings, Conversions and Continuations of Loans. (a) Each Borrowing, each conversion of Loans from one Type to the other, and each continuation of Eurocurrency Rate Loans shall be made upon the applicable Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone or, for the avoidance of doubt but subject to Section 11.02(b), e-mail. Each such notice must be received by the Administrative Agent not later than 11:00 a.m. (i) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurocurrency Rate Loans or of any conversion of Eurocurrency Rate Loans, and (ii) one Business Day prior to the requested date of any Borrowing of Base Rate Loans. Not later than 11:00 a.m., three Business Days before the requested date of such Borrowing, conversion or continuation of Eurocurrency Rate Loans, the Administrative Agent shall notify the applicable Borrower (which notice may be by telephone) whether or not the requested Interest Period has been consented to by all the Lenders. Each telephonic or e-mail notice by the Borrowers pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Borrowing Notice or Notice of Conversion or Continuation, as applicable, appropriately completed and signed by a Responsible Officer of the applicable Borrower. Each Borrowing of, conversion to or continuation of Eurocurrency Rate Loans shall be in a principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof. Except as provided in Section 2.04(d) , each Borrowing of or conversion to Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Borrowing Notice (whether telephonic or written) shall specify (i) the applicable Borrower is requesting a Borrowing, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Loans to be borrowed, (iv) the Type of Loans to be borrowed and (v) the duration of the Interest Period with respect thereto, if applicable. Each Notice of Conversion or Continuation (whether telephonic or written) shall specify (i) whether the applicable Borrower is requesting a conversion of Loans from one Type to the other or a continuation of Loans that are Eurocurrency Rate Loans, and (ii) specifying (A) the amount and Type of Loan being converted or continued, (B) in the case of a conversion to or a continuation of Eurocurrency Rate Loans, the applicable Interest Period and (C) in the case of a conversion, the date of such conversion. If a Borrower fail to specify a Type of Loan in a Borrowing Notice or if such Borrower fail to give a timely Notice of Conversion or Continuation with respect to Eurocurrency Rate Loans, then the applicable Loans shall be made as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurocurrency Rate Loans. If the applicable Borrower request a Borrowing of, conversion to, or continuation of Eurocurrency Rate Loans in any such Borrowing Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.

(b) Following receipt of a Borrowing Notice, the Administrative Agent shall promptly notify each Lender of the amount of its Applicable Percentage under the applicable Loan, and if no timely notice of a conversion or continuation is provided by the Borrowers, the Administrative Agent shall notify each such Lender of the details of any automatic conversion to Base Rate Loans described in the preceding subsection. In the case of any Borrowing, each Lender shall make the amount of its Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the Business Day specified in the applicable Borrowing Notice. Upon satisfaction or waiver of the applicable conditions set forth in Section 4.02 (and, if such Borrowing is on the Closing Date, Section 4.01 ), the Administrative Agent shall make all funds so received available to the applicable Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the applicable Borrower on the books of the Administrative Agent with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the applicable Borrower; provided , however , that if, on the date a Borrowing Notice with respect to a Borrowing is given by a Borrower, there are L/C Advances outstanding, then the proceeds of such Borrowing, first , shall be applied to the payment in full of any Unreimbursed Amounts in respect thereof, and second , shall be made available to the applicable Borrower as provided above.

(c) Unless the Lenders are compensated for any losses under Section 3.05 , a Eurocurrency Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurocurrency Rate Loan. During the existence of a Default, no Loans may be requested as, converted to or continued as Eurocurrency Rate Loans if the Required Lenders or the Administrative Agent so notify the applicable Borrower.

(d) The Administrative Agent shall promptly notify the Borrowers and the Lenders of the interest rate applicable to any Interest Period for Eurocurrency Rate Loans upon determination of such interest rate. At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the applicable Borrower and the Lenders of any change in the Administrative Agent’s “prime rate” used in determining the Base Rate promptly following the public announcement of such change.

(e) After giving effect to all Borrowings, all conversions of Loans from one Type to the other, and all continuations of Loans as the same Type, there shall not be more than five (5) Interest Periods in effect under the Facility.

Section 2.03. Protective Advances . (a) The Administrative Agent shall be authorized, in its sole discretion (but with no obligation), (i) after the occurrence and during the continuation of an Event of Default or (ii) at any time that any conditions in Section 4.02 are not satisfied, to make Loans (“ Protective Advances ”) in an aggregate principal amount outstanding not to exceed 5.0% of the Commitment at any time, if the Administrative Agent deems, in its Reasonable Credit Judgment, that such are Loans necessary or desirable to preserve or protect the Collateral, to enhance the collectability or repayment of the Obligations or to pay any other amounts chargeable to the Loan Parties under any Loan Documents, including costs, fees and expenses. Subject to the following paragraph, each Lender shall participate in Protective Advances on a pro rata basis. Required Lenders may prospectively revoke Administrative Agent’s ability to make such Protective Advances by written notice to Administrative Agent. All Protective Advances shall constitute Base Rate Loans and shall bear interest at the Base Rate plus the Applicable Rate and the Default Rate under Section 2.09(b )( i ) . Each Protective Advance shall be payable on demand.

(b) Notwithstanding anything contained in this Agreement or any other Loan Document, no Protective Advance may be made by Administrative Agent if such advance would cause the aggregate principal amount of all Protective Advances outstanding to exceed 5.0% of the aggregate Commitments.

(c) Each Protective Advance shall be secured by the Liens in favor of the Administrative Agent on the Collateral and shall constitute Obligations hereunder. The making of a Protective Advance on any one occasion shall not obligate the Administrative Agent to make any Protective Advance on any other occasion. At any time that the conditions precedent set forth in Section 4.02 have been satisfied or waived, the Administrative Agent may request that the Lenders to make a Loan to repay any Protective Advances.

(d) Upon the making of a Protective Advance by the Administrative Agent (whether before or after the occurrence of a Default or Event of Default), each Lender shall be deemed, without further action by any party hereto, unconditionally and irrevocably to have purchased from the Administrative Agent without recourse or warranty, an undivided interest and participation in such Protective Advance, in proportion to its Applicable Percentage, and upon demand by the Administrative Agent, shall fund such participation to the Administrative Agent.

Section 2.04. Letters of Credit . (a) The Letter of Credit Commitment . Subject to the terms and conditions set forth herein, (A) each L/C Issuer agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.04 , (1) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of the Borrowers or any other Loan Party, and to amend or extend Letters of Credit previously issued by it, in accordance with Section 2.04(c) , and (2) to honor drawings under the Letters of Credit; and (B) the Lenders severally agree to participate in Letters of Credit issued for the account of the Borrowers or any other Loan Party and any drawings thereunder; provided , that after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (w) the L/C Obligations outstanding with respect to such L/C Issuer shall not exceed the L/C Sublimit of such L/C Issuer, (x) the aggregate amount of L/C Obligations shall not exceed the L/C Sublimit of all L/C Issuers taken as a whole, (y) the Total Outstandings shall not exceed the Maximum Revolving Credit and (z) the Outstanding Amount of the Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations shall not exceed such Lender’s Commitment. Each Borrower hereby agrees to use commercially reasonable efforts to allocate the aggregate face amount of each Letter of Credit issued hereunder ratably among the L/C Issuers in accordance with their respective individual L/C Sublimit. Each request by the Borrowers or any other Loan Party for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the applicable Borrower that the L/C Credit Extension so requested complies with the conditions set forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof, each Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrowers may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

(b) (i) No L/C Issuer shall issue any Letter of Credit if the expiry date of such requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless the applicable L/C Issuer in its sole discretion and all the Lenders, have approved such expiry date.

(ii) No L/C Issuer shall be under any obligation to issue any Letter of Credit if:

(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such L/C Issuer from issuing such Letter of Credit, or any Law applicable to such L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or request that such L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which such L/C Issuer in good faith deems material to it;

(B) the issuance of such Letter of Credit would violate one or more policies of such L/C Issuer applicable to letters of credit generally;

(C) except as otherwise agreed by the Administrative Agent and such L/C Issuer, such Letter of Credit is in an initial stated amount less than $100,000;

(D) such Letter of Credit is to be denominated in a currency other than Dollars;

(E) subject to Section 2.04(c)(iv) , such Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder; or

(F) a default of any Lender’s obligations to fund under Section 2.04(d) exists or any Lender is at such time a Defaulting Lender hereunder, unless the applicable L/C Issuer has entered into satisfactory arrangements with the Borrowers or such Lender to eliminate such L/C Issuer’s risk with respect to such Lender.

(iii) No L/C Issuer shall be under any obligation to amend any Letter of Credit if (A) such L/C Issuer would not have any obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

(iv) Each L/C Issuer shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and each L/C Issuer shall have all of the benefits and immunities (A) provided to the Administrative Agent in Article 9 with respect to any acts taken or omissions suffered by such L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article 9 included such L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein with respect to such L/C Issuer.

(v) No L/C Issuer shall be required to issue documentary or “trade” Letters of Credit (as opposed to “standby” Letters of Credit).

(c) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit . (i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the applicable Borrower delivered to an L/C Issuer (with a copy to the Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible

Officer of the applicable Borrower. Such Letter of Credit Application must be received by such L/C Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) at least four Business Days (or such later date and time as the Administrative Agent and such L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and substance reasonably satisfactory to the applicable L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; and (G) such other matters as the applicable L/C Issuer may reasonably require. In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and substance reasonably satisfactory to the applicable L/C Issuer (1) the Letter of Credit to be amended; (2) the proposed date of amendment thereof (which shall be a Business Day); (3) the nature of the proposed amendment; and (4) such other matters as the applicable L/C Issuer may reasonably require. Additionally, the applicable Borrower shall furnish to the applicable L/C Issuer and the Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as the L/C Issuer or the Administrative Agent may reasonably require.

(ii) Promptly after receipt of any Letter of Credit Application, the applicable L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Application from the applicable Borrower and, if not, such L/C Issuer will provide the Administrative Agent with a copy thereof. Unless such L/C Issuer has received written notice from any Lender, the Administrative Agent or any Loan Party, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article 4 shall not then be satisfied, then, subject to the terms and conditions hereof, the applicable L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the applicable Borrower or enter into the applicable amendment, as the case may be, in each case in accordance with the applicable L/C Issuer’s usual and customary business practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the applicable L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter of Credit.

(iii) If a Borrower so requests in any applicable Letter of Credit Application, an L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “ Auto-Extension Letter of Credit ”); provided , that any such Auto-Extension Letter of Credit must permit the applicable L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “ Non-Extension Notice Date ”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by the applicable L/C Issuer, the Borrowers shall not be required to make a specific request to the applicable L/C Issuer for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the applicable L/C Issuer to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided , however , that the applicable L/C Issuer shall not permit any such extension if (A) the L/C Issuer has determined that it would not be permitted, or would have no obligation at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by

reason of the provisions of clause (ii) or (iii) of Section 2.04(b) ), or (B) it has received notice (which may be by telephone or in writing) on or before the day that is five Business Days before the Non-Extension Notice Date from the Administrative Agent or the Borrowers that one or more of the applicable conditions specified in Section 4.02 is not then satisfied, and in each such case directing the applicable L/C Issuer not to permit such extension.

(iv) If a Borrower so requests in any applicable Letter of Credit Application, an L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that permits the automatic reinstatement of all or a portion of the stated amount thereof after any drawing thereunder (each, an “ Auto-Reinstatement Letter of Credit ”). Unless otherwise directed by the applicable L/C Issuer, such Borrower shall not be required to make a specific request to the applicable L/C Issuer to permit such reinstatement. Once an Auto-Reinstatement Letter of Credit has been issued, except as provided in the following sentence, the Lenders shall be deemed to have authorized (but may not require) the applicable L/C Issuer to reinstate all or a portion of the stated amount thereof in accordance with the provisions of such Letter of Credit. Notwithstanding the foregoing, if such Auto-Reinstatement Letter of Credit permits the applicable L/C Issuer to decline to reinstate all or any portion of the stated amount thereof after a drawing thereunder by giving notice of such non-reinstatement within a specified number of days after such drawing (the “ Non-Reinstatement Deadline ”), the applicable L/C Issuer shall not permit such reinstatement if it has received a notice (which may be by telephone or in writing) on or before the day that is seven Business Days before the Non-Reinstatement Deadline from the Administrative Agent or the applicable Borrower that one or more of the applicable conditions specified in Section 4.02 is not then satisfied (treating such reinstatement as an L/C Credit Extension for purposes of this clause) and, in each case, directing the applicable L/C Issuer not to permit such reinstatement.

(v) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the applicable L/C Issuer will also deliver to the applicable Borrower a true and complete copy of such Letter of Credit or amendment.

(d) Drawings and Reimbursements; Funding of Participations . (i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the applicable L/C Issuer shall notify the applicable Borrower and the Administrative Agent thereof. The applicable Borrower shall reimburse such L/C Issuer through the Administrative Agent, either with its own funds or with the proceeds of Loans under the Facility, in an amount equal to the amount of such drawing within two Business Days following the date on which such Borrower receives notice of any payment by such L/C Issuer under a Letter of Credit, provided that the Borrowers receive notice by 1:00 p.m., New York City time on such date, or on the second Business Day if notice is not received by such time (each such date, an “ Honor Date ”). If such Borrower fails to so reimburse such L/C Issuer by the time set forth in the preceding sentence, the applicable L/C Issuer shall promptly notify the Administrative Agent of the Honor Date and the amount of the unreimbursed drawing (the “ Unreimbursed Amount ”). The Administrative Agent shall, in the case of a payment under a Letter of Credit, promptly notify each Lender thereof and of the amount of such Lender’s Applicable Percentage thereof. Any notice given by such L/C Issuer or the Administrative Agent pursuant to this Section 2.04(d)( i ) may be given by telephone if immediately confirmed in writing; provided , that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

(ii) Each Lender shall upon any notice pursuant to Section 2.04(d)( i ) make funds available to the Administrative Agent for the account of the applicable L/C Issuer at the Administrative Agent’s Office in an amount equal to its Applicable Percentage of the

Unreimbursed Amount not later than 1:00 p.m. (New York City time) on the Business Day specified in such notice by the Administrative Agent, whereupon, subject to the provisions of Section 2.04(d)(iii) , each Lender that so makes funds available shall be deemed to have made a Base Rate Loan to the relevant Borrower in such amount. The Administrative Agent shall remit the funds so received to the applicable L/C Issuer.

(iii) With respect to any Unreimbursed Amount for a payment under a Letter of Credit that is not fully refinanced by a Borrowing of Base Rate Loans because the conditions set forth in Section 4.02 cannot be satisfied or for any other reason, the applicable Borrower shall be deemed to have incurred from the applicable L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at (A) the rate applicable to Loans that are Base Rate Loans from the Honor Date to the date reimbursement is required pursuant to Section 2.04(d)( i ) and (B) thereafter, the Default Rate. Each Lender’s payment to the Administrative Agent for the account of the applicable L/C Issuer pursuant to Section 2.04(d )( ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.03 .

(iv) Until each Lender funds its Loan or L/C Advance pursuant to this Section 2.04(d) to reimburse the applicable L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Applicable Percentage of such amount shall be solely for the account of the applicable L/C Issuer.

(v) Each Lender’s obligation to make Loans or L/C Advances to reimburse the applicable L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.04(d) , shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against such L/C Issuer, the Borrowers or any other Person for any reason whatsoever; (B) the occurrence or continuance of a Default or Event of Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing (it being understood and agreed that each Lender’s obligation to make Loans pursuant to this Section 2.04(d) shall not be subject to the conditions set forth in Section 4.02 ). No such making of an L/C Advance shall relieve or otherwise impair the obligation of the applicable Borrower to reimburse the applicable L/C Issuer for the amount of any payment made by such L/C Issuer under any Letter of Credit, together with interest as provided herein.

(vi) If any Lender fails to make available to the Administrative Agent for the account of the applicable L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.04(d) by the time specified in Section 2.04(d)(ii) , the L/C Issuer shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annum equal to the Overnight Rate, plus any administrative, processing or similar fees customarily charged by the L/C Issuer in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Loan included in the relevant L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A certificate of the L/C Issuer submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this Section 2.04(d )( vi) shall be conclusive absent manifest error.

(e) Repayment of Participations . (i) At any time after an L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.04(d) , if the Administrative Agent receives for the account of the L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from the applicable Borrower or otherwise, including proceeds of cash collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to such Lender its Applicable Percentage thereof (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s L/C Advance was outstanding) in the same funds as those received by the Administrative Agent.

(ii) If any payment received by the Administrative Agent for the account of the applicable L/C Issuer pursuant to Section 2.04(d) is required to be returned under any of the circumstances described in Section 11.05 (including pursuant to any settlement entered into by the L/C Issuer in its discretion), each Lender shall pay to the Administrative Agent for the account of the L/C Issuer its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the applicable Overnight Rate from time to time in effect. The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(f) Obligations Absolute . The obligation of the Borrowers to reimburse the applicable L/C Issuer for each drawing under each Letter of Credit and to repay each Unreimbursed Amount shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

(ii) the existence of any claim, counterclaim, setoff, defense or other right that such Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the applicable L/C Issuer or any Lender, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit, except to the extent caused by the applicable L/C Issuer’s gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable judgment;

(iv) any payment by the applicable L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit, so long as the L/C Issuer shall have determined in the absence of gross negligence or willful misconduct, in good faith and in accordance with the standard of care specified in the Uniform Commercial Code of the State of New York, that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment appear on their face to be in conformity with such Letter of Credit;

(v) any payment made by the applicable L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

(vi) any other action taken or omitted to be taken by the applicable L/C Issuer under or in connection with any Letter of Credit or the related drafts or documents, whether or not similar to any of the foregoing, that might, but for this Section 2.04(f)(vi) , constitute a legal or equitable discharge of the Borrowers’ obligations hereunder.

The applicable Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the applicable Borrower’s instructions or other irregularity, such Borrower will promptly notify the applicable L/C Issuer. Such Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents unless such notice is given as aforesaid.

(g) Role of L/C Issuer . Each Lender and the Borrowers agree that, in paying any drawing under a Letter of Credit, the applicable L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. None of the L/C Issuers, the Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the L/C Issuers shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document. The Borrowers hereby assume all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided , however , that this assumption is not intended to, and shall not, preclude the Borrowers pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. Notwithstanding anything to the contrary herein the Borrowers may have a claim against the applicable L/C Issuer, and the applicable L/C Issuer may be liable to the Borrowers, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Borrowers which the applicable Borrower proves were caused by the applicable L/C Issuer’s willful misconduct or gross negligence as determined by a court of competent jurisdiction in a final, non-appealable judgment. In furtherance and not in limitation of the foregoing, the applicable L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the applicable L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

(h) Cash Collateral . (i) Upon the request of the Administrative Agent, (A) if, as of the Letter of Credit Expiration Date or the Termination Date, any L/C Obligation for any reason remains outstanding or (B) if an Event of Default has occurred and is continuing, the Borrowers shall, in each case, immediately Cash Collateralize the then Outstanding Amount of such L/C Obligation.

(ii) Section 2.04 and 8.02(a )( iii) set forth certain additional requirements to deliver cash collateral hereunder. “ Cash Collateralize ” means (A) to pledge to the Administrative Agent and deposit in a L/C Cash Collateral Account, for the benefit of the

applicable L/C Issuer and the Lenders, as collateral for the L/C Obligations, cash or deposit account balances in an amount equal to 103% of the L/C Obligations pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the applicable L/C Issuer (which documents are hereby consented to by the Lenders), or (B) to deliver to the applicable L/C Issuer a backstop letter of credit (in form and substance reasonably satisfactory to the L/C Issuer and the Administrative Agent, and issued by a U.S. commercial bank acceptable to each of such L/C Issuer and the Administrative Agent, in their commercially reasonable discretion). Derivatives of such term have corresponding meanings. The Borrowers hereby grant to the Administrative Agent, for the benefit of the L/C Issuers and the Lenders, a security interest in all such cash, deposit accounts and all balances therein and all proceeds of the foregoing. Cash collateral shall be maintained in the L/C Cash Collateral Account. If at any time the Administrative Agent determines that any funds held in the L/C Cash Collateral Account are subject to any right or claim of any Person other than the Administrative Agent or that the total amount of such funds is less than the aggregate Outstanding Amount of all L/C Obligations Borrower will, forthwith upon demand by the Administrative Agent, pay to the Administrative Agent, as additional funds to be deposited in the L/C Cash Collateral Account, an amount equal to the excess of (x) such aggregate Outstanding Amount over (y) the total amount of funds, if any, then held in the L/C Cash Collateral Account that the Administrative Agent determines to be free and clear of any such right and claim. Upon the drawing of any Letter of Credit for which funds are on deposit in the L/C Cash Collateral Account, such funds shall be applied, to the extent permitted under applicable Laws, to reimburse the L/C Issuer for the amount of such drawing.

(i) Applicability of ISP . Unless otherwise expressly agreed by the applicable L/C Issuer and the applicable Borrower when a Letter of Credit is issued, the rules of the ISP shall apply to each Letter of Credit.

(j) Letter of Credit Fees . The Borrowers shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage a Letter of Credit fee (the “ Letter of Credit Fee ”) for each Letter of Credit equal to the Applicable Rate for Loans that are Eurocurrency Rate Loans times the daily amount available to be drawn under such Letter of Credit. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06 . Letter of Credit Fees for Letters of Credit shall be (i) computed on a quarterly basis in arrears and (ii) due and payable on the last Business Day of each calendar quarter, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. If there is any change in the Applicable Rate during any quarter, the daily amount available to be drawn under each Letter of Credit shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect. Notwithstanding anything to the contrary contained herein, upon the request of the Required Lenders, while any Event of Default under Sections 8.01(a) , (f) or (g) exists, all Letter of Credit Fees shall accrue at the Default Rate.

(k) Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer . The Borrowers shall pay to the Administrative Agent, for the account of the applicable L/C Issuer, a fronting fee with respect to each Letter of Credit, at the rate of 0.25% per annum on the face amount drawn under each Letter of Credit, computed on the daily amount available to be drawn under such Letter of Credit on a quarterly basis in arrears. Such fronting fee shall be due and payable on the last Business Day of each calendar quarter, in respect of the most recently-ended quarterly period (or portion thereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06 . In addition, the Borrowers shall pay

directly to the L/C Issuer for its own account the customary issuance, presentation, negotiation, acceptance, transfer, amendment and other processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

(l) Conflict with Issuer Documents . In the event of any conflict between the terms hereof and the terms of any Issuer Document, the terms hereof shall control.

(m) Letters of Credit Issued for Subsidiaries . Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Subsidiary, the Borrowers shall be obligated to reimburse the applicable L/C Issuer hereunder for any and all drawings under such Letter of Credit. The Borrowers hereby acknowledge that the issuance of Letters of Credit for the account of any Subsidiary of any of the Borrowers inures to the benefit of the Borrowers, and that each Borrower’s business derives substantial benefits from the businesses of each such Subsidiary.

Section 2.05. Swingline Loans . (a) Subject to the terms and conditions set forth herein, the Swingline Lender agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.05 , to make loans (each such loan, a “ Swingline Loan ”) to the Borrowers from time to time on any Business Day during the Availability Period in an aggregate principal amount not to exceed at any time outstanding the amount of the Swingline Sublimit, notwithstanding the fact that such Swingline Loans, when aggregated with the Applicable Percentage of the Outstanding Amount of Loans and L/C Obligations of the Lender acting as Swingline Lender, may exceed the amount of such Lender’s Commitment; provided , however , that after giving effect to any Swingline Loan, (i) the Total Outstandings shall not exceed the Maximum Revolving Credit and (ii) the aggregate Outstanding Amount of the Loans of any Lender at such time, plus such Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations at such time, plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swingline Loans at such time shall not exceed such Lender’s Commitment, and provided further that the Borrowers shall not use the proceeds of any Swingline Loan to refinance any outstanding Swingline Loan. Within the foregoing limits, and subject to the other terms and conditions hereof, the Borrowers may borrow under this Section 2.05 , prepay under Section 2.06 , and reborrow under this Section 2.05 . Each Swingline Loan shall be a Base Rate Loan. Immediately upon the making of a Swingline Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swingline Lender a risk participation in such Swingline Loan in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Swingline Loan.

(b) Borrowing Procedures . Each Swingline Borrowing shall be made upon the applicable Borrower’s irrevocable notice to the Swingline Lender and the Administrative Agent, which may be given by telephone. Each such notice must be received by the Swingline Lender and the Administrative Agent not later than 1:00 p.m. (New York City time) on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $100,000, and (ii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to the Swingline Lender and the Administrative Agent of a written Swingline Loan Notice, appropriately completed and signed by a Responsible Officer of the applicable Borrower. Promptly after receipt by the Swingline Lender of any telephonic Swingline Loan Notice, the Swingline Lender will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has also received such Swingline Loan Notice and, if not, the Swingline Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof. Unless the Swingline Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 2:00 p.m. (New York City time) on the date of the proposed Swingline Borrowing (A) directing the Swingline Lender not to make such Swingline Loan as a result of the limitations set

forth in the first proviso to the first sentence of Section 2.05(a) , or (B) that one or more of the applicable conditions specified in Article 4 is not then satisfied, then, subject to the terms and conditions hereof, the Swingline Lender will, not later than 3:00 p.m. (New York City time) on the borrowing date specified in such Swingline Loan Notice, make the amount of its Swingline Loan available to the applicable Borrower at its office by crediting the account of the applicable Borrower on the books of the Swingline Lender in immediately available funds.

(c) Refinancing of Swingline Loans . (i) The Swingline Lender at any time in its sole and absolute discretion may, and in any event on the 10 ^th Business Day after such Swingline Loan is made, shall request, on behalf of the applicable Borrower (which hereby irrevocably authorizes the Swingline Lender to so request on its behalf), that each Lender make a Base Rate Loan in an amount equal to such Lender’s Applicable Percentage of the amount of Swingline Loans then outstanding or, in the case of any request given with respect to Swingline Loans which have been outstanding for 10 Business Days, the amount of such outstanding Swingline Loans; provided , that such Loans may, and upon the applicable Borrower’s request shall, be made as Eurocurrency Rate Loans if a Eurocurrency Rate Loan could otherwise be made pursuant to Section 2.02 . Such request shall be made in writing (which written request shall be deemed to be a Borrowing Notice for purposes hereof) and in accordance with the requirements of Section 2.02 , without regard to the minimum and multiples specified therein for the principal amount of Base Rate Loans or Eurocurrency Rate Loans, but subject to the unutilized portion of the aggregate Commitments and the conditions set forth in Section 4.02 . The Swingline Lender shall furnish the applicable Borrower with a copy of the applicable Borrowing Notice promptly after delivering such notice to the Administrative Agent. Each Lender shall make an amount equal to its Applicable Percentage of the amount specified in such Borrowing Notice available to the Administrative Agent in immediately available funds for the account of the Swingline Lender at the Administrative Agent’s Office not later than 1:00 p.m. (New York City time) on the day specified in such Borrowing Notice, whereupon, subject to Section 2.05(c)(ii) , each Swingline Lender that so makes funds available shall be deemed to have made a Base Rate Loan (or Eurocurrency Rate Loan, if applicable) to the applicable Borrower in such amount. The Administrative Agent shall remit the funds so received to the Swingline Lender.

(ii) If for any reason any Swingline Loan cannot be refinanced by such a Borrowing in accordance with Section 2.05(c)( i ) , the request for Base Rate Loans submitted by the Swingline Lender as set forth herein shall be deemed to be a request by the Swingline Lender that each of the Lenders fund its risk participation in the relevant Swingline Loan and each Lender’s payment to the Administrative Agent for the account of the Swingline Lender pursuant to Section 2.05(c)( i ) shall be deemed payment in respect of such participation.

(iii) If any Lender fails to make available to the Administrative Agent for the account of the Swingline Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.05(c) by the time specified in Section 2.05(c)(i) , the Swingline Lender shall be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Swingline Lender at a rate per annum equal to the Overnight Rate from time to time in effect, plus any administrative, processing or similar fees customarily charged by the Swingline Lender in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Loan included in the relevant Borrowing or funded participation in the relevant Swingline Loan, as the case may be. A certificate of the Swingline Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

(iv) Each Lender’s obligation to make Loans or to purchase and fund risk participations in Swingline Loans pursuant to this Section 2.05(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the Swingline Lender, the Borrowers or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default or Event of Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing (it being understood and agreed that each Lender’s obligation to make Loans pursuant to this Section 2.05(c) shall not be subject to the conditions set forth in Section 4.02 ). No such funding of risk participations shall relieve or otherwise impair the obligation of the Borrowers to repay Swingline Loans, together with interest as provided herein.

(d) Repayment of Participations . (i) At any time after any Lender has purchased and funded a risk participation in a Swingline Loan, if the Swingline Lender receives any payment on account of such Swingline Loan, the Swingline Lender will distribute to such Lender its Applicable Percentage of such payment (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s risk participation was funded) in the same funds as those received by the Swingline Lender.

(ii) If any payment received by the Swingline Lender in respect of principal or interest on any Swingline Loan is required to be returned by the Swingline Lender under any of the circumstances described in Section 11.05 (including pursuant to any settlement entered into by the Swingline Lender in its discretion), each Lender shall pay to the Swingline Lender its Applicable Percentage thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned, at a rate per annum equal to the applicable Overnight Rate. The Administrative Agent will make such demand upon the request of the Swingline Lender. The obligations of the Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(e) Interest for Account of Swingline Lender . The Swingline Lender shall be responsible for invoicing the Borrowers for interest on the Swingline Loans. Until each Lender funds its Base Rate Loan or risk participation pursuant to this Section 2.05 to refinance such Lender’s Applicable Percentage of any Swingline Loan, interest in respect of such Applicable Percentage shall be solely for the account of the Swingline Lender.

(f) Payments of Swingline Loans . The Borrowers shall make all payments of principal and interest in respect of the Swingline Loans to the Administrative Agent, for the account of the Swingline Lender.

Section 2.06. Prepayments . (a) Optional . The Borrowers may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Loans in whole or in part without premium or penalty; provided , that (A) such notice must be received by the Administrative Agent not later than 11:00 a.m. (1) three Business Days prior to any date of prepayment of Eurocurrency Rate Loans and (2) on the date of prepayment of Base Rate Loans; (B) any prepayment of Eurocurrency Rate Loans shall be in a principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof; and (C) any prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid and, if Eurocurrency Rate Loans are to be prepaid, the Interest Period(s) of such Loans. The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s ratable portion of such prepayment. If such notice

is given by the Borrowers, the Borrowers shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. Any prepayment of a Eurocurrency Rate Loan shall be accompanied by all accrued interest on the amount prepaid, together with any additional amounts required pursuant to Section 3.05 .

(b) Mandatory . (i) If, at any time, the Total Outstandings at such time exceed the Maximum Revolving Credit, then, within one Business Day, the Borrowers shall prepay the outstanding Loans and/or the Cash Collateralize the outstanding L/C Obligations (including by depositing funds in the L/C Cash Collateral Account pursuant to Section 2.04(h)( i ) ) in an aggregate amount sufficient to reduce the amount of Total Outstandings as of such date of payment to an amount less than or equal to the Maximum Revolving Credit; provided , however , that, subject to the provisions of Section 2.04(h)(ii) , the Borrowers shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.06(b) unless after the prepayment in full of the Loans the Total Outstandings exceed the Maximum Revolving Credit above at such time.

(ii) At any time following the occurrence and during the continuation of a Liquidity Period, within five Business Days following the receipt of any Net Cash Proceeds in respect of any Disposition of Collateral or any Net Insurance/Condemnation Proceeds (other than any Disposition (A) permitted by Section 7.05(a) , (b) , (c) , (d) , (h) or ( i ) , or (B) in the ordinary course of business of the Borrowers and their respective Subsidiaries), the Borrowers shall apply an amount equal to 100% of such Net Proceeds or Net Insurance/Condemnation Proceeds, as applicable, received with respect thereto to prepay the outstanding principal amount of the Loans and/or Cash Collateralize the outstanding L/C Obligations, and the Borrowers shall deliver an updated Borrowing Base Certificate to the Administrative Agent on the date of any such Disposition or receipt of Net Insurance/Condemnation Proceeds.

(iii) Prepayments of the Facilities made pursuant to this Section 2.06(b), shall be applied, first , to the L/C Borrowings, Swingline Loans or Protective Advances, second , ratably to the outstanding Loans and third , to Cash Collateralize the remaining L/C Obligations.

(iv) In the case of prepayments of the Facilities required pursuant to clause (i) or (ii) of this Section 2.06(b) , the amount remaining, if any, after the prepayment in full of all L/C Borrowings and Loans, outstanding at such time and the Cash Collateralization of the remaining L/C Obligations in full may be retained by the Borrowers for use in the ordinary course of their business. Upon the drawing of any Letter of Credit that has been Cash Collateralized, the funds held in the L/C Cash Collateral Account shall be applied (without any further action by or notice to or from the Borrowers or any other Loan Party) to reimburse the L/C Issuer or the Lenders, as applicable.

(c) At the option of the Administrative Agent, principal on the Swingline Loans and interest, fees, expenses and other sums due and payable in respect of the Loans and Protective Advances may be paid from the proceeds of Swingline Loans or Loans. Each Borrower hereby authorizes the Swingline Lender to make such Swingline Loans pursuant to Section 2.05(a) and the Lenders to make such Loans pursuant to Section 2.05(b) from time to time in the amounts of any and all principal payable with respect to the Swingline Loans and interest, fees, expenses and other sums payable in respect of the Loans and Protective Advances, and further authorizes the Administrative Agent to give the Lenders notice of any Borrowing with respect to such Swingline Loans and Revolving Loans and to distribute the proceeds of such Swingline Loans and Revolving Loans to pay such amounts. The Borrower agrees that all such Swingline Loans and Revolving Loans so made shall be deemed to have been requested by it and directs that all proceeds thereof shall be used to pay such amounts.

Section 2.07. Termination or Reduction of Commitments. (a) The Borrowers may, upon notice to the Administrative Agent, terminate, or from time to time permanently reduce, the Commitments; provided , that (i) any such notice shall be received by the Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof and (iii) the Borrowers shall not terminate or reduce the aggregate Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Maximum Revolving Credit. The Administrative Agent will promptly notify the Lenders of any such notice of termination or reduction of the aggregate Commitments. Any reduction of the aggregate Commitments shall be applied to the Commitment of each Lender according to its Applicable Percentage.

(b) Payment of Fees . All fees in respect of the Facility accrued until the effective date of any termination of the Facility shall be paid on the effective date of such termination.

Section 2.08. Repayment of Loans.

(a) Loans . The Borrowers shall, on a joint and several basis in accordance with Section 11.18, repay to the Lenders on the Termination Date the aggregate principal amount of all Loans outstanding on such date.

(b) Swingline Loans . The Borrowers shall, on a joint and several basis in accordance with Section 11.18, repay each Swingline Loan on the earlier to occur of (i) the date ten Business Days after such Loan is made and (ii) the Maturity Date.

Section 2.09. Interest. (a) Subject to the provisions of Section 2.09(b) ,

(i) Each Loan that is (A) a Eurocurrency Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurocurrency Rate for such Interest Period plus the Applicable Rate and (B) a Base Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate;

(ii) Each Swingline Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.

(b) (i) While any Event of Default under Section 8.01(a) , Section 8.01(f) and Section 8.01(g) exists, if any principal of or interest on any Loan or any fee payable by the Borrowers hereunder is not, in each case, paid or reimbursed when due, whether at stated maturity, by acceleration or otherwise, the relevant overdue amount shall bear interest, to the fullest extent permitted by law, after as well as before judgment, at a rate per annum equal to the Default Rate; provided that no amount shall accrue pursuant to this Section 2.09(b) on any overdue amount or other amount payable to a Defaulting Lender so long as such Lender is a Defaulting Lender. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein.

Section 2.10. Fees. In addition to certain fees described in Sections 2.04(j) and (k) :

(a) Commitment Fee . The Borrowers shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage, a commitment fee (the “ Commitment Fee ”) equal to (i) on any date on which Availability is less than 50% of the aggregate Commitments, 0.25% times the actual daily amount by which the aggregate Commitments of all Lenders exceed the sum of (A) the Outstanding Amount of Loans (excluding any Outstanding Amount of Swingline Loans) and (B) the Outstanding Amount of L/C Obligations, determined as of the last day of the immediately preceding fiscal quarter, or (ii) on any date on which Availability is equal to greater than or equal to 50% of the aggregate Commitments, 0.375% times the actual daily amount by which the aggregate Commitments of all Lenders exceed the sum of (A) the Outstanding Amount of Loans (excluding any Outstanding Amount of Swingline Loans) and (B) the Outstanding Amount of L/C Obligations, determined as of the last day of the immediately preceding fiscal quarter. The Commitment Fee shall accrue at all times, including at any time during which one or more of the conditions in Article 4 is not met, and shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter, commencing with the first such date to occur after the Closing Date, and on the Termination Date.

(b) Upfront Fee . The Borrowers shall pay to the Administrative Agent, for the account of each Lender, fees in the amounts and at the times specified in the Upfront Fee Letters.

(c) Other Fees . The Borrowers shall pay to the Arrangers and the Administrative Agent for their own respective accounts fees in the amounts and at the times specified in the applicable Fee Letters. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

(d) Defaulting Lender Fees . Notwithstanding anything herein to the contrary, during such period as a Lender is a Defaulting Lender, such Defaulting Lender will not be entitled to any fees accruing during such period pursuant to clause (a) above (without prejudice to the rights of the Non-Defaulting Lenders in respect of such fees); provided , that (i) to the extent that a Ratable Portion of the L/C Obligations of such Defaulting Lender is reallocated to the Non-Defaulting Lenders pursuant to Section 2.16(a) , such fees that would have accrued for the benefit of such Defaulting Lender will instead accrue for the benefit of and be payable to such Non-Defaulting Lenders, pro rata in accordance with their respective Commitments, and (ii) to the extent that all or any portion of such L/C Obligations cannot be so reallocated, such fees will instead accrue for the benefit of and be payable to the applicable L/C Issuer.

Section 2.11. Computation of Interest and Fees. (a) All computations of interest for Base Rate Loans (other than Loans bearing interest at the Base Rate based on clause (c) of the definition thereof) shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed. Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided , that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.13(a) , bear interest for one day. Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

Section 2.12. Evidence of Debt. (a) The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and, as part of the Register, by the Administrative Agent in the ordinary course of business. The accounts or records maintained by the Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the Lenders to the Borrowers and the interest and payments thereon. Any

failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrowers hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request of any Lender to the Borrowers made through the Administrative Agent, the Borrowers shall execute and deliver to such Lender (through the Administrative Agent) a Note (payable to such Lender or its registered assigns), which shall evidence such Lender’s Loans to the Borrowers in addition to such accounts or records. Each Lender may attach schedules to a Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

(b) In addition to the accounts and records referred to in Section 2.12(a) , each Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swingline Loans. In the event of any conflict between the accounts and records maintained by the Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

Section 2.13. Payments Generally; Administrative Agent ’ s Clawback . (a) General . All payments to be made by the Borrowers or the other Loan Parties shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrowers or the other Loan Parties hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date specified herein. The Administrative Agent will promptly distribute to each Lender its ratable share of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. If any payment to be made by the Borrowers shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

(b) (i) Funding by Lenders; Presumption by Administrative Agent . Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing of Eurocurrency Rate Loans (or, in the case of any Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 (or, in the case of a Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02 ) and may, in reliance upon such assumption, make available to the Borrowers a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrowers severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the date such amount is made available to the Borrowers to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the Overnight Rate, plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrowers, the interest rate applicable to Base Rate Loans. If the Borrowers and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrowers the amount of such interest paid by the Borrowers for such period. If such

Lender pays its share of the applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in such Borrowing. Any payment by the Borrowers shall be without prejudice to any claim the Borrowers may have against a Lender that shall have failed to make such payment to the Administrative Agent.

(ii) Payments by Borrowers; Presumptions by Administrative Agent . Unless the Administrative Agent shall have received notice from the Borrowers prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the applicable L/C Issuer hereunder that such Borrowers will not make such payment, the Administrative Agent may assume that such Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to such Lenders or the L/C Issuer, as the case may be, the amount due. In such event, if such Borrower has not in fact made such payment, then each of the Lenders or the L/C Issuer, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or such L/C Issuer, in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Overnight Rate.

A notice of the Administrative Agent to any Lender or the Borrowers with respect to any amount owing under this Section 2.13(b) shall be conclusive, absent manifest error.

(c) Failure to Satisfy Conditions Precedent . If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender to the Borrowers as provided in the foregoing provisions of this Article 2 , and such funds are not made available to the Borrowers by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article 4 are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall promptly return such funds (in like funds as received from such Lender) to such Lender, without interest.

(d) Obligations of Lenders Several . The obligations of (i) the Lenders hereunder to make Loans and to fund participations in Letters of Credit and (ii) all Lenders hereunder to make payments pursuant to Section 2.04(c) are several and not joint. The failure of (x) any Lender to make any Loan or to fund any such participation or (y) any Lender to make payment under Section 2.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to do so.

(e) Funding Source . Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

Section 2.14. Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of (a) Obligations due and payable to such Lender hereunder and under the other Loan Documents at such time in excess of its ratable share (according to the proportion of (i) the amount of such Obligations due and payable to such Lender at such time to (ii) the aggregate amount of the Obligations due and payable to all Lenders hereunder and under the other Loan Documents at such time) of payments on account of the Obligations due and payable to all Lenders hereunder and under the other Loan Documents at such time obtained by all Lenders at such time or (b) Obligations owing (but not due and payable) to such Lender hereunder and under the other Loan Documents at such time in excess of its ratable share (according to the proportion of (i) the amount of such Obligations owing (but not due and payable) to such Lender at such time to (i) the aggregate amount of the Obligations owing (but not due and payable) to all Lenders hereunder and under the other Loan Parties at such time) of payment on account of the Obligations owing (but not due

and payable) to all Lenders hereunder and under the other Loan Documents at such time obtained by all of the Lenders at such time then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and/or, if applicable, subparticipations in L/C Obligations and Swingline Loans of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of Obligations then due and payable to the Lenders or owing (but not due and payable) to the Lenders, as the case may be, provided , that:

(ii) if any such participations or subparticipations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations or subparticipations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(iii) the provisions of this Section 2.14 shall not be construed to apply to (A) any payment made by the Borrowers pursuant to and in accordance with the express terms of this Agreement, (B) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans, subparticipations in L/C Obligations, or Swingline Loans to any assignee or participant, other than to the Borrowers or any Subsidiary thereof (as to which the provisions of this Section 2.14 shall apply), or (C) any payments pursuant to the Fee Letters.

The Borrowers consent to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrowers rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrowers in the amount of such participation.

Section 2.15. Increase in Facility . (a) Provided that no Default or Event of Default has occurred and is continuing or would exist after giving effect thereto, upon at least 7 Business Days’ prior written notice to the Administrative Agent (which shall promptly notify the Lenders thereof), the Borrowers may from time to time request an increase in the amount of the Commitments under the Facility (each, a “ Facility Increase ”) in an aggregate stated amount (for all such requests) not to exceed $25,000,000 (the “ Facility Increase Amount ”); provided , that (i) any such request for a Facility Increase shall be in a minimum stated amount of $10,000,000 (or, if less, the entire remaining amount of the Facility Increase Amount), or such lower amount as determined by the Administrative Agent in its sole discretion, (ii) such increase shall be on the same terms (including with respect to margin, pricing, maturity and fees, other than any underwriting fees and arrangement fees applicable thereto) and pursuant to the exact same Loan Documents and any other documentation applicable to the Facility ( provided , that the Applicable Rate and the Commitment Fee applicable to the Facility may be increased to be identical to that for any Facility Increase to effectuate such Facility Increase) and (iii) such Facility Increase shall be Guaranteed by the exact same Guarantors and shall be secured by a Lien on the exact same Collateral ranking pari passu with the Lien securing the Facility (and no Facility Increase may be (x) Guaranteed by any Person that is not a Loan Party or (y) secured by any assets other than the Collateral).

