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•	as a result of our emergence from our Chapter 11 Cases, our historical financial information is not indicative of our future financial performance;

•	our profitability depends upon the prices we receive for our coal;

•	if a substantial number of our long-term coal supply agreements terminate, our revenues and operating profits could suffer if we are unable to find alternate buyers willing to purchase our coal on comparable terms to those in our contracts;

•	the loss of, or significant reduction in, purchases by our largest customers could adversely affect our revenues;

•	our trading and hedging activities do not cover certain risks, and may expose us to earnings volatility and other risks;

•	our operating results could be adversely affected by unfavorable economic and financial market conditions;

•	our ability to collect payments from our customers could be impaired if their creditworthiness or contractual performance deteriorates;

•	risks inherent to mining could increase the cost of operating our business, and events and conditions that could occur during the course of our mining operations could have a material adverse impact on us;

•	if transportation for our coal becomes unavailable or uneconomic for our customers, our ability to sell coal may be diminished;

•	a decrease in the availability or increase in costs of key supplies, capital equipment or commodities such as diesel fuel, steel, explosives and tires could decrease our anticipated profitability;

•	take-or-pay arrangements within the coal industry could unfavorably affect our profitability;

•	an inability of trading, brokerage, mining or freight counterparties to fulfill the terms of their contracts with us could reduce our profitability;

•	we may not recover our investments in our mining, exploration and other assets, which may require us to recognize impairment charges related to those assets;

•	our ability to operate our company effectively could be impaired if we lose key personnel or fail to attract qualified personnel;

•	we could be negatively affected if we fail to maintain satisfactory labor relations;

•	we could be adversely affected if we fail to appropriately provide financial assurances for our obligations;

•	our mining operations are extensively regulated, which imposes significant costs on us, and future regulations and developments could increase those costs or limit our ability to produce coal;

•	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;

•	we may be unable to obtain, renew or maintain permits necessary for our operations, which would reduce our production, cash flows and profitability;

•	our mining operations are subject to extensive forms of taxation, which imposes significant costs on us, and future regulations and developments could increase those costs or limit our ability to produce coal competitively;

•	if the assumptions underlying our asset retirement obligations for reclamation and mine closures are materially inaccurate, our costs could be significantly greater than anticipated;

•	our future success depends upon our ability to continue acquiring and developing coal reserves that are economically recoverable;

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•	we face numerous uncertainties in estimating our economically recoverable coal reserves and inaccuracies in our estimates could result in lower than expected revenues, higher than expected costs and decreased profitability;

•	our global operations increase our exposure to risks unique to international mining and trading operations;

•	joint ventures, partnerships or non-managed operations may not be successful and may not comply with our operating standards;

•	we may undertake further repositioning plans that would require additional charges;

•	we could be exposed to significant liability, reputational harm, loss of revenue, increased costs or other risks if we sustain cyber attacks or other security breaches that disrupt our operations or result in the dissemination of proprietary or confidential information about us, our customers or other third-parties;

•	our expenditures for postretirement benefit and pension obligations could be materially higher than we have predicted if our underlying assumptions prove to be incorrect;

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concerns about the impacts of coal combustion on global climate are increasingly leading to consequences that have and could continue to affect demand for our products or our securities, including the following: increased regulation of coal combustion in many jurisdictions; investment decisions by electricity generators that are unfavorable to coal-fueled generation units; unfavorable lending policies by lending institutions and development banks toward the financing of new overseas coal-fueled power plants; and divestment efforts affecting the institutional investment community;

•	numerous activist groups are devoting substantial resources to anti-coal activities to minimize or eliminate the use of coal as a source of electricity generation, domestically and internationally, thereby further reducing the demand and pricing for coal, and potentially materially and adversely impacting our future financial results, liquidity and growth prospects;

•	we may not be able to successfully integrate the recently acquired Shoal Creek Mine or other companies, assets or properties that we may acquire in the future;

•	if we fail to establish and maintain proper internal controls for the Shoal Creek Mine, our ability to produce accurate financial statements or comply with applicable regulations could be impaired;

•	our financial performance could be adversely affected by our indebtedness;

•	despite our indebtedness, we may still be able to incur substantially more debt, including secured debt, which could further increase the risks associated with our indebtedness;

•	we may not be able to generate sufficient cash to service all of our indebtedness or other obligations;

•	the terms of our indenture governing our senior secured notes and the agreements and instruments governing our other indebtedness impose restrictions that may limit our operating and financial flexibility;

•	the number and quantity of viable financing alternatives available to us may be significantly impacted by unfavorable lending and investment policies by financial institutions and insurance companies associated with concerns about environmental impacts of coal combustion;

•	the price of our securities may be volatile;

•	our Common Stock is subject to dilution and may be subject to further dilution in the future;

•	there may be circumstances in which the interests of a significant stockholder could be in conflict with other stakeholders’ interests;

•	the payment of dividends on our stock or repurchases of our stock is dependent on a number of factors, and future payments and repurchases cannot be assured;

•	we may not be able to fully utilize our deferred tax assets;

•	acquisitions and divestitures are a potentially important part of our long-term strategy, subject to our investment criteria, and involve a number of risks, any of which could cause us not to realize the anticipated benefits;

•	our certificate of incorporation and by-laws include provisions that may discourage a takeover attempt;

•	diversity in interpretation and application of accounting literature in the mining industry may impact our reported financial results; and

•	other risks and factors, including those discussed in “Legal Proceedings,” set forth in Part I, Item 3 of this report and “Risk Factors,” set forth in Part I, Item 1A of this report.