(b) Lender Elections to Increase . The Borrowers may seek commitments in respect of any Facility Increase from then-existing Lenders (each of which shall be entitled to agree or decline to participate in such Facility Increase in its sole discretion) or additional banks, financial institutions and other institutional lenders or investors who will become Lenders in connection with such Facility Increase (each, an “ Additional Lender ”); provided that each Additional Lender shall be approved by each of the Administrative Agent, the Swingline Lender and each L/C Issuer (such approval not to be unreasonably withheld, delayed or conditioned), to the extent approval thereof would be required pursuant to the definition of “Eligible Assignee” with respect to any assignment of Loans or Commitments.

(c) Effective Date and Allocations . If the Facility is increased in accordance with this Section 2.15 , the Administrative Agent and the Borrowers shall determine the effective date (the “ Increase Effective Date ”) and the final allocation of such Facility Increase. The Administrative Agent shall promptly notify the Borrowers and the Lenders of the final allocation of such Facility Increase and the Increase Effective Date.

(d) Conditions to Effectiveness of Increase . As a condition precedent to such Facility Increase, the Borrowers shall deliver to the Administrative Agent a certificate of each Loan Party dated as of the Increase Effective Date signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such Facility Increase, and (ii) in the case of the Borrowers, certifying that, before and after giving effect to such Facility Increase, (A) the representations and warranties contained in Article 5 and the other Loan Documents are true and correct in all material respects on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Section 2.15 , the representations and warranties contained in Section 5.05(a) and (b) shall be deemed to refer to the most recent financial statements furnished pursuant to Section 6.01 , and (B) no Default or Event of Default has occurred and is continuing. The Borrowers shall prepay any Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 3.05 ) to the extent necessary to keep the outstanding Loans ratable with any revised Applicable Percentages arising from any non-ratable increase in the Commitments under this Section 2.15 .

(e) Conflicting Provisions . This Section shall supersede any conflicting provisions in Section 2.14 or Section 11.01 .

Section 2.16. Defaulting Lender.

(a) Defaulting Lender Adjustments . Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:

(i) Waivers and Amendments . Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders; and

(ii) Defaulting Lender Waterfall . Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article 8 or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 11.08 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first , to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second , to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to any L/C Issuer or Swingline Lender hereunder; third , if so determined by the L/C Issuer or Swingline Lender hereunder, to be held as cash collateral for future funding obligations of such Defaulting Lender in respect of any participation in any Swingline Loan or L/C Obligation; fourth , as the Borrowers may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth , if so determined by the Administrative Agent and the Borrowers, to be held in a deposit account and released pro rata in order to satisfy obligations of such Defaulting Lender to fund Loans under this Agreement; sixth , to the payment of any amounts owing to the Lenders, the L/C Issuers or Swingline Lender

as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the L/C Issuers or Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh , so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrowers as a result of any judgment of a court of competent jurisdiction obtained by the Borrowers against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth , to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Borrowings owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Borrowings owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations are held by the Lenders pro rata in accordance with the Commitments under the applicable Facility without giving effect to clause (iii) below. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this Section 2.16(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii) Reallocation of Participations to Reduce Fronting Exposure . All or any part of such Defaulting Lender’s participation in L/C Obligations and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the aggregate Outstanding Amount of any Non-Defaulting Lender’s Loans and L/C Obligations to exceed such Non-Defaulting Lender’s Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(iv) Cash Collateral. If the reallocation described in clause (iii) above cannot, or can only partially, be effected, the Borrowers shall, without prejudice to any right or remedy available to it hereunder or under law, cash collateralize the L/C Issuers’ Fronting Exposure in accordance with the procedures set forth in Section 2.16(a)(ii) .

(b) Defaulting Lender Cure . If the Borrowers, the Administrative Agent, each L/C Issuer and each Swingline Lender agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swingline Loans to be held pro rata by the Lenders in accordance with the Commitments under the applicable Facility (without giving effect to Section 2.16(a)(iii) ), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrowers while that Lender was a Defaulting Lender; and provided , further , that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

(c) New Swingline Loans / Letters of Credit . So long as any Lender is a Defaulting Lender, (i) the Swingline Lender shall not be required to fund any Swingline Loans unless it is satisfied that it will have not Fronting Exposure after giving effect to such Swingline Loans and (ii) no L/C Issuer shall be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.

ARTICLE 3

T AXES , Y IELD P ROTECTION AND I LLEGALITY

Section 3.01. Taxes. (a) Payments Free of Taxes . Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deductions or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.01(a)) the applicable Recipient receives an amount equal to the sum it would have received had no such deductions or withholding been made.

(b) Payment of Other Taxes by the Borrowers . The Loan Parties shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of any Other Taxes.

(c) Indemnification by the Borrowers . The Loan Parties shall jointly and severally indemnify the Administrative Agent, each Lender and each L/C Issuer, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by the Administrative Agent, such Lender or such L/C Issuer or any of their respective Affiliates, or required to be withheld or deducted from a payment to the Administrative Agent, such Lender or such L/C Issuer or any of their respective Affiliates, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrowers by a Lender or an L/C Issuer (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender or an L/C Issuer, shall be conclusive absent manifest error.

(d) Indemnification by the Lender . Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.06(d) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this Section 3.01(d) .

(e) Evidence of Payments . As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 3.01 , such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(f) Status of Lenders .

(i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.01(ii)(A) , (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii) Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Borrower,

(A) any Lender that is a U.S. Person shall deliver to the Borrowers and Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter as prescribed by applicable law or upon the reasonable request of the Borrowers or Administrative Agent), executed copies of Internal Revenue Service Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B) any Foreign Lender shall, to the extent legally entitled to do so, deliver to the Borrowers and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrowers or the Administrative Agent), whichever of the following is applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of Internal Revenue Service Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any

other applicable payments under any Loan Document, Internal Revenue Service Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2) executed copies of Internal Revenue Service Form W-8ECI;

(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code, (x)(i) a certificate to the reasonable satisfaction of the Borrowers and the Administrative Agent to the effect that such Foreign Lender is not a “bank” within the meaning of section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrowers within the meaning of section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code (a “ U.S. Tax Compliance Certificate ”) and (ii)(y) duly completed copies of Internal Revenue Service Form W-8BEN or W-8BEN-E; or

(4) to the extent a Foreign Lender is not the beneficial owner, executed copies of Internal Revenue Service Form W-8IMY, accompanied by Internal Revenue Service Form W-8ECI, W-8BEN, W-8BEN-E, a U.S. Tax Compliance Certificate to the reasonable satisfaction of the Borrowers and Administrative Agent, Form W-9, and/or other certification document form each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate to the reasonable satisfaction of the Borrower and Administrative Agent on behalf of each such direct and indirect partner, or

(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed copies of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrowers and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrowers or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation

reasonably requested by the Borrowers or the Administrative Agent as may be necessary for the Borrowers and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that is any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

(g) Treatment of Certain Refunds . If any party determines, in its the sole discretion and good faith judgment, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.01 (including by the payment of additional amounts pursuant to this Section 3.01 ), it shall promptly pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnified payments made under this Section with respect to the Taxes giving rise to such refund) net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

(h) Survival . Each party’s obligations under this Section 3.01 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligation under any Loan Document.

(i) Defined Terms . For purpose of this Section 3.01, any term “Lender” includes any L/C Issuer and the term “applicable law” includes FATCA.

Section 3.02. Illegality. If any Lender determines that as a result of any Change in Law it becomes unlawful, or that any Governmental Authority asserts that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurocurrency Rate Loans, or to determine or charge interest rates based upon the Eurocurrency Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrowers through the Administrative Agent, any obligation of such Lender to make or continue Eurocurrency Rate Loans or to convert Base Rate Loans to Eurocurrency Rate Loans, shall be suspended until such Lender notifies the Administrative Agent and the Borrowers that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrowers shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all such Eurocurrency Rate Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurocurrency Rate Loans. Upon any such prepayment or conversion, the Borrowers shall also pay accrued interest on the amount so prepaid or converted.

Section 3.03. Inability to Determine Rates. If the Required Lenders determine that for any reason in connection with any request for a Eurocurrency Rate Loan or a conversion to or continuation thereof that (a) adequate and reasonable means do not exist for determining the Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan, or (b) the Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan does not adequately and fairly reflect the cost to such Lenders of funding such Eurocurrency Rate Loan, the Administrative Agent will promptly so notify the Borrowers and each Lender. Thereafter, the obligation of the Lenders to make or maintain Eurocurrency Rate Loans shall be suspended until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, the Borrowers may revoke any pending request for a Borrowing of, conversion to or continuation of Eurocurrency Rate Loans or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans in the amount specified therein.

Section 3.04. Increased Costs; Reserves on Eurocurrency Rate Loans . (a) Increased Costs Generally . If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the Eurocurrency Rate contemplated by Section 3.04(e) ) or any L/C Issuer;

(ii) subject any Administrative Agent, Lender or L/C Issuer (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (c) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii) impose on any Lender or L/C Issuer or the London interbank market any other condition, cost or expense affecting this Agreement or Eurocurrency Rate Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Administrative Agent, Lender or L/C Issuer of making or maintaining any Eurocurrency Rate Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Administrative Agent, Lender or L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or such L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon written request of such Lender or such L/C Issuer, the Borrowers will pay to such Administrative Agent, Lender or L/C Issuer as the case may be, such additional amount or amounts as will compensate such Administrative Agent, Lender or L/C Issuer, as the case may be, for such additional costs incurred or reduction suffered; provided , that before making any such demand, each Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions and so long as such efforts would not be disadvantageous to it, in its reasonable discretion, in any legal, economic or regulatory manner) to designate a different Eurocurrency Rate lending office if the making of such designation would allow the Lender or its Eurocurrency Rate lending office to continue to perform its obligation to make Eurocurrency Rate Loans or to continue to fund or maintain Eurocurrency Rate Loans and avoid the need for, or reduce the amount of, such increased cost.

(b) Capital Requirements . If any Lender or L/C Issuer determines that any Change in Law affecting such Lender or such L/C Issuer or any Lending Office of such Lender or such Lender’s or such L/C Issuer’s holding company, if any, regarding capital requirements has the effect of reducing the rate of return on such Lender’s or such L/C Issuer’s capital or on the capital of such Lender’s or such L/C Issuer’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the L/C Issuer, to a level below that which such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such L/C Issuer’s policies and the policies of such Lender’s or such L/C Issuer’s holding company with respect to capital adequacy), then from time to time, after submission to the Borrowers (with a copy to the Administrative Agent) of a written request therefor, the Borrowers will pay to such Lender or such L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company for any such reduction suffered.

(c) Certificates for Reimbursement . A certificate of a Lender or an L/C Issuer setting forth the amount or amounts necessary to compensate such Lender or such L/C Issuer or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section 3.04 , describing the basis therefore and showing the calculation thereof in reasonable detail, and delivered to the Borrowers shall be conclusive absent manifest error. The Borrowers shall pay such Lender or such L/C Issuer, as the case may be, the amount shown as due on any such certificate within 30 days after receipt thereof.

(d) Delay in Requests . Failure or delay on the part of any Lender or L/C Issuer to demand compensation pursuant to the foregoing provisions of this Section 3.04 shall not constitute a waiver of such Lender’s or such L/C Issuer’s right to demand such compensation, provided, that the Borrowers shall not be required to compensate a Lender or an L/C Issuer pursuant to the foregoing provisions of this Section 3.04 for any increased costs incurred or reductions suffered more than 90-days prior to the date that such Lender or such L/C Issuer, as the case may be, notifies the Borrowers of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or such L/C Issuer’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 90-day period referred to above shall be extended to include the period of retroactive effect thereof).

(e) Additional Reserve Requirements . The Borrowers shall pay to each Lender, (i) as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurocurrency Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive absent manifest error), and (ii) as long as such Lender shall be required to comply with any reserve ratio requirement or analogous requirement of any other central banking or financial regulatory authority imposed in respect of the maintenance of the Commitments or the funding of the Eurocurrency Rate Loans, such additional costs (expressed as a percentage per annum and rounded upwards, if necessary, to the nearest five decimal places) equal to the actual costs allocated to such Commitment or Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive absent manifest error), which in each case shall be due and payable on each date on which interest is payable on such Loan, provided the Borrowers shall have received at least 10 Business Days’ prior notice (with a copy to the Administrative Agent) of such additional interest or costs from such Lender describing the basis therefor and showing the calculation thereof in reasonable detail. If a Lender fails to give notice 10 Business Days prior to the relevant Interest Payment Date, such additional interest or costs shall be due and payable within 30 days from receipt of such notice.

Section 3.05. Compensation for Losses. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrowers shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

(a) any conversion, payment or prepayment of any Eurocurrency Rate Loan, and any conversion of a Base Rate Loan to a Eurocurrency Rate Loan, on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b) any failure by the Borrowers (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, or continue any Eurocurrency Rate Loan, or to convert a Base Rate Loan to a Eurocurrency Rate Loan, on the date or in the amount notified by the Borrowers; or

(c) any assignment of a Eurocurrency Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrowers pursuant to Section 11.13 ;

including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained, but excluding any loss of anticipated profits. The Borrowers shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Borrowers to the Lenders under this Section 3.05 , each Lender shall be deemed to have funded each Eurocurrency Rate Loan made by it at the Eurocurrency Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurocurrency Rate Loan was in fact so funded.

Section 3.06. Mitigation Obligations; Replacement of Lenders. (a) If any Lender requests compensation under Section 3.04 , or the Borrowers are required to pay any additional amount to any Lender, the Administrative Agent or any Governmental Authority for the account of any Lender pursuant to Section 3.01 , or if any Lender gives a notice pursuant to Section 3.02 , then such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04 , as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02 , as applicable, and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b) Replacement of Lenders . If any Lender requests compensation under Section 3.04 , if the Borrowers are required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 3.06(a) , or if any Lender gives a notice pursuant to Section 3.02 or if any Lender is at such time a Defaulting Lender, then the Borrowers may replace such Lender in accordance with Section 11.13 .

Section 3.07. Survival. All of the Borrowers’ obligations under this Article 3 shall survive termination of the aggregate Commitments and repayment of all other Obligations hereunder.

ARTICLE 4

C ONDITIONS P RECEDENT TO C REDIT E XTENSIONS

Section 4.01. Conditions of Effectiveness. The effectiveness of this Agreement is subject to satisfaction of the following conditions precedent:

(a) The Administrative Agent’s receipt of the following, each of which shall be originals or electronic copies (followed promptly by originals) unless otherwise specified, each properly executed by a duly authorized officer of the applicable signing Loan Party, each dated as of the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and substance reasonably satisfactory to the Administrative Agent:

(i) executed counterparts of this Agreement executed by the Administrative Agent, each Lender and each

Loan Party;

(ii) each Note executed by the Borrowers in favor of each Lender requesting a Note or Notes;

(iii) the Security Agreement executed by each Loan Party,

(iv) financing statements in form appropriate for filing under the Uniform Commercial Code of all jurisdictions that the Administrative Agent may deem necessary in order to perfect the Liens and security interests created or purported to be created under the Security Agreement, covering the Collateral described therein;

(v) certified copies of UCC, United States Patent and Trademark Office and United States Copyright Office, tax and judgment Lien searches, bankruptcy and pending lawsuit searches or equivalent reports or searches, each of a recent date listing all effective financing statements, Lien notices or comparable documents that name any Loan Party as debtor and that are filed in those state and county jurisdictions in which any property of any Loan Party is located and the state and county jurisdictions in which any Loan Party is organized or maintains its principal place of business and such other searches that the Administrative Agent deems reasonably necessary or appropriate, none of which encumber the Collateral covered or intended to be covered by the Security Agreements (other than Permitted Liens);

(vi) the Perfection Certificate, executed by each Loan Party;

(vii) a certificate of each Loan Party, dated as of the Closing Date and executed by a secretary, assistant secretary or other senior officer (as the case may be) thereof, which shall (A) certify that attached thereto is a true and complete copy of the resolutions or written consents of its shareholders, partners, managers, members, board of directors, board of managers or other governing body authorizing the execution, delivery and performance of the Loan Documents to which it is a party and, in the case of the Borrowers, the borrowings hereunder, and that such resolutions or written consents have not been modified, rescinded or amended and are in full force and effect, (B) identify by name and title and bear the signatures of the officers, managers, directors or authorized signatories of such Loan Party authorized to sign the Loan Documents to which it is a party on the Closing Date and (C) certify (x) that attached thereto is a true and complete copy of the certificate or articles of incorporation or organization (or memorandum of association or other equivalent thereof) of such Loan Party certified by the relevant authority of the jurisdiction of organization of such Loan Party and a true and correct copy of its by-laws or operating, management, partnership or similar agreement and (y) that such

documents or agreements have not been amended, restated, amended and restated, supplemented or otherwise modified (except as otherwise attached to such certificate and certified therein as being the only amendments, restatements, amendments and restatements, supplements or modifications thereto as of such date) and (ii) a good standing (or equivalent) certificate as of a recent date for such Loan Party from (A) its jurisdiction of organization and (B) in each jurisdiction in which it is qualified to engage in business where its ownership, lease or operation of properties or the conduct of its business requires such qualification, except, in the case of this clause (B), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect;

(viii) a certificate of a duly authorized officer of each Loan Party either (A) stating that all consents, licenses and approvals required in connection with the execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party have been received and are in full force and effect or (B) stating that no such consents, licenses or approvals are so required in connection with the consummation by such Loan Party of the Transactions;

(ix) a certificate signed by a Responsible Officer of Holdings certifying that the conditions set forth in Section 4.01(f) , (g) , (h) and ( i ) have been satisfied as of such date;

(x) a solvency certificate, substantially in the form of Exhibit L from a Responsible Officer of Holdings (or, at the option of Holdings, a customary third-party opinion as to the solvency of Holdings and its Subsidiaries, on a consolidated basis);

(xi) a Borrowing Base Certificate covering the Borrowing Base as of the Closing Date, with customary supporting documentation;

(xii) certificates of insurance evidencing that the Administrative Agent, for the benefit of the Secured Parties, shall be named as an additional insured, assignee, mortgagee and/or loss payee, as appropriate, with respect to all applicable insurance coverage and policies of the Loan Parties; and

(xiii) the executed opinion of Akin Gump Strauss Hauer & Feld LLP, counsel to the Loan Parties, addressed to the Administrative Agent, the Lenders and the L/C Issuer, as to such matters concerning the Loan Parties and the Loan Documents as the Administrative Agent may reasonably request.

(b) (i) Any fees required to be paid on or before the Closing Date to the Administrative Agent, any Arranger or the Lenders pursuant to the Fee Letters shall have been paid and (ii) any costs and expenses required to be paid on or before the Closing Date to the Administrative Agent, any Arranger or the Lenders to the extent invoices have been received by Holdings at least two Business Days prior to the Closing Date (or such later date as reasonably agreed by Holdings) shall have been paid.

(d) On or prior to the Closing Date, the Acquisition shall have been consummated pursuant to the Acquisition Agreement (without giving effect to any amendments, waivers, modifications or consents that are materially adverse to the interests of the Lenders or the Arrangers, without the consent of the Arrangers).

(e) On or prior to the Closing Date, the Initial Rights Offering shall have been consummated pursuant to the Equity Commitment Letter (without giving effect to any amendments, waivers, modifications or consents that are materially adverse to the interests of the Lenders or the Arrangers, without the consent of the Arrangers), and Holdings shall have received the proceeds of such Initial Rights Offering in an aggregate amount not less than the Minimum Rights Offering Amount.

(f) On the Closing Date, neither Holdings nor any of its Subsidiaries shall have any material Indebtedness for borrowed money (other than any Loans made and Letters of Credit issued on the Closing Date), purchase money Indebtedness, Capital Lease Obligations, working capital facilities for Foreign Subsidiaries, other Indebtedness incurred in the ordinary course of business, and other Indebtedness permitted pursuant to Section 7.02 .

(g) Since November 5, 2015, no Company Material Adverse Effect shall have occurred.

(h) The representations and warranties of each Loan Party and its Subsidiaries contained in this Agreement and each other Loan Document, shall be true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) on and as of the Closing Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date.

(i) No Default or Event of Default shall have occurred and be continuing, or would result from, the consummation of the Transactions (including any Credit Extension to be made on the Closing Date and the application of the proceeds thereof).

(j) The Administrative Agent shall have received (i) any certificates representing the Equity Interests required to be pledged pursuant to the Security Agreement, together with an undated stock or similar power for each such certificate executed in blank by a duly authorized officer of the pledgor thereof and (ii) any promissory note required to be pledged to the Administrative Agent pursuant to the Security Agreement endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank) by the pledgor thereof.

(k) Each document (including any UCC (or similar) financing statements) required by the Collateral Documents or under Law or reasonably requested by the Administrative Agent to be filed, registered or recorded in order to perfect such Lien shall be in proper form for filing, registration or recordation.

(l) The Administrative Agent shall have received, at least 3 Business Days prior to the Closing Date, all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the PATRIOT Act, to the extent requested by the Administrative Agent or any Lender at least 10 Business Days prior to the Closing Date.

For purposes of determining compliance with the conditions specified in this Section 4.01 , each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required under any Loan Document to be consented to or approved by or acceptable or satisfactory to such Lender, unless the Administrative Agent shall have received written notice from such Lender prior to the Closing Date specifying its objection thereto.

Section 4.02. Conditions to All Credit Extensions. The obligation of each Lender to honor any Request for Credit Extension (other than a Borrowing Notice requesting only a conversion of Loans to the other Type, or a continuation of Eurocurrency Rate Loans) is subject to the following conditions precedent:

(a) The representations and warranties of each Loan Party and its Subsidiaries contained in this Agreement and each other Loan Document, shall be true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) on and as of the date of such Credit Extension, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date.

(b) No Default or Event of Default shall have occurred and be continuing, or would result from such proposed Credit Extension or from the application of the proceeds thereof.

(c) After giving effect to any Credit Extension (or the incurrence of any L/Cs Obligations), the Total Outstandings shall not exceed the Maximum Revolving Credit;

(d) The Administrative Agent and, if applicable, each applicable L/C Issuer or the Swingline Lender shall have received a Request for Credit Extension in accordance with the requirements hereof.

Each Request for Credit Extension (other than a Borrowing Notice requesting only a conversion of Loans to the other Type or a continuation of Eurocurrency Rate Loans) submitted by the Borrowers shall be deemed to be a representation and warranty that the conditions specified in Sections 4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.

ARTICLE 5

R EPRESENTATIONS AND W ARRANTIES

The Borrowers and each Guarantor, on behalf of themselves and their respective Subsidiaries, represents and warrants to the Administrative Agent and the Lenders that:

Section 5.01. Existence, Qualification and Power. (a) Each Loan Party is (i) duly organized or formed and validly existing and (ii) in good standing under the Laws of the jurisdiction of its incorporation or organization, except, in the case of this clause (ii), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

(b) Each Loan Party has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party and consummate the Transactions, and (iii) is duly qualified and is licensed and, as applicable, in good standing, under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except, in the case of clauses (i) and (iii), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

Section 5.02. Authorization; No Contravention. The execution, delivery and performance by each Loan Party of each Loan Document, (a) have been duly authorized by all necessary corporate or other organizational action, and (b) do not and will not (i) contravene the terms of any of such Person’s Organization Documents; (ii) conflict with or result in any breach or contravention of, or the creation of any Lien (except for any Liens that may arise under the Loan Documents) under, or require any payment

to be made under (A) any Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (B) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) violate any Law, except, in the case of clause (b)(ii) and (c), as could not reasonably be expected to have a Material Adverse Effect.

Section 5.03. Governmental Authorization; Other Consents. (a) No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority and (b) no material approval, consent, exemption, authorization, or other action by, or notice to, or filing with any other Person, in each case, is necessary or required in connection with (i) the execution, delivery or performance by any Loan Party of this Agreement or any other Loan Document, or for the consummation of the Transactions, (ii) the grant by any Loan Party of the Liens granted by it pursuant to the Collateral Documents or (iii) the perfection of the Liens created under the Collateral Documents (including the first priority nature thereof), except for (x) those approvals, consents, exemptions, authorizations or other actions which have already been obtained, taken, given or made and are in full force and effect, and (y) any filings required to perfect the Liens created under the Collateral Documents.

Section 5.04. Binding Effect. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of each Loan Party party thereto, enforceable against such Loan Party in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other Laws relating to or affecting creditors’ rights generally, general principles of equity, regardless of whether considered in a proceeding in equity or at law and an implied covenant of good faith and fair dealing.

Section 5.05. Financial Statements; No Material Adverse Effect. (a) The Financial Statements of Holdings and its Subsidiaries (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein or in the notes thereto; and (ii) fairly present in all material respects the financial condition of Holdings and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby (subject, in the case of unaudited statements, to normal year-end audit adjustments and to any other adjustments described therein including in any notes thereto).

(b) The Pro Forma Financial Statements of Holdings and its Subsidiaries, certified by a Responsible Officer of Holdings, copies of which have been furnished to the Administrative Agent, on or prior to the Closing Date, fairly present in all material respects the consolidated pro forma financial condition of Holdings and its Subsidiaries, on a consolidated basis, as at such date and the consolidated pro forma results of operations of Holdings and its Subsidiaries for the period ended on such date, in each case giving effect to the Transactions, all prepared in accordance with GAAP, except as otherwise noted therein.

(c) Since the Closing Date, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

Section 5.06. Litigation. Except as set forth in Schedule 5.06 , there are no actions, suits, proceedings, claims, investigations or disputes pending or, to the knowledge of the Borrowers, threatened, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrowers or any of their respective Subsidiaries or against any of their properties or revenues (a) that purport to affect or

pertain to this Agreement or any other Loan Document (including the legality or enforceability thereof) or the consummation of the Transactions or (b) as to which there is a reasonable possibility of an adverse determination and that could reasonably be expected to have a Material Adverse Effect.

Section 5.07. No Default. Neither the Borrowers nor any Subsidiary is in default under or with respect to any Contractual Obligation that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document.

Section 5.08. Ownership of Property; Subsidiaries; Equity Interests. (a) Each of the Borrowers and each of their respective Subsidiaries, subject to Permitted Liens, has (i) good and marketable Mining Title to the Material Owned Real Property and the Material Leased Real Property for the ordinary conduct of the business and operations of each of the Loan Parties and each of their respective Subsidiaries as presently conducted on the date hereof and (ii) good record title to, or valid leasehold, easement or other real property interests in all other Real Property necessary for the ordinary conduct of the business and operations of the Loan Parties and their respective Subsidiaries as presently conducted, subject to such defects in title as could not reasonably be expected to materially interfere with the ordinary conduct of the business and operations of any Loan Party or any of its Subsidiaries.

(b) Each of the Borrowers and each of their Subsidiaries has good record title to, or valid leasehold, easement or other property interests in all personal property necessary for or used in the ordinary conduct of the business and operations of the Loan Parties and their respective Subsidiaries as presently conducted.

(c) As of the Closing Date, (i) all Equity Interests held by Holdings or any of its Subsidiaries are set forth in Schedule 5.08(c) , (ii) all of the outstanding Equity Interests in the Borrowers and their Subsidiaries have been validly issued, are fully paid and nonassessable (to the extent such concepts exist under applicable Law) and (iii) all Equity Interests owned by the Borrowers and their Subsidiaries are free and clear of all Liens except (x) those created under the Collateral Documents and (y) any nonconsensual Permitted Liens.

(d) To the knowledge of the Loan Parties on the Closing Date, all Material Owned Real Property and Material Leased Real Property of the Loan Parties that is being mined or operated as of the Closing Date is in physical condition that would permit mining or operations presently conducted.

Section 5.09. Environmental Compliance. Except as disclosed on Schedule 5.09 , or as otherwise could not reasonably be expected to have a Material Adverse Effect:

(a) None of the Borrowers nor any of their Subsidiaries has received any notice of violation, alleged violation, non-compliance, liability or potential liability concerning or arising out of Environmental Laws or Hazardous Materials with regard to any of the Properties or the business operated by the Borrowers or any of their respective Subsidiaries (the “ Business ”).

(b) Hazardous Materials have not been transported or disposed of from the Properties in violation of, or in a manner or to a location which could reasonably be expected to give rise to liability of the Borrowers or any of their Subsidiaries under, any applicable Environmental Law, nor have any Hazardous Materials been generated, treated, stored or disposed of at, on or under any of the Properties in violation of, or in a manner that could reasonably be expected to give rise to liability of the Borrowers or any of their Subsidiaries under, any applicable Environmental Law.

(c) No judicial proceeding or governmental or administrative action is pending or, to the knowledge of the Borrowers, threatened under any Environmental Law to which the Borrowers or any of their respective Subsidiaries is or, to the knowledge of the Borrowers, will be named as a party or with respect to the Properties or the Business, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other similar administrative or judicial requirements outstanding under any Environmental Law with respect to the Properties or the Business.

(d) There has been no release or threat of release of Hazardous Materials at or from the Properties, or arising from or related to the operations of the Borrowers or any of their respective Subsidiaries in connection with the Properties or otherwise in connection with the Business, in violation of or in amounts or in a manner that could reasonably be expected to give rise to liability of the Borrowers or any of their Subsidiaries under any applicable Environmental Laws.

(e) The Properties and all operations at the Properties and of the Business are and have been in compliance with all applicable Environmental Laws.

(f) The Borrowers and each of their Subsidiaries (i) hold and have held all Environmental Permits (each of which is in full force and effect and is not subject to appeal, except in such instances where the requirement to hold an Environmental Permit is being contested in good faith by the Borrowers or any of their respective Subsidiaries by appropriate proceedings diligently conducted) required for any of their current operations or for the current ownership, operation or use of the Properties, including all Environmental Permits required for the coal mining-related operations of the Borrowers or any of their respective Subsidiaries or, to the extent currently required, any pending construction or expansion related thereto; (ii) are, or have been, in compliance with all Environmental Permits, except in such instances where the requirement of an Environmental Permit is being contested in good faith by the Borrowers or any of their respective Subsidiaries by appropriate proceedings diligently conducted; and (iii) have used commercially reasonable efforts to cause all contractors, lessees and other Persons occupying, operating or using the mines on the Properties to comply with all Environmental Laws and obtain all Environmental Permits required for the operation of the mines.

(g) To the knowledge of the Borrowers, none of the Properties have any associated direct or indirect acid mine drainage which (i) constitutes or constituted a violation of, or (ii) could reasonably be expected to give rise to liability under, any applicable Environmental Law.

Section 5.10. Mining .

(a) The Borrowers and each of their Subsidiaries has, in the amounts and forms required pursuant to Environmental Law, obtained all performance bonds and surety bonds, or otherwise provided any financial assurance required under Environmental Law for Reclamation or otherwise in the ordinary conduct of the business and operations of the Loan Parties (collectively, “ Mining Financial Assurances ”), except as could not reasonably be expected to result in a Material Adverse Effect.

(b) There have been no accidents, explosions, implosions, collapses or flooding at or otherwise related to the Properties of the Business that have, directly or indirectly, resulted in, or could reasonably be expected to result in, a Material Adverse Effect.

Section 5.11. Insurance. The properties of the Borrowers and their Subsidiaries are insured with financially sound and reputable insurance companies in such amounts (after giving effect to any self-insurance compatible with the following standards), with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Borrowers or the applicable Subsidiary operates.

Section 5.12. Taxes. (a) The Borrowers and their Subsidiaries have filed all Federal, state and other tax returns and reports required to be filed, and have paid all Federal, state and other Taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable (other than those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with GAAP), except where the failure to do any of the foregoing could not reasonably be expected to result in a Material Adverse Effect; (b) no Tax Lien has been filed and, to the knowledge of the Borrowers, no claim is being asserted or audit being conducted, with respect to any Tax, fee or other charge of the Borrowers or any of their respective Subsidiaries, except as could not reasonably be expected to result in a Material Adverse Effect; and (c) there is no proposed Tax assessment against the Borrowers or any of their respective Subsidiary, except as could not reasonably be expected to result in a Material Adverse Effect. Neither any Loan Party nor any Subsidiary thereof is party to any tax sharing agreement.

Section 5.13. ERISA Compliance. (a) Except as could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, (i) each Plan is in compliance with the applicable provisions of ERISA, the Code and other Federal or state Laws (except that with respect to any Multiemployer Plan which is a Plan, such representation is deemed made only to the knowledge of the Borrowers) and (ii) with respect to each Plan, no failure to satisfy the minimum funding standards of Sections 412 or 430 of the Code has occurred, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made.

(b) There are no pending or, to the knowledge of the Borrowers, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could reasonably be expected to have a Material Adverse Effect. There has been no nonexempt “prohibited transaction” (as defined in Section 406 of ERISA) or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected to result in a Material Adverse Effect.

(c) Except as could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect: (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither the Borrowers nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither the Borrowers nor any ERISA Affiliate has incurred, or reasonably expects to incur (except as may occur as a result of relief granted pursuant to section 1113 of the Bankruptcy Code), any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the Borrowers nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.

Section 5.14. [Reserved.]

Section 5.15. Margin Regulations; Investment Company Act. (a) The Borrowers are not engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the Federal Reserve Board), or extending credit for the purpose of purchasing or carrying margin stock. Following the application of the proceeds of each Borrowing or drawing under each Letter of Credit, not more than 25% of the value of the assets (either of the Borrowers only or of the Borrowers and their Subsidiaries on a consolidated basis) subject to the provisions of Section 7.01 , Section 7.04 or Section 7.05 or subject to any restriction contained in any agreement or instrument between the Borrowers and any Lender or any Affiliate of any Lender relating to Indebtedness and within the scope of Section 8.01(e) will be margin stock.

(b) None of the Borrowers, any Person Controlling the Borrowers, or any Subsidiary is required to register as an “investment company” under the Investment Company Act of 1940.

Section 5.16. Disclosure. No report, financial statement, certificate or other information furnished (in writing) by or on behalf of any Loan Party or any of its Subsidiaries to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document, taken as a whole with any other information furnished or publicly available, contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading as of the date when made or delivered; provided , that with respect to any forecast, projection or other statement regarding future performance, future financial results or other future developments, the Borrowers represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time such information was prepared (it being understood that any such information is subject to significant uncertainties and contingencies, many of which are beyond the Borrowers’ control, and that no assurance can be given that the future developments addressed in such information can be realized).

Section 5.17. Compliance with Laws. The Borrowers and each of their respective Subsidiaries is in compliance with the requirements of all Laws (including any zoning, building, ordinance, code or approval or any building or mining permits) and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted, or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

Section 5.18. Intellectual Property; Licenses, Etc. The Borrowers and each of their Subsidiaries exclusively own, or possess the valid and continuing right to use, all of the trademarks, service marks, trade names, other source or business identifiers, Internet domain names, copyrights, patents, patent rights, trade secrets, know-how, franchises, licenses and other intellectual property rights, in each case, whether registered or unregistered and including all goodwill associated with the foregoing (collectively, “ Intellectual Property ”), in each case, free and clear of all Liens (other than Permitted Liens), except where failure to have such Intellectual Property individually or in the aggregate could not reasonably be expected to have a Material Adverse Effect. To the knowledge of the Borrowers, the use of such Intellectual Property by such Borrower or any Subsidiary does not infringe upon any rights held by any other Person. No claim or litigation regarding any of the foregoing is pending or, to the knowledge of the Borrowers, threatened that either individually or in the aggregate could reasonably be expected to have a Material Adverse Effect.

Section 5.19. Solvency. As of the Closing Date and after giving effect to the Transactions and the incurrence of the Indebtedness and obligations being incurred in connection with this Agreement and the Transactions, (i) the sum of the debt (including contingent liabilities) of Holdings and its Subsidiaries, on a consolidated basis, does not exceed the fair value of the present assets of Holdings and its Subsidiaries, on a consolidated basis; (ii) the present fair saleable value of the assets of Holdings and its Subsidiaries, on a consolidated basis, is not less than the amount that will be required to pay the probable liabilities (including contingent liabilities) of Holdings and its Subsidiaries, on a consolidated basis, as they become absolute and matured; (iii) the capital of Holdings and its Subsidiaries, on a consolidated basis, is not unreasonably small in relation to the business of Holdings or its Subsidiaries, on a consolidated basis, contemplated as of the Closing Date; and (iv) Holdings and its Subsidiaries, on a

consolidated basis, do not intend to incur, or believe that they will incur, debts (including current obligations and contingent liabilities) beyond their ability to pay such debt as they mature in the ordinary course of business. For the purposes hereof, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

Section 5.20. Casualty, Etc. Neither the businesses nor the properties of the Borrowers or any of their respective Subsidiaries have been affected by any fire, explosion, accident, strike, lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty (whether or not covered by insurance) that, either individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

Section 5.21. Labor Matters . Except as specifically disclosed on Schedule 5.21 , there are no collective bargaining agreements or Multiemployer Plans covering the employees of the Borrowers or any of their respective Subsidiaries as of the Closing Date. As of the Closing Date, (a) neither the Borrowers nor any Subsidiary has suffered any strikes, walkouts, work stoppages or other material labor difficulty within the last five years, and (b) since the Closing Date, neither the Borrowers nor any Subsidiary has suffered any strikes, walkouts, work stoppages or other material labor difficulty that could reasonably be expected to result in a Material Adverse Effect.

Section 5.22. Collateral Documents. The provisions of the Collateral Documents, together with such filings and other actions required to be taken hereby or by the applicable Collateral Documents, when executed and delivered (and at all times thereafter) are effective to create in favor of the Administrative Agent for the benefit of the Secured Parties a legal, valid and enforceable Lien on all right, title and interest of the Collateral owned by the Loan Parties and described therein (subject to Permitted Liens).

Section 5.23. Use of Proceeds. The Borrowers will use the proceeds of the Loans solely as provided for in Section 6.11 .

Section 5.24. Coal Act; Black Lung Act.

(a) (i) The Borrowers, each of their Subsidiaries and each of their respective “related persons” (as defined in the Coal Act) are, and have been, in compliance in all material respects with the Coal Act and any regulations promulgated thereunder, and (ii) none of the Borrowers, their Subsidiaries or each of their respective “related persons” (as defined in the Coal Act) has any liability under the Coal Act, except, in the case of this clause (ii), as disclosed in the Borrowers’ financial statements (after deducting the minimum balance required by the United States Department of Labor to be maintained in the 501(c)(21) Trust) on or prior to the Closing Date (or as otherwise disclosed from time to time to the Administrative Agent in form and substance reasonably satisfactory to the Administrative Agent) or which could not reasonably be expected to have a Material Adverse Effect, or with respect to premiums or other material payments required thereunder which have been paid when due.

(b) (i) The Borrowers and each of their Subsidiaries are, and have been, in compliance in all material respects with the Black Lung Act, and (ii) neither the Borrowers nor any of their Subsidiaries has either incurred any Black Lung Liability or assumed any other Black Lung Liability, or with respect to premiums, contributions or other material payments required thereunder which have been paid when due, except, in the case of this clause (ii), as disclosed in the Borrowers’ financial statements after deducting the minimum balance required by the United States Department of Labor to be maintained in the 501(c)(21) Trust) on or prior to the Closing Date (or as otherwise disclosed from time to time to the Administrative Agent in form and substance reasonably satisfactory to the Administrative Agent), or which could not reasonably be expected to have a Material Adverse Effect.

Section 5.25. Anti-Terrorism Laws; Anti-Corruption Laws and Sanctions. (a) None of the Loan Parties or any of their respective Subsidiaries, or any of their respective directors, officers, employees or, to the knowledge of any of the Borrowers, any of their respective agents, Affiliates or representatives is an individual or entity that is, or is owned or controlled by any individual or entity that is (i) currently the target or any Sanctions or (ii) located, organized or resident in a country or territory that is the target of comprehensive Sanctions.

(b) each of the Loan Parties and their respective Subsidiaries is in compliance, in all material respects, with Anti-Corruption Laws, Anti-Money Laundering Laws, Anti-Terrorism Laws and Sanctions.

ARTICLE 6

A FFIRMATIVE C OVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied (other than in respect of contingent obligations, indemnities and expenses related thereto not then payable or in existence as of the later of the Termination Date or the Letter of Credit Expiration Date), or any Letter of Credit shall remain outstanding, each Loan Party shall, and shall cause each of its respective Subsidiaries to:

Section 6.01. Financial Statements. Deliver to the Administrative Agent and each Lender, in form and substance reasonably satisfactory to the Administrative Agent:

(a) as soon as available, but in any event within 120 days after the end of each fiscal year of Holdings (commencing with the fiscal year ended December 31, 2016), a consolidated balance sheet of Holdings and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income or operations, changes in shareholders’ equity and cash flows for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and prepared in accordance with GAAP, such consolidated statements to be audited and accompanied by a report and opinion of any independent certified public accountant of nationally recognized standing reasonably acceptable to the Administrative Agent and Holdings, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit (except for an explanatory paragraph solely with respect to or resulting from an upcoming scheduled maturity date of the Loans occurring within one year from the time such report is delivered); and

(b) as soon as available, but in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year of Holdings (commencing with the fiscal quarter ended June 30, 2016), a consolidated balance sheet of Holdings and its Subsidiaries as at the end of such fiscal quarter, and the related consolidated statements of income or operations, changes in shareholders’ equity and cash flows for such fiscal quarter and for the portion of Holdings’s fiscal year then ended, setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail, such consolidated statements to be certified by a Responsible Officer of Holdings as fairly presenting in all material respects the financial condition, results of operations, changes in shareholders’ equity and cash flows of Holdings and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes;

Section 6.02. Certificates; Other Information. Deliver to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent (or, in the case of clause (k) below, participate in):

(a) [reserved];

(b) concurrently with the delivery of the financial statements referred to in Section 6.01(a) and (b) (commencing with the delivery of the financial statements for the fiscal quarter ending June 30, 2016), a duly completed Compliance Certificate signed by a Responsible Officer of Holdings, which shall (i) include reasonably detailed computations of the financial covenant set forth in Section 7.11 , (ii) state that no Default or Event of Default has occurred and is continuing or, if a Default or an Event of Default has occurred and is continuing, stating the nature thereof and the action that the Borrowers propose to take with respect thereto and (iii) either confirm that there has been no change in the information with respect to the Collateral owned by any Loan Party in the Perfection Certificate delivered on the Closing Date since the date of such Perfection Certificate or the date of the most recent certificate delivered pursuant to this Section or if any such change has occurred, attaching a Perfection Certificate Supplement signed by the Loan Parties, identifying such changes;

(c) promptly, upon receipt thereof and after any request by the Administrative Agent, copies of any detailed audit reports, management letters or recommendations submitted to the board of directors (or the audit committee of the board of directors) of any Loan Party by independent accountants in connection with the accounts or books of the Borrowers or any of their respective Subsidiaries, or any audit of any of them;

(d) unless otherwise required to be delivered to the Lenders hereunder, promptly after the furnishing thereof, copies of any statement or report furnished to any holder of debt securities of any Loan Party or any of its Subsidiaries pursuant to the terms of any indenture or similar agreement and not otherwise required to be furnished to the Lenders pursuant to Section 6.01 or any other clause of this Section 6.02 ;

(e) [reserved];

(f) as soon as available, but in any event within the time period in which Holdings must deliver its annual audited financials under Section 6.01(a) , a report supplementing Schedules 5.08(a) and 5.08(b) and identifying all Material Owned Real Property and Material Leased Real Property acquired or disposed of by any Loan Party during such fiscal year;

(g) promptly, such additional information regarding the business, financial, legal or corporate affairs of any of the Borrowers or any of its Subsidiaries, or compliance with the terms of the Loan Documents, as the Administrative Agent may from time to time reasonably request;

(h) not later than 90 days after the end of each fiscal year of Holdings, a copy of summary projections by Holdings of the operating budget and cash flow budget of Holdings and its respective Subsidiaries for the succeeding fiscal year, such projections to be accompanied by a certificate of a Responsible Officer to the effect that such projections have been prepared based on assumptions believed by the Borrowers to be reasonable;

(i) a Borrowing Base Certificate substantially in the form of Exhibit G , as of the date required to be delivered or so requested, in each case with supporting documentation:

(i) (A) monthly (as of the last day of each month (or, if such day is not a Business Day, as of the Business Day immediately preceding such last day)), commencing for the month ended April 30, 2016, on or before the twentieth day of each month or (B) during any Liquidity Period, weekly, commencing with the week ending April 8, 2016, as applicable, on or before the third Business Day of each week ( provided , in the case of this clause (B) , (1) Inventory reporting shall be updated on a bi-weekly basis and (2) ineligibility in respect of the eligibility criteria set forth in the definitions of “Eligible Accounts” and “Eligible Inventory” shall be reported on a monthly basis), in each case, which Borrowing Base Certificate shall reflect the Collateral contained in the Borrowing Base updated as of last day of each month or week, as applicable, in each case, together with:

(x) a trial balance showing Accounts outstanding aged from the statement date as follows: 1 to 30 days, 31 to 60 days, 61 to 90 days and 91 days or more, accompanied by a comparison to the prior month’s or week’s trial balance and supporting detail and documentation as shall be reasonably satisfactory to the Administrative Agent;

(y) a summary of Inventory by location and type of each of the Loan Parties, accompanied by such supporting detail and documentation as shall be reasonably satisfactory to the Administrative Agent; and

(z) a reconciliation of the Accounts trial balance and Inventory reports of each of the Loan Parties to the general ledger of such Loan Party;

(ii) at any other time when the Administrative Agent reasonably believes that the then existing Borrowing Base Certificate is materially inaccurate, as soon as reasonably available after such request, in each case with supporting documentation as the Administrative Agent may reasonably request, such other reports, statements and reconciliations with respect to the Borrowing Base or Collateral of any or all Loan Parties as the Administrative Agent shall from time to time reasonably request;

(j) promptly (and in any event within three Business Days) after any Loan Party has knowledge that Accounts of the Loan Parties in an aggregate face amount of $2,500,000 or more cease to be Eligible Accounts, notice of such occurrence;

(k) following the delivery of the financial statements referred to in Section 6.01(a) , a conference call with the Lenders at a time to be mutually agreed between the Borrowers and the Administrative Agent.

Documents required to be delivered pursuant to Section 6.01(a) or (b) or Section 6.02(a) or (b) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrowers post such documents, or provides a link thereto on the Borrowers’ website on the Internet at the website address listed on Schedule 11.02 (or as the Borrowers may otherwise notify the Administrative Agent); (ii) on which such documents are posted on the Borrowers’ behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); or (iii) on which such documents are filed for public availability of the SEC’s Electronic Data Gathering and Retrieval system; provided , that the Borrowers shall notify the Administrative Agent and each Lender (by telecopier or electronic mail) of the posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions ( i.e. , soft copies) of the documents required to be delivered pursuant to Section 6.01(a) or (b) or Section 6.02(a) or (b) . The Administrative

Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrowers with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

Section 6.03. Notices. Notify the Administrative Agent:

(a) promptly, of the occurrence of any Default or Event of Default;

(b) promptly, of any event which could reasonably be expected to have a Material Adverse Effect;

(c) of the occurrence of any ERISA Event that, individually, or in the aggregate, would be reasonably likely to have a Material Adverse Effect, as soon as possible and in any event within 15 days after any of the Borrowers knows or has obtained notice thereof;

(d) of any material change in accounting policies or financial reporting practices by any Loan Party or any Subsidiary thereof;

(e) promptly after receipt of notice or knowledge of any Loan Party thereof, of any action, suit, proceeding or claim alleging any Environmental Liability against or by such Loan Party or any of its Subsidiaries that could reasonably be expected to result in a Material Adverse Effect;

(f) promptly after receipt of notice or knowledge of the Borrowers thereof, of any accidents, explosions, implosions, collapses or flooding at or otherwise related to the Properties that result in (i) any fatality or (ii) the trapping of any Person in any mine for more than twenty-four hours;

(g) promptly after receipt of notice or knowledge of the Borrowers thereof, of the issuance of any closure order pursuant to any Law (including any Environmental Law) or pursuant to any Environmental Permit that could reasonably be expected to directly or indirectly result in the closure or cessation of operation of any mine for a period of more than 5 consecutive days; and

(h) promptly after receipt of notice or knowledge of any Loan Party of any default by such Loan Party of any of its Subsidiaries under any Contractual Obligation with respect to Material Leased Real Property (except for non-material non-payment defaults and defaults which do not or, with the giving of any notice, the passage of time, or both, would not give rise a right of termination by the lessor).

Each notice pursuant to this Section 6.03 (which may be in electronic form) shall be accompanied by a statement of a Responsible Officer of the applicable Borrower setting forth details of the occurrence referred to therein and stating what action the applicable Borrowers have taken and proposes to take with respect thereto.

Section 6.04. Payment of Obligations. Pay and discharge as the same shall become due and payable (a) all Tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, except where failure to do so could not reasonably be expected to result in a Material Adverse Effect or (b) all lawful claims which, if unpaid, would by law become a Lien upon any material portion of the Collateral, unless, in each of clause (a) or (b) above, such liabilities, assessments, governmental charges, levies or claims are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Borrowers or any of their respective Subsidiaries.

Section 6.05. Preservation of Existence, Etc. With respect to each of the Borrowers and each of its respective Subsidiaries, (a) preserve, renew and maintain in full force and effect its (i) legal existence and (ii) good standing, in each case, under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 7.04 or 7.05 ; (b) take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary for the normal conduct of its business, except in connection with transactions permitted by Section 7.04 or Dispositions permitted by Section 7.05 to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and (c) preserve or renew all of its registered patents, trademarks, trade names and service marks, the non-preservation of which could reasonably be expected to have a Material Adverse Effect.

Section 6.06. Maintenance of Properties. With respect to each of the Borrowers and each of its respective Subsidiaries, maintain, preserve and protect all of its properties and equipment necessary in the operation of its business in good working order and condition (ordinary wear and tear and damage by fire or other casualty or taking by condemnation excepted), except where the failure to do so could not reasonably be expected to have a Material Adverse Effect. The Loan Parties shall use, store and maintain all Inventory with reasonable care and caution, in accordance with applicable standards of any insurance and in conformity with all applicable Law.

Section 6.07. Maintenance of Insurance. Maintain with financially sound and reputable insurance companies, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or Similar Business, of such types and in such amounts (after giving effect to any self-insurance compatible with the following standards) as are customarily carried by companies engaged in Similar Businesses and owning similar properties in localities where any of the Borrowers or their respective Subsidiaries operate. Without limiting the generality of the foregoing, each of the Borrowers and their respective Subsidiaries will maintain or cause to be maintained (a) flood insurance with respect to each parcel of improved Real Property that is covered by a Mortgage and located in a Special Flood Hazard Area (as designated by the Federal Emergency Management Administration) of a community that participates in the National Flood Insurance Program, in each case in compliance with any applicable regulations of the Board of Governors of the Federal Reserve System, (b) liability insurance, (c) business interruption insurance, and (d) replacement value casualty insurance on the Collateral under such policies of insurance, with such insurance companies, in such amounts, with such deductibles, and covering such risks as would be carried or maintained under similar circumstances by Persons of established reputation engaged in Similar Businesses. Each such policy of insurance shall (i) name the Administrative Agent, on behalf of Secured Parties, as an additional insured thereunder as its interests may appear, (ii) in the case of each casualty insurance policy, contain a loss payable clause or endorsement, reasonably satisfactory in form and substance to the Administrative Agent, that names the Administrative Agent, on behalf of the Secured Parties, as the loss payee thereunder and provide for at least thirty days’ prior written notice to the Administrative Agent of any modification or cancellation of such policy.

Section 6.08. Compliance with Laws. Comply in all respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by the Borrowers or any of their respective Subsidiaries by appropriate proceedings diligently conducted or (b) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.

Section 6.09. Books and Records. (a) Maintain proper books of record and account, in which in all material respects full, true and correct entries in conformity with GAAP consistently applied shall be made of all material financial transactions and matters involving the assets and business of each of the Borrowers and their respective Subsidiaries, as the case may be; (b) maintain such books of record and

account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over the Borrowers or such Subsidiary, as the case may be; and (c) each Loan Party shall keep accurate and complete records of its Inventory, including costs and daily withdrawals and additions.

Section 6.10. Inspection Rights; Field Exams; Appraisals. (a) Permit representatives and independent contractors of the Administrative Agent, and during any continuation of an Event of Default, any Lender, at the Borrowers’ expense, to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom during normal business hours (except to the extent (i) any such access is restricted by a requirement of Law or (ii) any such agreements, contracts or the like are subject to a written confidentiality agreement with a non-Affiliate that prohibits the Borrowers or any of their respective Subsidiaries from granting such access to the Administrative Agent or the Lenders; provided , that with respect to such confidentiality restrictions affecting the Borrowers or any of their respective Subsidiaries, a Responsible Officer is made available to such Lender to discuss such confidential information to the extent permitted), and to discuss the business, finances and accounts with its officers and independent public accountants at such reasonable times during normal business hours and as often as may be reasonably desired, provided , that the Administrative Agent or such Lender shall give Borrowers reasonable advance notice prior to any contact with such accountants and give the Borrowers the opportunity to participate in such discussions.

(b) At any reasonable time and from time to time during regular business hours, upon reasonable notice, permit (i) any Approved Appraisers or Approved Field Examiners to visit the properties of the Loan Parties to, at the Borrowers’ expense, conduct field examinations and inventory appraisals in connection with the Borrowers’ computation of the Borrowing Base and (ii) any representatives or independent contractors of the Administrative Agent or any of the Lenders to visit the properties of the Loan Parties to, at the Lenders’ expense, conduct evaluations and environmental assessments and ongoing maintenance and monitoring of the assets and properties of the Loan Parties or their Subsidiaries constituting Non-ABL Priority Collateral as the Administrative Agent may reasonably require; provided that, so long as a Liquidity Period is not in effect, not more than two field exams and two inventory appraisals may be conducted at the Borrowers’ expense per twelve-month period; provided further , during any Liquidity Period, one additional field exam and one additional inventory appraisal may be conducted at the Borrowers’ expense in any twelve-month period. Notwithstanding the foregoing, following the occurrence and during the continuation of an Event of Default, such field examinations and inventory appraisals may be conducted at the Borrowers’ expense as many times as the Administrative Agent shall consider reasonably necessary. In addition, the Borrowers shall have the right (but not the obligation), at the Borrowers’ expense, at any time and from time to time (but not more than once per twelve-month period) to provide the Administrative Agent with additional field examinations and additional inventory appraisals of any or all of the Collateral, prepared in a form and on a basis reasonably satisfactory to the Administrative Agent, in which case such field examination or such inventory appraisal shall be used in connection with the calculation of the Borrowing Base hereunder. Each inventory appraisal after the Closing Date shall be performed by any Approved Appraiser. Each field examination after the Closing Date shall be performed by any Approved Field Examiner. With respect to each field examination or inventory appraisal made after the Closing Date, the Administrative Agent and the Borrowers shall each be given at least five Business Days to review and comment on the facts set forth in a draft form of such field examination or such inventory appraisal prior to its finalization and any adjustments to the Borrowing Base as a result of such field examination or such inventory appraisal shall become effective immediately following the finalization of such field examination or inventory appraisal.

(c) At any reasonable time and from time to time during regular business hours, upon reasonable notice, permit any Approved Appraisers, Approved Field Examiner or any

representatives or independent contractors of the Administrative Agent to visit the Real Property of any of the Borrowers to, at the Lenders’ expense, conduct evaluations, appraisals, surveys and environmental assessments (i) in connection with monitoring any Non-ABL Priority Collateral, and (ii) after the occurrence and during the continuance of an Event of Default, in order to market any Real Property for sale in connection with an exercise of remedies by the Administrative Agent under the applicable Collateral Documents and applicable Laws.

Section 6.11. Use of Proceeds.

(a) Use the proceeds of the Credit Extensions solely (i) to pay Transaction Costs and (ii) to fund working capital needs and other general corporate purposes of Holdings and its Subsidiaries, including the financing of Capital Expenditures, Permitted Acquisitions, other permitted Investments, Restricted Payments and any other purpose not prohibited by the Loan Documents; provided , that (x) subject to Section 2.01 , Loans may be made on the Closing Date solely to finance the payment of Transaction Costs and (y) subject to Section 2.04 , Letters of Credit in an aggregate face amount not to exceed $35,000,000 may be issued on the Closing Date.

(b) None of the Borrowers shall, directly or indirectly, use the proceeds of any Credit Extension or lend, contribute, or otherwise make available such proceeds to any Subsidiary, joint venture partner, or other Person (i) to fund, finance, or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding, is the target of Sanctions or (ii) in any other manner that would result in the violation of Sanctions applicable to any party to this Agreement.

Section 6.12. Covenant to Guarantee Obligations and Give Security.

(a) Upon the formation or acquisition of any new direct or indirect Domestic Subsidiary (other than any Excluded Subsidiary) by any Loan Party, then the Borrowers shall, at the Borrowers’ expense:

(i) within 45 days (or such longer period as the Administrative Agent may agree) after such formation or acquisition, cause such Subsidiary, to duly execute and deliver to the Administrative Agent a supplement to this Agreement and to the Security Agreement, in each case in form and substance reasonably satisfactory to the Administrative Agent, whereby such Subsidiary shall (A) become a party to this Agreement (as both a Borrower and a Guarantor) and the Security Agreement upon execution and delivery by such Subsidiary of an Assumption Agreement in the form of Exhibit K hereto, any supplements to the Security Agreement or Intellectual Property Security Agreements, and any other security and pledge agreements, in all such cases, as specified by and in form and substance reasonably satisfactory to the Administrative Agent (including delivery of all Pledged Collateral in and of such Subsidiary, and other instruments representing the Pledged Stock in certificated form accompanied by undated stock powers executed in blank or the Instruments, Securities and other Investment Property indorsed in blank to the extent required by the Security Agreement), in all such cases to the same extent that such documents and instruments would have been required to have been delivered by Persons that were Borrowers or Guarantors on the Closing Date, securing payment of all the Obligations, (B) Guarantee the other Loan Parties’ Obligations and become a Guarantor for all purposes under the Loan Documents and (C) grant a security interest in substantially all of its assets to secure such Obligations;

(ii) within 45 days (or such longer period as the Administrative Agent may agree) after such formation or acquisition, furnish to the Administrative Agent a description any Material Owned Real Property of such Subsidiary, in detail reasonably satisfactory to the Administrative Agent; and

(iii) cause such Subsidiary to (A) duly execute and deliver to the Administrative Agent within 90 days (or such longer period as the Administrative Agent may agree) after such formation or acquisition, deeds of trust, trust deeds, deeds to secure debt and/or mortgages covering the Material Owned Real Property of such Subsidiary and (B) in connection with the foregoing, upon the request of the Administrative Agent in its reasonable discretion, deliver to the Administrative Agent any legal opinions addressed to the Administrative Agent and the other Secured Parties, reasonably acceptable to the Administrative Agent as to such matters as the Administrative Agent may reasonably request.

(b) Upon the acquisition of any Material Owned Real Property by any Loan Party other than pursuant to any acquisition covered by Section 2.12(a) , the Borrowers shall, at the Borrowers’ expense:

(i) within 45 days (or such longer period as the Administrative Agent may agree) after such acquisition, furnish to the Administrative Agent a description of the Material Owned Real Property so acquired in detail reasonably satisfactory to the Administrative Agent;

(ii) (A) with respect to Material Owned Real Property, cause the applicable Loan Party to duly execute and deliver to the Administrative Agent within 90 days after such acquisition (or such longer period as the Administrative Agent may agree), deeds of trust, trust deeds, deeds to secure debt and/or mortgages, in each case, in form and substance reasonably satisfactory to the Administrative Agent, securing payment of all the Obligations and (B) in connection with the foregoing, upon the request of the Administrative Agent in its reasonable discretion, deliver to the Administrative Agent any legal opinions addressed to the Administrative Agent and the other Secured Parties, reasonably acceptable to the Administrative Agent as to such matters as the Administrative Agent may reasonably request; and

(iii) within 45 days (or such longer period as the Administrative Agent may agree) after such request, cause the applicable Loan Party to provide the Administrative Agent with all geological data, reserve data, material existing mine maps, surveys, title insurance policies, title insurance, abstracts and other evidence of title, core hole logs and associated data, Coal measurements, Coal samples, lithologic data, Coal reserve calculations or reports, washability analyses or reports, quality analyses, mine plans, mining permit applications and supporting data, engineering studies and all other information, maps, reports and data, but only to the extent that each of the foregoing shall be (x) in the possession of such Loan Party and relating to or affecting the Real Property, including the Coal reserves, Coal ownership, Real Property Leases, mining conditions, mines, and mining plans of such Loan Party and (y) prepared and utilized by such Loan Party in its ordinary course of business.

(c) Notwithstanding anything to the contrary in this Section 6.12 or in any other Loan Document (i) neither the Borrowers nor the Guarantors will be required to perfect security interests (x) in motor vehicles or other assets covered by a certificate of title, other than by the filing of UCC financing statements, (y) in letter of credit rights or other supporting obligations with a value less than $100,000 individually or in the aggregate, and (z) in assets requiring perfection through control agreements (other than (A) control of Pledged Collateral to the extent required herein or under any other Loan Document and (B) Deposit Accounts, Securities Accounts and Commodities Account requiring perfection through Blocked Account Agreements to the extent required by Section 6.19 or any other Loan Document) and (ii) no foreign law security or pledge agreements or foreign intellectual property fillings will be required.

Section 6.13. Compliance with Environmental Laws. (a) Comply, and use commercially reasonable efforts to cause all lessees and other Persons operating or occupying its properties to comply, in all material respects, with all applicable Environmental Laws and Environmental Permits and obtain, to the extent necessary, and renew all Environmental Permits for its operations and properties, except in such instances in which (i) the requirement of an Environmental Permit is being contested in good faith by the Borrowers or any of their respective Subsidiaries by appropriate proceedings diligently conducted, or (ii) the failure to so comply, obtain or renew, in addition to the risk thereof, has been disclosed on Schedule 5.09 or is unlikely to result in a material liability; and (b) undertake and perform any cleanup, removal, remedial or other action necessary to remove and clean up all Hazardous Materials from any of its properties, in accordance with the requirements of all Environmental Laws, except in such instances in which (i) the requirement to undertake or perform is being contested in good faith by the Borrowers or any of their respective Subsidiaries by appropriate proceedings diligently conducted, or (ii) the failure to so undertake or perform has been, in addition to the risk thereof, disclosed on Schedule 5.09 or is unlikely to result in a material liability.

Section 6.14. Preparation of Environmental Reports. Not more often than once per year per Property during the term of this Agreement (or more frequently during the continuance of an Event of Default), at the reasonable request of the Administrative Agent, the Borrowers shall provide to the Lenders within 60 days after such request (or such longer period as may be agreed by the Administrative Agent), at the expense of the Borrowers, an environmental and/or mining site assessment and compliance audit report for any of its Properties described in such request, prepared by an environmental or mining consulting firm reasonably acceptable to the Administrative Agent and the Borrowers describing the presence or absence of Hazardous Materials and information otherwise reasonably requested by the Lenders.

Section 6.15. Further Assurances. Promptly upon request by the Administrative Agent, or any Lender through the Administrative Agent, (a) correct any material defect or error that may be discovered in any Loan Document or in the execution, acknowledgment, filing or recordation thereof, and (b) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other instruments (including Mortgages) as the Administrative Agent, or any Lender through the Administrative Agent, may reasonably require from time to time in order to (i) carry out more effectively the purposes of the Loan Documents, (ii) to the fullest extent permitted by applicable law, subject each of the Loan Parties’ properties, assets, rights or interests to the Liens now or hereafter intended to be covered by any of the Collateral Documents, and (iii) perfect and maintain the validity, effectiveness and priority of any of the Collateral Documents and any of the Liens intended to be created thereunder.

Section 6.16. Certain Long Term Liabilities and Environmental Reserves. To the extent required by GAAP, maintain adequate reserves or other financial assurances for (i) future costs associated with any lung disease claim alleging pneumoconiosis or silicosis or arising out of exposure or alleged exposure to coal dust or the coal mining environment, (ii) future costs associated with retiree and health care benefits, (iii) future costs associated with Reclamation of disturbed acreage, removal of facilities and other closing costs in connection with its mining operations and (iv) future costs associated with other potential Environmental Liabilities.

Section 6.17. Mining Financial Assurances. Maintain all material Mining Financial Assurances to the extent required pursuant to any Environmental Law.

Section 6.18. Administration of Accounts . (a) If an Account of any Loan Party includes a charge for any taxes, the Administrative Agent is authorized, in its discretion, to pay the amount thereof to the proper taxing authority for the account of such Loan Party if such Loan Party does not do so and to charge such Loan Party therefor; provided , however , that neither the Administrative Agent nor the Lenders shall be liable for any Taxes that may be due from the Loan Parties or with respect to any Collateral.

(b) Whether or not any Default or Event of Default exists, the Administrative Agent shall have the right at any time, in the name of the Administrative Agent, any designee of the Administrative Agent or any Loan Party, to verify the validity, amount or any other matter relating to any Accounts of any Loan Party by mail, telephone or otherwise. The Loan Parties shall cooperate fully with the Administrative Agent in an effort to facilitate and promptly conclude any such verification process.

Section 6.19. Cash Management System.

(a) Within 45 days after the Closing Date (or such later date as the Administrative Agent may specify in its sole discretion), and at all times thereafter, each of the Loan Parties shall enter into and maintain a Blocked Account Agreement, satisfactory in form and substance to the Administrative Agent in its reasonable discretion, with respect to each of its Deposit Accounts, Securities Account or Commodities Accounts (other than any Excluded Account) (each such Deposit Account, Securities Account or Commodities Account, a “ Control Account ”). Each such Blocked Account Agreement shall permit the Administrative Agent, during any Liquidity Period, upon written notice thereof from the Administrative Agent to Holdings, to instruct the applicable depository to transfer (whether by ACH, wire transfer or otherwise as the Administrative Agent may direct) by the end of each Business Day all ledger or available, as applicable, cash receipts held in such Control Accounts to the Collateral Account. No Loan Party shall direct any Account Debtor, or any customer, to make payments on Accounts to any Deposit Account other than the Control Accounts and the Collateral Account.

(b) Each Loan Party shall not establish or maintain any Securities Account, Commodities Account or Deposit Account that is not a Control Account, in each case, other than any Excluded Accounts. Each Loan Party shall instruct each Person that is obligated to make any payment to it, to make such payment or to continue to make payment, to the appropriate Control Account as required by this Section 6.19 .

(c) Each Loan Party hereby acknowledges and agrees that (i) during any Liquidity Period, it shall have no right of withdrawal from the Control Accounts and (ii) the funds on deposit in the Control Accounts shall at all times continue to be collateral security for all of the Obligations. In the event that, notwithstanding the provisions of this Section 6.19 , a Loan Party receives or otherwise has dominion and control of any such proceeds or collections, such proceeds and collections shall be held in trust by such Loan Party for the Administrative Agent, shall not be commingled with any of such Loan Party’s other funds or deposited in any account of such Loan Party and shall promptly be deposited into the appropriate Control Account or dealt with in such other fashion as such Loan Party may be instructed by the Administrative Agent.

(d) Without limiting the foregoing, funds on deposit in any Deposit Account or Securities Account under the sole dominion and control of the Administrative Agent may be invested (but the Administrative Agent shall be under no obligation to make any such investment) in Cash Equivalents at the direction of the Administrative Agent and, except during the continuance of a Liquidity Period, the Administrative Agent agrees with the Borrower to issue entitlement orders for such investments in Cash Equivalents as reasonably requested by the Borrower; provided , however , that the Administrative Agent shall not have any responsibility for, or bear any risk of loss of, any such investment or income thereon.

(e) Subject to clause (a) above, any amounts received in the Collateral Account and each other Control Account (other than the L/C Cash Collateral Account) shall be applied, first to payment of all Loans then due, second to the extent otherwise required by the Agreement, to Cash Collateralize all outstanding Letters of Credit, and then as directed by the Borrower; provided that, if an Event of Default has occurred and is continuing, all amounts in Control Accounts shall be applied pursuant to Section 8.03 .

Section 6.20. Post-Closing Obligations. Perform the obligations set forth on Schedule 6.20 , as and when set forth therein.

ARTICLE 7

N EGATIVE C OVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied (other than in respect of contingent obligations, indemnities and costs and expenses related thereto not then payable or in existence as of the later of the Termination Date or the Letter of Credit Expiration Date), or any Letter of Credit shall remain outstanding, Holdings and each other Borrower shall not, nor shall they permit any of their respective Subsidiaries to, directly or indirectly:

Section 7.01. Liens. Create, incur, assume or suffer to exist any Lien upon, or exception to title to, any of its property, assets or revenues, whether now owned or hereafter acquired, or sign or file under the Uniform Commercial Code of any jurisdiction a financing statement that names the Borrowers or any of their respective Subsidiaries as debtor, or assign any accounts or other right to receive income, other than the following (“ Permitted Liens ”):

(a) Liens pursuant to any Loan Document;

(b) Liens on the property of the Borrowers or any of their respective Subsidiaries existing on the date hereof and listed on Schedule 7.01 ;

(c) Liens for Taxes that were not yet due or which are being contested in good faith and by appropriate proceedings, provided that, adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;

(d) carriers’, warehousemen’s, mechanics’, landlords’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business which are not overdue or which are being contested in good faith and by appropriate proceedings, if adequate reserves with respect thereto are maintained on the books of the applicable Person;

(e) Liens securing attachments or judgments for the payment of money not constituting an Event of Default under Section 8.01(h) or securing appeal or surety bonds related to such attachments or judgments;

(f) pledges or deposits in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation and deposits securing liability to insurance carriers under insurance or self-insurance arrangements;

(g) (i) deposits to secure the performance of tenders, bids, trade contracts and leases (other than Indebtedness), Reclamation bonds, statutory obligations, surety, stay, customs and appeals bonds, bids, bills, performance bonds and other obligations of a like nature incurred in the ordinary course of business and (ii) Liens on assets to secure obligations under surety bonds obtained as required in connection with the entering into of new federal coal leases;

(h) any title exceptions referred to in the title insurance policies purchased by any Loan Party in connection with the purchase of Property pursuant to the Acquisition Agreement, any easements, covenants, conditions, rights-of-way, zoning restrictions, encroachments, minor defects or other irregularities in title, other restrictions and other similar encumbrances which, either individually or in the aggregate, are not substantial in amount and do not secure any Indebtedness and do not materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person or the Property subject thereto;

(i) Liens securing Indebtedness of the Borrowers and their respective Subsidiaries permitted by Section 7.02(e) incurred to finance the acquisition of fixed or capital assets; provided , that (i) such Liens shall be created substantially simultaneously with the acquisition of such fixed or capital assets, (ii) such Liens do not at any time encumber any property other than the property financed by such Indebtedness (other than after-acquired title in or on such property and proceeds of the existing collateral in accordance with the instrument creating such Lien), and (iii) the principal amount of Indebtedness secured by any such Lien shall at no time exceed 100% of the original purchase price of such property at the time it was acquired;

(j) Liens on the fixed assets of a Person (or on the Equity Interests of such Person) which is acquired after the date hereof pursuant to a Permitted Acquisition securing Indebtedness permitted by Section 7.02 not to exceed $20,000,000 at any time outstanding, provided , that (i) such Liens existed at the time such entity became a Guarantor and were not created in anticipation thereof, (ii) any such Lien is not expanded to cover any other property or assets of such Person (other than the proceeds of the property or assets subject to such Lien) or of Holdings or any Guarantor, (iii) the amount of Indebtedness secured thereby is not increased, and (iv) if the terms of such Indebtedness require any Lien hereunder to be subordinated to such Liens, then the Lien hereunder shall be subordinated on terms reasonably acceptable to the Administrative Agent;

(k) Liens on the property of the Borrowers or any of their respective Subsidiaries, as a tenant under a lease or sublease entered into in the ordinary course of business by such Person, in favor of the landlord under such lease or sublease, securing the tenant’s performance under such lease or sublease, as such Liens are provided to the landlord under applicable law and not waived by the landlord;

(l) Liens arising from precautionary Uniform Commercial Code financing statement filings with respect to operating leases or consignment arrangements entered into by the Borrowers or any of their respective Subsidiaries in the ordinary course of business;

(m) Production Payments, royalties, dedication of reserves under supply agreements or similar rights or interests granted, taken subject to, or otherwise imposed on properties consistent with normal practices in the mining industry;

(n) leases, subleases, licenses, sublicenses and rights-of-use granted to others incurred in the ordinary course of business and that do not materially and adversely affect the use of the property encumbered thereby for its intended purpose;

(o) Liens in favor of a banking institution arising by operation of law or any contract encumbering deposits (including the right of set-off) held by such banking institutions incurred in the ordinary course of business and which are within the general parameters customary in the banking industry;

(p) Liens securing Indebtedness permitted by Section 7.02(l )( i ) and 7.02(l)(ii) ;

(q) rights of owners of interests in overlying, underlying or intervening strata and/or mineral interests not owned by any of the Borrowers or any of their respective Subsidiaries, with respect to tracts of real property where the Borrowers or applicable Subsidiary’s ownership is only surface or severed mineral or is otherwise subject to mineral severances in favor of one or more third parties;

(r) other defects and exceptions to title of real property where such defects or exceptions are not material to the value of such real property; and

(s) other Liens on fixed assets incurred in the ordinary course of business of any Loan Party or any of its Subsidiaries, securing Indebtedness or other obligations in an aggregate amount not to exceed the greater of (i) $15,000,000 and (ii) 1.25% of Consolidated Total Assets on any date.

Section 7.02. Indebtedness. Create, incur, assume or suffer to exist any Indebtedness, except:

(a) Indebtedness under the Loan Documents (including any such Indebtedness in respect of any Facility Increase in accordance with Section 2.15 );

(b) Indebtedness outstanding on the date hereof and listed on Schedule 7.02 ;

(c) any refinancings, refundings, renewals or extensions of Indebtedness permitted under Section 7.02(b) or (l) ; provided , that (i) the amount of such Indebtedness (the “ Refinancing Indebtedness ”) is not increased at the time of such refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to any existing commitments unutilized thereunder, (ii) the direct or any contingent obligor with respect thereto is not changed, as a result of or in connection with such refinancing, refunding, renewal or extension and (iii) the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such refinancing, refunding, renewing or extending Indebtedness, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Loan Parties or the Lenders than the terms of any agreement or instrument governing the Indebtedness being refinanced, refunded, renewed or extended and the interest rate applicable to any such refinancing, refunding, renewing or extending Indebtedness does not exceed the then applicable market interest rate (as determined in good faith by the Borrowers);

(d) Guarantees of the Borrowers or any of their respective Subsidiaries in respect of Indebtedness otherwise permitted hereunder of the Borrowers or any other Loan Party;

(e) Indebtedness in respect of Capital Lease Obligations and purchase money obligations for fixed or capital assets within the limitations set forth in Section 7.01( i ) ; provided , however , that the aggregate principal amount of all such Indebtedness at any one time outstanding shall not exceed the greater of (i) $50,000,000 and (ii) 4.00% of Consolidated Total Assets on any date;

(f) Indebtedness in respect of Swap Contracts designed to hedge against interest rate, foreign exchange rate risks or commodities pricing incurred in the ordinary course of business for non-speculative purposes and consistent with prudent past business practice;

(g) Indebtedness of the Borrowers or any other Loan Party to any other Loan Party and of any non-Loan Party Subsidiary to any Loan Party or any other non-Loan Party Subsidiary; provided , that such Indebtedness must be subordinated to the Obligations on terms reasonably satisfactory to the Administrative Agent;

(h) Intercompany current liabilities between Loan Parties incurred in the ordinary course of business of such Loan Parties;

(i) Indebtedness in respect of netting services, automatic clearinghouse arrangements, overdraft protections and similar arrangements in each case in connection with deposit accounts and in the ordinary course of business;

(j) Indebtedness representing deferred or equity compensation to employees of any of the Borrowers or any of its respective Subsidiaries incurred in the ordinary course of business;

(k) Indebtedness in the form of bank guaranties, bid, performance and Reclamation bonds, statutory obligations, surety, stay, customs and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business; provided that such Indebtedness described in this clause (k) is not secured by any Lien other than Liens permitted by Section 7.01(g) ;

(l) Indebtedness in an aggregate principal amount, in the case of clauses ( i ) , (ii) and (iii) below, collectively, not to exceed $50,000,000, so long as such Indebtedness is:

(i) secured by a Lien on the Collateral; provided , that (x) any such Lien shall rank junior to the Collateral Agent’s Lien securing the Obligations pursuant to an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent and (y) after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof, the Total Leverage Ratio, on a pro forma basis, is not greater than 2.50:1.00 as of the last day of the most recently ended Test Period;

(ii) secured by a Lien on (x) the Non-ABL Priority Collateral (and not any part of the ABL Priority Collateral other than as permitted by clause (y) below); provided , that any such Lien shall rank pari passu or senior to the Administrative Agent’s Lien securing the Obligations pursuant to an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent and (y) the ABL Priority Collateral; provided , that any such Lien on the ABL Priority Collateral shall rank junior to the Administrative Agent’s Lien securing the Obligations pursuant to an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent; and provided , further that in the case of clauses (x) and (y) , the Payment Conditions shall have been satisfied after giving effect to the incurrence of such Indebtedness and the use of proceeds thereof; or

(iii) unsecured; and

(m) Indebtedness consisting of financing of insurance premiums or take-or-pay obligations contained in supply agreements, in each case, in the ordinary course of business.

Section 7.03. Investments. Make or hold any Investments, except:

(a) Investments held by any of the Borrowers or any of their respective Subsidiaries in the form of Cash Equivalents;

(b) advances to officers, directors and employees of any of the Borrowers or any of their respective Subsidiaries in an aggregate amount not to exceed $1,000,000 at any time outstanding for travel, entertainment, relocation and analogous ordinary business purposes;

(c) Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss;

(d) Investments (including debt obligations and Equity Interests) received in satisfaction of judgments or in connection with the bankruptcy or reorganization of suppliers and customers of the Borrowers and their Subsidiaries and in settlement of delinquent obligations of, and other disputes with, such customers and suppliers arising in the ordinary course of business;

(e) Investments in the nature of Production Payments, royalties, dedication of reserves under supply agreements or similar rights or interests granted, taken subject to, or otherwise imposed on properties with normal practices in the mining industry;

(f) Investments existing on the date hereof and set forth on Schedule 7.03 ;

(g) promissory notes and other similar non-cash consideration received by the Borrowers and their Subsidiaries in connection with Dispositions not otherwise prohibited under this Agreement;

(h) Swap Contracts permitted under Section 7.02(f);

(i) Investments by the Borrowers or their Subsidiaries in any Loan Party and Investments by any non-Loan Party in any other non-Loan Party; provided , that if the Investment is in the form of Indebtedness, such Indebtedness must be permitted pursuant to Section 7.02(g) ;

(j) Investments by the Borrowers or any of their respective Subsidiaries not otherwise permitted under this Section 7.03 in an aggregate amount not to exceed $5,000,000;

(k) the purchase or other acquisition of any property and assets or businesses of any Person, or of assets constituting a business unit, a line of business or division of such Person, or the Equity Interests in any Person (including, following a Qualifying IPO of Holdings, any such Equity Interests of such Person acquired in exchange for the Equity Interests of Holdings) that, upon the consummation thereof, will be a Wholly-Owned Subsidiary of Holdings (including as a result of a merger, amalgamation or consolidation); provided that, with respect to each purchase or other acquisition made pursuant to this Section 7.03(k) (each, a “ Permitted Acquisition ”):

(i) to the extent required by this Agreement or any Collateral Document, the property, assets and businesses acquired in such purchase or other acquisition shall constitute Collateral and each applicable Loan Party and any such newly created or acquired Subsidiary (and, to the extent required by this Agreement or any Collateral Document, the Subsidiaries of such created or acquired Subsidiary) shall be Loan Parties and shall have complied with the requirements of Section 6.12 , within the times specified therein (for the avoidance of doubt, this clause (i) shall not override any provisions of Section 6.12 );

(ii) to the extent such Investments are made in Persons that are not required to become Loan Parties pursuant to the terms of the Loan Documents, the Payment Conditions shall have been satisfied at the time of closing of such Permitted Acquisition on a pro forma basis (after giving effect to any Credit Extensions and other Indebtedness incurred to finance such Permitted Acquisitions);

(iii) the acquired property, assets, business or Person is in a business permitted under Section 7.07 ;

(iv) immediately before and immediately after giving effect to any such purchase or other acquisition, no Default or Event of Default shall have occurred and be continuing;

(v) the Fixed Charge Coverage Ratio, on a pro forma basis, as of the last day of the most recently ended Test Period (after giving pro forma effect to such Permitted Transaction and each other Permitted Transaction that has occurred since the beginning of such Test Period) shall not be less than 1.00 to 1.00, and a Responsible Officer of Holdings shall have delivered a certificate to the Administrative Agent demonstrating compliance with such requirement (including calculations in respect thereof in reasonable detail); and

(vi) Holdings shall have delivered to the Administrative Agent, on behalf of the Lenders, no later than five (5) Business Days after the date on which any such purchase or other acquisition is consummated, a certificate of a Responsible Officer, certifying that all of the requirements set forth in this clause (k) have been satisfied or will be satisfied on or prior to the consummation of such purchase or other acquisition; and

(l) other Investments, so long as the Payment Conditions are satisfied at the time the relevant Investment is consummated.

Section 7.04. Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person, except that, so long as no Default or Event of Default exists or would result therefrom:

(a) any Subsidiary may merge with (i) any of the Borrowers, provided , that such Borrower shall be the continuing or surviving Person, or (ii) any one or more other Subsidiaries, provided , that when any Subsidiary that is a Loan Party is merging with another Subsidiary, the Loan Party shall be the continuing or surviving Person;

(b) any Subsidiary may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to the Borrowers or to another Subsidiary; provided, that if the transferor in such a transaction is a Loan Party, then the transferee must be another Loan Party; and

(c) the Borrowers and their Subsidiaries may consummate any transaction that would be permitted as an Investment under Section 7.03 .

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Section 7.05. Dispositions. Make any Disposition or enter into any agreement to make any Disposition, except:

(a) Dispositions of used, worn out, obsolete or surplus property by the Borrowers or any of their respective Subsidiaries in the ordinary course of business or the abandonment or allowance to lapse or expire or other Disposition of Intellectual Property in the ordinary course of business that is, in the reasonable judgment of the Borrowers, no longer useful in the conduct of the Borrowers and their Subsidiaries taken as a whole;

(b) Dispositions of inventory in the ordinary course of business;

(c) Dispositions of equipment to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property or (ii) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property;

(d) Dispositions of property by any Subsidiary to the Borrowers or to a Wholly-Owned Subsidiary of Holdings; provided , that if the transferor of such property is a Loan Party, the transferee thereof must be another Loan Party;

(e) Dispositions permitted by Section 7.04 ;

(f) Dispositions by the Borrowers and their respective Subsidiaries of fixed assets with a Fair Market Value, on any date of determination, not in excess of 25% of Consolidated Total Assets in the aggregate as of such date;

(g) so long as no Default or Event of Default shall occur and be continuing, the grant of any option or other right to purchase any asset in a transaction that would be permitted under the provisions of this Section 7.05 ;

(h) assignments, licenses, sublicenses of Intellectual Property in the ordinary course of business and in accordance with the applicable Collateral Documents; provided , however , that any license or sublicense of intellectual property shall be on a non-exclusive basis;

(i) sales or discounts (without recourse) of accounts receivable arising in the ordinary course of business in connection with the compromise or collection thereof;

(j) sales, transfers and other dispositions of Investments in Joint Ventures to the extent required by, or made pursuant to customary buy/sell arrangement between, the Joint Venture parties set forth in Joint Venture arrangements and similar binding arrangements;

(k) transfers of property subject to casualty or condemnation events upon receipt of Net Insurance/Condemnation Proceeds in respect thereof;

(l) Dispositions of assets by the Borrowers and their Subsidiaries not otherwise permitted under this Section 7.05 ; provided , that (i) 75% of the consideration received in respect of any such Disposition shall be cash or Cash Equivalents and (ii) at the time of any such Disposition, no Default or Event of Default shall exist or would result from such Disposition; and

(m) Dispositions constituting Investments permitted by Section 7.03 , provided , however , that any Disposition pursuant to Section 7.05(b) , (c) , (f) , and (l) shall be for Fair Market Value.

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Section 7.06. Restricted Payments. Declare or make, directly or indirectly, any Restricted Payment; except that:

(a) each Subsidiary may make Restricted Payments to the Borrowers; and

(b) following the first anniversary of the Closing Date, any of the Borrowers or any of its respective Subsidiaries may make Restricted Payments so long as the Distribution Conditions have been satisfied at the time such Restricted Payment is made.

Section 7.07. Change in Nature of Business. Engage in any material line of business other than a Similar Business.

Section 7.08. Transactions With Affiliates. Enter into any transaction of any kind with any Affiliate, including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service, unless such transaction is (i) not prohibited by this Agreement and (ii) upon fair and reasonable terms substantially as favorable to the applicable Borrower or any of its Subsidiaries as would be obtainable by such Borrower or such Subsidiary at the time in a comparable arm’s length transaction with a Person other than an Affiliate. The foregoing restrictions shall not apply to the following:

(a) transactions between or among the Borrowers and any other Loan Parties or between and among any Loan Parties;

(b) the payment of reasonable and customary fees and reimbursement of expenses payable to directors of the Borrowers or any Subsidiary or to any Plan, Plan administrator or Plan trustee;

(d) arrangements with respect to the procurement of services of directors, officers, independent contractors, consultants or employees in the ordinary course of business and the payment of customary compensation (including bonuses) and other benefits (including retirement, health, stock option and other benefit plans) and reasonable reimbursement arrangements in connection therewith;

(e) payments to directors and officers of the Borrowers and their Subsidiaries in respect of the indemnification of such Persons in such respective capacities from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements, as the case may be, pursuant to the Organization Documents or other corporate action of the Borrowers or their Subsidiaries, respectively, or pursuant to applicable law; and

(f) Restricted Payments permitted by Section 7.06 ;

(g) the Transactions;

(h) transactions with suppliers, joint venture partners or purchasers or sellers of goods or services, in each case, in the ordinary course of business and otherwise in compliance with the terms of this Agreement which are fair to Holdings or its Subsidiaries in the reasonable determination of the board of directors of Holdings or such Subsidiary or the senior management thereof, or are on terms at least as favorable as would reasonably have been obtained at such time from an unaffiliated party;

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(i) for any taxable period (or portion thereof) that Holdings is treated as a corporation for U.S. federal income tax purposes and for which Borrowers and/or any of its subsidiaries are members (or are pass-through entities of such members) of a consolidated, combined or similar income Tax group for U.S. federal, state, local or foreign income Tax purposes for which Holdings is the common parent, the Borrowers may make Restricted Payments to Holdings to pay the portion of any U.S. federal, state, local or foreign income Taxes (as applicable) of Holdings for such taxable period that are attributable to the income of the Borrowers and/or its applicable subsidiaries; provided that the aggregate amount of such distributions shall not exceed the aggregate Taxes the Borrowers and/or its subsidiaries, as applicable, would be required to pay in respect of such U.S. federal, state, local and foreign Taxes on a stand-alone basis for such taxable period; and

(j) transactions in which Holdings or any of its Subsidiaries deliver to the Administrative Agent a letter from independent financial advisor, in form and substance reasonably satisfactory to the Administrative Agent, stating that such transaction is meets the requirements of Section 7.08(ii) .

Section 7.09. Burdensome Agreements. Enter into any Contractual Obligation (other than this Agreement or any other Loan Document) that (a) limits the ability (i) of any Subsidiary to make Restricted Payments to the Borrowers or any Guarantor or to otherwise transfer property to or invest in the Borrowers or any Guarantor, unless such Contractual Obligations could not reasonably be expected to materially hinder the Borrowers’ ability to meet their obligations under this Agreement.

Section 7.10. Use of Proceeds. Use the proceeds of any Credit Extension, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the Federal Reserve Board) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund Indebtedness originally incurred for such purpose.

Section 7.11. Minimum Fixed Charge Coverage Ratio. During any Liquidity Period, permit the Fixed Charge Coverage Ratio to be less than 1.00 to 1.00 as of the last day of any Test Period, commencing with the Test Period ended immediately preceding the commencement of such Liquidity Period (it being understood that the requirement to comply with such minimum Fixed Charge Coverage Ratio under this Section 7.11 shall again be triggered upon the commencement of any other Liquidity Period on any succeeding day).

Section 7.12. Amendments of Organizational Documents. Amend any of its Organization Documents in any respect materially adverse to the Lenders.

Section 7.13. Accounting Changes. Make any change in (a) its accounting policies or reporting practices, except as required or permitted by GAAP, or (b) its fiscal year.

Section 7.14. Prepayments, Etc. of Indebtedness.

(a) Voluntarily pay, prepay, redeem, purchase, defease, acquire, retire or otherwise satisfy prior to the scheduled maturity thereof in any manner, or make any payment in violation of any subordination terms of, any Indebtedness that is expressly subordinated in right of payment to the Obligations (other than any such Indebtedness among the Borrowers and any of their

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respective Subsidiaries) (such Indebtedness, the “ Subordinated Debt ”, and each such payment, prepayment, redemption, purchase, defeasance, acquisition, retirement or other satisfaction thereof, a “ Restricted Subordinated Debt Payment ”), except:

(i) payments of regularly scheduled principal, interest and fees in respect of any Subordinated Debt;

(ii) any Restricted Subordinated Debt Payment made by exchange for, or out of the proceeds of, any Refinancing Indebtedness permitted by Section 7.02(c) ; and

(iii) any other Restricted Subordinated Debt Payment, so long as the Payment Conditions have been satisfied at the time such Restricted Subordinated Debt Payment is made.

(b) Amend, restate, amend and restate, modify or otherwise change in any manner materially adverse to the interests of the Lenders any term or condition of any Subordinated Debt Document.

ARTICLE 8

E VENTS OF D EFAULT AND R EMEDIES

Section 8.01. Events of Default. Any of the following shall constitute an Event of Default:

(a) Non-Payment . Any Borrower or any other Loan Party fails to pay (i) when and as required to be paid herein, any amount of principal of any Loan or any L/C Obligation or (ii) within three Business Days after the same becomes due, any interest on any Loan or on any L/C Obligation, any fee due hereunder, or any other amount payable hereunder or under any other Loan Document; or

(b) Specific Covenants . (i) Holdings or any of its Subsidiaries fails to perform or observe any term, covenant or agreement contained in any of Section 6.03(a) , 6.05(a)( i ) (solely with respect to Holdings or any other Borrowers), 6.10 , 6.11, 6.20 or Article 7 or (ii) any of the Guarantors fails to perform or observe any term, covenant or agreement contained in Article 10 of this Agreement (but only to the extent it relates to a default under one of the covenants listed in clause (i) above); or

(c) Other Defaults . (i) Holdings or any of its Subsidiaries fails to perform or observe any other term, covenant or agreement (other than Section 6.17 and not specified in Section 8.01(a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for (A) in the case of Section 6.17 , 15 days and (B) otherwise, 30 days, in each case, after the earlier of (x) receipt by any Borrower of written notice thereof from the Administrative Agent and (y) knowledge of any Borrower of such default or failure to perform or observe; or

(d) Representations and Warranties . Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of Holdings or any of its Subsidiaries herein, in any other Loan Document, or in any document delivered in connection herewith or therewith shall be incorrect or misleading in any material respect when made or deemed made; or

(e) Cross-Default . (i) Holdings or any of its Subsidiaries (A) fails to make any payment when due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee (other than Indebtedness hereunder, Indebtedness under Swap Contracts or Guarantees of the Obligations), in each case having an aggregate principal amount (including amounts owing to all creditors under any combined or syndicated credit agreement) of more than the Threshold Amount, beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness or Guarantee was created or (B) fails to observe or perform any other agreement or condition relating to any such Indebtedness or Guarantee or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of

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which default or other event is to cause, or to permit the holder or holders of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity, or such Guarantee to become due or payable; or (ii) there occurs under any Swap Contract an Early Termination Date (as defined under such Swap Contract) resulting from (A) any event of default under such Swap Contract as to which Holdings or any of its Subsidiaries is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which Holdings or any of its Subsidiaries is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by Holdings or such Subsidiary as a result thereof is greater than the Threshold Amount; or

(f) Insolvency Proceedings, Etc. Holdings or any of its Subsidiaries institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any substantial part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any substantial part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or

(g) Inability to Pay Debts; Attachment. (i) Holdings or any of its Subsidiaries becomes unable or admits in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any substantial part of the property of any such Person and is not released, vacated or fully bonded within 60 days after its issue or levy; or

(h) Judgments . There is entered against Holdings or any of its Subsidiaries one or more final judgments or orders for the payment of money in an aggregate amount (as to all such judgments and orders) exceeding the Threshold Amount (to the extent not covered by independent third-party insurance), and, such judgments or orders shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from the entry thereof; or

(i) ERISA . (i) The occurrence of any of the following events that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect: (i) an ERISA Event with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected to result in an actual obligation to pay money of the Borrowers under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC or (ii) the Borrowers or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan; or

(j) Invalidity of Loan Documents . Any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or Holdings, any of its Subsidiaries or any other Person contests in any manner the validity or enforceability of any Loan Document; or Holdings or any of its Subsidiaries denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document; or

(k) Change of Control . There occurs any Change of Control; or

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(l) Collateral Documents . Any Collateral Document after delivery thereof pursuant to Section 4.01 or 6.12 shall for any reason (other than pursuant to the terms hereof or thereof, including as a result of a transaction permitted by Section 7.04 or 7.05 ) cease to create a valid and perfected Lien, with the priority required hereby or thereby (subject to Liens permitted by Section 7.01 ), on the Collateral purported to be covered thereby, except to the extent that any such loss of perfection or priority results from the failure of the Administrative Agent to maintain possession of certificates actually delivered to it representing securities pledged under the Collateral Documents or to file UCC continuation statements and except as to Collateral consisting of real property to the extent that such losses are covered by a lender’s title insurance policy and such insurer has not denied or failed to acknowledge coverage.

Section 8.02. Remedies Upon Event of Default. (a) If any Event of Default occurs and is continuing, the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions:

(i) declare the commitment of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments and obligation shall be terminated;

(ii) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrowers;

(iii) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof);

(iv) exercise on behalf of itself, the Lenders and the applicable L/C Issuer all rights and remedies available to it, such Lenders and such L/C Issuer under the Loan Documents or applicable law (including in respect of the Collateral);

provided, however , that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrowers under the Debtor Relief Laws, the obligation of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Borrowers to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.

(b) Upon the occurrence of the Termination Date, (i) the Commitments of each Lender to make Loans and the Commitments of each Lender and Issuer to issue or participate in Letters of Credit shall each automatically be terminated, (ii) the Loans, all interest thereon and all other amounts and Obligations shall automatically become due and payable in cash, without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by the Borrowers and the other Loan Parties.

Section 8.03. Application of Funds. On the Termination Date and after the exercise of remedies provided for in Section 8.02 (or after the Loans have automatically become immediately due and payable and the L/C Obligations have automatically been

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required to be Cash Collateralized), any amounts received on account of the Obligations shall, subject to the provisions of Section 2.16 , be applied by the Administrative Agent in the following order:

First , to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Administrative Agent and amounts payable under Article 3 ) payable to the Administrative Agent in its capacity as such;

Second , to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest and Letter of Credit Fees) payable to the Lenders and the L/C Issuer with respect to Letters of Credit (including fees, charges and disbursements of counsel to the respective Lenders and the L/C Issuer (including fees and time charges for attorneys who may be employees of any Lender or the L/C Issuer) and amounts payable under Article 3 , ratably among them in proportion to the respective amounts described in this clause Second payable to them;

Third , to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit Fees and interest on the Loans, L/C Borrowings and other Obligations, ratably among the Lenders and the L/C Issuer in proportion to the respective amounts described in this clause Third payable to them;

Fourth , to payment of that portion of the Obligations constituting unpaid principal of the Loans, L/C Borrowings and amounts owing under Secured Hedge Agreements and Secured Cash Management Agreements, ratably among the Lenders, the L/C Issuers, the Hedge Banks and the Cash Management Banks, as applicable, in proportion to the respective amounts described in this clause Fourth held by them;

Fifth , to the Administrative Agent for the account of the L/C Issuers, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit; and

Last , the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrowers or as otherwise required by Law;

Subject to Section 2.04(d) , amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth above shall be applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on deposit as cash collateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied to the other Obligations, if any, in the order set forth above.

ARTICLE 9

A DMINISTRATIVE A GENT

Section 9.01. Appointment . (a) Each of the Lenders and the L/C Issuers hereby irrevocably appoints, designates and authorizes the Administrative Agent to take such actions on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are delegated to the Administrative Agent by the terms and provisions hereof and of the other Loan Documents, together with such power as are reasonably incidental thereto. Notwithstanding any provision to the contrary contained elsewhere herein or in any other Loan Document, the Administrative Agent shall have no duties or responsibilities, except those expressly set forth herein, nor shall the Administrative Agent have or be deemed to have any fiduciary relationship with any Lender, L/C Issuer or participant, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent. Without limiting the generality of the foregoing sentence, the use of the term

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“agent” herein and in the other Loan Documents with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties. The provisions of this Article 9 (other than Sections 9.10 and 9.12 ) are solely for the benefit of the Administrative Agent, the Lenders and the L/C Issuer, and neither the Borrowers nor any other Loan Party shall have rights as a third party beneficiary of any such provisions.

(b) Each L/C Issuer shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and each such L/C Issuer shall have all of the benefits and immunities (i) provided to the Administrative Agent in this Article 9 with respect to any acts taken or omissions suffered by such L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and the applications and agreements for letters of credit pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in this Article 9 and in the definition of “Agent Affiliate” included such L/C Issuer with respect to such acts or omissions, and (ii) as additionally provided herein with respect to such L/C Issuer.

(c) The Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the Lenders (in its capacities as a Lender or Swingline Lender (if applicable)) and L/C Issuer hereby irrevocably appoints and authorizes the Administrative Agent to act as the agent of (and to hold any security interest created by the Collateral Documents for and on behalf of or on trust for) such Lender, L/C Issuer and its Affiliates for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together with such powers and discretion as are reasonably incidental thereto. In this connection, the Administrative Agent, as “collateral agent” (and any co-agents, sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant to Section 9.02 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Collateral Documents, or for exercising any rights and remedies thereunder at the direction of the Administrative Agent), shall be entitled to the benefits of all provisions of this Article 9 (including Section 9.07 , as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto. Without limiting the generality of the foregoing, the Lenders and L/C Issuers hereby expressly authorize the Administrative Agent to execute any and all documents (including releases) with respect to the Collateral and the rights of the Secured Parties with respect thereto, as contemplated by and in accordance with the provisions of this Agreement and the Collateral Documents and acknowledge and agree that any such action by any Agent shall bind the Lenders and L/C Issuers.

Section 9.02. Delegation of Duties . The Administrative Agent may execute any of its duties under this Agreement or any other Loan Document (including for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Collateral Documents or of exercising any rights and remedies thereunder) by or through agents, sub-agents, employees or attorneys-in-fact (including for the purpose of any Borrowing or payment in alternative currencies) as shall be deemed necessary by the Administrative Agent and shall be entitled to advice of counsel and other consultants or experts concerning all matters pertaining to such duties. Each such sub-agent and the Affiliates of the Administrative Agent and each such sub-agent shall be entitled to the benefits of all provisions of this Article 9 , Section 11.04(a) and Section 11.04(b) (as though such sub-agents were the “Administrative Agent” under the Loan Documents) as if set forth in full herein with respect thereto. The Administrative Agent shall not be responsible for the negligence or misconduct of any agent or sub-agent or attorney-in-fact that it selects in the absence of gross negligence or willful misconduct (as determined in the final judgment of a court of competent jurisdiction).

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Section 9.03. Liability of Agents . No Agent Affiliate shall (a) be liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan Document or the transactions contemplated hereby (except for its own gross negligence or willful misconduct, as determined by the final judgment of a court of competent jurisdiction, in connection with its duties expressly set forth herein), or (b) be responsible in any manner to any Lender, L/C Issuer or participant for any recital, statement, representation or warranty made by any Loan Party or any officer thereof, contained herein or in any other Loan Document, or in any certificate, report, statement or other document referred to or provided for in, or received by any Agent under or in connection with, this Agreement or any other Loan Document, or the execution, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or the perfection or priority of any Lien or security interest created or purported to be created under the Collateral Documents, or for any failure of any Loan Party or any other party to any Loan Document to perform its obligations hereunder or thereunder. No Agent Affiliate shall be under any obligation to any Lender, any L/C Issuer or participant to ascertain or to inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or the perfection or priority of any Lien or security interest created or purported to be created by the Collateral Documents, (v) the satisfaction of any condition set forth in Article 4 or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent, or (vi) or to inspect the properties, books or records of any Loan Party or any Affiliate thereof. No Agent Affiliate shall have any duties or obligations to any Lender, any L/C Issuer or participant except those expressly set forth herein and in the other Loan Documents, and without limiting the generality of the foregoing, the Agent Affiliates:

(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that such Person is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that such Person shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose it to liability or that is contrary to any Loan Document or applicable law; and

(c) shall not be required to carry out any “know your customer” or other checks in relation to any person on behalf of any Lender or any L/C Issuer and each Lender and each L/C Issuer confirms to the Administrative Agent that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Administrative Agent or any of its Affiliates.

No Agent Affiliate be liable (i) to any participant or Secured Party or their Affiliates for any failure, delay in performance, breach by, or as a result of information provided by, any other party to any Loan Document or action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or such Person shall believe in good faith shall be necessary under the circumstances) or (ii) in the absence of its own gross negligence or willful misconduct, as determined by a final judgment of a court of competent jurisdiction.

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Section 9.04. Reliance by the Administrative Agent . (a) The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, instrument, document, communication, signature, resolution, representation, notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone message, electronic mail message, statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons, and/or upon advice and statements of legal counsel (including counsel to any Loan Party), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action under any Loan Document unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders and L/C Issuers against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Required Lenders (or such greater number of Lenders as may be expressly required hereby in any instance) and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and L/C Issuers; provided that the Administrative Agent shall not be required to take any action that, in its opinion or in the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable Law.

Section 9.05. Notice of Default . The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Lenders or the L/C Issuers, unless the Administrative Agent shall have received written notice from a Lender or a Borrower referring to this Agreement, describing such Default and stating that such notice is a “notice of default.” The Administrative Agent will notify the Lenders and the L/C Issuers of its receipt of any such notice. The Administrative Agent shall take such action with respect to any Event of Default as may be directed by the Required Lenders in accordance with Article 8 ; provided that unless and until the Administrative Agent has received any such direction, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Event of Default as it shall deem advisable or in the best interest of the Lenders and the L/C Issuers.

Section 9.06. Credit Decision; Disclosure of Information by Agents . Each Lender and each L/C Issuer acknowledges that no Agent Affiliate has made any representation or warranty to it, and that no act by the Administrative Agent hereafter taken, including any consent to and acceptance of any assignment or review of the affairs of any Loan Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by any Agent Affiliate to any Lender or L/C Issuer as to any matter, including whether Agent Affiliates have disclosed material information in their possession. Each Lender and each L/C Issuer represents to each Agent that it has, independently and without reliance upon any Agent Affiliate and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of the Loan Parties and their respective Subsidiaries, and all applicable bank or other regulatory Laws relating to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to the Borrowers and the other Loan Parties hereunder. Each Lender and each L/C Issuer also represents that it will, independently and without reliance upon any Agent Affiliate and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of the Borrowers and the other Loan Parties. Except for notices, reports and other documents expressly required to be furnished to the Lenders or the L/C Issuers by any Agent herein, such Agent shall not have any duty or responsibility to provide any Lender or any L/C Issuer with

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any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any of the Loan Parties or any of their respective Affiliates which may come into the possession of any Agent Affiliate.

Section 9.07. Indemnification of the Administrative Agent . Whether or not the transactions contemplated hereby are consummated, the Lenders and L/C Issuers shall indemnify upon demand the Administrative Agent and each other Agent Affiliate (to the extent not reimbursed by or on behalf of any Loan Party and without limiting the obligation of any Loan Party to do so), pro rata, and hold harmless the Administrative Agent and each other Agent Affiliate from and against any and all Indemnified Liabilities incurred by it; provided that no Lender or L/C Issuer shall be liable for the payment to any Agent Affiliate of any portion of such Indemnified Liabilities resulting from such Agent Affiliate’s own gross negligence or willful misconduct, as determined by the final judgment of a court of competent jurisdiction; provided that no action taken in accordance with the directions of the Required Lenders (or such other number or percentage of the Lenders as shall be required by the Loan Documents) shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section 9.07 . In the case of any investigation, litigation or proceeding giving rise to any Indemnified Liabilities, this Section 9.07 applies whether any such investigation, litigation or proceeding is brought by any Lender, any L/C Issuer or any other Person. Without limitation of the foregoing, each Lender and each L/C Issuer shall reimburse the Administrative Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including all reasonable fees, expenses and disbursements of any law firm or other external legal counsel and compensation of agents and employees paid for services rendered on behalf of the Lenders or the L/C Issuer) incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of the Borrowers, provided that such reimbursement by the Lenders or by the L/C Issuers shall not affect the Borrowers’ continuing reimbursement obligations with respect thereto. The undertaking in this Section 9.07 shall survive termination of the Commitments of all Lenders and all L/C Issuers, the payment of all other Obligations and the resignation of the Administrative Agent.

Section 9.08. Withholding Tax . If any Governmental Authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold Taxes from amounts paid to or for the account of any Lender or any L/C Issuer for any reason (including, without limitation, because the appropriate form was not delivered or not property executed, or because such Lender or such L/C Issuer failed to notify the Administrative Agent of a change in circumstance that rendered the exemption from, or reduction of withholding Tax ineffective), such Lender or such L/C Issuer shall indemnify and hold harmless the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by any Loan Party and without limiting or expanding the obligation of the applicable Loan Party to do so) for all amounts paid, directly or indirectly, by the Administrative Agent as Taxes or otherwise, including any interest, additions to tax or penalties thereto, together with all reasonable expenses incurred, including legal expenses and any other out-of-pocket expenses, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Government Authority. A certificate as to the amount of such payment or liability delivered to any Lender or any L/C Issuer by the Administrative Agent shall be conclusive absent manifest error.

Section 9.09. Administrative Agent in Its Individual Capacity . (a) Any Person serving as Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include each Person serving as Administrative Agent hereunder in its individual capacity. Each Agent

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and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire Equity Interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business with each of the Loan Parties and their respective Affiliates as though such Agent were not an Agent or an L/C Issuer hereunder and without notice to or consent of the Lenders. The Lenders and L/C Issuer acknowledge that, pursuant to such activities, the Administrative Agent or its Affiliates may receive information regarding any Loan Party or any of its Affiliates (including information that may be subject to confidentiality obligations in favor of such Loan Party or such Affiliate) and acknowledge that the Administrative Agent shall not be under any obligation to provide such information to them. With respect to its Loans, the Administrative Agent shall have the same rights and powers under this Agreement as any other Lender and may exercise such rights and powers as though it were not an Agent the Administrative Agent an L/C Issuer, and the terms “Lender” and “Lenders” include each Agent in its individual capacity.

(b) Each Lender and each L/C Issuer understands that the Person serving as Administrative Agent, acting in its individual capacity, and its Affiliates (collectively, the “ Agent ’ s Group ”) are engaged in a wide range of financial services and businesses (including investment management, financing, securities trading, corporate and investment banking and research) (such services and businesses are collectively referred to in this Section 9.09 as “ Activities ”) and may engage in the Activities with or on behalf of one or more of the Loan Parties or their respective Affiliates. Furthermore, the Agent’s Group may, in undertaking the Activities, engage in trading in financial products or undertake other investment businesses for its own account or on behalf of others (including the Loan Parties and their Affiliates and including holding, for its own account or on behalf of others, equity, debt and similar positions in the Company, another Loan Party or their respective Affiliates), including trading in or holding long, short or derivative positions in securities, loans or other financial products of one or more of the Loan Parties or their Affiliates. Each Lender and each L/C Issuer understands and agrees that in engaging in the Activities, the Agent’s Group may receive or otherwise obtain information concerning the Loan Parties or their Affiliates (including information concerning the ability of the Loan Parties to perform their respective Obligations hereunder and under the other Loan Documents) which information may not be available to any of the Lenders or any of the L/C Issuers that are not members of the Agent’s Group. Neither the Administrative Agent nor any member of the Agent’s Group shall have any duty to disclose to any Lender or any L/C Issuer or use on behalf of the Lenders or on behalf of the L/C Issuers, and shall not be liable for the failure to so disclose or use, any information whatsoever about or derived from the Activities or otherwise (including any information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any Loan Party or any Affiliate of any Loan Party) or to account for any revenue or profits obtained in connection with the Activities, except that the Administrative Agent shall deliver or otherwise make available to each Lender and each L/C Issuer such documents as are expressly required by any Loan Document to be transmitted by the Administrative Agent to the Lenders or the L/C Issuers.

(c) Each Lender and each L/C Issuer further understands that there may be situations where members of the Agent’s Group or their respective customers (including the Loan Parties and their Affiliates) either now have or may in the future have interests or take actions that may conflict with the interests of any one or more of the Lenders or L/C Issuers (including the interests of the Lenders or L/C Issuers hereunder and under the other Loan Documents). Each Lender and each L/C Issuer agrees that no member of the Agent’s Group is or shall be required to restrict its activities as a result of the Person serving as Administrative Agent being a member of the Agent’s Group, and that each member of the Agent’s Group may undertake any Activities without further consultation with or notification to any Lender or any L/C Issuer. None of (i) this Agreement nor any other Loan Document, (ii) the receipt by the Agent’s Group of information (including Information) concerning the Loan Parties or their Affiliates (including information concerning the ability of the Loan Parties to perform their respective Obligations hereunder and under the other Loan Documents) nor (iii) any other matter shall give rise to any fiduciary,

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equitable or contractual duties (including without limitation any duty of trust or confidence) owing by the Administrative Agent or any member of the Agent’s Group to any Lender or any L/C Issuer including any such duty that would prevent or restrict the Agent’s Group from acting on behalf of customers (including the Loan Parties or their Affiliates) or for its own account.

Section 9.10. Resignation by the Administrative Agent . The Administrative Agent may resign as the Administrative Agent upon thirty (30) days’ prior notice to the Lenders, the L/C Issuers and the Borrowers. If the Administrative Agent resigns under this Agreement, the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall be consented to by Holdings at all times other than during the existence of an Event of Default under Section 8.01(f) (which consent of Holdings shall not be unreasonably withheld or delayed). If no successor agent is appointed prior to the effective date of the resignation of the Administrative Agent, the Administrative Agent may appoint, after consulting with the Lenders and Holdings, a successor agent from among the Lenders. Upon the acceptance of its appointment as successor agent hereunder, the Person acting as such successor agent shall succeed to all the rights, powers and duties of the retiring Administrative Agent, and the term “Administrative Agent” shall mean such successor administrative agent and/or supplemental administrative agent, as the case may be, and the retiring Administrative Agent’s appointment, powers and duties as the Administrative Agent shall be terminated. After the retiring Administrative Agent’s resignation hereunder as the Administrative Agent, the provisions of this Article 9 , Section 11.04(a) and Section 11.04(b ) shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrative Agent under this Agreement. If no successor agent has accepted appointment as the Administrative Agent by the date which is thirty (30) days following the retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective and the Lenders and L/C Issuers shall perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above. Upon the acceptance of any appointment as the Administrative Agent hereunder by a successor and upon the execution and filing or recording of such financing statements, or amendments thereto, and such other instruments or notices, as may be necessary or desirable, or as the Required Lenders may request, in order to (a) continue the perfection of the Liens granted or purported to be granted by the Collateral Documents or (b) otherwise ensure that the Section 6.12 is satisfied, the successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, discretion, privileges, and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under the Loan Documents (if not already discharged therefrom as provided above in this Section 9.10 ). After the retiring Administrative Agent’s resignation hereunder as the Administrative Agent, the provisions of this Article 9 , Section 11.04(a) and Section 11.04(b) shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative Agent.

Any resignation by the Administrative Agent as Administrative Agent pursuant to this Section 9.10 shall also constitute its resignation as a Swingline Lender and its resignation as an L/C Issuer. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (i) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Swingline Lender and L/C Issuer, (ii) the retiring Swingline Lender and L/C Issuer shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (iii) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit issued by Citibank, N.A., if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring L/C Issuer effectively to assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit.

Anything herein to the contrary notwithstanding, if at any time the Required Lenders determine that the Person serving as Administrative Agent is (without taking into account any provision in the

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definition of “Defaulting Lender” requiring notice from the Administrative Agent or any other party) a Defaulting Lender, the Required Lenders (determined after giving effect to Section 11.01 ) may by notice to the Administrative Borrower and such Person remove such Person as Administrative Agent and, with the consent of Holdings (not to be unreasonably withheld), appoint a replacement Administrative Agent hereunder. Such removal will, to the fullest extent permitted by applicable law, be effective on the date a replacement Administrative Agent is appointed.

Section 9.11. Administrative Agent May File Proofs of Claim . In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrowers) shall be entitled and empowered, by intervention in such proceeding or otherwise:

(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the L/C Issuers and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuers and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under Section 2.04(j) , Section 2.04(k) , Section 2.10 and Section 11.04(b) ) allowed in such judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, interim receiver, receiver and manager, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and each L/C Issuer to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders or L/C Issuers, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Agents and their respective agents and counsel, and any other amounts due the Administrative Agent under Section 2.10 and Section 11.04(b) .

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or any L/C Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or any L/C Issuer or to authorize the Administrative Agent to vote in respect of the claim of any Lender or any L/C Issuer in any such proceeding.

Section 9.12. Collateral and Guaranty Matters . The Lenders and the L/C Issuer irrevocably agree:

(a) that any Lien on any property granted to or held by the Administrative Agent under any Loan Document shall be automatically released (i) upon termination of the Commitments of all the Lenders and the L/C Issuer and payment in full of all Obligations (other than contingent indemnification obligations not yet accrued and payable) and the expiration or termination of all Letters of Credit (other than Letters of Credit in which the Outstanding Amount of the L/C Obligations related thereto have been Cash Collateralized or, if satisfactory to the L/C Issuer in its sole discretion, for which a backstop letter of credit is in place), (ii) at the time the property subject to such Lien is transferred or to be

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transferred as part of or in connection with any transfer permitted hereunder or under any other Loan Document to a Loan Party, or (iii) subject to Section 11.01 , if the release of such Lien is approved, authorized or ratified in writing by the Required Lenders;

(b) to release or subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 7.01(i) ;

(c) that any Guarantor (other than the Borrowers) shall be automatically released from its obligations under the Guarantee in Article 10 if in the case of any Guarantor, such Person ceases to be a Subsidiary as a result of a transaction or designation permitted hereunder;

(d) if any Guarantor shall cease to be a Material Subsidiary (as certified in writing by a Responsible Officer) and Holdings notifies the Administrative Agent in writing that it wishes such Guarantor to be released from its Obligations hereunder or its obligations under the Guarantee in Article 10 hereto such Subsidiary shall be automatically released from its Obligations hereunder or its obligations under its Guarantee;

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under the Guaranty pursuant to this Section 9.12 . In each case as specified in this Section 9.12 , the Administrative Agent will promptly (and each Lender and each L/C Issuer irrevocably authorizes the Administrative Agent to), at Holding’s expense, execute and deliver to the applicable Loan Party such documents as such Loan Party may reasonably request to evidence the release or subordination of such item of Collateral from the assignment and security interest granted under the Collateral Documents, or to evidence the release of such Loan Party from its obligations under any of the Loan Documents, in each case in accordance with the terms of the Loan Documents and this Section 9.12 .

Section 9.13. Arrangers and Bookrunners . Except as expressly provided herein, none of the Lenders or other Persons identified on the facing page or signature pages of this Agreement as a “Joint Lead Arranger” or “Joint Bookrunner” shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than those applicable to all Lenders as such. Without limiting the foregoing, none of the Lenders or other Persons so identified shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender and each L/C Issuer acknowledges that it has not relied, and will not rely, on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or in taking or not taking action hereunder

Section 9.14. Appointment of Supplemental Collateral Agents . (a) It is the purpose of this Agreement and the other Loan Documents that there shall be no violation of any Law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as agent or trustee in such jurisdiction. It is recognized that in case of litigation under this Agreement or any of the other Loan Documents, and in particular in case of the enforcement of any of the Loan Documents, or in case the Administrative Agent deems that by reason of any present or future Law of any jurisdiction it may not exercise any of the rights, powers or remedies granted herein or in any of the other Loan Documents or take any other action which may be desirable or necessary in connection therewith, the Administrative Agent is hereby authorized to appoint an additional individual or institution selected by the Administrative Agent in its sole discretion as a separate trustee, co-trustee, administrative agent, collateral agent, collateral sub-agent, collateral co-agent, administrative sub-agent or administrative co-agent (any such additional individual or institution being referred to herein individually as a “ Supplemental Administrative Agent ” and collectively as “ Supplemental Administrative Agents ”).

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(b) In the event that the Administrative Agent appoints a Supplemental Administrative Agent with respect to any Collateral, (i) each and every right, power, privilege or duty expressed or intended by this Agreement or any of the other Loan Documents to be exercised by or vested in or conveyed to the Administrative Agent with respect to such Collateral shall be exercisable by and vest in such Supplemental Administrative Agent to the extent, and only to the extent, necessary to enable such Supplemental Administrative Agent to exercise such rights, powers and privileges with respect to such Collateral and to perform such duties with respect to such Collateral, and every covenant and obligation contained in the Loan Documents and necessary to the exercise or performance thereof by such Supplemental Administrative Agent shall run to and be enforceable by either the Administrative Agent or such Supplemental Administrative Agent, and (ii) the provisions of this Article 9 and of Section 11.04(a) and Section 11.04(b) that refer to the Administrative Agent shall inure to the benefit of such Supplemental Administrative Agent and all references therein to the Administrative Agent shall be deemed to be references to the Administrative Agent and/or such Supplemental Administrative Agent, as the context may require.

(c) Should any instrument in writing from any Loan Party be required by any Supplemental Administrative Agent so appointed by the Administrative Agent for more fully and certainly vesting in and confirming to it such rights, powers, privileges and duties, such Loan Party shall execute, acknowledge and deliver any and all such instruments promptly upon request by the Administrative Agent. In case any Supplemental Administrative Agent, or a successor thereto, shall die, become incapable of acting, resign or be removed, all the rights, powers, privileges and duties of such Supplemental Administrative Agent, to the extent permitted by Law, shall vest in and be exercised by the Administrative Agent until the appointment of a new Supplemental Administrative Agent.

Section 9.15. Reports and Financial Statements . By signing this Agreement, each Lender and each L/C Issuer:

(a) is deemed to have requested that the Administrative Agent furnish such Lender or such L/C Issuer, as applicable, promptly after they become available, copies of all financial statements required to be delivered by Holdings hereunder and all field examinations, audits and appraisals of the Collateral received by the Administrative Agent (collectively, the “ Reports ”);

(b) expressly agrees and acknowledges that the Administrative Agent (i) makes no representation or warranty as to the accuracy of the Reports, and (ii) shall not be liable for any information contained in any Report;

(c) expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that the Administrative Agent or any other party performing any audit or examination will inspect only specific information regarding the Loan Parties and will rely significantly upon the Loan Parties’ books and records, as well as on representations of the Loan Parties’ personnel;

(d) agrees to keep all Reports confidential in accordance with the provisions of Section 11.07 (other than clause (g) thereof); and

(e) without limiting the generality of any other indemnification provision contained in this Agreement, agrees: (i) to hold the Administrative Agent and any such other Lender preparing a Report harmless from any action the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any Loans or Letters of Credit that the indemnifying Lender has made or may make to the Borrowers, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a Loan or Loans of the Borrowers; and (ii) to pay and protect, and indemnify, defend, and hold the Administrative Agent and any such other Lender preparing a

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Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including reasonable attorney costs) incurred by the Administrative Agent and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender; provided that no Lender shall be liable for the payment to the Administrative Agent or any other Lender preparing a Report for any portion of losses arising from such claims, actions, proceedings, damages, costs, expenses and other amounts (including attorney costs) to the extent resulting from the Administrative Agent’s or such other Lender’s own gross negligence or willful misconduct, as determined by the final judgment of a court of competent jurisdiction.

Section 9.16. Posting of Approved Electronic Communications . (a) Each of the Lenders and L/C Issuers and each Loan Party agree that the Administrative Agent may, but shall not be obligated to, make the Approved Electronic Communications available to the Lenders and the L/C Issuers by posting such Approved Electronic Communications on Debt Domain, IntraLinks™ or a substantially similar electronic platform chosen by the Administrative Agent to be its electronic transmission system (the “ Approved Electronic Platform ”).

(b) Although the Approved Electronic Platform and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by the Administrative Agent from time to time (including, as of the Closing Date, a dual firewall and a User ID/Password Authorization System) and the Approved Electronic Platform is secured through a single-user-per-deal authorization method whereby each user may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lenders, the L/C Issuer and each Loan Party acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution. In consideration for the convenience and other benefits afforded by such distribution and for the other consideration provided hereunder, the receipt and sufficiency of which is hereby acknowledged, each of the Lenders, the L/C Issuer and each Loan Party hereby approves distribution of the Approved Electronic Communications through the Approved Electronic Platform and understands and assumes the risks of such distribution.

(c) The Approved Electronic Platform and the Approved Electronic Communications are provided “as is” and “as available”. Neither the Administrative Agent nor any of its Affiliates or any of their respective officers, directors, employees, agents, advisors, attorneys or representatives (each, an “ Agent Affiliate ”) warrant the accuracy, adequacy or completeness of the Approved Electronic Communications or the Approved Electronic Platform and each expressly disclaims liability for errors or omissions in the Approved Electronic Platform and the Approved Electronic Communications. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Agent Affiliates in connection with the Approved Electronic Platform or the Approved Electronic Communications.

(d) Each of the Lenders, the L/C Issuers and each Loan Party agree that the Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Approved Electronic Communications on the Approved Electronic Platform in accordance with the Administrative Agent’s generally-applicable document retention procedures and policies.

(e) Each Borrower hereby acknowledges that certain of the Lenders may be “public-side” Lenders ( i.e. , Lenders that do not wish to receive material non-public information with respect to the Borrower or its securities) (each, a “ Public Lender ”). Each Borrower hereby agrees that so long as a Borrower is the issuer of any outstanding debt or equity securities that are registered or issued pursuant to a private offering or is actively contemplating issuing any such securities (w) all materials and/or information provided by or on behalf of the Borrowers hereunder (collectively, “ Borrower Materials ”)

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that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrowers shall be deemed to have authorized the Administrative Agent, any Arranger, the L/C Issuers and the Lenders to treat the Borrower Materials as not containing any material non-public information with respect to the Borrowers or its securities for purposes of United States Federal and state securities laws ( provided , however , that to the extent the Borrower Materials constitute Information, they shall be treated as set forth in Section 11.07 ); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Administrative Agent and any Arranger shall be entitled to treat the Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor.” Notwithstanding the foregoing, the Borrower shall not be under any obligation to mark the Borrower Materials “PUBLIC.” In connection with the foregoing, each party hereto acknowledges and agrees that the foregoing provisions are not in derogation of their confidentiality obligations under Section 11.07 .

ARTICLE 10

G UARANTEE

Section 10.01. Guarantee. (a) Each of the Guarantors hereby, jointly and severally, unconditionally and irrevocably, guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties and their respective successors, indorsees, transferees and assigns, the prompt and complete payment and performance by the Borrowers and each other Loan Party when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations.

(b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum liability of each Guarantor hereunder and under the other Loan Documents shall in no event exceed the amount which can be guaranteed by such Guarantor under any applicable Law relating to fraudulent conveyances, fraudulent transfers, or the insolvency of debtors (after giving effect to the right of contribution established in Section 10.02 ).

(c) Each Guarantor agrees that the Obligations may at any time and from time to time exceed the maximum amount of the liability of such Guarantor under Section 10.01(b) without impairing the guarantee contained in this Article 10 or affecting the rights and remedies of the Secured Parties hereunder.

(d) The guarantee contained in this Article 10 shall remain in full force and effect until all the Obligations (other than any contingent indemnification obligations not then due) shall have been satisfied by payment in full, no Letter of Credit shall be outstanding (except to the extent that the Letters of Credit have been Cash Collateralized or otherwise supported, in each case, on terms satisfactory to the Administrative Agent), and the Commitments shall be terminated, notwithstanding that from time to time during the term of the Credit Agreement the Borrowers may be free from any Borrower Obligations.

(e) No payment made by the Borrowers, any of the Guarantors, any other Guarantor or any other Person or received or collected by any Secured Party from the Borrowers, any of the Guarantors, any other Guarantor or any other Person by virtue of any action or proceeding or any set-off or appropriation or application at any time or from time to time in reduction of or in payment of the Obligations shall be deemed to reduce, release, modify or otherwise affect the liability of any Guarantor hereunder which shall, notwithstanding any such payment (other than any payment made by such

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Guarantor in respect of the Obligations or any payment received or collected from such Guarantor in respect of the Obligations), remain liable for the Obligations up to the maximum liability of such Guarantor hereunder until the Obligations (other than any contingent indemnification obligations not then due) are paid in full, no Letter of Credit shall be outstanding (except to the extent that the Letters of Credit have been Cash Collateralized or otherwise supported, in each case, on terms satisfactory to the Administrative Agent), and the Commitments are terminated.

Section 10.02. Right of Contribution. Each Guarantor hereby agrees that to the extent that a Guarantor shall have paid more than its proportionate share of any payment made hereunder (including by way of set-off rights being exercised against it), such Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment. Each Guarantor’s right of contribution shall be subject to the terms and conditions of Section 10.03 . The provisions of this Section 10.02 shall in no respect limit the obligations and liabilities of any Guarantor to the Secured Parties, and each Guarantor shall remain jointly and severally liable to the Secured Parties for the full amount guaranteed by such Guarantor hereunder.

Section 10.03. No Subrogation. Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds of any Guarantor by any Secured Party, no Guarantor shall be entitled to be subrogated to any of the rights of any Secured Party against the Borrowers or any Guarantor or any collateral security or guarantee or right of offset held by any Secured Party for the payment of the Obligations, nor shall any Guarantor seek or be entitled to seek any contribution or reimbursement from the Borrowers or any other Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing to the Secured Parties by the Borrowers on account of the Obligations (other than any contingent indemnification obligations not then due) are paid in full, no Letter of Credit shall be outstanding (except to the extent that the Letters of Credit have been Cash Collateralized or otherwise supported, in each case, on terms satisfactory to the Administrative Agent), and the Commitments are terminated. If any amount shall be paid to any Guarantor on account of such subrogation rights at any time when all of the Obligations (other than any contingent indemnification obligations not then due) shall not have been paid in full, such amount shall be held by such Guarantor in trust for the Secured Parties, segregated from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to the Administrative Agent in the exact form received by such Guarantor (duly indorsed by such Guarantor to the Administrative Agent, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Administrative Agent may determine.

Section 10.04. Amendments, etc. with Respect to the Borrower Obligations. Each Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against any Guarantor and without notice to or further assent by any Guarantor, any demand for payment of any of the Obligations made by any Secured Party may be rescinded by such Secured Party and any of the Borrower Obligations continued, and the Obligations, or the liability of any other Person upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, increased, amended, modified, accelerated, compromised, waived, surrendered or released by any Secured Party, and this Agreement and the other Loan Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (or the Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, and any collateral security, guarantee or right of offset at any time held by any Secured Party for the payment of the Obligations may be sold, exchanged, waived, surrendered or released. No Secured Party shall have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for the guarantee contained herein or any property subject thereto.

Section 10.05. Guarantee Absolute and Unconditional. Each Guarantor agrees that its obligations hereunder are irrevocable, absolute, independent and unconditional and shall not be affected

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by any circumstance that constitutes a legal or equitable discharge of a guarantor or a surety other than payment in full of the Obligations. In furtherance of the foregoing and without limiting the generality thereof, each Guarantor agrees as follows:

(a) The guarantee under this Article 10 is a guaranty of payment when due and not of collectability, and is a primary obligation of each Guarantor and not merely a contract of surety.

(b) The Administrative Agent may enforce the guarantee under this Article 10 upon the occurrence of an Event of Default notwithstanding the existence of any dispute between the Borrowers and any Beneficiary with respect to the existence of such Event of Default.

(c) Each Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance by any Secured Party upon the guarantee contained in this Article 10 or acceptance of the guarantee contained in this Article 10 .

(d) The Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the guarantee contained in this Article 10 and all dealings between the Borrowers and any of the Guarantors, on the one hand, and the Secured Parties, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the guarantee contained in this Article 10 .

(e) To the fullest extent permitted by applicable law, each Guarantor waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon the Borrowers or any of the Guarantors with respect to the Obligations.

(f) Each Guarantor understands and agrees that the guarantee contained in this Article 10 shall be construed as a continuing, absolute and unconditional guarantee of payment and performance without regard to

(i) the validity or enforceability of the Credit Agreement or any other Loan Document, any of the Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by any Secured Party,

(ii) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the Borrowers or any other Person against any Secured Party,

(iii) any acts of any legislative body or Governmental Authority affecting the Borrowers, including but not limited to, any restrictions on the conversion of currency or repatriation or control of funds or any total or partial expropriation of the Borrowers’ property, or by economic, political, regulatory or other events in the countries where the Borrowers are located, or

(iv) any other circumstance whatsoever (with or without notice to or knowledge of the Borrowers or such Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of the Borrowers for the Obligations, or of such Guarantor under the guarantee contained in this, in bankruptcy or in any other instance.

(g) When making any demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, any Secured Party may, but shall be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as it may have against the

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Borrowers, any other Guarantor or any other Person or against any collateral security or guarantee for the Obligations or any right of offset with respect thereto, and any failure by the Administrative Agent or any other Secured Party to make any such demand, to pursue such other rights or remedies or to collect any payments from the Borrowers, any other Guarantor or any other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of the Borrowers, any other Guarantor or any other Person or any such collateral security or guarantee or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Secured Parties against any Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings.

Section 10.06. Waiver by Guarantors. Each Guarantor hereby waives, for the benefit of the Secured Parties: (a) any right to require any Secured Party, as a condition of payment or performance by such Guarantor, to (i) proceed against Borrowers, any other Guarantor of the Obligations or any other Person, (ii) proceed against or exhaust any security held from Borrowers, any such other Guarantor or any other Person, (iii) proceed against or have resort to any balance of any deposit account or credit on the books of any Secured Party in favor of Borrowers or any other Person, or (iv) pursue any other remedy in the power of any Secured Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of Borrowers or any other Guarantor including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of Borrowers or any other Guarantor from any cause other than payment in full of the Obligations; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Secured Party’s errors or omissions in the administration of the Obligations, except behavior which amounts to bad faith; (e) (i) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms hereof and any legal or equitable discharge of such Guarantor’s obligations hereunder, (ii) the benefit of any statute of limitations affecting such Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights of set offs, recoupments and counterclaims, and (iv) promptness, diligence and any requirement that any Secured Party protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, including the acceptance hereof, notices of default hereunder, the Secured Hedge Agreements or any agreement or instrument related thereto, the Secured Cash Management Agreements or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations or any agreement related thereto, notices of extension of credit to Borrowers; (g) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate Guarantors or sureties, or which may conflict with the terms hereof, (h) any defenses arising from the amendment of waiver of any term of the Loan Documents; (i) any defenses arising from failure to perfect any security granted over the Collateral or any release of security over the Collateral, (j) any law or regulation of any jurisdiction or any other event affecting any term of the Loan Documents or the Obligations and (k) any other circumstances that might constitute a defense to the Guarantor.

Section 10.07. Releases. (a) At such time as the Obligations shall have been paid in full (other than any contingent indemnification obligations not then due), the Commitments have been terminated and no Letters of Credit shall be outstanding (except to the extent that the Letters of Credit that have been Cash Collateralized or otherwise supported, in each case, on terms satisfactory to the Administrative Agent), all obligations (other than those expressly stated to survive such termination) of each Guarantor hereunder shall terminate, all without delivery of any instrument or performance of any act by any party. At the request and sole expense of any Guarantor following any such termination, the Administrative Agent shall execute and deliver to such Guarantor such documents as such Guarantor shall reasonably request to evidence such termination.

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(b) A Guarantor shall automatically be released from its obligations hereunder and the Guarantee of such Guarantor shall automatically be released (i) upon the consummation of any transaction or related series of transaction permitted hereunder if as a result thereof such Guarantor shall cease to be a Subsidiary (or becomes an Excluded Subsidiary) or (ii) upon the occurrence of the Maturity Date. In connection with any such release, the Administrative Agent shall promptly execute and deliver to any Guarantor, at such Guarantor’s expense, all documents that such Guarantor shall reasonably request to evidence termination or release. Any execution and delivery of documents pursuant to the preceding sentence of this Section 10.07(b) shall be without recourse to or warranty by the Administrative Agent (other than as to the Administrative Agent’s authority to execute and deliver such documents).

Section 10.08. Subordination of Other Obligations . Any Indebtedness of the Borrowers or any Guarantor held as of the Closing Date or thereafter by any Guarantor (the “ Obligee Guarantor ”) is hereby subordinated in right of payment to the Obligations, and any such indebtedness collected or received by the Obligee Guarantor after an Event of Default has occurred and is continuing shall be held in trust for the Administrative Agent on behalf the Beneficiaries and shall forthwith be paid over to the Administrative Agent for the benefit of the Beneficiaries to be credited and applied against the Obligations but without affecting, impairing or limiting in any manner the liability of the Obligee Guarantor under any other provision hereof.

Section 10.09. Authority of Guarantors or Borrowers . It shall not be necessary for any Beneficiary to inquire into the capacity or powers of any Guarantor or Borrowers or the officers, directors or agents acting or purporting to act on behalf of any of them.

Section 10.10. Financial Condition of Borrowers . Any Credit Extension may be made to the Borrowers or continued from time to time, without notice to or authorization from any Guarantor regardless of the financial or other condition of Borrowers at the time of such grant or continuation. No Beneficiary shall have any obligation to disclose or discuss with any Guarantor its assessment, or any Guarantor’s assessment, of the financial condition of the Borrowers. Each Guarantor has adequate means to obtain information from the Borrowers on a continuing basis concerning the financial condition of the Borrowers and its ability to perform its obligations under the Loan Documents, and each Guarantor assumes the responsibility for being and keeping informed of the financial condition of the Borrowers and all circumstances bearing upon the risk of nonpayment of the Obligations. Each Guarantor hereby waives and relinquishes any duty on the part of any Beneficiary to disclose any matter, fact or thing relating to the business, operations or conditions of the Borrowers known as of the Closing Date or thereafter known by any Beneficiary.

Section 10.11. Taxes and Payments. The provisions of Section 3.01(a)-(e) shall apply mutatis mutandis to the Guarantors and payments thereby.

Section 10.12. Assignments . Each Guarantor acknowledges that the Administrative Agent or any Lender may assign or otherwise transfer all or any portion of its rights and obligations under this Agreement (including, without limitation, all or any portion of its Commitments, the Loans owing to it and any Note or Notes held by it) and such assignee, transferee or participant shall thereupon become vested with all the benefits in respect thereof granted to such party herein or otherwise, in each case as and to the extent provided in Section 11.06 . No Guarantor shall have the right to assign its rights hereunder or any interest herein except in accordance with Section 11.06 .

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Section 10.13. Reinstatement . Each Guarantor agrees that if (a) any payment made by the Borrowers or any other Person and applied to the Obligations is at any time annulled, avoided, set aside, rescinded, invalidated, declared to be fraudulent or preferential or otherwise required to be refunded or repaid, or (b) the proceeds of Collateral are required to be returned by any Beneficiary to the Borrowers or its estate, trustee, receiver or any other Party including any Guarantor or its estate, trustee, or receiver under any requirement of Law, then, to the extent of such payment or repayment, any such Guarantors liability hereunder shall be and remain in full force and effect, as fully as if such payment had never been made. If, prior to any of the foregoing, the guarantee under this Article 10 shall have been cancelled or surrendered (and, if any Lien or other Collateral securing such Guarantor’s liability hereunder shall have been released or terminated by virtue of such cancellation or surrender), the guarantee under this Article 10 (and such Lien or other Collateral) shall be reinstated in full force and effect, and such prior cancellation or surrender shall not diminish, release, discharge, impair or otherwise affect the obligations of any such Guarantor in respect of the amount of such payment (or any lien or other Collateral securing such obligation).

Section 10.14. Keepwell . Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of its obligations under this Guarantee in respect of Swap Contracts (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 10.14 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 10.14 , or otherwise under this Guarantee, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section 10.14 shall remain in full force and effect until the Obligations have been paid in full and the Commitments and all Letters of Credit have been terminated. Each Qualified ECP Guarantor intends that this Section 10.14 constitute, and this Section 10.14 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each Loan Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

ARTICLE 11

M ISCELLANEOUS

Section 11.01. Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Borrowers or any other Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrowers or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided , however , that no such amendment, waiver or consent shall:

(a) extend or increase the Commitment of any Lender without the written consent of each Lender directly affected thereby;

(b) (i) extend the scheduled maturity of any Loan or (ii) postpone any date fixed by this Agreement or any other Loan Document for any payment or mandatory prepayment of principal, interest, fees or other amounts due to the Lenders (or any of them) or any mandatory reduction of the aggregate Commitments hereunder without the written consent of each Lender directly adversely affected thereby;

(c) reduce the principal of, or the stated rate of interest specified herein on, any Loan or Unreimbursed Amount, or (subject to clause (iv) of the proviso to this Section 11.01 ) any fees or other amounts payable hereunder without the written consent of each Lender entitled to such amount; provided ,

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however , that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Borrowers to pay interest or Letter of Credit Fees at the Default Rate;

(d) change Section 2.07 or Section 8.03 in a manner that would alter the pro rata sharing of payments or payment priorities required thereby without the written consent of each Lender;

(e) change any provision of this Section 11.01 or the definitions of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder without the written consent of each Lender;

(f) release all or substantially all of the Collateral in any transaction or series of related transactions, without the written consent of each Lender; provided that the Collateral Agent may, without consent from any other Lender, release any Collateral that is sold or otherwise Disposed of by a Loan Party in compliance with Section 7.05 or as otherwise expressly provided in the Loan Documents;

(g) release all or substantially all of the Guarantors, without the written consent of each Lender, except to the extent the release of any Guarantor is permitted pursuant to Section 10.07 or as otherwise expressly permitted under the Loan Documents (in which case such release may be made by the Administrative Agent acting alone); or

(h) directly or indirectly, whether by amendment, waiver or otherwise, increase the advance rates set forth in the definition of the term “Borrowing Base,” add new asset categories to the Borrowing Base or otherwise cause the Borrowing Base or availability under the Facility provided for herein to be increased (other than changes in Reserves implemented by the Administrative Agent in its Reasonable Credit Judgment) without the written consent of each Lender;

provided , that (i) no amendment, waiver or consent shall, unless in writing and signed by the applicable L/C Issuer in addition to the Lenders required above, affect the rights or duties of such L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued or to be issued by it; and (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swingline Lender in addition to the Lenders required above, affect the rights and duties of the Swingline Lender under this Agreement; and (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; and (iv) the Fee Letters may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto. Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased or extended without the consent of such Lender.

If any Lender does not consent to a proposed amendment, waiver, consent or release with respect to any Loan Document that requires the consent of each Lender and that has been approved by the Required Lenders, the Borrowers may replace each non-consenting Lender in accordance with Section 11.13 ; provided , that such amendment, waiver, consent or release can be effected as a result of all such assignments.

Any such waiver and any such amendment or modification pursuant to this Section 11.01 shall apply equally to each of the Lenders and shall be binding upon the Borrowers, the Lenders, the L/C Issuers, the Administrative Agent and all future holders of the Loans. In the case of any waiver, the Borrowers, the Lenders, the L/C Issuers and the Administrative Agent shall be restored to their former

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positions and rights hereunder and under the other Loan Documents, and any Default or Event of Default that is waived pursuant to this Section 11.01 shall be deemed to be cured and not continuing during the period of such waiver.

Section 11.02. Notices; Effectiveness; Electronic Communications. (a) Notices Generally . Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i) if to the Borrowers, the Administrative Agent or L/C Issuer, to the address, telecopier number, electronic mail address or telephone number specified for such Person on Schedule 11.02 (or such other address or number as the Borrowers, the Administrative Agent or any L/C Issuer may from time to time notify to each other party); and

(ii) if to any other Lender, to the address, telecopier number, electronic mail address or telephone number specified in its Administrative Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications to the extent provided in subsection (b) below shall be effective as provided in such subsection (b).

(b) Electronic Communications . Notices and other communications to the Lenders and the L/C Issuers hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided , that the foregoing shall not apply to notices to any Lender or L/C Issuer pursuant to Article 2 if such Lender or such L/C Issuer, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrowers may, in their discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided , that approval of such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to the Lenders and the L/C Issuers to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided , that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

Each Lender agrees that notice to it specifying that any Borrower Materials or other notices or communications have been posted to the Platform shall constitute effective delivery of such information, documents or other materials to such Lender for purposes of this Agreement; provided that if requested by any Lender, the Administrative Agent shall deliver a copy of the Borrower Materials, notices or other communications to such Lender by email or fax.

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(c) The Platform . THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “ Agent Parties ”) have any liability to the Borrowers, any Lender, L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrowers’ or the Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses have resulted from the gross negligence or willful misconduct of such Agent Party as determined by a court of competent jurisdiction in a final, non-appealable judgment; provided , however , that in no event shall the Agent Party have any liability to the Borrowers, any Lender, L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

(d) Change of Address, Etc . Each of the Borrowers, the Administrative Agent and each L/C Issuer may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the Borrowers, the Administrative Agent and each L/C Issuer. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.

(e) Reliance by Administrative Agent, L/C Issuers and Lenders . The Administrative Agent, the L/C Issuers and the Lenders shall be entitled to rely and act upon any notices (including telephonic Borrowing Notices) purportedly given by or on behalf of the Borrowers even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

Section 11.03. No Waiver; Cumulative Remedies. None of the Secured Parties shall by any act (except by a written instrument pursuant to Section 11.01 ), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default. No failure by any Lender, L/C Issuer or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any other Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. A waiver by any Secured Party of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which such Secured Party would otherwise have on any future occasion. The rights, remedies, powers and privileges herein provided, and provided under each other Loan Document, are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

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Section 11.04. Expenses; Indemnity; Damage Waiver. (a) Costs and Expenses . The Borrowers shall pay (i) all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent, the Arrangers, the Lenders as of the Closing Date, and their Affiliates (including the reasonable and documented fees, charges and disbursements of counsel and industry advisors for the Administrative Agent), in connection with the Facility, including, without limitation, internal per diem field examination costs (whether incurred before or after the date hereof), syndication of the Facility, closing and due diligence costs and costs in connection with the preparation, negotiation, execution, delivery, administration and enforcement of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable and documented out-of-pocket expenses incurred by any L/C Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent, any Lender or any L/C Issuer (including the reasonable and documented fees, charges and disbursements of any (x) one primary counsel and one reasonably necessary specialist counsel for the Administrative Agent, any Lender or any L/C Issuer, (y) in the case of an actual or perceived conflict of interest, one additional counsel to the affected Persons similarly situated taken as a whole, and a single local counsel for all Persons taken as a whole in each relevant jurisdiction to the affected Persons taken as a whole in each relevant and (z) solely in the case of a conflict of interest, one additional local counsel in such jurisdiction to the affected Indemnified Persons similarly situated taken as a whole), regardless of whether any of the transactions contemplated hereby is consummated or in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section 11.04 , or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such all reasonable and documented out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit. Each Guarantor agrees to pay or reimburse each Secured Party for all its reasonable and documented out-of-pocket expenses incurred in collecting against such Guarantor under the guarantee contained in Article 10 or otherwise enforcing or preserving any rights under this Agreement and the other Loan Documents to which such Guarantor is a party, including, without limitation, the fees and disbursements of counsel to each Secured Party and of counsel to the Administrative Agent.

(b) Indemnification by the Loan Parties . The Borrowers and each Guarantor shall indemnify the Administrative Agent (and any sub-agent thereof), each Arranger, each Lender and each L/C Issuer, and each of their Related Party of any of the foregoing Persons (each such Person being called an “ Indemnitee ”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities, costs and expenses (including, without limitation, the reasonable and documented out-of-pocket fees, charges and disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrowers or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrowers or any of their respective Subsidiaries, or any Environmental

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Liability related in any way to the Borrowers or any of their respective Subsidiaries, or (iv) any actual or prospective claim, actions, suits, inquiries, litigation, investigation or proceeding relating to any of the foregoing (each, a “ Proceeding ”) or the preparation of any defense in connection therewith, in each case, arising out of or in connection with or by reason of this Agreement, the Loan Documents or the transactions contemplated hereby or thereby, or any actual or proposed use of the proceeds of the Facility, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrowers or any other Loan Party, and regardless of whether any Indemnitee is a party thereto (all of the foregoing, collectively, the “ Indemnified Liabilities ”); provided , that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee as determined by a court of competent jurisdiction in a final, non-appealable judgment, (y) have resulted from a material breach of such Indemnitee’s obligations under this Agreement or other Loan Documents, or (z) arises out of any Proceeding that does not involve an act or omission of the Loan Parties or any of its respective Affiliates and that is brought by an Indemnitee against any other Indemnitee (other than any Proceeding against any Arranger or the Agent solely in their respective capacities or in fulfilling their respective roles as an Arranger, Agent or similar role under the Facility), provided further , that the Loan Parties shall not be required to reimburse the legal fees and expenses of more than (x) one primary counsel and one reasonably necessary specialist counsel for each specialty for the Administrative Agent, any Lender or any L/C Issuer, (y) in the case of an actual or perceived conflict of interest, one additional counsel to the affected Persons similarly situated taken as a whole, and a single local counsel for all Persons taken as a whole in each relevant jurisdiction to the affected Persons taken as a whole in each relevant jurisdiction and (z) solely in the case of an actual or perceived conflict of interest, one additional local counsel in such jurisdiction to the affected Indemnified Persons similarly situated taken as a whole). In the case of any Proceeding to which the indemnity in this paragraph applies, such indemnity shall be effective, whether or not such Proceeding is brought by any Borrower, any of its directors, security holders or creditors, an Indemnitee or any other person, or an Indemnitee is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated. Notwithstanding any other provision in this Agreement or any other Loan Document, no Indemnitee shall be liable for any indirect, special, punitive or consequential damages (including, without limitation, any loss of profits, business or anticipated savings) in connection with its activities related to this Agreement, the other Loan Documents or the transactions contemplated hereby or thereby.

No Loan Party shall, without the prior written consent of any affected Indemnitee (which consent shall not be unreasonably withheld, delayed or conditioned), effect any settlement of any pending or threatened proceedings in respect of which indemnity could have been sought hereunder by such Indemnitee unless such settlement (i) includes an unconditional release of such Indemnitee from all liability or claims that are the subject matter of such proceedings and (ii) does not include any statement as to or any admission of fault, culpability, wrongdoing or a failure to act by or on behalf of any Indemnitee.

Each Borrower acknowledges that information and other materials relative to the Facility and the transactions contemplated hereby may be transmitted through the Platform. No Indemnified Person will be liable to any Borrower or any of its affiliates or any of their respective security holders or creditors for any damages arising from the use by unauthorized persons of information or other materials sent through the Platform that are intercepted by such persons.

(c) Reimbursement by Lenders . To the extent that the Borrowers for any reason fails to indefeasibly pay any amount required under subsection (a) or (b) of this Section 11.04 to be paid by it to the Administrative Agent (or any sub-agent thereof), any L/C Issuer or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), such L/C Issuer or such Related Party, as the case may be, such Lender’s pro rata share (based on the

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Loans and unused Commitments held by such Lender relative to the total Loans and unused Commitments then outstanding) of such unpaid amount, provided , that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent) or such L/C Issuer in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent) or L/C Issuer in connection with such capacity. The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.13(d).

(d) Waiver of Consequential Damages, Etc . To the fullest extent permitted by applicable law, the Borrowers shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby, except to the extent such damages result from the gross negligence or willful misconduct of such Indemnitee, in each case, as determined by the final nonappealable judgment of a court of competent jurisdiction.

(e) Payments . All amounts due under this Section 11.04 shall be payable not later than ten Business Days after demand therefor.

(f) Survival . The agreements in this Section 11.04 shall survive the resignation of the Administrative Agent or any L/C Issuer, the replacement of any Lender, the termination of the aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.

Section 11.05. Payments Set Aside. To the extent that any payment by or on behalf of the Borrowers is made to the Administrative Agent, any L/C Issuer or any Lender, or the Administrative Agent, any L/C Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent, any L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender and L/C Issuer severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Overnight Rate from time to time in effect. The obligations of the Lenders and the L/C Issuers under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

Section 11.06. Successors and Assigns. (a) Successors and Assigns Generally . The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that no Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender, and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of Section 11.06(b) , (ii) by way of participation in accordance with the provisions of Section 11.06(d) , or (iii) by way of pledge

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or assignment of a security interest subject to the restrictions of Section 11.06(f) . Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the L/C Issuers and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Assignments by Lenders . Any Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitments or Loans (including for purposes of this Section 11.06(b) , participations in L/C Obligations and Swingline Loans) at the time owing to it), provided , that:

(i) except in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Acceptance, as of such “Trade Date”, shall not be less than $5,000,000;

(ii) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned; and

(iii) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee in the amount of $3,500; provided , however , that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The Eligible Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Acceptance, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01 , 3.04 , 3.05 and 11.04 with respect to facts and circumstances occurring prior to the effective date of such assignment. Upon request, the Borrowers (at their expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with

Section 11.06(d) .

(c) Register . The Administrative Agent, acting solely for this purpose as an agent of the Borrowers, shall maintain at the Administrative Agent’s Office a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be

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conclusive, and the Borrowers, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrowers and the L/C Issuer, at any reasonable time and from time to time upon reasonable prior notice.

(d) Participations . Any Lender may at any time, without the consent of, or notice to, the Borrowers or the Administrative Agent, sell participations to any Person (other than a natural person or the Borrowers or any of the Borrowers’ Affiliates or Subsidiaries) (each, a “ Participant ”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans (including such Lender’s participations in L/C Obligations and/or Swingline Loans) owing to it); provided , that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrowers, the Administrative Agent, the Lenders and the L/C Issuers shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided , that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in clauses (a), (b), (c), (f) and (g) of the first proviso to Section 11.01 that affects such Participant. Subject to subsection (e) of this Section, the Borrowers agree that each Participant shall be entitled to the benefits of Sections 3.01 , 3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment; provided , further , that in the case of Section 3.01 , such Participant shall have complied with the requirements of such section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.07 as though it were a Lender, provided such Participant agrees to be subject to Section 2.14 as though it were a Lender.

Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Borrowers, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “ Participant Register ”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the U.S. Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

(e) Limitations upon Participant Rights . A Participant shall not be entitled to receive any greater payment under Section 3.01, Section 3.04 or Section 3.05 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with Holding’s prior written consent or such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.

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(f) Certain Pledges . Any Lender may at any time pledge or assign to any Person a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or other central bank; provided , that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(g) Electronic Execution of Assignments . The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Acceptance shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state Laws based on the Uniform Electronic Transactions Act.

(h) Resignation as L/C Issuer or Swingline Lender after Assignment . Notwithstanding anything to the contrary contained herein, if at any time a L/C Issuer or Swingline Lender, as applicable, assigns all of its Commitment and Loans pursuant to Section 11.06(b) , such L/C Issuer or Swingline Lender, as applicable, may, (i) upon 30 days’ notice to the Borrowers, the other Lenders and other L/C Issuers, resign as L/C Issuer or Swingline Lender, as applicable, or (ii) upon 10 days’ notice to the Borrowers, the other Lenders and other L/C Issuers, appoint an Affiliate of such L/C Issuer or Swingline Lender, as applicable, as a successor L/C Issuer or Swingline Lender hereunder. In the event of any such resignation as L/C Issuer or Swingline Lender pursuant to clause (i) of the preceding sentence, the Borrowers shall be entitled to appoint from among the Lenders and their Affiliates a successor L/C Issuer or Swingline Lender hereunder; provided, however, that no failure by the Borrowers to appoint any such successor shall affect the resignation of such L/C Issuer or Swingline Lender, as the case may be. If Citibank N.A. resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require the Lenders to make Base Rate Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.04(d) ). If Citibank N.A. resigns as Swingline Lender, it shall retain all the rights of the Swingline Lender provided for hereunder with respect to Swingline Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make Base Rate Loans or fund risk participations in outstanding Swingline Loans pursuant to Section 2.05(c) . Upon the appointment of a successor L/C Issuer and/or Swingline Lender, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swingline Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to such L/C Issuer to effectively assume the obligations of such L/C Issuer with respect to such Letters of Credit.

Section 11.07. Treatment of Certain Information; Confidentiality. Each of the Administrative Agent, the Lenders and the L/C Issuers agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) on a need-to-know basis to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, counsel, independent auditors, professionals and other experts, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable Laws or

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regulations or by any subpoena, compulsory legal process or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section 11.07 to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 11.06 , (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrowers and their obligations, (g) with the consent of Holdings, (h) to the extent such Information becomes publicly available other than as a result of a breach of this Section 11.07 , (i) to any rating agencies, or (j) any proxy relating to transactions contemplated hereby.

For purposes of this Section 11.07 , “ Information ” means all information received from the Borrowers or any of their Subsidiary relating to the Borrowers or any of their Subsidiary or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or any L/C Issuer on a nonconfidential basis prior to disclosure by the Borrowers or any Subsidiary, provided , that in the case of information received from the Borrowers or any such Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section 11.07 shall be considered to have complied with its obligation to do so if such Person has exercised reasonable care to protect such Information, and in no event less than the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Each of the Administrative Agent, the Lenders and the L/C Issuers acknowledges that (a) the Information may include material non-public information concerning the Borrowers or a Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use of material non-public information and (c) it will handle such material non-public information in accordance with applicable Law, including Federal and state securities laws.

Section 11.08. Right of Setoff. Upon any amount becoming due and payable hereunder (whether at stated maturity, by acceleration or otherwise), each Lender, each L/C Issuer and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, such L/C Issuer or any such Affiliate to or for the credit or the account of the Borrowers or any other Loan Party against any and all of the obligations of the Borrowers or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or such L/C Issuer, irrespective of whether or not such Lender or such L/C Issuer shall have made any demand under this Agreement or any other Loan Document or are owed to a branch or office of such Lender or such L/C Issuer different from the branch or office holding such deposit or obligated on such indebtedness. The rights of each Lender, such L/C Issuer and their respective Affiliates under this Section 11.08 are in addition to other rights and remedies (including other rights of setoff) that such Lender, such L/C Issuer or their respective Affiliates may have. Each Lender and L/C Issuer agrees to notify the Borrowers and the Administrative Agent promptly after any such setoff and application, provided , that the failure to give such notice shall not affect the validity of such setoff and application.

Section 11.09. Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “ Maximum Rate ”). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal,

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refunded to the Borrowers. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

Section 11.10. Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01 , this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement or of a Lender Addendum by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

Section 11.11. Survival of Representations and Warranties. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

Section 11.12. Severability. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 11.13. Replacement of Lenders. If (a) any Lender requests compensation under Section 3.04 , (b) the Borrowers are required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 , (c) any Lender is at such time a Defaulting Lender or has given notice pursuant to Section 3.02 or (d) any Lender becomes a Nonconsenting Lender (as hereinafter defined), then the Borrowers may, at their sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to (and such Lender shall) assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.06 ), all of its interests, rights and obligations under this Agreement and the related Loan Documents to an assignee selected by the Borrowers that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided , that (i) the Administrative Agent shall have received the assignment fee specified in Section 11.06(b) ; (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.05 ) from the assignee (to the extent of

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such outstanding principal and accrued interest and fees) or the Borrowers (in the case of all other amounts); (iii) in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to be made pursuant to Section 3.01 , such assignment will result in a reduction in such compensation or payments thereafter; (iv) such assignment does not conflict with applicable Laws; and (v) neither the Administrative Agent nor any Lender shall be obligated to be or to find the assignee.

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrowers to require such assignment and delegation cease to apply. In the event that (x) the Borrowers or the Administrative Agent has requested the Lenders to consent to a departure or waiver of any provisions of the Loan Documents or to agree to any amendment thereto and (y) the Required Lenders have agreed to such consent, waiver or amendment, then any Lender who does not agree to such consent, waiver or amendment shall be deemed a “ Nonconsenting Lender. ” Any such replacement shall not be deemed a waiver of any rights that the Borrowers shall have against the replaced Lender.

Section 11.14. Governing Law; Jurisdiction; Etc. (a) GOVERNING LAW . THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b) SUBMISSION TO JURISDICTION . EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWERS OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE . EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d) SERVICE OF PROCESS . EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 12.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

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Section 11.15. Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section 11.16. Designation of Secured Agreements. (a) The Borrowers and any Cash Management Bank or Hedge Bank may from time to time designate a Cash Management Agreement or Swap Contract permitted hereunder as a Secured Agreement upon written notice (a “ Designation Notice ”) to the Administrative Agent from the Borrowers and such Cash Management Bank or Hedge Bank, in form reasonably acceptable to the Administrative Agent, which Designation Notice shall include a description of such Secured Agreement and the maximum amount of obligations thereunder which are to constitute Obligations (each, a “ Designated Amount ”); provided that (x) no such Designated Amount with respect to any Secured Agreement shall constitute Obligations to the extent that, at the time of delivery of the applicable Designation Notice and after giving effect to such Designated Amount (including to the reserve for Secured Agreements to be established by the Administrative Agent in connection therewith), the Availability would be less than zero and (y) any such Designated Amount shall constitute Obligations only to the extent that such Designated Amount, together with all other Designated Amounts under Secured Agreements theretofore designated hereunder and constituting Obligations, does not exceed, $10,000,000.

(b) The Borrowers and any counterparty to a Secured Agreement may increase, decrease or terminate any Designated Amount in respect of such Secured Agreement upon written notice to the Administrative Agent; provided that any increase in a Designated Amount shall be deemed to be a new designation of a Designated Amount pursuant to a new Designation Notice and shall be subject to the limitations set forth in Section 11.16(a) . No obligations under any Secured Agreement in excess of the applicable Designated Amount shall constitute Obligations hereunder or the other Loan Documents.

(c) No counterparty to a Secured Agreement that obtains the benefits of Section 8.03 , Article 10 , or any Collateral by virtue of the provisions hereof or of any Guaranty or any Collateral Document shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents. The Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Obligations arising under Secured Agreements unless the Administrative Agent has received written notice of such Obligations, together with such supporting documentation as the Administrative Agent may request, from the applicable counterparty to a Secured Agreement.

Section 11.17. No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other

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modification hereof or of any other Loan Document), the Borrowers and the other Loan Parties acknowledge and agree that: (i) (A) the arranging and other services regarding this Agreement provided by the Administrative Agent and any Arranger are arm’s-length commercial transactions between the Borrowers, the other Loan Parties and their respective Affiliates, on the one hand, and the Administrative Agent and any Arranger, on the other hand, (B) the Borrowers and the other Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent deemed appropriate by such Loan Parties, and (C) the Borrowers and the other Loan Parties are capable of evaluating, and understand and accept, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the Administrative Agent and any Arranger each is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrowers, the other Loan Parties, their respective Affiliates or any other Person and (B) neither the Administrative Agent nor any Arranger has any obligation to the Borrowers, the other Loan Parties or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent and any Arranger and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrowers and their Affiliates, and neither the Administrative Agent nor any Arranger has any obligation to disclose any of such interests to the Borrowers or their Affiliates. To the fullest extent permitted by law, the Borrowers and each other Loan Party hereby waives and releases any claims that it may have against the Administrative Agent and any Arranger with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

Section 11.18. Joint and Several Liability . All Loans, upon funding, shall be deemed to be jointly funded to and received by the Borrowers. Each Borrower is jointly and severally liable under this Agreement for all Obligations, regardless of the manner or amount in which proceeds of Loans are used, allocated, shared or disbursed by or among the Borrowers themselves, or the manner in which the Administrative Agent, any Lender and/or any L/C Issuer accounts for such Loans or other Credit Extensions on its books and records. Each Borrower shall be liable for all amounts due to the Administrative Agent, any Lender and/or any L/C Issuer from the Borrowers under this Agreement, regardless of which Borrower actually receives Loans or other Credit Extensions hereunder or the amount of such Loans and Credit Extensions received or the manner in which the Administrative Agent, such Lender and/or such L/C Issuer accounts for such Loans or other Credit Extensions on its books and records. Each Borrower’s Obligations with respect to Loans and other Credit Extensions made to it, and such Borrower’s Obligations arising as a result of the joint and several liability of such Borrower hereunder with respect to Loans made to the other Borrowers hereunder shall be separate and distinct obligations, but all such Obligations shall be primary obligations of such Borrower. The Borrowers acknowledge and expressly agree with the Administrative Agent, each Lender and each L/C Issuer that the joint and several liability of each Borrower is required solely as a condition to, and is given solely as inducement for and in consideration of, credit or accommodations extended or to be extended under the Loan Documents to any or all of the other Borrowers and is not required or given as a condition of Credit Extensions to such Borrower. Each Borrower’s Obligations under this Agreement shall, to the fullest extent permitted by law, be unconditional irrespective of (i) the release of any other Borrower pursuant to Section 9.12 or the validity or enforceability, avoidance, or subordination of the Obligations of any other Borrower or of any promissory note or other document evidencing all or any part of the Obligations of any other Borrower, (ii) the absence of any attempt to collect the Obligations from any other Borrower, or any other security therefor, or the absence of any other action to enforce the same, (iii) the waiver, consent, extension, forbearance, release, or granting of any indulgence by the Administrative Agent, any Lender and/or any L/C Issuer with respect to any provision of any instrument evidencing the Obligations of any other Borrower, or any part thereof, or any other agreement now or hereafter executed by any other Borrower and delivered to the Administrative Agent, any Lender and/or any L/C Issuer, (iv) the failure by the Administrative Agent, any Lender and/or any L/C Issuer to take any steps to perfect and maintain its

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security interest in, or to preserve its rights to, any security or collateral for the Obligations of any other Borrower, (v) the Administrative Agent’s, any Lender’s and/or any L/C Issuer’s election, in any proceeding instituted under the Bankruptcy Code, of the application of Section 1111(b)(2) of the Bankruptcy Code, (vi) any borrowing or grant of a security interest by any other Borrower, as debtor-in-possession under Section 364 of the Bankruptcy Code, (vii) the disallowance of all or any portion of the Administrative Agent’s, any Lender’s and/or any L/C Issuer’s claim(s) for the repayment of the Obligations of any other Borrower under Section 502 of the Bankruptcy Code, or (viii) any other circumstances which might constitute a legal or equitable discharge or defense of a guarantor or of any other Borrower. With respect to any Borrower’s Obligations arising as a result of the joint and several liability of the Borrowers hereunder with respect to Loans or other Credit Extensions made to any of the other Borrowers hereunder, such Borrower waives, until the Obligations shall have been paid in full and this Agreement shall have been terminated, any right to enforce any right of subrogation or any remedy which the Administrative Agent, any Lender and/or any L/C Issuer now has or may hereafter have against any other Borrower, any endorser or any guarantor of all or any part of the Obligations, and any benefit of, and any right to participate in, any security or collateral given to the Administrative Agent, any Lender and/or any L/C Issuer to secure payment of the Obligations or any other liability of any Borrower to the Administrative Agent, any Lender and/or any L/C Issuer. Upon any Event of Default, the Administrative Agent may proceed directly and at once, without notice, against any Borrower to collect and recover the full amount, or any portion of the Obligations, without first proceeding against any other Borrower or any other Person, or against any security or collateral for the Obligations. Each Borrower consents and agrees that the Administrative Agent shall be under no obligation to marshal any assets in favor of any Borrower or against or in payment of any or all of the Obligations. Notwithstanding anything to the contrary in the foregoing, any Person released from its Obligations in accordance with Section 9.12 shall be simultaneously released from the foregoing provisions of this Section 11.23.

Section 11.19. Contribution and Indemnification Among the Borrowers . Each Borrower is obligated to repay the Obligations as a joint and several obligor under this Agreement. To the extent that any Borrower shall, under this Agreement as a joint and several obligor, sell any of its assets to satisfy or otherwise repay any of the Obligations constituting Loans made to another Borrower hereunder or other Obligations incurred directly and primarily by any other Borrower (an “ Accommodation Payment ”), then the Borrower making such Accommodation Payment shall be entitled to contribution and indemnification from, and be reimbursed by, each of the other Borrowers, in an amount, for each of such other Borrowers, if any, equal to a fraction of such Accommodation Payment, the numerator of which fraction is such other Borrower’s Allocable Amount (as defined below) and the denominator of which is the sum of the Allocable Amounts of all of the Borrowers. As of any date of determination, the “ Allocable Amount ” of each Borrower shall be equal to the maximum amount of liability for Accommodation Payments which could be asserted against such Borrower hereunder without (a) rendering such Borrower “insolvent” within the meaning of Section 101(31) of the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer Act (“ UFTA ”) or Section 2 of the Uniform Fraudulent Conveyance Act (“ UFCA ”), (b) leaving such Borrower with unreasonably small capital or assets, within the meaning of Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving such Borrower unable to pay its debts as they become due within the meaning of Section 548 of the Bankruptcy Code or Section 4 of the UFTA, or Section 5 of the UFCA. All rights and claims of contribution, indemnification, and reimbursement under this Section shall be subordinate in right of payment to the prior payment in full of the Obligations. The provisions of this Section 11.19 shall, to the extent expressly inconsistent with any provision in any Loan Document, supersede such inconsistent provision. If any Borrower discharges the Obligation (or any part of it) pursuant to Section 11.18, the corresponding claim against the relevant Loan Party shall not pass over and no rights and claims of the Secured Parties under any Loan Document shall pass to any Loan Party by subrogation or otherwise.

138

Section 11.20. Agency of the Administrative Borrower for Each Other Borrower . Each of the other Borrowers irrevocably appoints Holdings as its agent for all purposes relevant to this Agreement (in such capacity, the “ Borrower Representative ”), including the giving and receipt of notices and execution and delivery of all documents, instruments, and certificates contemplated herein (including, without limitation, execution and delivery to the Administrative Agent of Borrowing Base Certificates and Borrowing Notices) and all modifications hereto. Any acknowledgment, consent, direction, certification, or other action which might otherwise be valid or effective only if given or taken by all or any of the Borrowers or acting singly, shall be valid and effective if given or taken only by the Borrower Representative, whether or not any of the other Borrowers join therein, and the Administrative Agent, the Lenders and the L/C Issuers shall have no duty or obligation to make further inquiry with respect to the authority of the Administrative Borrower under this Section 11.20; provided that nothing in this Section 11.20 shall limit the effectiveness of, or the right of the Administrative Agent, the Lenders and the L/C Issuers to rely upon, any notice (including, without limitation, a Borrowing Notice), document, instrument, certificate, acknowledgment, consent, direction, certification or other action delivered by any Borrower pursuant to this Agreement.

Section 11.21. USA Patriot Act Notice. Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrowers that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Patriot Act ”), it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of each Loan Party and other information that will allow such Lender or the Administrative Agent, as applicable, to identify each Loan Party in accordance with the Act.

Section 11.22. Time of the Essence. Time is of the essence of the Loan Documents.

Section 11.23. Acknowledgement and Consent to Bail-In of EEA Financial Institutions . Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-in Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

[ Signature Pages Follow ]

139

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.


BORROWERS:

WARRIOR MET COAL LLC
WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC
WARRIOR MET COAL GAS, LLC
WARRIOR MET COAL MINING, LLC
WARRIOR MET COAL TRI, LLC
WARRIOR MET COAL BCE, LLC
WARRIOR MET COAL LAND, LLC
WARRIOR MET COAL WV, LLC
WARRIOR MET COAL LA, LLC,

By:		/s/ Stephen D. Williams
		Name: Stephen D. Williams
		Title: Authorized Person

[S IGNATURE P AGE TO C REDIT A GREEMENT ]

CITIBANK, N.A.,

as Administrative Agent, Lender,

L/C Issuer and Swingline Lender


By:		/s/ Allister Chan
		Name: Allister Chan
		Title: Vice President

[S IGNATURE P AGE TO C REDIT A GREEMENT ]

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as a Lender


By:		/s/ Robert Hetu
		Name: Robert Hetu
		Title: Authorized Signatory

By:		/s/ Lingzi Huang
		Name: Lingzi Huang
		Title: Authorized Signatory

[S IGNATURE P AGE TO C REDIT A GREEMENT ]

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as L/C Issuer


By:		/s/ Robert Hetu
		Name: Robert Hetu
		Title: Authorized Signatory

By:		/s/ Lingzi Huang
		Name: Lingzi Huang
		Title: Authorized Signatory

[S IGNATURE P AGE TO C REDIT A GREEMENT ]

Schedules


Schedule 1.01(a)		Subsidiary Guarantors
Schedule 1.01(b)		Commitments and L/C Sublimit
Schedule 5.06		Litigation
Schedule 5.08(a)		Material Leased Real Property
Schedule 5.08(b)		Material Owned Real Property
Schedule 5.08(c)		Subsidiaries
Schedule 5.09		Environmental Matters
Schedule 5.14		Subsidiaries and Other Equity Investments; Loan Parties
Schedule 5.18		Intellectual Property Matters
Schedule 5.21		Labor Matters
Schedule 6.20		Post-Closing Obligations
Schedule 7.01		Existing Liens
Schedule 7.02		Existing Indebtedness
Schedule 7.03		Existing Investments
Schedule 11.02		Agents’ Offices, Certain Addresses for Notices

Schedule 1.01(a)

Guarantors

1.	Warrior Met Coal, LLC

2.	Warrior Met Coal Intermediate Holdco, LLC

3.	Warrior Met Coal Gas, LLC

4.	Warrior Met Coal Mining, LLC

5.	Warrior Met Coal TRI, LLC

6.	Warrior Met Coal BCE, LLC

7.	Warrior Met Coal Land, LLC

8.	Warrior Met Coal WV, LLC

9.	Warrior Met Coal LA, LLC

Schedule 1.01(b)

Commitments and L/C Sublimit


Lender	Commitment		L/C Sublimit
Citibank, N.A.	$	25,000,000	$	25,000,000
Credit Suisse AG, Cayman Islands Branch	$	25,000,000	$	25,000,000

Total	$	50,000,000	$	50,000,000

Schedule 5.06

Litigation

None.

Schedule 5.08(a)

Material Leased Real Property

To be provided in accordance with Schedule 6.20

Schedule 5.08(b)

Material Owned Real Property

Owner

County

State

Parcel ID

Description

Section

Township

Range

Warrior Met Coal Mining LLC

TUSCALOOSA

63-23-04-20-0-
000-001.007

THAT PART E/2-NW/4 LYING S OF CO RD 59

20S

07W

Warrior Met Coal Mining LLC

TUSCALOOSA

63-23-09-30-0-
001-001.000

NW/4; W/2-NE/4; THAT PART NE/4-NE/4 LYING W OF LOCK 17 RD; LESS PUBLIC R/W; LESS RR R/W LESS & EXCEPT; BEG NW COR SW1/4-NE1/4; S909(S); E22(S); NE252(S); NE289(S); NE257(S); NE12(S); E397(S); N

20S

07W

Warrior Met Coal Mining LLC

TUSCALOOSA

63-23-09-31-0-
001-005.007

COM NE COR S31 T20S R7W; W 162S; SWLY 2023S TO POB; S 873S; SW 1358S; N 883S; NE 1492S TO PB LESS & EXCEPT PUBLIC ROW

20S

07W

Warrior Met Coal Mining LLC

JEFFERSON

36-00-19-0-
000-001.001

COM AT NE COR OF S19 T19 R6W TH S 348.1 FT TH W 909.3 FT TH SE 235 FT TH SW 2521.4 FT TH SW 1372.6 FT TH W 506.1 FT TH NW 50 FT TO POB TH SW 8 1.8 FT TH W 664.7 FT TO WEST LINE OF SD SEC TH N 911.1 FT FT TH NE 212.5 FT TH SW 85.8 FT SE 51.1 FT TH SE 46.3 FT TH SE 66.9 FT TH

19S

Warrior Met Coal Land, LLC

TUSCALOOSA

63-23-08-28-0-
000-001.000

ALL OF SEC LESS ALL ROWS OF RECORD LESS; COM NW COR NE1/4-NW1/4; TH S398.5 TO POB; TH NE315.3 SE247.5 TO N R/W HWY-116; SW383.9 ALG R/W; N251.6 TO POB ALSO LESS: BEG NW COR S21; TH 4 477(S); S662(S0 TO N R/W

20S

07W

Schedule 5.08(c)

Subsidiaries


Company Name	Beneficial Owner	Percentage Ownership			Class of Equity Interests
Warrior Met Coal Intermediate Holdco, LLC	Warrior Met Coal, LLC		100	%	limited liability company membership interests

Warrior Met Coal Gas, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Warrior Met Coal Mining, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Warrior Met Coal TRI, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Warrior Met Coal BCE, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Warrior Met Coal Land, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Warrior Met Coal WV, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Warrior Met Coal LA, LLC	Warrior Met Coal Intermediate Holdco, LLC		100	%	limited liability company membership interests

Black Warrior Methane Corp.	Warrior Met Coal Gas, LLC		50	%	shares of capital stock

Black Warrior Transmission Corp.	Warrior Met Coal Gas, LLC		50	%	shares of capital stock

Schedule 5.09

Environmental Matters

None.

Schedule 5.18

Intellectual Property Matters

Patents

None.

Patent Licenses

None.

Trademarks


Trademark	Owner	Application No.	Trademark No.
Walter Coke	Warrior Met Coal, LLC	77/752,925	4,268,529
Walter Energy with Logo	Warrior Met Coal, LLC	77/752,904	4,264,857
Walter Energy	Warrior Met Coal, LLC	77/727,068	4,264,849
Walter Minerals	Warrior Met Coal, LLC	77/728,468	4,264,850
Walter Energy	Warrior Met Coal, LLC		TMA913,365

Trademark Licenses

None.

Copyrights


Owner	Title	Registration No.
Warrior Met Coal, LLC	American II. (and American prior)	TX0002380640

Warrior Met Coal, LLC	Arlington.	VA0000932613

Warrior Met Coal, LLC	Bakersfield.	VA0001247047

Warrior Met Coal, LLC	Cambridge.	VA0000526186

Warrior Met Coal, LLC	Columbia.	TX0002396361

Warrior Met Coal, LLC	Foxborough.	VA0000932614

Warrior Met Coal, LLC	Glendale : form JW840-1.	VA0000548516

Warrior Met Coal, LLC	Islander.	TX0002396352

Warrior Met Coal, LLC	Lakeside. (and Southport prior)	VA0001127143

Warrior Met Coal, LLC	Plantation construction plans.	TX0002763348

Warrior Met Coal, LLC	President II.	VA0000904000

Warrior Met Coal, LLC	Ridgemont : construction plans.	TX0004284389

Warrior Met Coal, LLC	San Antonio.	TX0002145182

Warrior Met Coal, LLC	Savannah.	VA0001162128

Warrior Met Coal, LLC	Victorian.	TX0002365842

Warrior Met Coal, LLC	Windwood.	TX0002365844

Warrior Met Coal, LLC	Yorktown.	VA0001214475

Warrior Met Coal, LLC	Cameron	VA0001706837

Warrior Met Coal, LLC	Essex	VA0001706841


Owner	Title	Registration No.
Warrior Met Coal, LLC	Fairmont	VA0001706833

Warrior Met Coal, LLC	Lennox	VA0001706834

Warrior Met Coal, LLC	Sonoma	VA0001706842

Warrior Met Coal, LLC	Sterling	VA0001706840

Warrior Met Coal, LLC	Summerdale	VA0001706849

Warrior Met Coal, LLC	Warwick	VA0001706845

Warrior Met Coal, LLC	Fleming	VA0001706851

Warrior Met Coal, LLC	Huntsville	VA0001706832

Warrior Met Coal, LLC	Bayberry	VA0001706853

Warrior Met Coal, LLC	Montgomery	VA0001706836

Warrior Met Coal, LLC	Executive.	TX0001736845

Warrior Met Coal, LLC	Auburn.	TX0002364874

Warrior Met Coal, LLC	Casual.	TX0002396359

Warrior Met Coal, LLC	Floridian.	TX0002396357

Warrior Met Coal, LLC	Greenbriar.	TX0002396358

Warrior Met Coal, LLC	Hatteras.	TX0002396362

Warrior Met Coal, LLC	Hollywood.	TX0002396353

Warrior Met Coal, LLC	Leisure.	TX0002396354

Warrior Met Coal, LLC	Lexington.	TX0002396356

Warrior Met Coal, LLC	Lincoln.	TX0002396355

Warrior Met Coal, LLC	Madison.	TX0002366037

Warrior Met Coal, LLC	Meadowwood.	TX0002366040

Warrior Met Coal, LLC	Monte Carlo.	TX0002366039

Warrior Met Coal, LLC	Oxford.	TX0002366038

Warrior Met Coal, LLC	President.	TX0002396366

Warrior Met Coal, LLC	Salem.	TX0002396367

Warrior Met Coal, LLC	Southern Belle.	TX0002366177

Warrior Met Coal, LLC	TICA.	TX0002366178

Warrior Met Coal, LLC	Vicksburg.	TX0002365843

Warrior Met Coal, LLC	Wellington.	TX0002365840

Warrior Met Coal, LLC	Williamsburg.	TX0002365841

Warrior Met Coal, LLC	Brunswick construction plans.	TX0002763351

Warrior Met Coal, LLC	Coventry construction plans.	TX0002763344

Warrior Met Coal, LLC	Dartmouth construction plans.	TX0002763338

Warrior Met Coal, LLC	Kensington construction plans.	TX0002763350

Warrior Met Coal, LLC	Newport construction plans.	TX0002763349

Warrior Met Coal, LLC	Yorkshire construction plans.	TX0002763347

Warrior Met Coal, LLC	Jamestown	TX0003222408

Warrior Met Coal, LLC	Bedford.	VA0000902783

Warrior Met Coal, LLC	Clairmont.	VA0000904001


Owner	Title	Registration No.
Warrior Met Coal, LLC	Stratford.	VA0000910994

Warrior Met Coal, LLC	Hawthorne.	VA0000932617

Warrior Met Coal, LLC	Lancaster.	VA0000932615

Warrior Met Coal, LLC	Parkfield.	VA0000932616

Warrior Met Coal, LLC	Camden.	VA0000989942

Warrior Met Coal, LLC	Windsor II.	VA0000989946

Warrior Met Coal, LLC	Durham.	VA0001034971

Warrior Met Coal, LLC	Plum Street, Plant City, FL. Trenton Model	VA0001064192

Warrior Met Coal, LLC	Roxbury.	VA0001030311

Warrior Met Coal, LLC	Building together in cities, towns, and rural America. Jim Walter Homes.	TX0002920669

Warrior Met Coal, LLC	Building together : Jim Walter homes.	TX0001963976

Warrior Met Coal, LLC	Jim Walter Homes, Inc., limited warranty.	TX0001913000

Warrior Met Coal, LLC	Building together—Jim Walter Homes.	TX0002663887

Warrior Met Coal, LLC	Building together : Jim Walter homes.	TX0002461022

Warrior Met Coal, LLC	Regency series / by Jim Walter Homes, Inc.	TX0002645966

Warrior Met Coal, LLC	Building together : Jim Walter Homes.	TX0002812497

Warrior Met Coal, LLC	Introducing more home than you dreamed you could afford.	TX0002783288

Warrior Met Coal, LLC	Building together : a catalog of fine homes.	VA0000519867

Warrior Met Coal, LLC	Building together : a catalog of fine homes.	TX0003055888

Warrior Met Coal, LLC	Building together : a catalog of fine homes.	TX0003055889

Warrior Met Coal, LLC	Building together : a catalog of fine homes.	TX0003236090

Warrior Met Coal, LLC	Building together : a catalog of fine homes.	TX0003394861

Warrior Met Coal, LLC	Building together : a catalog of fine homes.	TX0003313870

Warrior Met Coal, LLC	Catalog of fine homes : Jim Walter Homes.	TX0003633614


Owner	Title	Registration No.
Warrior Met Coal, LLC	Attention : real estate professionals.	TX0006117325

Warrior Met Coal, LLC	Home free.	TX0006117326

Warrior Met Coal, LLC	Mi casa.	TX0006117324

Warrior Met Coal, LLC	More home for less money.	TX0006117328

Warrior Met Coal, LLC	Step-by-step homebuilding process.	TX0006117322

Warrior Met Coal, LLC	Your financing options, simplified.	TX0006117323

Warrior Met Coal, LLC	Attention real estate professionals.	TX0006117327

Warrior Met Coal, LLC	More home for less money.	TX0006117329

Warrior Met Coal, LLC	Regency series / by Jim Walter Homes, Inc.	V2425P222

Warrior Met Coal, LLC	Building together (C913); brochure / By Jim Walter Corporation.	V2604P160

Warrior Met Coal, LLC	We do it right : Jim Walter homes.	TX0000917147

Warrior Met Coal, LLC	Building together : Jim Walter homes.	TX0000917146

Warrior Met Coal, LLC	Building together.	TX0000883634

Warrior Met Coal, LLC	Building together.	TX0001077809

Warrior Met Coal, LLC	Four new homes with features you’ll love.	TX0001322596

Warrior Met Coal, LLC	Building together Jim Walter homes.	TX0002168868

Warrior Met Coal, LLC	Building together : Jim Walter homes.	TX0002228198

Warrior Met Coal, LLC	Accident investigation training program.	PAu000847840

Warrior Met Coal, LLC	We do it right & 3 other titles.	V2425P222

None.

Domain Names

blackwarriormetcoal.com

blackwarriormetcoal.net

blackwarriormetcoal.org

blackwarriormetcoal.xxx

insidewarriormetcoal.com

insidewmc.com

warrior-mc.com

warrior-mc.net

warrior-mc.org

warrior-mc.xxx

warrior-metco.xxx

warrior-metcoal.com

warrior-metcoal.net

warrior-metcoal.org

warriormcoal.com

warriormcoal.net

warriormcoal.org

warriormcoal.xxx

warriormetcoal.com

warriormetcoal.net

warriormetcoal.org

warriormetcoal.website

warriormetcoal.xxx

Schedule 5.21

Labor Matters

1.	Collective Bargaining Agreement, dated as of February 3, 2016 (and effective as of April 1, 2016), by and between Coal Acquisition Sub 2, LLC and the United Mine Workers of American, International Union.

Schedule 6.20

Post-Closing Obligations

1. Within 45 days (or such longer period as the Administrative Agent may agree), Borrowers shall deliver insurance endorsements in form and substance reasonably satisfactory to the Administrative Agent.

2. Within 45 days (or such longer period as the Administrative Agent may agree), Borrowers shall deliver mortgages covering each Material Owned Real Property of the Loan Parties, in form and substance reasonably satisfactory to the Administrative Agent.

3. Within 45 days (or such longer period as the Administrative Agent may agree), Borrowers shall deliver Blocked Account Control Agreements with respect to each Control Account, in form and substance reasonably satisfactory to the Administrative Agent.

4. Within 30 days (or such longer period as the Administrative Agent may agree), Borrowers shall use commercially reasonable efforts to obtain from the seller under the Asset Purchase Agreement the original copy of the Promissory Note issued by Cowin & Company in favor of Jim Walter Resources, Inc., dated as of July 25, 2011 (“Cowin Note”), provided that if the Administrative Agent and the Borrowers reasonably determine that the original copy of Cowin Note has been lost or misplaced by such seller, then Borrowers shall use commercially reasonable efforts to obtain a new copy of the Cowin Note from Cowin & Company, the original copy of which shall be promptly delivered to the Administrative Agent in accordance with Section 4.02 of the Security Agreement.

5. Within 15 days (or such longer period as the Administrative Agent may agree), Borrowers shall deliver Schedule 5.08(a) to the Credit Agreement, listing all Material Leased Real Properties (as defined in the Credit Agreement).

6. Within 5 days (or such longer period as the Administrative Agent may agree), Borrowers shall deliver to the Administrative Agent the following:

(a)

a pro forma unaudited consolidated balance sheet and related statement of income and a reconciliation of Consolidated EBITDA of Holdings and its Subsidiaries as of the end of each of the following periods: (1) the nine-month period ended September 30, 2015 and (2) the fiscal year ended December 31, 2015;

(b)

a pro forma unaudited consolidated statement of income and a reconciliation of Consolidated EBITDA of Holdings and its Subsidiaries as of the end of the fiscal year ended December 31, 2014;

(c)

a carve out unaudited consolidated balance sheet and related statement of income of Holdings and its Subsidiaries as of the end of each of the following periods: (1) the nine-month period ended September 30, 2015 and (2) the fiscal years ended December 31, 2014 and December 31, 2013, respectively; and

(d)

a carve out unaudited consolidated statement of income of Holdings and its Subsidiaries as of the end of the nine month period ended September 30, 2014;

provided, that in each case of clauses (a), (b), (c) and (d) above, (x) each such pro forma or carve out financial statement shall be prepared after giving effect to the transactions contemplated by the Loan Documents as if such transactions had occurred as of such dates (in the case of such balance sheet) to the beginning of such periods (in the case of the statement of income), (y) each such pro forma or carve out

financial statement shall be prepared in good faith by Holdings and (z) no such pro forma or carve out financial statement shall be required to include adjustments for purchase accounting (including adjustments of the type contemplated by Financial Accounting Standards Board Accounting Standards Codification 805, Business Combinations (formerly SFAS 141R)).

Schedule 7.01

Existing Liens

None.

Schedule 7.02

Existing Indebtedness

None.

Schedule 7.03

Existing Investments

1.	See Schedule 5.08(c) above.

2.	Promissory Note issued by Cowin & Company in favor of Jim Walter Resources, Inc., dated as of July 25, 2011.

Schedule 11.02

Agents’ Offices, Certain Addresses for Notices

Each Borrower Party :

Walter Met Coal, LLC

16243 Highway 216

Brookwood, AL 35444

Attn: Mitchell Mataya

Tel:

Fax:

Email: mitchell.mataya@warriormetcoal.com

Website address: www.warriormetcoal.com

Administrative Agent:

Citibank, N.A.

390 Greenwich St. 1st Floor

New York, NY 10013

Attn: Shane Azzara

Tel: (212) 723-3748

Fax: (646) 291-3359

E-mail: shane.azzara@citi.com

L/C Issuer:

Citigroup | Asset Based & Transitional Finance

390 Greenwich St., 1st Floor

New York, NY, 10013

Attn: Katy Noel

Tel: 212-723-3755

Fax: 646-291-5987

E-mail: katy.noel@citi.com

Credit Suisse AG

Eleven Madison Avenue, 6th Floor

New York, New York 10010

Attn: Trade Finance Services Department

Fax: (212) 325-8315

Email: list.ib-lettersofcredit-ny@credit-suisse.com

E XHIBIT A

C REDIT A GREEMENT

F ORM OF B ORROWING N OTICE

Citibank, N.A.

as Administrative Agent under the

Credit Agreement referred to below

390 Greenwich Street, 1st Floor

New York, New York 10013

Attention: [●]

Re:

Borrowing Notice (this “ Notice ”) of Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”)

Reference is made to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among the Borrowers, the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement.

[The undersigned][Holdings, as Borrower Representative,] hereby gives you notice, irrevocably, pursuant to Section 2.02(a) of the Credit Agreement that the undersigned hereby requests a Borrowing of Loans under the Credit Agreement and, in connection therewith, sets forth below the information relating to such Borrowing (the “ Proposed Borrowing ”) as required by Section 2.02(a) of the Credit Agreement:

A. The Business Day of the Proposed Borrowing is , (the “ Funding Date ”).

A-1

B. [The aggregate amount of the Borrowing is $ , of which amount [$ consists of Base Rate Loans] [and] [$ consists of Eurocurrency Rate Loans having an initial Interest Period of [one] [two] [three] [six] or [twelve] ¹ month[s]].]

C. After giving effect to the Proposed Borrowing, the aggregate amount of all Loans outstanding is $ .

The undersigned, being a Responsible Officer, hereby certifies, in its capacity as a Responsible Officer and not in his/her individual capacity, that the following statements are true and correct on the date hereof and will be true and correct on the Funding Date:

A. The representations and warranties of each Loan Party and its Subsidiaries contained in the Credit Agreement and each other Loan Document or which are contained in any document furnished at any time under or in connection herewith or therewith, are true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) on and as of each such date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall have been true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) as of such earlier date; and

B. No Default or Event of Default has occurred or is continuing, or would result from the Proposed Borrowing or from the application of the Proceeds thereof.

[SIGNATURE PAGES FOLLOW]

¹	An Interest Period of twelve (12) months requires consent of all Lenders pursuant to the definition of “Interest Period” in the Credit Agreement.

A-2

IN WITNESS WHEREOF, the undersigned has caused this Notice to be executed and delivered by a duly authorized officer as of the date first written above.


[WARRIOR MET COAL, LLC]
[WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC]
[WARRIOR MET COAL GAS, LLC]
[WARRIOR MET COAL MINING, LLC]
[WARRIOR MET COAL TRI, LLC]
[WARRIOR MET COAL BCE, LLC]
[WARRIOR MET COAL LAND, LLC]
[WARRIOR MET COAL WV, LLC]
[WARRIOR MET COAL LA, LLC]

By:
Name:
Title:

[S IGNATURE P AGE TO B ORROWING N OTICE ]

E XHIBIT B

C REDIT A GREEMENT

F ORM OF

N OTICE OF C ONVERSION OR C ONTINUATION

Citibank, N.A.

as Administrative Agent under the

Credit Agreement referred to below

390 Greenwich Street, 1st Floor

New York, New York 10013

Attention: [●],

Re:

Notice of Conversion or Continuation (this “ Notice ”) by Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”)

Reference is made to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among the Borrowers, the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement.

The undersigned hereby gives you notice, irrevocably, pursuant to Section 2.02(a) of the Credit Agreement that the undersigned hereby requests a [conversion] [continuation] on , of $ in principal amount of presently outstanding Loans that are

B-1

[Base Rate] [Eurocurrency Rate] Loans having an Interest Period ending on , [to] [as] [Base Rate][Eurocurrency Rate] Loans. [The Interest Period for such amount requested to be converted to or continued as Eurocurrency Rate Loans is [one] [two] [three] [six] or [twelve] ² month[s].]

[SIGNATURE PAGES FOLLOW]

²	An Interest Period of twelve (12) months requires consent of all Lenders pursuant to the definition of “Interest Period” in the Credit Agreement.

B-2

IN WITNESS WHEREOF, the undersigned has caused this Notice to be executed and delivered by a duly authorized officer as of the date first written above.


[WARRIOR MET COAL, LLC]
[WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC]
[WARRIOR MET COAL GAS, LLC]
[WARRIOR MET COAL MINING, LLC]
[WARRIOR MET COAL TRI, LLC]
[WARRIOR MET COAL BCE, LLC]
[WARRIOR MET COAL LAND, LLC]
[WARRIOR MET COAL WV, LLC]
[WARRIOR MET COAL LA, LLC]

By:
Name:
Title:

[S IGNATURE P AGE TO N OTICE OF C ONVERSION OR C ONTINUATION ]

E XHIBIT C

C REDIT A GREEMENT

F ORM OF N OTE

LOGO (this “ Note ”)


Lender: [N AME OF L ENDER ]				New York, New York
Principal Amount: [$ ]				,

FOR VALUE RECEIVED, the undersigned, Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”), hereby promise to pay, on a joint and several basis, to the order of the Lender set forth above (the “ Lender ”) the Principal Amount set forth above, or, if less, the aggregate unpaid principal amount of all Loans (as defined in the Credit Agreement referred to below) of the Lender to the Borrowers, payable at such times, and in such amounts, as are specified in the Credit Agreement.

The Borrowers promise to pay interest on the unpaid principal amount of the Loans from the date made until such principal amount is paid in full, at such interest rates, and payable at such times, as are specified in the Credit Agreement.

Both principal and interest are payable in Dollars to Citibank N.A., as Administrative Agent, at 390 Greenwich Street, 1st Floor, New York, New York 10013, in immediately available funds.

This Note is one of the Notes referred to in, and is entitled to the benefits of, the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among the Borrowers, the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement.

The Credit Agreement, among other things, (a) provides for the making of Loans by the Lender to the Borrowers in an aggregate amount not to exceed at any time outstanding the Principal Amount set forth above, the indebtedness of the Borrower resulting from such Loans

C-1

being evidenced by this Note and (b) contains provisions for acceleration of the maturity of the unpaid principal amount of this Note upon the happening of certain stated events and also for prepayments on account of the principal hereof prior to the maturity hereof upon the terms and conditions therein specified.

This Note is entitled to the benefits of the Guarantee provided in Article 10 of the Credit Agreement and is secured by the Collateral described in the Collateral Documents.

Demand, diligence, presentment, protest and notice of non-payment and protest are hereby waived by the Borrowers.

This Note shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

[SIGNATURE PAGES FOLLOW]

C-2

IN WITNESS WHEREOF, the Borrowers have caused this Note to be executed and delivered by a duly authorized officer as of the date first written above.


WARRIOR MET COAL, LLC
WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC
WARRIOR MET COAL GAS, LLC
WARRIOR MET COAL MINING, LLC
WARRIOR MET COAL TRI, LLC
WARRIOR MET COAL BCE, LLC
WARRIOR MET COAL LAND, LLC
WARRIOR MET COAL WV, LLC
WARRIOR MET COAL LA, LLC

By:
Name:
Title:

[S IGNATURE P AGE TO R EVOLVING C REDIT N OTE ]

E XHIBIT D

C REDIT A GREEMENT

F ORM OF S WINGLINE L OAN N OTICE

( this “Notice”)

Citibank, N.A.

as Administrative Agent under the

Credit Agreement referred to below

390 Greenwich Street, 1st Floor

New York, New York 10013

Attention: [●]

Re:

Swingline Loan Notice (this “ Notice ”) of Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”).

Reference is made to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among the Borrowers, the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement.

[The undersigned][Holdings, as Borrower Representative,] hereby requests a Swingline Loan of Loans under the Credit Agreement and, in connection therewith, sets forth below the information relating to such Borrowing (the “ Proposed Borrowing ”) as required by Section 2.05(b) of the Credit Agreement:

A. The Business Day of the Proposed Borrowing is , (the “ Funding Date ”).

D-1

B. [The aggregate amount of the Borrowing is $ , which amount shall consist of Base Rate Loans.]

C. The representations and warranties of each Loan Party and its Subsidiaries contained in the Credit Agreement and each other Loan Document or which are contained in any document furnished at any time under or in connection herewith or therewith, are true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) on and as of each such date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall have been true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) as of such earlier date; and

D. No Default or Event of Default has occurred or is continuing, or would result from the Proposed Borrowing or from the application of the Proceeds thereof.

[SIGNATURE PAGES FOLLOW]

D-2

IN WITNESS WHEREOF, the undersigned has caused this Notice to be executed and delivered by a duly authorized officer as of the date first written above.


[WARRIOR MET COAL, LLC]
[WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC]
[WARRIOR MET COAL GAS, LLC]
[WARRIOR MET COAL MINING, LLC]
[WARRIOR MET COAL TRI, LLC]
[WARRIOR MET COAL BCE, LLC]
[WARRIOR MET COAL LAND, LLC]
[WARRIOR MET COAL WV, LLC]
[WARRIOR MET COAL LA, LLC]

By:
Name:
Title:

[S IGNATURE P AGE TO S WINGLINE N OTICE ]

E XHIBIT E

C REDIT A GREEMENT

F ORM OF C OMPLIANCE C ERTIFICATE

(this “ Certificate ”)

Financial Statement Date: ,

To:	Citibank, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”), the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein shall have the meanings given to them in the Credit Agreement.

The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the [ Chief Executive Officer/Chief Financial Officer/the Treasurer/Assistant Treasurer/Vice President of Finance/Controller ] ³ of Holdings, and that, as such, he/she is authorized to execute and deliver this Certificate to the Administrative Agent on the behalf of Holdings, and that:

1. [Holdings has delivered the audited financial statements required by Section 6.01(a) of the Credit Agreement for the fiscal year of Holdings ended [●], 20[●].]

2. [Holdings has delivered the unaudited financial statements required by Section 6.01(b) of the Credit Agreement for the fiscal quarter of Holdings ended as of [●], 20[●]. Such consolidated financial statements fairly present in all material respects the financial condition, results of operations, changes in shareholders’ equity and cash flows of Holdings and its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes.]

³	Select as appropriate.

E-1

3. The undersigned has reviewed and is familiar with the terms of the Credit Agreement and has made, or has caused to be made under his/her supervision, a detailed review of the financial condition of Holdings and its Subsidiaries during the accounting period covered by such [audited] ⁴ [unaudited] ⁵ financial statements.

4. A review of the activities of Holdings and its Subsidiaries during such fiscal period has been made under the supervision of the undersigned with a view to determining whether during such fiscal period Holdings and its Subsidiaries performed and observed all their respective Obligations under the Loan Documents, and

[select one:]

[to the best knowledge of the undersigned, during such fiscal period Holdings and its Subsidiaries performed and observed each covenant of the Loan Documents applicable to it, and no Default or Event of Default has occurred and is continuing.]

—or—

[to the best knowledge of the undersigned, the following covenants or conditions have not been performed or observed and the following is a list of each such Default or Event of Default, its nature and status and the action that Holdings and its Subsidiaries propose to take with respect thereto:]

5. [To the best knowledge of the undersigned, during such fiscal period, there has been no change in the information with respect to the Collateral owned by any Loan Party in the Perfection Certificate delivered on the Closing Date since the date of such Perfection Certificate or the date of the most recent Compliance Certificate][Attached to this Certificate as Schedule 2 is a Perfection Certificate Supplement, signed by the Loan Parties, identifying such changes to the Collateral since the Closing Date or the date of the most recent Compliance Certificate, as applicable].]

6. The financial covenant analyses and information set forth on Schedule 1 attached hereto are true and accurate on and as of the date of this Certificate.

[SIGNATURE PAGES FOLLOW]

⁴	Select if paragraph 1 is included.

⁵	Select if paragraph 2 is included.

E-2

IN WITNESS WHEREOF, the undersigned has caused this Certificate to be executed and delivered by a duly authorized officer as of the date first written above.


WARRIOR MET COAL, LLC

By:
Name:
Title:

[SIGNATURE PAGE TO COMPLIANCE CERTIFICATE]

SCHEDULE 1

For the fiscal [quarter][year] ended , (“ Statement Date ”)

Fixed Charge Coverage Ratio.

The Fixed Charge Coverage Ratio for the Test Period ended as of the Financial Statement Date written above (“ Measurement Period ”) is set forth below and [is/is not] greater than or equal to 1.00:1.00 for the Measurement Period.

Fixed Charge Coverage Ratio is defined as follows:


A.	Consolidated EBITDA of Holdings and its Subsidiaries (per Exhibit A)	$

B.	Non-financed Capital Expenditure (including Capital Expenditure financed with the proceeds of any Loans) paid or payable currently in cash by Holdings or any of its Subsidiaries	$

C.	Total (A minus B)	$

D.	Fixed Charges of Holdings and its Subsidiaries (per Exhibit B)	$

	Fixed Charge Coverage Ratio (C divided by D)

E-4

E XHIBIT A

C ONSOLIDATED EBITDA OF H OLDINGS AND ITS S UBSIDIARIES


A.	Total Consolidated Net Income for the Measurement Period (A1 - A2 – A3):		$

	1.	Consolidated net income (or loss) for the Measurement Period in respect of Holdings and its Subsidiaries on a consolidated basis determined in accordance with GAAP	$

Minus , without duplication:

	2.	Any reduction related to preferred stock dividend issued to employees	$

	3.	The cumulative effect of any change in accounting principles made in accordance with GAAP which affects net income	$

Plus , without duplication, to the extent not included in Consolidated Net Income for the Measurement Period:

	4.	Consolidated interest expense for the Measurement Period, determined in accordance with GAAP	$

	5.	Federal, state and local Tax expense for the Measurement Period, including franchise and excise Taxes	$

	6.	Depreciation and depletion expenses for the Measurement Period, including, amortization of intangibles, deferred financing fees and any amortization included in pension, other postemployment benefits and other benefits benefit expenses, but excluding amortization of prepaid cash expenses that were paid in a prior period	$

	7.	Amortization expenses for the Measurement Period	$

	8.	Non-recurring fees, costs and expenses related to closing of the Facility	$

	9.	Non-cash stock based compensation expense, and non-cash expenses or losses and other non-cash charges incurred during the Measurement Period (excluding any non-cash charges representing an accrual of, or reserve for, cash charges to be paid within the next twelve months or inventory write downs)	$

	10.	Any non-cash losses from foreign currency transactions (including losses related to currency remeasurements of Indebtedness) for the Measurement Period, to the extent that such losses were deducted in calculating Consolidated Net Income	$

	11.	Non-cash purchase accounting adjustments, including but not limited to, the amortization of inventory	$

	12.	Nonrecurring or unusual losses, business optimization expenses, charges, costs or expenses or any other restructuring charges (which, for the avoidance of doubt, shall include plant closure, retention, severance, systems establishment costs, excess pension charges, other postemployment benefits, black lung settlement, curtailment or other excess charges and fees, expenses, charges or premiums related to any offering or modification of Indebtedness of such Person permitted to be incurred)	$

E-5


	13.	Any losses attributable to early extinguishment of Indebtedness	$

	14.	All non-cash impairment charges or non-cash charges resulting from amortization of intangibles	$

	15.	Any net after-Tax loss from disposed, abandoned, transferred, closed or discontinued operations or fixed assets and any net after-Tax losses on disposal or disposed, abandoned, transferred, closed or discontinued operations or fixed assets	$

	16.	The non-cash portion of “straight-line” rent expense	$

	17.	Accretion of asset retirement obligations in accordance with Accounting Standards Codifications 410 Asset Retirement and Environmental Obligations, and any similar accounting in prior periods	$

B.	Total add-backs to net income (sum of 4-17 above)		$

Minus , without duplication, to the extent included in Consolidated Net Income for the Measurement Period:

	18.	Extraordinary gains in accordance with GAAP and unusual or non-recurring gains	$

	19.	Non-cash gains and other non-cash income	$

	20.	Any non-cash gains from foreign currency transactions (including gains related to currency remeasurements of Indebtedness) for the Measurement Period resulting from the application of FASB ASC 830	$

	21.	Gains attributable to early extinguishment of Indebtedness	$

	22.	Any net after-Tax income from disposed, abandoned, transferred, closed or discontinued operations or fixed assets and any net after-Tax gains on disposal or disposed, abandoned, transferred, closed or discontinued operations or fixed assets	$

	23.	The cash portion of “straight line” rent expense which exceeds the amount expensed in respect of such rent expense	$

C.	Total exclusions from net income (sum of 18-23 above)		$

Consolidated EBITDA (Lines A plus B minus C):			$

E-6

E XHIBIT B

F IXED C HARGES OF H OLDINGS AND ITS S UBSIDIARIES


A.	All scheduled amortization payments of principal paid or due and payable during the Measurement Period by Holdings or any its Subsidiaries in respect of any Indebtedness under clause (a) of the definition of Indebtedness (including scheduled payments of the principal portion of Capital Lease Obligations)	$

B.	Consolidated interest expense (including the interest component of payments under Capital Lease Obligations) of Holdings and its Subsidiaries for the Measurement Period	$

C.	The aggregate amount of federal, state, local and foreign income Taxes and franchise and similar Taxes (net of any benefit or credit) included in the determination of Consolidated Net Income paid in cash during the Measurement Period	$

D.	All Restricted Payments payable during the Measurement Period to any Person other than Holdings and its Subsidiaries	$

Fixed Charges (sum of A plus B plus C plus D)		$

E-7

E XHIBIT F

C REDIT A GREEMENT

F ORM OF A SSIGNMENT AND A CCEPTANCE

This Assignment and Acceptance (the “ Assignment and Acceptance ”) is dated as of the Effective Date set forth below and is entered into by and between [ Insert name of Assignor ] (the “ Assignor ”) and [ Insert name of Assignee ] (the “ Assignee ”). Capitalized terms used but not defined herein shall have the meanings given to such terms in the Credit Agreement referenced below, receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Acceptance as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the Facility (including without limitation any letters of credit, guarantees, and swingline loans included in the Facility), and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by the Assignor to the Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as the “ Assigned Interest ”). Each such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Acceptance, without representation or warranty by the Assignor.


1.	Assignor:

2.	Assignee:
		Assignee is an [Affiliate][Approved Fund] of [ identify Lender ]

3.	Borrowers:	Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware

F-1


		limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV and any other entity party to the Credit Agreement from time to time as a Borrower, collectively, the “ Borrowers ”)

4.	Administrative Agent:	Citibank, N.A., in such capacity, as the Administrative Agent under the Credit Agreement

5.	Credit Agreement:	Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among the Borrowers, the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Credit Agreement.

6.	Assigned Interest:

Assignor

Assignee

Facility

Assigned

Aggregate Amount
of Commitment/
Loans for all
Lenders

Amount of
Commitment/
Loans Assigned

Percentage
Assigned of
Commitment/
Loans

CUSIP

Number

7. Trade Date: ⁶

Effective Date: , 20 [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

⁶	To be completed if the Assignor and the Assignee intend that the minimum assignment amount is to be determined as of the Trade Date.

F-2

The terms set forth in this Assignment and Acceptance are hereby agreed to:


ASSIGNOR

[NAME OF ASSIGNOR]

By:
Name:
Title:

ASSIGNEE

[NAME OF ASSIGNEE]

By:
Name:
Title:


[Consented to and] ⁷ Accepted:

CITIBANK, N.A.,
as Administrative Agent[, L/C Issuer] ⁸ [and Swingline Lender] ⁹

By:
Name:
Title:

[Consented to]: ¹⁰

WARRIOR MET COAL, LLC, as the Borrower Representative

By:
Name:
Title:

⁷	To be added only if the consent of the Administrative Agent is required in the Credit Agreement by Section 11.06(b) or the definition of “Eligible Assignee.”

⁸	To be added only if the consent of the L/C Issuer is required in the Credit Agreement by Section 11.06(b) or the definition of “Eligible Assignee.”

⁹	To be added only if the consent of the Swingline Lender is required in the Credit Agreement by Section 11.06(b) or the definition of “Eligible Assignee.”

¹⁰	To be added only if the consent of the Borrowers is required in the Credit Agreement by Section 11.06(b) or the definition of “Eligible Assignee.”

F-3

ANNEX 1 TO ASSIGNMENT AND ACCEPTANCE

ASSET-BASED REVOLVING CREDIT AGREEMENT DATED AS OF APRIL 1,

2016, BY AND AMONG THE BORROWERS, THE LENDERS PARTY THERETO

AND CITIBANK, N.A., AS ADMINISTRATIVE AGENT

STANDARD TERMS AND CONDITIONS

1. Representations and Warranties .

1.1 Assignor . The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and (iv) it is not a Defaulting Lender; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrowers, any of their Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document, or (iv) the performance or observance by the Borrowers, any of their Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2. Assignee . The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 11.06 of the Credit Agreement (subject to such consents, if any, as may be required thereunder), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements referred to in Section 4.01(c) or delivered pursuant to Section 6.01 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase the Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase the Assigned Interest, and (vii) if it is a Foreign Lender, attached to the Assignment and Acceptance is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without

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reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

2. Payments . From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of the principal amount outstanding, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date. Notwithstanding the foregoing, the Administrative Agent shall make all payments of interest, fees or other amounts paid or payable in kind from and after the Effective Date to the Assignee.

3. General Provisions . This Assignment and Acceptance shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Acceptance may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Acceptance by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance. This Assignment and Acceptance shall be governed by, and construed in accordance with, the law of the State of New York.

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E XHIBIT G

C REDIT A GREEMENT

F ORM OF

B ORROWING B ASE C ERTIFICATE

Warrior Met Coal, LLC

Borrowing Base Certificate

Period ending / /

Citibank, N.A.

as Administrative Agent under the

Credit Agreement referred to below

390 Greenwich Street, 1st Floor

New York, New York 10013

Pursuant to Section 6.02(i) of the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”), the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent, Capitalized terms used but not defined herein shall have the meanings given to such terms in the Credit Agreement. The undersigned, being a Responsible Officer of Holdings, hereby certifies, in such capacity and not in any individual capacity that:

(a) attached hereto as Exhibit A is a schedule of the Borrowing Base of the Borrowers as of the above date and the calculations made with respect thereto, and such attached information is true, complete and correct in all material respects as of the close of business on the period end set forth above, and

(b) based on the schedule attached hereto as Exhibit A, the aggregate amount of the Borrowing Base as of such date is: $ .

[SIGNATURE PAGES FOLLOW]

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IN WITNESS WHEREOF, the Borrowers have caused this certificate to be executed and delivered by a duly authorized officer on the date first written above.


WARRIOR MET COAL, LLC
WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC
WARRIOR MET COAL GAS, LLC
WARRIOR MET COAL MINING, LLC
WARRIOR MET COAL TRI, LLC
WARRIOR MET COAL BCE, LLC
WARRIOR MET COAL LAND, LLC
WARRIOR MET COAL WV, LLC
WARRIOR MET COAL LA, LLC

By:
Name:
Title:

[S IGNATURE P AGE TO B ORROWING B ASE C ERTIFICATE ]

E XHIBIT A TO B ORROWING B ASE C ERTIFICATE

B ORROWING B ASE C ALCULATIONS

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E XHIBIT H

C REDIT A GREEMENT

S ECURITY A GREEMENT

[SEE ATTACHED]

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E XHIBIT I

C REDIT A GREEMENT

F ORM OF P ERFECTION C ERTIFICATE

[SEE ATTACHED]

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E XHIBIT J

C REDIT A GREEMENT

F ORM OF P ERFECTION C ERTIFICATE S UPPLEMENT

[●], 201[●]

Reference is hereby made to (i) that certain Pledge and Security Agreement, dated as of [●] (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “ Security Agreement ”), by and among Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”) and any other person from time to time party thereto, Citibank, N.A. (“ Citi ”), in its capacity as administrative agent for the Lenders (as defined therein) and collateral agent for the Secured Parties (as defined therein) (in such capacities, the “ Agent ”), and the other parties thereto, (ii) that certain Credit Agreement, dated as of April 1, 2016 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “ Credit Agreement ”), by and among the Borrowers, the Guarantors, the Lenders and L/C Issuers party thereto from time to time, the Agent, and the other parties thereto and (iii) that certain Perfection Certificate, dated as of April 1, 2016 (as supplemented by any perfection certificate supplements delivered prior to the date hereof, the “ Prior Perfection Certificate ”), executed by the Grantors and delivered to the Agent. Capitalized terms used but not defined herein have the meanings assigned to such terms in the Security Agreement or the Credit Agreement, as applicable.

As used herein, the term “ Companies ” means each Borrower and each of the other Grantors.

As of the date hereof, the undersigned hereby certify to the Agent as follows:

1. Names . (a) Except as listed on Schedule 1(a) hereto, Schedule 1(a) of the Prior Perfection Certificate sets forth, with respect to each Company, the exact legal name of each Company, as such name appears in its respective Organizational Documents filed with the Secretary of State (or other comparable filing office) of such Company’s jurisdiction of organization. Except as listed on Schedule 1(a) hereto, each Company is the type of entity disclosed next to its name in Schedule 1(a) of the Prior Perfection Certificate. Except as listed on Schedule 1(a) hereto, also, set forth in Schedule 1(a) of the Prior Perfection Certificate is the organizational identification number, if any, of each Company, the Federal Taxpayer Identification Number (or other comparable identification number), if any, of each Company, the jurisdiction of organization of each Company and the applicable office for the filing of a financing statement, or a similar document, for each Grantor.

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(b) Except as listed on Schedule 1(b ) hereto, Schedule 1(b) of the Prior Perfection Certificate sets forth any other legal name that any Company has had in the past five years, together with the date of the relevant change.

(c) Except as listed on Schedule 1(c) hereto, Schedule 1(c) of the Prior Perfection Certificate lists each trade name or assumed name, if any, used by each Company during the past five years.

(d) Except as listed on Schedule 1(d) hereto, Schedule 1(d) of the Prior Perfection Certificate lists the information required by Section 1(a) of this certificate for any other Person (i) to which each Company became the successor by merger, consolidation or acquisition or (ii) that has been liquidated into, or transferred all or substantially all of its assets to, any Company, at any time within the past five years preceding the date hereof.

(e) Except as listed on Schedule 1(e) hereto, no Company has changed its jurisdiction of organization or form of entity at any time during the past five years.

(f) Except as listed on Schedule 1(f) hereto, no Company has become a “transmitting utility” (as defined in Section 9-102(a)(80) of the UCC).

2. Locations . (a) Except as updated by Schedule 2(a) hereto, the address of each Company’s chief executive office is accurately disclosed in Schedule 2(a) of the Prior Perfection Certificate.

(b) Except as updated by Schedule 2(b) hereto, Schedule 2(b) of the Prior Perfection Certificate sets forth all locations where each Company maintains any books or records relating to any Collateral.

(c) Except as updated by Schedule 2(c) hereto, Schedule 2(c) of the Prior Perfection Certificate sets forth all locations owned by each Company where any Collateral consisting of Inventory or Equipment is located as of the date hereof (other than property in possession of a third party (e.g. warehouseman or other bailee) or Collateral in transit).

(d) Except as updated by Schedule 2(d) hereto, Schedule 2(d) of the Prior Perfection Certificate sets forth all locations leased by each Company where any Collateral consisting of Inventory or Equipment is currently maintained as of the date hereof (other than Collateral in transit).

(e) Except as updated by Schedule 2(e) hereto, Schedule 2(e) of the Prior Perfection Certificate sets forth the locations where each Company currently maintains any Collateral consisting of Inventory or Equipment (other than Collateral in transit) at which Inventory or Equipment is held in a public warehouse or is otherwise held by a bailee or on consignment and the names and addresses of all Persons other than each Company, such as lessees, consignees, bailees, warehousemen or other third parties in possession or control of any such Collateral.

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3. Stock or Share Ownership and Other Equity Interests . Except as updated by Schedule 3 hereto, Schedule 3 of the Prior Perfection Certificate sets forth a true and correct list of all of the issued and outstanding stock or share, partnership interests, limited liability company membership interests or other equity interests owned by each Company constituting Pledged Stock, the beneficial owner of such stock or share, partnership interests, membership interests or other equity interests and the percentage of the total issued and outstanding stock or share, partnership interests, membership interests or other equity interests represented thereby.

4. Instruments and Tangible Chattel Paper . Except as updated by Schedule 4 hereto, Schedule 4 of the Prior Perfection Certificate sets forth a true and correct list of all promissory notes, Instruments and Tangible Chattel Paper, if any, of each Company with a face amount, individually or in the aggregate with the promissory notes, Instruments or Tangible Chattel Paper, as applicable, of all Companies, of $250,000 or more and all intercompany notes between or among any two or more Companies including the names of the obligors, amounts owing, due dates and other material information.

5. Intellectual Property . Except as updated by Schedule 5(a) hereto, Schedule 5(a) of the Prior Perfection Certificate sets forth all of each Company’s Patents, Patent Licenses, Trademarks and Trademark Licenses registered, if any, with (or applied for in) the United States Patent and Trademark Office or any relevant office or agency in any applicable foreign jurisdiction, including the name of the registered owner and the registration number (or, if applicable, the applicant and application number) of each such Patent, Patent License, Trademark and Trademark License. Except as updated by Schedule 5(b) hereto, Schedule 5(b) of the Prior Perfection Certificate sets forth all of each Company’s Copyrights registered, if any, with (or applied for in) the United States Copyright Office or any relevant office or agency in any applicable foreign jurisdiction and Copyright Licenses (each as defined in the Security Agreement), including the name of the registered owner and the registration number (or, if applicable, the applicant and the application number) of each such Copyright or Copyright License. Except as updated by Schedule 5(c) hereto, Schedule 5(c) of the Prior Perfection Certificate sets forth all of each Company’s Domain Names registered with a United States Domain Name registrar or any relevant registrar in any applicable foreign jurisdiction.

6. Commercial Tort Claims . Except as updated by Schedule 6 hereto, Schedule 6 of the Prior Perfection Certificate sets forth a true and correct list of all Commercial Tort Claims of each Company with value, individually or in the aggregate with the Commercial Tort Claims of all Companies, of $250,000 or more, if any, including a brief description thereof.

7. Letter-of-Credit Rights . Except as updated by Schedule 7 hereto, Schedule 7 of the Prior Perfection Certificate sets forth a true and correct list of all Letter-of-Credit Rights of each Company with value, individually or in the aggregate with the Letter-of-Credit Rights of all Companies, of $100,000 or more, if any.

8. Deposit; Securities; Commodities Accounts . Except as updated by Schedule 8 hereto, Schedule 8 of the Prior Perfection Certificate sets forth a true and correct list of all Deposit, Securities and Commodities Accounts, if any, maintained by each Company, which list includes for each such account the name of the Company maintaining such account, the name of the financial institution or other institution at which such account is maintained, the account number of such account, the purpose of such account and whether such account constitutes an Excluded Account.

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9. Insurance . Except as updated by Schedule 9 hereto, Schedule 9 of the Prior Perfection Certificate sets forth a true and correct list of all insurance policies and insurance contracts (and insurance Receivables arising thereunder) which list includes for each such agreement or receivable the name and address of the insurers of the relevant policy, the type of the policy, the date of the policy and the policy value. Except as updated by Schedule 9 hereto, none of the Account Debtors in respect of any Receivable is the government of the United States, any agency or instrumentality thereof, any state or municipality or any foreign sovereign.

[SIGNATURE PAGES FOLLOW]

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IN WITNESS WHEREOF, we have hereunto signed this Perfection Certificate Supplement as of the date first written of above.


WARRIOR MET COAL, LLC
WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC
WARRIOR MET COAL GAS, LLC
WARRIOR MET COAL MINING, LLC
WARRIOR MET COAL TRI, LLC
WARRIOR MET COAL BCE, LLC
WARRIOR MET COAL LAND, LLC
WARRIOR MET COAL WV, LLC
WARRIOR MET COAL LA, LLC

By:
Name:
Title:

[S IGNATURE P AGE TO P ERFECTION C ERTIFICATE S UPPLEMENT ]

Schedule 1(a)

L EGAL N AMES


Company Name	Type of Entity	Jurisdiction of Organization	Applicable Filing Office	Organizational ID Number	Federal Taxpayer Identification Number

Schedule 1(b)

P RIOR O RGANIZATIONAL N AMES


Company Name	Prior Legal Name	Date of Change

Schedule 1(c)

T RADE OR A SSUMED N AMES


Company Name		Other Name

Schedule 1(d)

C HANGES IN C ORPORATE I DENTITY


Company Name	Action	Legal Name of Predecessor Entity	Date of Action

Schedule 1(e)

C HANGES IN J URISDICTION OR F ORM


Company Name	Prior Jurisdiction or Form	Date of Change

Schedule 1(f)

T RANSMITTING U TILITIES


		Company Name

Schedule 2(a)

C HIEF E XECUTIVE O FFICES


Company Name		Address of Chief Executive Office

Schedule 2(b)

L OCATION OF B OOKS AND R ECORDS


Company Name		Location of Books/Records

Schedule 2(c)

O WNED L OCATIONS WHERE E QUIPMENT OR I NVENTORY IS M AINTAINED


Company Name		Location of Collateral

Schedule 2(d)

L EASED L OCATIONS OF E QUIPMENT AND I NVENTORY


Company Name		Location of Collateral

Schedule 2(e)

T HIRD P ARTY L OCATIONS OF E QUIPMENT AND I NVENTORY

Schedule 3

E QUITY I NTERESTS OF C OMPANIES AND S UBSIDIARIES

Schedule 4

P ROMISSORY N OTES , I NSTRUMENTS AND T ANGIBLE C HATTEL P APER

1.	Promissory Notes:

[●]

2.	Instruments:

[●]

3.	Tangible Chattel Paper:

[●]

Schedule 5(a), 5(b) and 5(c)

I NTELLECTUAL P ROPERTY (P ATENTS , T RADEMARKS , C OPYRIGHTS AND D OMAIN N AMES )

Schedule 5(a)

Patents

Patent Licenses

Trademarks

Trademark Licenses

Schedule 5(b)

Copyrights

Schedule 5(c)

Domain Names

Schedule 6

C OMMERCIAL T ORT C LAIMS

Schedule 7

L ETTER - OF -C REDIT R IGHTS

Schedule 8

D EPOSIT ; S ECURITIES ; C OMMODITIES A CCOUNTS

Company

Name

Name of Financial

Institution

Account

Number

Account Type

Excluded

Account?

[Yes][No]

Schedule 9

I NSURANCE

Company

Name

Name of
Insurer

Address of
Insurer

Policy Type

Policy Date

Value

Government
Entity

[Yes][No]

E XHIBIT K

F ORM OF

A SSUMPTION A GREEMENT

(this “ Assumption Agreement ”)

ASSUMPTION AGREEMENT, dated as of , 20 , made by , a [corporation] [limited liability company] [limited partnership] (the “ Additional Borrower ”), in favor of Citibank, N.A., as administrative agent (in such capacity, the “ Administrative Agent ”) for the banks and other financial institutions (the “ Lenders ”) parties to the Credit Agreement referred to below. All capitalized terms not defined herein shall have the meaning ascribed to them in such Credit Agreement.

WITNESSETH:

WHEREAS, Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Existing Borrowers ”, and together with the Additional Borrower, collectively, the “ Borrowers” ), the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and the Administrative Agent have entered into that certain Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”);

WHEREAS, the Credit Agreement provides for a guarantee by the Guarantors in favor of the Administrative Agent for the benefit of the Secured Parties;

WHEREAS, the Credit Agreement requires the Additional Borrower to become a party to thereto as a borrower and guarantee the Obligations thereunder pursuant to Article 10 therefor; and

WHEREAS, the Additional Borrower has agreed to execute and deliver this Assumption Agreement in order to become a party to the Credit Agreement and the Security Agreement;

NOW, THEREFORE, IT IS AGREED:

1. By executing and delivering this Assumption Agreement, the Additional Borrower, as provided in Section 6.12 of the Credit Agreement, hereby becomes a party to the Credit Agreement as both a Borrower and a Guarantor thereunder with the same force and effect as if originally named therein as a Borrower and a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Borrower and a Guarantor thereunder.

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2. The Additional Borrower hereby represents and warrants that (i) each of the representations and warranties, to the extent applicable to a Borrower and a Guarantor, contained in the Credit Agreement and in each other Loan Document, is true and correct in all material respects (or, if such representation or warranty is subject to materiality or Material Adverse Effect qualification, in all respects) on and as the date hereof as if made on and as of such date (after giving effect to this Assumption Agreement), except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date and (ii) at the time of and immediately after the date hereof, no Default or Event of Default has occurred or is continuing, or would result from such Person becoming an Borrower and a Guarantor under the Credit Agreement.

3. The Additional Borrower agrees that the guarantees of the Obligations contained in the Credit Agreement will apply to the Obligations of the Additional Borrower, to the extent applicable in accordance with the terms thereof. Upon execution of this Assumption Agreement by each of the Existing Borrowers, the Additional Borrower and the Administrative Agent, and the satisfaction of the conditions set forth in Section 6.12 of the Credit Agreement, the Additional Borrower (i) shall be a party to the Credit Agreement and the other Loan Documents and shall constitute a “Borrower” and a “Guarantor” for all purposes thereof with the same force and effect as if originally named a Borrower and a Guarantor therein and (ii) agrees to be bound by all provisions of the Credit Agreement and the other Loan Documents and shall have all the rights and obligations of a Borrower or a Guarantor thereunder.

4. The Additional Borrower hereby ratifies and agrees to be bound by Section 11.18 ( Joint and Several Liability ) of the Credit Agreement and the appointment of the Borrower Representative under Section 11.20 of the Credit Agreement.

5. Governing Law . THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[SIGNATURE PAGES FOLLOW]

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IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above written.


[ADDITIONAL BORROWER]

By:
Name:
Title:

[S IGNATURE P AGE TO A SSUMPTION A GREEMENT ]

E XHIBIT L

C REDIT A GREEMENT

F ORM OF S OLVENCY C ERTIFICATE

Reference is made to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the “ Credit Agreement ”), by and among Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), Warrior Met Coal Intermediate Holdco, LLC, a Delaware limited liability company (“ Intermediate Holdco ”), Warrior Met Coal Gas, LLC, a Delaware limited liability company (“ WMC Gas ”), Warrior Met Coal Mining, LLC, a Delaware limited liability company (“ WMC Mining ”), Warrior Met Coal TRI, LLC, a Delaware limited liability company (“ WMC Tri ”), Warrior Met Coal BCE, LLC, a Delaware limited liability company (“ WMC BCE ”), Warrior Met Coal Land, LLC, a Delaware limited liability company (“ WMC Land ”), Warrior Met Coal WV, LLC, a Delaware limited liability company (“ WMC WV ”), and Warrior Met Coal LA, LLC, a Delaware limited liability company (“ WMC LA ”, and together with Holdings, Intermediate Holdco, WMC Gas, WMC Mining, WMC Tri, WMC BCE, WMC Land, WMC WV, collectively, the “ Borrowers ”), the Guarantors party thereto, the Lenders and L/C Issuers party thereto from time to time and Citibank, N.A., as Administrative Agent. Capitalized terms used herein shall have the meanings given to them in the Credit Agreement.

I, [●], the [ Chief Executive Officer/Chief Financial Officer/the Treasurer/Assistant Treasurer/Vice President of Finance/Controller ] ¹¹ of Holdings, in such capacity and not in an individual capacity, hereby certify as follows:

1.	I am generally familiar with the businesses and assets of Holdings and its Subsidiaries, taken as a whole, and am duly authorized to execute this Solvency Certificate on behalf of Holdings and its Subsidiaries pursuant to Section 4.01(a)(x) the Credit Agreement; and

As of the Closing Date and after giving effect to the Transactions and the incurrence of the Indebtedness and obligations being incurred in connection with the Credit Agreement and the Transactions, (i) the sum of the debt (including contingent liabilities) of Holdings and its Subsidiaries, on a consolidated basis, does not exceed the fair value of the present assets of Holdings and its Subsidiaries, on a consolidated basis, (ii) the present fair saleable value of the assets of Holdings and its Subsidiaries, on a consolidated basis, is not less than the amount that will be required to pay the probable liabilities (including contingent liabilities) of Holdings and its Subsidiaries, on a consolidated basis, as they become absolute and mature; (iii) the capital of Holdings and its Subsidiaries, on a consolidated basis, is not unreasonably small in relation to the business of Holdings or its Subsidiaries, on a consolidated basis, contemplated as of the Closing Date; and (iv)

¹¹	Select as appropriate.

L-1

Holdings and its Subsidiaries, on a consolidated basis, do not intend to incur, or believe that they will incur, debts (including current obligations and contingent liabilities) beyond their ability to pay such debt as they mature in the ordinary course of business. For the purposes hereof, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the undersigned has executed this certificate in such undersigned’s capacity as a Responsible Officer of Holdings, on behalf of Holdings, and not individually, as of the date first stated above.


WARRIOR MET COAL, LLC

By:
Name:
Title:

[S IGNATURE P AGE TO S OLVENCY C ERTIFICATE ]

Exhibit 10.2

AMENDMENT NO. 1 TO ASSET-BASED REVOLVING CREDIT AGREEMENT

AMENDMENT NO. 1 TO ASSET BASED REVOLVING CREDIT AGREEMENT, dated as of January 23, 2017 (this “ Amendment ”), to the Asset-Based Revolving Credit Agreement, dated as of April 1, 2016 (as amended, restated, supplemented and/or otherwise modified from time to time prior to the date hereof, the “ Credit Agreement ”), among Warrior Met Coal, LLC, a Delaware limited liability company (“ Holdings ”), certain of its subsidiaries identified therein as borrowers (together with Holdings, each a “ Borrower ” and collectively, the “ Borrowers ”), the guarantors party thereto, each lender providing the Additional Commitment (as defined below) pursuant to this Amendment (such lenders, the “ Commitment Increase Lenders ”) and each other lender party to the Credit Agreement (the “Existing Lenders”, and together with the Commitment Increase Lenders, the “ Lenders ”) and Citibank, N.A., as administrative agent and collateral agent (in such capacities, including any successor thereto, the “ Administrative Agent ”).

W I T N E S S E T H :

WHEREAS, the parties hereto desire to increase the Commitments under the Credit Agreement by $50,000,000 (the “ Additional Commitment ”);

WHEREAS, each Commitment Increase Lender has provided a new Commitment under the Amended Credit Agreement (as defined below) in the amount set forth opposite such Commitment Increase Lender’s name on Part A of Schedule 1.01(b) attached hereto;

WHEREAS, the parties hereto desire to amend the other terms of the Credit Agreement as provided herein;

NOW, THEREFORE, in consideration of the mutual agreements contained in this Amendment and the Amended Credit Agreement and herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1 . Defined Terms; References . Unless otherwise specifically defined herein, each term used herein that is defined in the Credit Agreement has the meaning assigned to such term in the Credit Agreement. Unless expressly provided otherwise, each reference in the Credit Agreement to “this Agreement”, “hereof”, “hereunder”, “herein”, “hereby” and each other similar reference to the Credit Agreement, and each reference to the Credit Agreement in any Loan Document shall, from and after the First Amendment Effective Date (as defined below), refer to the Credit Agreement as amended and modified by this Amendment (the “ Amended Credit Agreement ”). This Amendment shall constitute a Loan Document.

SECTION 2. Additional Commitment.

(a) Each Commitment Increase Lender hereby acknowledges and agrees that it hereby provides a new Commitment in the amount set forth opposite such Commitment Increase Lender’s name on Part A of Schedule 1.01(b) attached to this Amendment, and each party hereto acknowledges and agrees that, after giving effect to this Amendment, the Commitments of each Lender shall be as set forth on Part B of Schedule 1.01(b) attached to this Amendment.

(b) Each Commitment Increase Lender:

(i) confirms that it has received a copy of the Credit Agreement, the other Loan Documents, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Amendment;

(ii) appoints and authorizes the Administrative Agent and Collateral Agent to take such actions as agent on its behalf and to exercise such powers under the Amended Credit Agreement and the other Loan Documents as are delegated to the Administrative Agent and the Collateral Agent, as the case may be, by the terms thereof, together with such powers as are reasonably incidental thereto; and

(iii) acknowledges and agrees that, upon its execution of this Amendment, such Commitment Increase Lender shall automatically and without further action become a “Lender” under, and for all purposes of, the Amended Credit Agreement and the other Loan Documents, and shall be subject to and bound by the terms thereof, and shall perform all the obligations of and shall have all rights of a Lender thereunder.

SECTION 3. Amendments.

(a) Schedule 1.01(b) to the Credit Agreement is hereby amended and restated in its entirety in the form attached to this Amendment as Schedule 1.01(b).

(b) The definition of “Facility” in the introductory paragraphs of the Credit Agreement shall be amended to replace the reference to “$50,000,000” with “$100,000,000”.

(c) Section 1.01 of the Credit Agreement is hereby amended by adding the following definitions in the appropriate alphabetical order:

““ First Amendment ” means that certain Amendment No. 1 to Asset-Based Revolving Credit Agreement, dated as of the First Amendment Effective Date, among the Loan Parties, the Lenders party thereto and the Administrative Agent.”

““ First Amendment Effective Date ” means January 23, 2017.”

(d) Section 1.01 of the Credit Agreement is hereby amended by amending and restating the definition of “Applicable Rate” in its entirety as follows:

““ Applicable Rate ” means, as of any date of determination, a per annum rate equal to (a) for the period commencing on the Closing Date through the last day of the first full fiscal quarter ending after the Closing Date, (i) for Eurocurrency Rate Loans, 3.50% and (ii) for Base Rate Loans, 2.50% and (b) thereafter, the rate set forth below under the applicable Type of Loan and opposite the applicable Availability, based on the average daily Availability during the fiscal quarter most recently ended immediately preceding such date, as a percentage of the Maximum Revolving Credit:


C ATEGORY	A VERAGE Q UARTERLY A VAILABILITY (% OF M AXIMUM R EVOLVING C REDIT )	E UROCURRENCY L OANS	B ASE R ATE L OANS
I	Greater than or equal to 66%	2.00%	1.00%
II	Less than 66% and greater than or equal to 33%	2.25%	1.25%
III	Less than 33%	2.50%	1.50%

Changes in the Applicable Rate resulting from a change in Availability shall become effective as to all Loans, Swingline Loans, L/C Obligations and Protective Advances upon delivery by the Borrowers to the Administrative Agent of a new Borrowing Base Certificate pursuant to Section 6.02(i) in respect of the calendar month ending on the last day of such fiscal quarter. Notwithstanding anything to the contrary set forth in this Agreement (including the then effective Availability), if the Borrowers shall fail to deliver such Borrowing Base Certificate within any of the time periods specified in Section 6.02(i), the Applicable Rate from and including the 20th day after the end of the applicable month or, during a Liquidity Period, the 3rd Business Day after the end of the applicable week, as the case may be, to but not including the date the Borrowers deliver to the Administrative Agent such Borrowing Base Certificate shall equal the highest possible Applicable Rate provided for by this definition.”

(e) Section 1.01 of the Credit Agreement is hereby amended by amending and restating the definition of “Commitment” in its entirety as follows:

““ Commitment ” means, as to each Lender, the amount set forth under the caption “Commitment” opposite such Lender’s name on Schedule 1.01(b), or, as the case may be, opposite such caption in the Assignment and Acceptance pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement. The aggregate amount of the Commitments as of the First Amendment Effective Date is $100,000,000.”

(f) Section 1.01 of the Credit Agreement is hereby amended by amending and restating the definition of “Qualifying IPO” in its entirety as follows:

““ Qualifying IPO ” means the offering and sale of common Equity Interests of any Borrower or Holdings (or any parent holding company thereof) by one or more Persons (including a Borrower, Holdings, any parent holding company thereof and any Person owning such Equity Interests prior to the sale) in an underwritten public offering (other than a public offering pursuant to a registration statement on Form S-8) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act”

(g) Section 6.11(b) of the Credit Agreement is hereby amended and restated in its entirety as follows:

“None of the Borrowers shall, directly or knowingly indirectly, (x) use the proceeds of any Credit Extension or (y) lend, contribute, or otherwise make available such proceeds to any Subsidiary, joint venture partner, or other Person (i) to fund, finance, or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding, is the target of Sanctions or (ii) in any other manner that would result in the violation of Sanctions, Anti-Corruption Laws, Anti-Money Laundering Laws and Anti-Terrorism Laws, in each case, applicable to any party to this Agreement.”

(h) Section 7.12 of the Credit Agreement is hereby amended and restated in its entirety as follows:

“Amend any of its Organization Documents in a manner that is in any respect materially adverse to the Lenders; provided that, any amendment or modification of any Organization Document solely to change (i) the legal name of any Loan Party, (ii) the identity or corporate structure of any Loan Party ( provided that, after giving effect to any such change in its identity or corporate structure, such Loan Party shall be a limited liability company, a corporation or a limited partnership), (iii) the jurisdiction of incorporation or formation of any Loan Party to any state within the United States of America or to the District of Columbia, or (iv) the federal taxpayer identification number (or other comparable identification number) of any Loan Party, in each case, shall not be deemed materially adverse to the Lenders, so long as the applicable Loan Party (A) complies with Section 4.01(d) of the Security Agreement and (B) has provided all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the PATRIOT Act, as requested by any Lender or the Administrative Agent promptly following such request.”

(i) Clause (y) in the first proviso of Section 11.04(b) of the Credit Agreement is hereby amended and restated in its entirety as follows:

“have resulted from a material breach of such Indemnitee’s obligations under this Agreement or other Loan Documents as determined by a court of competent jurisdiction in a final, non-appealable judgment, or”

SECTION 4 Representations and Warranties . Each Loan Party represents and warrants to the Administrative Agent and the Lenders, as of the First Amendment Effective Date, that:

(a) No Default . Immediately after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

(b) Representations and Warranties True and Correct . Immediately after giving effect to this Amendment, each of the representations and warranties of the Loan Parties set forth in the Loan Documents shall be true and correct in all material respects (or, with respect to any representation or warranty that is itself modified or qualified by materiality or a “Material Adverse Effect” standard, such representation or warranty shall be true and correct in all respects) with the same effect as if made on the First Amendment Effective Date, except to the extent such representations and warranties expressly relate to an earlier date, in which case such

representations and warranties shall be true and correct in all material respects (or, with respect to any representation or warranty that is itself modified or qualified by materiality or a “Material Adverse Effect” standard, such representation or warranty shall be true and correct in all respects) as of such earlier date.

SECTION 5 . Effectiveness . This Amendment shall become effective on the date (the “ First Amendment Effective Date ”) on which the Administrative Agent shall have received:

(a) a signed counterpart of this Amendment from each Loan Party and each Lender;

(b) each Note executed by the Borrowers in favor of each Lender requesting a Note or Notes;

(c) an amendment fee, for the benefit of each Lender that has executed a counterpart to this Amendment on or prior to the First Amendment Effective Date, in an aggregate amount equal to 0.25% of the Additional Commitments in effect on the First Amendment Effective Date;

(d) the executed opinion of Akin Gump Strauss Hauer & Feld LLP, counsel to the Loan Parties, addressed to the Administrative Agent, each of the Lenders and the L/C Issuer, as to such matters concerning the Loan Parties and the Loan Documents as the Administrative Agent may reasonably request;

(e) a certificate of each Loan Party, dated as of the First Amendment Effective Date and executed by a secretary, assistant secretary or other senior officer (as the case may be) thereof, which shall (A) certify that attached thereto is a true and complete copy of the resolutions or written consents of its shareholders, partners, managers, members, board of directors, board of managers or other governing body authorizing the execution, delivery and performance of this Amendment to which it is a party and, in the case of the Borrowers, the borrowings under the Amended Credit Agreement, and that such resolutions or written consents have not been modified, rescinded or amended and are in full force and effect, (B) identify by name and title and bear the signatures of the officers, managers, directors or authorized signatories of such Loan Party authorized to sign this Amendment to which it is a party on the First Amendment Effective Date and (C) certify (x) that attached thereto is a true and complete copy of the certificate or articles of incorporation or organization (or memorandum of association or other equivalent thereof) of such Loan Party certified by the relevant authority of the jurisdiction of organization of such Loan Party and a true and correct copy of its by-laws or operating, management, partnership or similar agreement and (y) that such documents or agreements have not been amended, restated, amended and restated, supplemented or otherwise modified (except as otherwise attached to such certificate and certified therein as being the only amendments, restatements, amendments and restatements, supplements or modifications thereto as of such date) and (ii) a good standing (or equivalent) certificate as of a recent date for such Loan Party from (A) its jurisdiction of organization and (B) in each jurisdiction in which it is qualified to engage in business where its ownership, lease or operation of properties or the conduct of its business requires such qualification, except, in the case of this clause (B), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect;

(f) no Default or Event of Default shall have occurred and be continuing, or would result from, the consummation of the transactions contemplated by this Amendment (including any Credit Extension to be made on the First Amendment Effective Date and the application of the proceeds thereof);

(g) the representations and warranties of each Loan Party and its Subsidiaries contained in this Amendment and each other Loan Document, shall be true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) on and as of the First Amendment Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (or, if such representation or warranty is subject to a materiality or Material Adverse Effect qualification, in all respects) as of such earlier date;

(h) a certificate signed by a Responsible Officer of Holdings certifying that the conditions set forth in Sections 5(f) and 5(g) have been satisfied as of such date;

(i) a solvency certificate, substantially in the form of Exhibit L of the Credit Agreement from a Responsible Officer of Holdings (or, at the option of Holdings, a customary third-party opinion as to the solvency of Holdings and its Subsidiaries, on a consolidated basis); and

(j) any costs and expenses required to be paid under Section 11.04(a) of the Credit Agreement on or before the First Amendment Effective Date to the Administrative Agent, any Arranger or the Lenders, as applicable, to the extent invoices have been received by Holdings at least two Business Days prior to the First Amendment Effective Date (or such later date as reasonably agreed by Holdings) shall have been paid.

SECTION 6. Reaffirmation and Consent .

(a) Each Loan Party hereby consents to the execution, delivery and performance of this Amendment and agrees that each reference to the Credit Agreement in the Loan Documents shall, on and after the First Amendment Effective Date, be deemed to be a reference to the Amended Credit Agreement.

(b) Each Guarantor party hereto hereby consents to the terms and conditions of this Amendment and the Amended Credit Agreement, including the Additional Commitments and the incurrence by the Borrowers of any Loans thereunder.

(c) Each Borrower and each Guarantor hereby acknowledges and agrees that (i) all of its respective obligations and liabilities under the Credit Agreement are reaffirmed, and remain in full force and effect, and (ii) after giving effect to this Amendment, all of its respective obligations and liabilities under the Loan Documents to which it is a party, as such obligations and liabilities have been amended by this Amendment, are reaffirmed, and remain in full force and effect.

(d) Each Loan Party hereby irrevocably and unconditionally ratifies and reaffirms each Lien granted by it to the Administrative Agent for the benefit of the Secured Parties under each

of the Loan Documents to which it is a party, which Liens shall continue in full force and effect during the term of the Amended Credit Agreement, and shall continue to secure the Obligations (including, without limitation, any additional Obligations resulting from or incurred pursuant to this Amendment or the Amended Credit Agreement), in each case, on and subject to the terms and conditions set forth in the Amended Credit Agreement and the other Loan Documents.

(e) Nothing in this Section 6 shall create or otherwise give rise to any right to consent on the part of the Guarantors to the extent not required by the express terms of the Loan Documents.

SECTION 7 Costs and Expense . Each Borrower hereby reconfirms its obligations pursuant to Section 11.04(a) of the Credit Agreement to pay and reimburse the Administrative Agent for all reasonable costs and expenses (including, without limitation, reasonable fees of counsel) incurred in connection with the negotiation, preparation, execution and delivery of this Amendment and all other documents and instruments delivered in connection herewith.

SECTION 8 No Waiver; Continuing Effect . This Amendment shall be effective only in this specific instance for the specific purpose set forth herein. Except as otherwise expressly provided herein, the Credit Agreement and the other Loan Documents are, and shall continue to be, in full force and effect and are hereby ratified and confirmed in all respects. Without limiting the generality of the foregoing, the Collateral Documents and all of the Collateral described therein shall continue to secure the payment of all Obligations of the Loan Parties, as amended by this Amendment. Except as expressly provided herein, the execution, delivery and effectiveness of this Amendment shall not operate as an amendment or waiver of any right, power or remedy of the Administrative Agent or the Lenders under the Credit Agreement or any other Loan Document, nor constitute a waiver of, or consent to, any Default or Event of Default now existing or hereafter arising under the Credit Agreement or any other Loan Document and the Administrative Agent and the Lenders expressly reserve all of their rights and remedies under the Credit Agreement and the other Loan Documents, under applicable law or otherwise.

SECTION 9 . Governing Law; etc. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. The provisions in Sections 11.14(b), 11.14(c) and 11.15 of the Credit Agreement are incorporated herein by reference, mutatis mutandis .

SECTION 10 . Counterparts . This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment by telecopy shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 11. Headings . Section headings in this Amendment are included for convenience of reference only and shall not affect the interpretation of this Amendment.

SECTION 12. Binding Effect; Illegality. This Amendment shall be binding upon and inure to the benefit of the Loan Parties, the Administrative Agent and the Lenders and their

respective successors and assigns in accordance with the terms of the Amended Credit Agreement. The illegality or unenforceability of any provision of this Amendment or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Amendment or any instrument or agreement required hereunder.

SECTION 13. No Novation. Neither this Amendment nor the Amended Credit Agreement shall constitute a novation of the Credit Agreement or any of the Obligations thereunder.

[ Signature Pages Follow ]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.


BORROWERS AND GUARANTORS:

WARRIOR MET COAL LLC

By:		/s/ Walter J. Scheller, III
		Name: Walter J. Scheller, III
		Title: Chief Executive Officer

WARRIOR MET COAL INTERMEDIATE HOLDCO, LLC
WARRIOR MET COAL GAS, LLC
WARRIOR MET COAL MINING, LLC
WARRIOR MET COAL TRI, LLC
WARRIOR MET COAL BCE, LLC
WARRIOR MET COAL LAND, LLC
WARRIOR MET COAL WV, LLC
WARRIOR MET COAL LA, LLC,

By:		/s/ Kelli Gant
		Name: Kelli Gant
		Title: Chief Administrative Officer

[Signature Page to Amendment No. 1 to ABL Credit Agreement]

CITIBANK, N.A. ,

as Administrative Agent, a Lender,

L/C Issuer and Swingline Lender


By:		/s/ Allister Chan
		Name: Allister Chan
		Title: Vice President

[Signature Page to Amendment No. 1 to ABL Credit Agreement]

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH ,

as a Lender


By:		/s/ Robert Hetu
		Name: Robert Hetu
		Title: Authorized Signatory


By:		/s/ Lingzi Huang
		Name: Lingzi Huang
		Title: Authorized Signatory

[Signature Page to Amendment No. 1 to ABL Credit Agreement]

BMO HARRIS BANK, N.A. ,

as a Commitment Increase Lender and a Lender


By:	/s/ Quinn Heiden	.
	Name: Quinn Heiden
	Title: Director

[Signature Page to Amendment No. 1 to ABL Credit Agreement]

ROYAL BANK OF CANADA ,

as a Commitment Increase Lender and a Lender


By:		/s/ Daniel Gioia
		Name: Daniel Gioia
		Title: Authorized Signatory

[Signature Page to Amendment No. 1 to ABL Credit Agreement]

MORGAN STANLEY SENIOR FUNDING, INC. ,

as a Commitment Increase Lender and a Lender


By:		/s/ Michael King
		Name: Michael King
		Title: Vice President

[Signature Page to Amendment No. 1 to ABL Credit Agreement]

Schedule 1.01(b)

PART A


Commitment Increase Lender		Additional Commitment
Morgan Stanley Senior Funding, Inc.		$16,666,667
BMO Harris Bank, N.A.		$16,666,667
Royal Bank of Canada		$16,666,666
Total		$50,000,000

PART B

Commitments and L/C Sublimit


Lender	Commitment	L/C Sublimit
Citibank, N.A.	$25,000,000	$25,000,000
Credit Suisse AG, Cayman Islands Branch	$25,000,000	$25,000,000
Morgan Stanley Senior Funding, Inc.	$16,666,667	$0
BMO Harris Bank, N.A.	$16,666,667	$0
Royal Bank of Canada	$16,666,666	$0
Total	$100,000,000	$50,000,000

Exhibit 10.7

This EMPLOYMENT AGREEMENT by and between Warrior Met Coal, LLC (the “ Company ”), and Walter Scheller, III (“ Executive ”) (collectively, the “ Parties ”) is made as of March 31, 2016, and effective as of the later of April 1, 2016 and the Closing (as defined below) (such later date, the “ Effective Date ”).

WHEREAS , the Company intends to acquire certain assets of Walter Energy Inc. and its affiliated debtors and debtors-in-possession (the “ Transaction ”); and

WHEREAS , the Company and Executive desire to enter into this employment agreement (the “ Agreement ”) pursuant to the terms, provisions and conditions set forth herein, which will govern the terms of Executive’s employment with the Company following the closing of the Transaction (the “ Closing ”).

NOW, THEREFORE, in consideration of the premises and of the mutual covenants, understandings, representations, warranties, undertakings and promises hereinafter set forth, intending to be legally bound thereby, the Parties agree as follows:

1. Employment Period.

Executive shall be employed by the Company for a period commencing as of the Effective Date and continuing until such time as Executive’s employment is terminated in accordance with Section 3 hereof (the “ Employment Period ”). Upon Executive’s termination of employment with the Company for any reason, Executive shall immediately resign all positions with the Company or any of its subsidiaries or affiliates, including any position as a member of the Company’s Board of Directors (the “ Board ”).

2. Terms of Employment .

(a) Position . During the Employment Period, Executive shall serve as Chief Executive Officer of the Company and will perform such duties and exercise such supervision with regard to the business of the Company as are commensurate with such position, including such duties as may be prescribed from time to time by the Board. Executive shall report directly to the Board and, if reasonably requested by the Board, Executive hereby agrees to serve (without additional compensation) as an officer and director of the Company or any affiliate or subsidiary thereof.

(b) Duties . During the Employment Period, Executive shall have such responsibilities, duties, and authority that are commensurate with Executive’s position, subject at all times to the control of the Board, and shall perform such services as customarily are provided by an executive of a corporation with Executive’s position and such other services consistent with Executive’s position, as shall be assigned to Executive from time to time by the Board. During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote all of Executive’s business time to the business and affairs of the Company and to use Executive’s commercially reasonable efforts to perform faithfully, effectively and efficiently Executive’s responsibilities and obligations hereunder. Executive shall be entitled to engage in charitable and educational activities and to manage Executive’s personal and family investments, to the extent such activities are not competitive with the business of the Company, do not interfere with the performance of Executive’s duties for the Company and are otherwise consistent with the Company’s governance policies.

(i) Base Salary . During the Employment Period, Executive shall receive an annual base salary in an amount equal to six hundred thousand dollars ($600,000), less all applicable withholdings, which shall be paid in accordance with the customary payroll practices of the Company and prorated for partial calendar years of employment (as in effect from time to time, the “ Annual Base Salary ”). The Annual Base Salary shall be subject to annual review by the Board, in its sole discretion, for possible increase and any such increased Annual Base Salary documented in the form of a resolution adopted by the Board or an amendment to this Agreement shall constitute “Annual Base Salary” for purposes of this Agreement.

(ii) Annual Bonus . During the Employment Period, with respect to each completed fiscal year of the Company, Executive shall be eligible to receive a bonus (the “ Bonus ”) with a target amount equal to 100% of Annual Base Salary contingent upon the achievement of qualitative and quantitative performance goals approved by the Board. The Bonus, if any, shall be paid in accordance with the terms of the applicable bonus plan as in effect from time to time, and shall require that Executive be employed with the Company on the date of payment of such Bonus.

(iii) 100 Day Plan . The Company will develop, and Executive will be eligible to receive an award under, a bonus plan to incentivize performance during the initial one hundred (100) day period following the Closing, contingent upon the achievement of performance goals approved by the Board. Executive must be employed by the Company on the payment date in order to receive a bonus under such plan, which bonus shall be payable in the form of cash, equity or combination thereof, as determined by the Board in its sole discretion.

(iv) Benefits . During the Employment Period, Executive shall be eligible to participate in all retirement, compensation and employee benefit plans, practices, policies and programs provided by the Company to the extent applicable generally to other executives of the Company (except severance plans, policies, practices, or programs) subject to the eligibility criteria set forth therein, as such may be amended or terminated from time to time.

(v) Expenses . During the Employment Period, Executive shall be entitled to receive reimbursement for all reasonable business expenses incurred by Executive in performance of Executive’s duties hereunder provided that Executive provides all necessary documentation in accordance with the Company’s policies.

(vi) The Company shall indemnify the Executive, to the fullest extent permitted by applicable law, against all costs, charges and expenses incurred or sustained by Executive, including the cost and expenses of legal counsel, in connection with any action, suit or proceeding (collectively a “Proceeding”) to which the Executive may be made a party by reason of the Executive being or having been an officer, director, or employee of the Company or any of its affiliates. Notwithstanding the preceding, the Executive shall not be entitled to indemnification in connection with any gross negligence or willful misconduct of the Executive.

The Executive shall be covered during the entire term of this Agreement and thereafter for at least six (6) years by officer and director liability insurance in amounts and on terms similar to that afforded to other executives and/or directors of the Company affiliates.

3. Termination of Employment.

(a) Death or Disability . Executive’s employment shall terminate automatically upon Executive’s death. If Executive becomes subject to a “Disability” (as defined below) during the Employment Period, the Company may give Executive written notice in accordance with Sections 3(f) and 10(g) of its intention to terminate Executive’s employment. For purposes of this Agreement, “ Disability ” means Executive’s inability to perform Executive’s duties hereunder by reason of any medically determinable physical or mental impairment for a period of six (6) months or more in any twelve (12) month period.

(b) Cause . Executive’s employment may be terminated at any time by the Company for “Cause” (as defined below). For purposes of this Agreement, “ Cause ” shall mean Executive’s (i) commission of, conviction for, plea of guilty or nolo contendere to a felony or a crime involving moral turpitude, or other material act or omission involving dishonesty or fraud, (ii) engaging in conduct that constitutes fraud or embezzlement, (iii) engaging in conduct that constitutes gross negligence or willful gross misconduct that results or could reasonably be expected to result in harm to the Company’s or any affiliate’s business or reputation, (iv) breach of any material terms of Executive’s employment, which results or could reasonably be expected to result in harm to the Company’s or any affiliate’s business or reputation, (v) continued willful failure to substantially perform Executive’s duties or (vi) breach of any material policy of the Company or any affiliate that is applicable to employees generally that is reasonably likely to result in demonstrable harm to the Company or any affiliate. Executive’s employment shall not be terminated for “Cause” within the meaning of clauses (iv), (v) or (vi) above unless Executive has been given written notice stating the basis for such termination and Executive is given fifteen (15) days to cure, to the extent curable, the act or omission that is the basis of any such claim.

(d) Good Reason . Executive’s employment may be terminated at any time by Executive for Good Reason upon thirty (30) days’ prior written notice following the occurrence of the event giving rise to the termination for Good Reason. For purposes of this Agreement, “ Good Reason ” means voluntary resignation after any of the following actions taken by the Company without Executive’s written consent: (i) a material diminution in Executive’s title or authority; (ii) any material failure to pay compensation when due, (iii) a reduction in base pay or bonus opportunity other than reductions applicable to senior executives generally occurring after December 31, 2016; (iv) relocation of Executive’s principal place of business by more than 50 miles that materially increases Executive’s commute, or (v) any other material breach of this Agreement by the Company. Executive’s employment shall not be terminated for “Good Reason” unless Executive has given the Company written notice stating the condition that is the basis for such termination within thirty (30) days following the initial occurrence of the event or condition allegedly constituting Good Reason and the Company fails to cure such condition within fifteen (15) days following receipt of such notice

(e) Voluntary Termination . Executive’s employment may be terminated at any time by Executive without Good Reason upon thirty (30) days’ prior written notice.

(f) Notice of Termination . Any termination by the Company for Cause or without Cause, or by Executive for Good Reason or without Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 10(g). For purposes of this Agreement, a “ Notice of Termination ” means a written notice that (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) if the “Date of Termination” (as defined below) is other than the date of receipt of such notice, specifies the termination date. The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company hereunder or preclude Executive or the Company from asserting such fact or circumstance in enforcing Executive’s or the Company’s rights hereunder.

(g) Date of Termination . “ Date of Termination ” means (i) if Executive’s employment is terminated by the Company for Cause, without Cause or by reason of Disability, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(f), as the case may be, (ii) if Executive’s employment is terminated by Executive for Good Reason or without Good Reason, the date specified in the Notice of Termination in accordance with Section 3(d) or Section 3(e) and pursuant to Section 3(f), as the case may be and (iii) if Executive’s employment is terminated by reason of death, the date of death.

4. Obligations of the Company upon Termination .

(a) With Good Reason; Without Cause . If during the Employment Period, the Company shall terminate Executive’s employment without Cause or Executive shall terminate Executive’s employment for Good Reason, then the Company will provide Executive with the following payments and/or benefits:

(i) The Company shall pay to Executive as soon as reasonably practicable but no later than the 15 ^th day of the third month following the end of the calendar year that contains the Date of Termination in a lump sum to the extent not previously paid, (A) the Annual Base Salary through the Date of Termination, (B) the amount of any unpaid expense reimbursements to which Executive may be entitled pursuant to Section 2(c)(v) hereof, and (C) any other vested payments or benefits to which Executive or Executive’s estate may be entitled to receive under any of the Company’s benefit plans or applicable law, in accordance with the terms of such plans or law (clauses (A)-(C), the “ Accrued Obligations ”); and

(ii) subject to Section 4(e) below, after the Date of Termination, the Company will pay Executive an amount equal to one times (1x) Executive’s Annual Base Salary as in effect as of the Date of Termination in substantially equal installments in accordance with the Company’s customary payroll practices, commencing on the first payroll date occurring on or after the date that is sixty (60) days following the Date of Termination (with the first installment inclusive of the installments that would have otherwise been payable during such initial sixty (60) day period) and ending on the first anniversary of the Date of Termination (the “ Severance Payment ”);

(iii) subject to Section 4(e) below, after a Date of Termination occurring following the third quarter of the Company’s fiscal year, the Company will pay Executive a prorated bonus for the year of termination based on the number of days in such year elapsed through the Date of Termination with the amount thereof determined based on the actual result of the Company for such year and payable when bonuses for such year are generally paid to employees of the Company;

(iv) subject to Section 4(e) below, upon a Date of Termination occurring within 30 days prior to a vesting date relating to an equity award previously granted to Executive, the portion of such award that would have become vested within such 30-day period shall vest.

(b) With Good Reason; Without Cause following a Change in Control . If during the Employment Period, a Change in Control (as defined below) occurs and within twelve (12) months following the occurrence of such Change in Control, the Company shall terminate Executive’s employment without Cause or Executive shall terminate Executive’s employment for Good Reason, then, in lieu of the payments and benefits described in Section 4(a) above, the Company will provide Executive with the following payments and/or benefits:

(i) the Accrued Obligations; and

(ii) subject to Section 4(e) below, after the Date of Termination, the Company will pay Executive a lump sum amount equal to two (2) times (2x) Executive’s Annual Base Salary as in effect as of the Date of Termination (the “ Enhanced Severance Payment ”).

For purposes of this Agreement, “ Change in Control ” means, with respect to the Company, the first to occur of any of the following: (i) the acquisition by any person or “group” (as defined in section 13(d) of the Securities Exchange Act of 1934, as amended), other than by (A) the Company or any of its affiliates; (B) any employee benefit plan of the Company or any of its affiliates; or (C) any holder of equity units issued in connection with the Company’s 2016 reorganization, through one transaction or a series of related transactions of more than 50% of the combined voting power of the then outstanding voting securities of the Company; (ii) the merger or consolidation of the Company as a result of which persons who were unit holders of the Company immediately prior to such merger or consolidation, do not, immediately thereafter, own, directly or indirectly, 50% or more of the combined voting power entitled to vote generally in the election of directors of the merged or consolidated company; or (iii) the sale, transfer or other disposition of all or substantially all of the assets of the Company and its subsidiaries (determined on a consolidated basis) through one transaction or a series of related transactions occurring during any period of twelve (12) consecutive months to one or more persons who are not, immediately prior to such sale, transfer or other disposition, unit holders or affiliates of the Company.

Notwithstanding the foregoing, a “Change of Control” shall not be deemed to occur (i) unless such transaction satisfies the requirements of Treasury Regulation Section 1.409A-3(i)(5)(v) or (vii) or (ii) upon the occurrence of any liquidation or dissolution of the Company, including if the Company files for bankruptcy, liquidation or reorganization under the United States Bankruptcy Code.

(c) Death or Disability . If Executive’s employment shall be terminated by reason of the Executive’s death or Disability, then the Company will provide Executive with the Accrued Obligations. Thereafter, the Company shall have no further obligation to Executive or Executive’s legal representatives.

(d) Cause; Other than for Good Reason . If Executive’s employment shall be terminated by the Company for Cause or by Executive without Good Reason, then the Company shall have no further obligations to Executive other than for payment of the Accrued Obligations.

(e) Separation Agreement and General Release . The Company’s obligation to make the Severance Payment or the Enhanced Severance Payment is conditioned on Executive’s or Executive’s legal representative’s executing a separation agreement and general release of claims related to or arising from Executive’s employment with the Company or the termination of employment, against the Company and its affiliates (and their respective officers and directors) in a form reasonably determined by the Company, which shall be provided by the Company to Executive within five (5) days following the Date of Termination; provided , that, if Executive should fail to execute (or revokes) such release within sixty (60) days following the Date of Termination, the Company shall not have any obligation to provide the Severance Payment or the Enhanced Severance Payment. If Executive executes the release within such sixty (60) day period and does not revoke the release within seven (7) days following the execution of the release, the Severance Payment or the Enhanced Severance Payment will be made in accordance with Section 4(a)(ii) or Section 4(b)(ii), as applicable.

5. Restrictive Covenants .

(a) Non-Solicitation . In consideration of Executive’s employment and receipt of payments hereunder, during the period commencing on the Effective Date and ending twenty-four (24) months after the Date of Termination, Executive shall not directly, or indirectly through another person, (x) induce or attempt to induce any employee, representative, agent or consultant of the Company or any of its affiliates or subsidiaries to leave the employ or services of the Company or any of its affiliates or subsidiaries, or in any way interfere with the relationship between the Company or any of its affiliates or subsidiaries and any employee, representative, agent or consultant thereof, (y) hire any person who was an employee, representative, agent or consultant of the Company or any of its affiliates or subsidiaries at any time during the twelve-month period immediately prior to the date on which such hiring would take place or (z) directly or indirectly call on, solicit or service any customer, supplier, licensee, licensor, representative, agent or other business relation of the Company or any of its affiliates or subsidiaries in order to induce or attempt to induce such person to cease doing business with, or reduce the amount of business conducted with, the Company or any of its affiliates or subsidiaries, or in any way interfere with the relationship between any such customer, supplier, licensee, licensor, representative, agent or business relation of the Company or any of its affiliates or subsidiaries. No action by another person or entity shall be deemed to be a breach of this provision unless the Executive directly or indirectly assisted, encouraged or otherwise counseled such person or entity to engage in such activity.

(b) Non-Competition . Executive hereby acknowledges that it is familiar with the Confidential Information (as defined below) of the Company and its subsidiaries. Executive acknowledges and agrees that the Company would be irreparably damaged if Executive were to provide services to any person competing with the Company or any of its affiliates or subsidiaries or engaged in a similar business and that such competition by Executive would result in a significant loss of goodwill by the Company. Therefore, Executive agrees that during the period commencing on the Effective Date and ending twelve (12) months after the Date of Termination Executive shall not (and shall cause each of Executive’s or its affiliates not to) directly or indirectly own any interest in, manage, control, participate in (whether as an officer, director, manager, employee, partner, equity holder, member, agent, representative or otherwise), consult with, render services for, or in any other manner engage in any business engaged directly or indirectly, in the Geographic Area (as defined below), in the business of the Company and its subsidiaries as currently conducted or proposed to be conducted as of the Date of Termination; provided , that nothing herein shall prohibit Executive from being a passive owner of not more than 5% of the outstanding stock of any class of a corporation which is publicly traded so long as none of such persons has any active participation in the business of such corporation. For purposes of this Agreement, the “ Geographic Area ” shall mean North America.

(c) Non-Disclosure; Non-Use of Confidential Information . Executive shall not disclose or use at any time, either during Executive’s employment with the Company or at any time thereafter, any Confidential Information of which Executive is or becomes aware, whether or not such information is developed by Executive, except to the extent that such disclosure or use is directly related to and required by Executive’s performance in good faith of duties assigned to Executive by the Company. Executive will take all appropriate steps to safeguard Confidential Information in Executive’s possession and to protect it against disclosure, misuse, espionage, loss and theft. Executive shall deliver to the Company at the termination of Executive’s employment with the Company, or at any time the Company may request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information or the “Work Product” (as defined in Section 5(e)(ii)) of the business of the Company and its affiliates (the “ Company Group ”) that Executive may then possess or have under Executive’s control.

(d) Proprietary Rights . Executive recognizes that the Company Group possesses a proprietary interest in all Confidential Information and Work Product and has the exclusive right and privilege to use, protect by copyright, patent or trademark, or otherwise exploit the processes, ideas and concepts described therein to the exclusion of Executive, except as otherwise agreed between the Company Group and Executive in writing. Executive expressly agrees that any Work Product made or developed by Executive or Executive’s agents during the course of Executive’s employment, including any Work Product which is based on or arises out of Work Product, shall be the property of and inure to the exclusive benefit of the Company Group. Executive further agrees that all Work Product developed by Executive (whether or not able to be protected by copyright, patent or trademark) during the course of Executive’s employment with the Company, or involving the use of the time, materials or other resources of the Company Group, shall be promptly disclosed to the Company Group and shall become the exclusive property of the Company Group, and Executive shall execute and deliver any and all documents necessary or appropriate to implement the foregoing.

(e) Certain Definitions .

(i) As used herein, the term “ Confidential Information ” means information that is not generally known to the public (but for purposes of clarity, Confidential Information shall never exclude any such information that becomes known to the public because of Executive’s unauthorized disclosure) and that is used, developed or obtained by the Company Group in connection with its business, including, but not limited to, information, observations and data obtained by Executive while employed by the Company Group concerning (A) the business or affairs of the Company Group, (B) products or services, (C) fees, costs and pricing structures, (D) designs, (E) analyses, (F) drawings, photographs and reports, (G) computer software, including operating systems, applications and program listings, (H) flow charts, manuals and documentation, (I) databases, (J) accounting and business methods, (K) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (L) customers and clients and customer or client lists, (M) other copyrightable works, (N) all production methods, processes, technology and trade secrets, and (O) all similar and related information in whatever form. Confidential Information will not include any information that has been published in a form generally available to the public (except as a result of Executive’s unauthorized disclosure) prior to the date Executive proposes to disclose or use such information. Confidential Information will not be deemed to have been published or otherwise disclosed merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

(ii) As used herein, the term “ Work Product ” means all inventions, innovations, improvements, technical information, systems, software developments, methods, designs, analyses, drawings, reports, service marks, trademarks, trade names, logos and all similar or related information (whether patentable or unpatentable) that relates to the Company Group’s actual or anticipated business, research and development or existing or future products or services and that are conceived, developed or made by Executive (whether or not during usual business hours and whether or not alone or in conjunction with any other person) while employed by the Company together with all patent applications, letters patent, trademark, trade name and service mark applications or registrations, copyrights and reissues thereof that may be granted for or upon any of the foregoing.

(f) Enforcement . If Executive commits a breach of any of the provisions of this Section 5 or Section 6 below, the Company shall have the right and remedy to have the provisions specifically enforced by any court having jurisdiction, it being acknowledged and agreed by Executive that the services being rendered hereunder to the Company Group are of a special, unique and extraordinary character and that any such breach will cause irreparable injury to the Company Group and that money damages will not provide an adequate remedy to the Company Group. Such right and remedy shall be in addition to, and not in lieu of, any other rights and remedies available to the Company at law or in equity. Accordingly, Executive consents to the issuance of an injunction, whether preliminary or permanent, consistent with the terms of this Agreement (without posting a bond or other security) if the Company establishes a violation of Section 5 or 6 of this Agreement.

(g) Blue Pencil . If, at any time, the provisions of this Section 5 shall be determined to be invalid or unenforceable under any applicable law, by reason of being vague or unreasonable as to area, duration or scope of activity, this Agreement shall be considered divisible and shall become and be immediately amended to only such area, duration and scope of activity as shall be determined to be reasonable and enforceable by the court or other body having jurisdiction over the matter and Executive and the Company agree that this Agreement as so amended shall be valid and binding as though any invalid or unenforceable provision had not been included herein.

(h) Tolling . The periods during which the covenants set forth in this Section 5 shall survive shall be tolled during (and shall be deemed automatically extended by) any period during which Executive is in violation of any such covenants, to the extent permitted by applicable law.

(i) Severance Payment . In addition to the foregoing, and not in any way in limitation of any right or remedy otherwise available to the Company, if Executive violates Section 5 or Section 6 hereof, any Severance Payment or Enhanced Severance Payment then or thereafter due from the Company to Executive shall be terminated immediately and the Company’s obligation to pay and Executive’s right to receive such Severance Payment or Enhanced Severance Payment shall terminate and be of no further force or effect.

(j) EXECUTIVE ACKNOWLEDGES THAT EXECUTIVE HAS CAREFULLY READ THIS SECTION 5 AND HAS HAD THE OPPORTUNITY TO REVIEW ITS PROVISIONS WITH ANY ADVISORS AS EXECUTIVE CONSIDERED NECESSARY AND THAT EXECUTIVE UNDERSTANDS THIS AGREEMENT’S CONTENTS AND SIGNIFIES SUCH UNDERSTANDING AND AGREEMENT BY SIGNING BELOW.

6. Non-Disparagement .

During the Employment Period and at all times thereafter, neither Executive nor Executive’s agents, on the one hand, nor the Company formally, or its executives or board of directors, on the other hand, shall directly or indirectly issue or communicate any public statement, or statement likely to become public, that maligns, denigrates or disparages the other (including, in the case of communications by Executive or Executive’s agents, Company Group, any of Company Group’s officers, directors or employees, Apollo, GSO, KKR, or Franklin or any affiliate thereof). The foregoing shall not be violated by truthful responses to (i) legal process or governmental inquiry or (ii) by private statements to Company Group or any of Company Group’s officers, directors or employees; provided , that in the case of Executive, with respect to clause (ii), such statements are made in the course of carrying out Executive’s duties pursuant to this Agreement.

7. Confidentiality of Agreement .

The Parties agree that the consideration furnished under this Agreement, the discussions and correspondence that led to this Agreement, and the terms and conditions of this Agreement are private and confidential. Except as may be required by applicable law, regulation, or stock exchange requirement, neither Party may disclose the above information to any other person or entity without the prior written approval of the other.

8. Compensation Recovery Policy . If any of the Company’s financial statements are required to be restated due to errors, omissions, fraud or misconduct (including, but not limited to circumstances where the Company has been required to prepare an accounting restatement due to material non-compliance with any financial reporting requirement, as enforced by the Securities and Exchange Commission), the Compensation Committee of the Board may, in its sole discretion but acting in good faith, direct that the Company recover all or a portion of any cash incentive, equity compensation or severance disbursements paid to Executive with respect to any fiscal year of the Company for which the financial results are negatively affected by such restatement.

9. Executive’s Representations, Warranties and Covenants . Executive hereby represents and warrants to the Company that:

(i) Executive has all requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby, and this Agreement has been duly executed by Executive;

(ii) the execution, delivery and performance of this Agreement by Executive does not and will not, with or without notice or the passage of time, conflict with, breach, violate or cause a default under any agreement, contract or instrument to which Executive is a party or any judgment, order or decree to which Executive is subject;

(iii) Executive is not a party to or bound by any employment agreement, consulting agreement, non-compete agreement, fee for services agreement, confidentiality agreement or similar agreement with any other person;

(iv) upon the execution and delivery of this Agreement by the Company and Executive, this Agreement will be a legal, valid and binding obligation of Executive, enforceable in accordance with its terms;

(v) Executive understands that the Company will rely upon the accuracy and truth of the representations and warranties of Executive set forth herein and Executive consents to such reliance; and

(vi) as of the date of execution of this Agreement, Executive is not in breach of any of its terms, including having committed any acts that would form the basis for a Cause termination if such act had occurred after the Effective Date.

10. General Provisions .

provision in any other jurisdiction; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

(b) Entire Agreement and Effectiveness . Effective as of the Effective Date, this Agreement embodies the complete agreement and understanding among the Parties hereto with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the Parties, written or oral, which may have related to the subject matter hereof in any way.

(i) This Agreement is personal to Executive and without the prior written consent of the Company shall not be assignable by Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by Executive’s legal representatives.

(ii) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law, or otherwise.

(d) Governing Law . THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICTING PROVISION OR RULE THAT WOULD CAUSE THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE TO BE APPLIED. IN FURTHERANCE OF THE FOREGOING, THE INTERNAL LAW OF THE STATE OF DELAWARE WILL CONTROL THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT, EVEN IF UNDER SUCH JURISDICTION’S CHOICE OF LAW OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE LAW OF SOME OTHER JURISDICTION WOULD ORDINARILY APPLY.

(e) Enforcement .

agreement, shall be settled by submission by either Executive or the Company of the controversy, claim or dispute to binding arbitration in Alabama (unless the Parties agree in writing to a different location), before a single arbitrator in accordance with the Employment Dispute Resolution Rules of the American Arbitration Association then in effect. In any such arbitration proceeding the Parties agree to provide all discovery deemed necessary by the arbitrator. The decision and award made by the arbitrator shall be accompanied by a reasoned opinion, and shall be final, binding and conclusive on all Parties hereto for all purposes, and judgment may be entered thereon in any court having jurisdiction thereof. The Company will bear the totality of the arbitrator’s and administrative fees and costs. Each party shall bear its or Executive’s litigation costs and expenses; provided , however , that the arbitrator shall have the discretion to award the prevailing party reimbursement of its or his or her reasonable attorney’s fees and costs. Upon the request of any of the parties, at any time prior to the beginning of the arbitration hearing the parties may attempt in good faith to settle the dispute by mediation administered by the American Arbitration Association. The Company will bear the totality of the mediator’s and administrative fees and costs.

(ii) Remedies . All remedies hereunder are cumulative, are in addition to any other remedies provided for by law and may, to the extent permitted by law, be exercised concurrently or separately, and the exercise of any one remedy shall not be deemed to be an election of such remedy or to preclude the exercise of any other remedy.

(iii) Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(f) Amendment and Waiver . The provisions of this Agreement may be amended and waived only with the prior written consent of the Company and Executive and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall be construed as a waiver of such provisions or affect the validity, binding effect or enforceability of this Agreement or any provision hereof.

(g) Notices . Any notice provided for in this Agreement must be in writing and must be either personally delivered, transmitted via telecopier, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated or at such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Notices will be deemed to have been given hereunder and received when delivered personally, when received if transmitted via telecopier, five (5) days after deposit in the U.S. mail and one day after deposit for overnight delivery with a reputable overnight courier service.

If to the Company, to:

Warrior Met Coal, LLC

3000 Riverchase Galleria, Suite 1700

Birmingham, AL 35244

Attention: Chairman

with a copy (which shall not constitute notice) to:

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

New York, NY 10036

Facsimile: (212) 872-1002

Attention: Daniel Fisher

If to Executive, to:

Executive’s home address most recently on file with the Company.

(h) Withholdings Taxes . The Company may withhold from any amounts payable under this Agreement such federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation.

(i) Survival of Representations, Warranties and Agreements . All representations, warranties and agreements contained herein shall survive the consummation of the transactions contemplated hereby indefinitely.

(j) Descriptive Headings . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. All references to a “Section” in this Agreement are to a section of this Agreement unless otherwise noted.

(k) Construction . Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against any Party.

(l) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

taxable to Executive, any reimbursement payment due to Executive shall be paid to Executive on or before the last day of Executive’s taxable year following the taxable year in which the related expense was incurred; provided , that , Executive has provided the Company written documentation of such expenses in a timely fashion and such expenses otherwise satisfy the Company’ expense reimbursement policies. Reimbursements pursuant to this Agreement or otherwise are not subject to liquidation or exchange for another benefit and the amount of such reimbursements that Executive receives in one taxable year shall not affect the amount of such reimbursements that Executive receives in any other taxable year. Notwithstanding any provision in this Agreement to the contrary, if on the date of his termination from employment with the Company Executive is deemed to be a “specified employee” within the meaning of Code Section 409A and the Final Treasury Regulations using the identification methodology selected by the Company from time to time, or if none, the default methodology under Code Section 409A, any payments or benefits due upon a termination of Executive’s employment under any arrangement that constitutes a “deferral of compensation” within the meaning of Code Section 409A shall be delayed and paid or provided (or commence, in the case of installments) on the first payroll date on or following the earlier of (i) the date which is six (6) months and one (1) day after Executive’s termination of employment for any reason other than death, and (ii) the date of Executive’s death, and any remaining payments and benefits shall be paid or provided in accordance with the normal payment dates specified for such payment or benefit. Notwithstanding any of the foregoing to the contrary, the Company and its respective officers, directors, employees, or agents make no guarantee that the terms of this Agreement as written comply with, or are exempt from, the provisions of Code Section 409A, and none of the foregoing shall have any liability for the failure of the terms of this Agreement as written to comply with, or be exempt from, the provisions of Code Section 409A.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement as of the date first written above.


WARRIOR MET COAL, LLC

By:		/s/ Stephen D. Williams
		Name: Stephen D. Williams
		Title: Authorized Person

EXECUTIVE

/s/ Walter Scheller, III
Walter Scheller, III

Exhibit 10.8

This EMPLOYMENT AGREEMENT by and between Warrior Met Coal, LLC (the “ Company ”), and Michael T. Madden (“ Executive ”) (collectively, the “ Parties ”) is made as of March 31, 2016, and effective as of the later of April 1, 2016 and the Closing (as defined below) (such later date, the “ Effective Date ”).

WHEREAS , the Company intends to acquire certain assets of Walter Energy Inc. and its affiliated debtors and debtors-in-possession (the “ Transaction ”); and

NOW , THEREFORE , in consideration of the premises and of the mutual covenants, understandings, representations, warranties, undertakings and promises hereinafter set forth, intending to be legally bound thereby, the Parties agree as follows:

1. Employment Period .

2. Terms of Employment .

(a) Position . During the Employment Period, Executive shall serve as Chief Commercial Officer of the Company and will perform such duties and exercise such supervision with regard to the business of the Company as are commensurate with such position, including such duties as may be prescribed from time to time by the Chief Executive Officer of the Company (the “ CEO ”). Executive shall report directly to the CEO and, if reasonably requested by the Board, Executive hereby agrees to serve (without additional compensation) as an officer and director of the Company or any affiliate or subsidiary thereof.

(b) Duties . During the Employment Period, Executive shall have such responsibilities, duties, and authority that are commensurate with Executive’s position, subject at all times to the control of the CEO, and shall perform such services as customarily are provided by an executive of a corporation with Executive’s position and such other services consistent with Executive’s position, as shall be assigned to Executive from time to time by the CEO. During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote all of Executive’s business time to the business and affairs of the Company and to use Executive’s commercially reasonable efforts to perform faithfully, effectively and efficiently Executive’s responsibilities and obligations hereunder. Executive shall be entitled to engage in charitable and educational activities and to manage Executive’s personal and family investments, to the extent such activities are not competitive with the business of the Company, do not interfere with the performance of Executive’s duties for the Company and are otherwise consistent with the Company’s governance policies.

(i) Base Salary . During the Employment Period, Executive shall receive an annual base salary in an amount equal to three hundred twenty thousand dollars ($320,000), less all applicable withholdings, which shall be paid in accordance with the customary payroll practices of the Company and prorated for partial calendar years of employment (as in effect from time to time, the “ Annual Base Salary ”). The Annual Base Salary shall be subject to annual review by the Board, in its sole discretion, for possible increase and any such increased Annual Base Salary documented in the form of a resolution adopted by the Board or an amendment to this Agreement shall constitute “Annual Base Salary” for purposes of this Agreement.

(ii) Annual Bonus . During the Employment Period, with respect to each completed fiscal year of the Company, Executive shall be eligible to receive a bonus (the “ Bonus ”) with a target amount equal to 75% of Annual Base Salary contingent upon the achievement of qualitative and quantitative performance goals approved by the Board. The Bonus, if any, shall be paid in accordance with the terms of the applicable bonus plan as in effect from time to time, and shall require that Executive be employed with the Company on the date of payment of such Bonus.

indemnification in connection with any gross negligence or willful misconduct of the Executive. The Executive shall be covered during the entire term of this Agreement and thereafter for at least six (6) years by officer and director liability insurance in amounts and on terms similar to that afforded to other executives and/or directors of the Company affiliates.

3. Termination of Employment .

(e) Voluntary Termination . Executive’s employment may be terminated at any time by Executive without Good Reason upon thirty (30) days’ prior written notice.

4. Obligations of the Company upon Termination .

Company’s customary payroll practices, commencing on the first payroll date occurring on or after the date that is sixty (60) days following the Date of Termination (with the first installment inclusive of the installments that would have otherwise been payable during such initial sixty (60) day period) and ending on the first anniversary of the Date of Termination (the “ Severance Payment ”);

(i) the Accrued Obligations; and

(ii) subject to Section 4(e) below, after the Date of Termination, the Company will pay Executive a lump sum amount equal to one and one-half times (1.5x) Executive’s Annual Base Salary as in effect as of the Date of Termination (the “ Enhanced Severance Payment ”).

5. Restrictive Covenants .

interfere with the relationship between any such customer, supplier, licensee, licensor, representative, agent or business relation of the Company or any of its affiliates or subsidiaries. No action by another person or entity shall be deemed to be a breach of this provision unless the Executive directly or indirectly assisted, encouraged or otherwise counseled such person or entity to engage in such activity.

able to be protected by copyright, patent or trademark) during the course of Executive’s employment with the Company, or involving the use of the time, materials or other resources of the Company Group, shall be promptly disclosed to the Company Group and shall become the exclusive property of the Company Group, and Executive shall execute and deliver any and all documents necessary or appropriate to implement the foregoing.

(e) Certain Definitions .

rights and remedies available to the Company at law or in equity. Accordingly, Executive consents to the issuance of an injunction, whether preliminary or permanent, consistent with the terms of this Agreement (without posting a bond or other security) if the Company establishes a violation of Section 5 or 6 of this Agreement.

6. Non-Disparagement .

7. Confidentiality of Agreement .

9. Executive’s Representations, Warranties and Covenants . Executive hereby represents and warrants to the Company that:

(v) Executive understands that the Company will rely upon the accuracy and truth of the representations and warranties of Executive set forth herein and Executive consents to such reliance; and

10. General Provisions .

(a) Severability . It is the desire and intent of the Parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies

applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

(e) Enforcement .

(i) Arbitration . Except for disputes arising under Sections 5 and 6 of this Agreement (including, without limitation, any claim for injunctive relief), any controversy, dispute or claim arising out of or relating to this Agreement, or its interpretation, application, implementation, breach or enforcement which the Parties are unable to resolve by mutual agreement, shall be settled by submission by either Executive or the Company of the controversy, claim or dispute to binding arbitration in Alabama (unless the Parties agree in writing to a different location), before a single arbitrator in accordance with the Employment Dispute Resolution Rules of the American Arbitration Association then in effect. In any such arbitration proceeding the Parties agree to provide all discovery deemed necessary by the arbitrator. The decision and award made by the arbitrator shall be accompanied by a reasoned opinion, and shall be final, binding and conclusive on all Parties hereto for all purposes, and judgment may be entered thereon in any court having jurisdiction thereof. The Company will bear the totality of the arbitrator’s and administrative fees and costs. Each party shall bear its or Executive’s litigation costs and expenses; provided , however , that the arbitrator shall have the discretion to award the prevailing party reimbursement of its or his or her reasonable attorney’s fees and costs. Upon the request of any of the parties, at any time prior to the beginning of the arbitration hearing the parties may attempt in good faith to settle the dispute by mediation administered by the American Arbitration Association. The Company will bear the totality of the mediator’s and administrative fees and costs.

(iii) Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

If to the Company, to:

Warrior Met Coal, LLC

3000 Riverchase Galleria, Suite 1700

Birmingham, AL 35244

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

New York, NY 10036

Facsimile: (212) 872-1002

Attention: Daniel Fisher

If to Executive, to:

Executive’s home address most recently on file with the Company.

(l) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement or otherwise which constitutes a “deferral of compensation” within the meaning of Section 409A of the Code. All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code. To the extent that any reimbursements pursuant to this Agreement or otherwise are taxable to Executive, any reimbursement payment due to Executive shall be paid to Executive on or before the last day of Executive’s taxable year following the taxable year in which the related expense was incurred; provided , that , Executive has provided the Company written documentation of such expenses in a timely fashion and such expenses otherwise satisfy the Company’ expense reimbursement policies. Reimbursements pursuant to this Agreement or otherwise are not subject to liquidation or exchange for another benefit and the amount of such reimbursements that Executive receives in one taxable year shall not affect the amount of such reimbursements that Executive receives in any other taxable year. Notwithstanding any provision in this Agreement to the contrary, if on the date of his termination from employment with the Company Executive is deemed to be a “specified employee” within the meaning of Code Section 409A and the Final Treasury Regulations using the identification methodology selected by the Company from time to time, or if none, the default methodology under Code Section 409A, any payments or benefits due upon a termination of Executive’s employment under any arrangement that constitutes a “deferral of compensation” within the meaning of Code Section 409A shall be delayed and paid or provided (or commence, in the case of installments) on the first payroll date on or following the earlier of (i) the date which is six (6) months and one (1) day after Executive’s termination of employment for any reason other than death, and (ii) the date of Executive’s death, and any remaining payments and benefits shall be paid or provided in accordance with the normal payment dates specified for such payment or benefit. Notwithstanding any of the foregoing to the contrary, the Company and its respective officers, directors, employees, or agents make no guarantee that the terms of this Agreement as written comply with, or are exempt from, the provisions of Code Section 409A, and none of the foregoing shall have any liability for the failure of the terms of this Agreement as written to comply with, or be exempt from, the provisions of Code Section 409A.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement as of the date first written above.


WARRIOR MET COAL, LLC

By:		/s/ Stephen D. Williams
		Name: Stephen D. Williams
		Title: Authorized Person

EXECUTIVE

/s/ Michael T. Madden
Michael T. Madden

Exhibit 10.9

This EMPLOYMENT AGREEMENT by and between Warrior Met Coal, LLC (the “ Company ”), and Jack Richardson (“ Executive ”) (collectively, the “ Parties ”) is made as of March 31, 2016, and effective as of the later of April 1, 2016 and the Closing (as defined below) (such later date, the “ Effective Date ”).

WHEREAS , the Company intends to acquire certain assets of Walter Energy Inc. and its affiliated debtors and debtors-in-possession (the “ Transaction ”); and

1. Employment Period .

2. Terms of Employment .

(a) Position . During the Employment Period, Executive shall serve as Chief Operating Officer of the Company and will perform such duties and exercise such supervision with regard to the business of the Company as are commensurate with such position, including such duties as may be prescribed from time to time by the Chief Executive Officer of the Company (the “ CEO ”). Executive shall report directly to the CEO and, if reasonably requested by the Board, Executive hereby agrees to serve (without additional compensation) as an officer and director of the Company or any affiliate or subsidiary thereof.

(b) Duties . During the Employment Period, Executive shall have such responsibilities, duties, and authority that are commensurate with Executive’s position, subject at all times to the control of the CEO, and shall perform such services as customarily are provided by an executive of a corporation with Executive’s position and such other services consistent with Executive’s position, as shall be assigned to Executive from time to time by the CEO. During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote all of Executive’s business time to the business and affairs of the Company and to use Executive’s commercially reasonable efforts to perform faithfully, effectively and efficiently Executive’s responsibilities and obligations hereunder. Executive shall be entitled to engage in charitable and educational activities and to manage Executive’s personal and family investments, to the extent such activities are not competitive with the business of the Company, do not interfere with the performance of Executive’s duties for the Company and are otherwise consistent with the Company’s governance policies.

(i) Base Salary . During the Employment Period, Executive shall receive an annual base salary in an amount equal to three hundred twenty five thousand dollars ($325,000), less all applicable withholdings, which shall be paid in accordance with the customary payroll practices of the Company and prorated for partial calendar years of employment (as in effect from time to time, the “ Annual Base Salary ”). The Annual Base Salary shall be subject to annual review by the Board, in its sole discretion, for possible increase and any such increased Annual Base Salary documented in the form of a resolution adopted by the Board or an amendment to this Agreement shall constitute “Annual Base Salary” for purposes of this Agreement.

3. Termination of Employment .

(e) Voluntary Termination . Executive’s employment may be terminated at any time by Executive without Good Reason upon thirty (30) days’ prior written notice.

4. Obligations of the Company upon Termination .

(i) the Accrued Obligations; and

5. Restrictive Covenants .

(e) Certain Definitions .

6. Non-Disparagement .

7. Confidentiality of Agreement .

9. Executive’s Representations, Warranties and Covenants . Executive hereby represents and warrants to the Company that:

(v) Executive understands that the Company will rely upon the accuracy and truth of the representations and warranties of Executive set forth herein and Executive consents to such reliance; and

10. General Provisions .

(a) Severability . It is the desire and intent of the Parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies

(e) Enforcement .

(iii) Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

If to the Company, to:

Warrior Met Coal, LLC

3000 Riverchase Galleria, Suite 1700

Birmingham, AL 35244

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

New York, NY 10036

Facsimile: (212) 872-1002

Attention: Daniel Fisher

If to Executive, to:

Executive’s home address most recently on file with the Company.

(l) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement as of the date first written above.


WARRIOR MET COAL, LLC

By:		/s/ Stephen D. Williams
		Name: Stephen D. Williams
		Title: Authorized Person

EXECUTIVE

/s/ Jack Richardson
Jack Richardson

Exhibit 10.10

This EMPLOYMENT AGREEMENT by and between Warrior Met Coal, LLC (the “ Company ”), and Dale W. Boyles (“ Executive ”) (collectively, the “ Parties ”) is made as of January 1, 2017 (the “ Effective Date ”).

1. Employment Period .

2. Terms of Employment .

(a) Position . During the Employment Period, Executive shall serve as Chief Financial Officer of the Company and will perform such duties and exercise such supervision with regard to the business of the Company as are commensurate with such position, including such duties as may be prescribed from time to time by the Chief Executive Officer of the Company (the “ CEO ”). Executive shall report directly to the CEO and, if reasonably requested by the Board, Executive hereby agrees to serve (without additional compensation) as an officer and director of the Company or any affiliate or subsidiary thereof.

(b) Duties . During the Employment Period, Executive shall have such responsibilities, duties, and authority that are commensurate with Executive’s position, subject at all times to the control of the CEO, and shall perform such services as customarily are provided by an executive of a corporation with Executive’s position and such other services consistent with Executive’s position, as shall be assigned to Executive from time to time by the CEO. During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote all of Executive’s business time to the business and affairs of the Company and to use Executive’s commercially reasonable efforts to perform faithfully, effectively and efficiently Executive’s responsibilities and obligations hereunder. Executive shall be entitled to engage in charitable and educational activities and to manage Executive’s personal and family investments, to the extent such activities are not competitive with the business of the Company, do not interfere with the performance of Executive’s duties for the Company and are otherwise consistent with the Company’s governance policies.

(i) Base Salary . During the Employment Period, Executive shall receive an annual base salary in an amount equal to three hundred fifty thousand dollars ($350,000), less all applicable withholdings, which shall be paid in accordance with the customary payroll practices of the Company and prorated for partial calendar years of employment (as in effect from time to time, the “ Annual Base Salary ”). The Annual Base Salary shall be subject to annual review by the Board, in its sole discretion, for possible increase and any such increased Annual Base Salary documented in the form of a resolution adopted by the Board or an amendment to this Agreement shall constitute “Annual Base Salary” for purposes of this Agreement.

(iii) Signing Bonus . The Company shall pay to Executive a signing bonus equal to fifty five thousand dollars ($55,000) (the “ Signing Bonus ”). The Signing Bonus shall be paid to Executive in a cash lump sum on the first payroll date of the Company following the Effective Date.

(iv) Additional Bonus . Executive shall remain eligible to receive the bonus payments pursuant to, and in accordance with, Section 3(c) and Section 3(d) of the Consulting Agreement, dated as of November 8, 2016, between the Company and Boyles Consulting LLC.

(v) Equity Award . As soon as practicable following the Effective Date, Executive will be issued an award of restricted units of Class C Units of the Company with an aggregate grant date fair market value equal to approximately $675,000 pursuant to the Warrior Met Coal, LLC 2016 Equity Incentive Plan and the applicable award agreement, which will contain the vesting and other terms relating to such award.

(vi) Benefits . During the Employment Period, Executive shall be eligible to participate in all retirement, compensation and employee benefit plans, practices, policies and programs provided by the Company to the extent applicable generally to other executives of the Company (except severance plans, policies, practices, or programs) subject to the eligibility criteria set forth therein, as such may be amended or terminated from time to time.

(vii) Expenses . During the Employment Period, Executive shall be entitled to receive reimbursement for all reasonable business expenses incurred by Executive in performance of Executive’s duties hereunder provided that Executive provides all necessary documentation in accordance with the Company’s policies.

(viii) The Company shall indemnify the Executive, to the fullest extent permitted by applicable law, against all costs, charges and expenses incurred or sustained by Executive, including the cost and expenses of legal counsel, in connection with any action, suit

or proceeding (collectively a “ Proceeding ”) to which the Executive may be made a party by reason of the Executive being or having been an officer, director, or employee of the Company or any of its affiliates. Notwithstanding the preceding, the Executive shall not be entitled to indemnification in connection with any gross negligence or willful misconduct of the Executive. The Executive shall be covered during the entire term of this Agreement and thereafter for at least six (6) years by officer and director liability insurance in amounts and on terms similar to that afforded to other executives and/or directors of the Company affiliates.

3. Termination of Employment .

Reason” unless Executive has given the Company written notice stating the condition that is the basis for such termination within thirty (30) days following the initial occurrence of the event or condition allegedly constituting Good Reason and the Company fails to cure such condition within fifteen (15) days following receipt of such notice

(e) Voluntary Termination . Executive’s employment may be terminated at any time by Executive without Good Reason upon thirty (30) days’ prior written notice.

4. Obligations of the Company upon Termination .

(i) the Accrued Obligations; and

(determined on a consolidated basis) through one transaction or a series of related transactions occurring during any period of twelve (12) consecutive months to one or more persons who are not, immediately prior to such sale, transfer or other disposition, unit holders or affiliates of the Company.

5. Restrictive Covenants .

induce or attempt to induce such person to cease doing business with, or reduce the amount of business conducted with, the Company or any of its affiliates or subsidiaries, or in any way interfere with the relationship between any such customer, supplier, licensee, licensor, representative, agent or business relation of the Company or any of its affiliates or subsidiaries. No action by another person or entity shall be deemed to be a breach of this provision unless the Executive directly or indirectly assisted, encouraged or otherwise counseled such person or entity to engage in such activity.

of Work Product, shall be the property of and inure to the exclusive benefit of the Company Group. Executive further agrees that all Work Product developed by Executive (whether or not able to be protected by copyright, patent or trademark) during the course of Executive’s employment with the Company, or involving the use of the time, materials or other resources of the Company Group, shall be promptly disclosed to the Company Group and shall become the exclusive property of the Company Group, and Executive shall execute and deliver any and all documents necessary or appropriate to implement the foregoing.

(e) Certain Definitions .

to the Company Group and that money damages will not provide an adequate remedy to the Company Group. Such right and remedy shall be in addition to, and not in lieu of, any other rights and remedies available to the Company at law or in equity. Accordingly, Executive consents to the issuance of an injunction, whether preliminary or permanent, consistent with the terms of this Agreement (without posting a bond or other security) if the Company establishes a violation of Section 5 or 6 of this Agreement.

6. Non-Disparagement .

7. Confidentiality of Agreement .

9. Executive’s Representations, Warranties and Covenants . Executive hereby represents and warrants to the Company that:

(v) Executive understands that the Company will rely upon the accuracy and truth of the representations and warranties of Executive set forth herein and Executive consents to such reliance; and

10. General Provisions .

(a) Severability . It is the desire and intent of the Parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law, or otherwise.

(e) Enforcement .

(iii) Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

If to the Company, to:

Warrior Met Coal, LLC

3000 Riverchase Galleria, Suite 1700

Birmingham, AL 35244

Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

Akin Gump Strauss Hauer & Feld LLP

One Bryant Park

New York, NY 10036

Facsimile: (212) 872-1002

Attention: Daniel Fisher

If to Executive, to:

Executive’s home address most recently on file with the Company.

(k) Construction . Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or

restrict in any manner the construction of the general statement to which it relates. The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against any Party.

(l) Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

(m) Section 409A . Notwithstanding anything herein to the contrary, this Agreement is intended to be interpreted and applied so that the payment of the benefits set forth herein either shall either be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “ Code ”), or shall comply with the requirements of such provision. Notwithstanding anything in this Agreement or elsewhere to the contrary, distributions upon termination of Executive’s employment may only be made upon a “separation from service” as determined under Section 409A of the Code. Each payment under this Agreement or otherwise shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement or otherwise which constitutes a “deferral of compensation” within the meaning of Section 409A of the Code. All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code. To the extent that any reimbursements pursuant to this Agreement or otherwise are taxable to Executive, any reimbursement payment due to Executive shall be paid to Executive on or before the last day of Executive’s taxable year following the taxable year in which the related expense was incurred; provided , that , Executive has provided the Company written documentation of such expenses in a timely fashion and such expenses otherwise satisfy the Company’ expense reimbursement policies. Reimbursements pursuant to this Agreement or otherwise are not subject to liquidation or exchange for another benefit and the amount of such reimbursements that Executive receives in one taxable year shall not affect the amount of such reimbursements that Executive receives in any other taxable year. Notwithstanding any provision in this Agreement to the contrary, if on the date of his termination from employment with the Company Executive is deemed to be a “specified employee” within the meaning of Code Section 409A and the Final Treasury Regulations using the identification methodology selected by the Company from time to time, or if none, the default methodology under Code Section 409A, any payments or benefits due upon a termination of Executive’s employment under any arrangement that constitutes a “deferral of compensation” within the meaning of Code Section 409A shall be delayed and paid or provided (or commence, in the case of installments) on the first payroll date on or following the earlier of (i) the date which is six (6) months and one (1) day after Executive’s termination of employment for any reason other than death, and (ii) the date of Executive’s death, and any remaining payments and benefits shall be paid or provided in accordance with the normal payment dates specified for such payment or benefit. Notwithstanding any of the foregoing to the contrary, the Company and its respective officers, directors, employees, or agents make no guarantee that the terms of this Agreement as written comply with, or are exempt from, the provisions of Code Section 409A, and none of the foregoing shall have any liability for the failure of the terms of this Agreement as written to comply with, or be exempt from, the provisions of Code Section 409A.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement as of the date first written above.


WARRIOR MET COAL, LLC

By:		/s/ Walter J. Scheller, III
		Name: Walter J. Scheller, III
		Title: Chief Executive Officer

EXECUTIVE

/s/ Dale W. Boyles
Dale W. Boyles

Exhibit 21.1

WARRIOR MET COAL, LLC

Subsidiaries List


Name of Subsidiary	Jurisdiction of Organization
Warrior Met Coal Intermediate Holdco, LLC		Delaware
Warrior Met Coal Gas, LLC		Delaware
Warrior Met Coal TRI, LLC		Delaware
Warrior Met Coal Land, LLC		Delaware
Warrior Met Coal LA, LLC		Delaware
Warrior Met Coal Mining, LLC		Delaware
Warrior Met Coal BCE, LLC		Delaware
Warrior Met Coal WV, LLC		Delaware
Black Warrior Methane Corp.*		Alabama
Black Warrior Transmission Corp. *		Alabama

*	Represents a joint venture company of which the registrant indirectly owns 50% of the common stock.

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the reference to our firm under the caption “Experts” and to the use of our report dated March 7, 2017 in this Registration Statement (Form S-1) and related Prospectus of Warrior Met Coal, LLC dated March 7, 2017.

/s/ Ernst & Young LLP

Birmingham, Alabama

March 7, 2017

Exhibit 23.2

CONSENT OF MARSHALL MILLER & ASSOCIATES, INC.

Marshall Miller & Associates, Inc. hereby consents to the references to our firm in the Registration Statement on Form S-1 (the “Registration Statement”), and the related prospectus, of Warrior Met Coal, LLC, including the reference to our firm under the heading “Experts” in the Registration Statement and related prospectus. We hereby further consent to the use of information contained in our report, dated as of February 2, 2017, relating to estimates of certain coal reserves.


Marshall Miller & Associates, Inc.

By:		/s/ K. Scott Keim
Name:		K. Scott Keim
Title:		CEO & Partner

Dated:		March 6, 2017

Exhibit 23.3

LOGO

Pat Akers

Vice President

Surface Mining/Financial Services

CONSENT OF NORWEST CORPORATION

March 6, 2017

To whom it may concern:

Subject: Warrior Met Coal, LLC

Dear Madam or Sir:

Norwest Corporation is an independent geologic and mining consultancy engaged in mineral resource analysis and mine planning since 1979. We consent to the inclusion in this Registration Statement on Form S-1 (the “Registration Statement”), and the related prospectus, of references to our name, including the reference to our name under the heading “Experts” in the Registration Statement and the related prospectus, and information from our report dated as of February 17, 2017 relating to certain proven and probable coal reserves of Warrior Met Coal, LLC.

Yours Sincerely,

/s/ Pat Akers

Pat Akers

Vice President, Surface Mining/Financial Services

American Plaza II – 57 West 200 South, Suite 500 • Salt Lake City, Utah 84101 USA

Tel 801.539.0044 • USA 800.266.6351 • Fax 801.539.0055 • www.norwestcorp.com

SALT LAKE CITY / CALGARY / DENVER / VANCOUVER / SASKATOON / GRAND JUNCTION / CHARLESTON WV

Exhibit 23.4

CONSENT OF MCGEHEE ENGINEERING CORP.

McGehee Engineering Corp. hereby consents to the references to our firm in the Registration Statement on Form S-1 (the “Registration Statement”), and the related prospectus, of Warrior Met Coal, LLC, including the reference to our firm under the heading “Experts” in the Registration Statement and related prospectus. We hereby further consent to the use of information contained in our report, dated as of February 7, 2017, relating to estimates of certain coal reserves.


McGehee Engineering Corp.

By:		/s/ C. W. McGehee
Name:		C. W. McGehee
Title:		President

Dated: March 2, 2017

Exhibit 23.5

CONSENT OF WOOD MACKENZIE INC.

We hereby consent to (i) the use of our firm’s name, Wood Mackenzie Inc. (“Wood Mackenzie”), in the Registration Statement on Form S-1 to be filed with the U.S. Securities and Exchange Commission by Warrior Met Coal, LLC and any amendments thereto, including the prospectus contained therein (the “Registration Statement”), including the use of our firm’s name under the heading “Experts” in the Registration Statement, and (ii) the inclusion of information relating to the coal industry (the “Information”) in the Registration Statement that was supplied by Wood Mackenzie and references to Wood Mackenzie as the source of such Information.

We further wish to advise you that Wood Mackenzie was not employed on a contingent basis and that at the time of the preparation of the Information, as well as at the date hereof, neither Wood Mackenzie nor any of its employees had or now has a substantial interest in Warrior Met Coal, LLC or any of its affiliates or subsidiaries.



By:		/s/ Alan Kenny
		Alan Kenny
		VP of Sales
		Wood Mackenzie Inc.
		For and on behalf of Wood Mackenzie Inc.

Date: March 3, 2017