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(1)	Third-party purchased coal used to satisfy coal supply agreements.

(2)	Mine was suspended in 2018.

(3)	We own a 73.3% undivided interest in an unincorporated joint venture that owns the Coppabella and Moorvale mines. The tons shown reflect our share.

(4)	The mine ceased open-cut mining in September 2018 and now exclusively conducts highwall mining.

(5)	Our North Goonyella Mine experienced a fire in a portion of the mine during September 2018.

(6)	Tons sold is for the period December 4 through December 31, 2018.

(7)	We own a 50% equity interest in Middlemount, which owns the Middlemount Mine. Because that entity is accounted for as an unconsolidated equity affiliate, 2018 tons sold from that mine, which totaled 4.2 million tons (on a 100% basis), have been excluded from the table above.

(8)	Majority-owned mines in which there is an outside non-controlling ownership interest.

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•	the demand for electricity and capacity utilization of electricity generating units (whether coal or non-coal);

•	changes in the fuel consumption and dispatch patterns of electric power generators;

•	the proximity, capacity and cost of transportation and terminal facilities;

•	the relative price of natural gas and other energy sources used to generate electricity;

•	competition with and the availability, quality and price of coal and alternative fuels, including natural gas, fuel oil, nuclear, hydroelectric, wind, biomass and solar power;

•	the strength of the global economy;

•	the global supply and production costs of thermal and metallurgical coal;

•	the demand for steel, which may lead to price fluctuations in the monthly and quarterly repricing of our metallurgical coal contracts;

•	weather patterns, severe weather and natural disasters;

•	governmental regulations and taxes, including tariffs or other trade restrictions as well as those establishing air emission standards for coal-fueled power plants or mandating or subsidizing increased use of electricity from renewable energy sources;

•	regulatory, administrative and judicial decisions, including those affecting future mining permits and leases; and

•	technological developments, including those related to alternative energy sources, those intended to convert coal-to-liquids or gas and those aimed at capturing, using and storing carbon dioxide.

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•	elevated gas levels;

•	fires and explosions, including from methane gas or coal dust;

•	accidental mine water discharges;

•	weather, flooding and natural disasters;

•	hazardous events such as roof falls and high wall or tailings dam failures;

•	key equipment failures;

•	variations in coal seam thickness, coal quality, the amount of rock and soil overlying coal deposits, and geologic conditions impacting mine sequencing;

•	unexpected maintenance problems; and

•	unforeseen delays in implementation of mining technologies that are new to our operations.

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•	lack of availability, higher expense or unfavorable market terms of new surety bonds; and

•	inability to provide or fund collateral for current and future third-party surety bond issuers.

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•	workplace health and safety;

•	limitations on land use;

•	mine permitting and licensing requirements;

•	reclamation and restoration of mining properties after mining is completed;

•	the storage, treatment and disposal of wastes;

•	remediation of contaminated soil, sediment and groundwater;

•	air quality standards;

•	water pollution;

•	protection of human health, plant-life and wildlife, including endangered or threatened species and habitats;

•	protection of wetlands;

•	the discharge of materials into the environment; and

•	the effects of mining on surface water and groundwater quality and availability.

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•	geologic and mining conditions, which may not be fully identified by available exploration data and may differ from our experience in areas we currently mine;

•	current and future market prices for coal, contractual arrangements, operating costs and capital expenditures;

•	severance and excise taxes, royalties and development and reclamation costs;

•	current and future market prices for coal, contractual arrangements, operating costs and capital expenditures;

•	demand for coal;

•	future mining technology improvements;

•	the effects of regulation by governmental agencies;

•	the ability to obtain, maintain and renew all required permits;

•	employee health and safety; and

•	historical production from the area compared with production from other producing areas.

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•	making it more difficult for us to pay interest and satisfy our debt obligations;

•	increasing the cost of borrowing;

•	increasing our vulnerability to general adverse economic and industry conditions;

•	requiring the dedication of a substantial portion of our cash flow from operations to the payment of principal and interest on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, business development or other general corporate requirements;

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

•	making it more difficult to obtain surety bonds, letters of credit, bank guarantees or other financing, particularly during periods in which credit markets are weak;

•	limiting our flexibility in planning for, or reacting to, changes in our business and in the coal industry;

•	causing a decline in our credit ratings; and

•	placing us at a competitive disadvantage compared to less leveraged competitors.

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•	incur additional indebtedness;

•	pay dividends on or make distributions in respect of stock or make certain other restricted payments or investments;

•	enter into agreements that restrict distributions from certain subsidiaries;

•	sell or otherwise dispose of assets;

•	incur capital expenditures beyond a specified amount;

•	enter into transactions with affiliates;

•	create or incur liens;

•	merge, consolidate or sell all or substantially all of our assets; and

•	place restrictions on the ability of subsidiaries to pay dividends or make other payments to us.

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•	actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry;

•	industry cycles and trends;

•	mergers and strategic alliances in the coal industry;

•	changes in government regulation;

•	potential or actual military conflicts or acts of terrorism;

•	the failure of securities analysts to publish research about us or to accurately predict the results we actually achieve;

•	changes in accounting principles;

•	announcements concerning us or our competitors;

•	lack of trading liquidity; and

•	the general state of the securities market.

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(1)	Estimated proven and probable coal reserves have been adjusted to account for estimated process dilutions and losses during mining and processing involved in producing a saleable coal product.

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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.

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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.

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Geological settings. The geological characteristics of each mine are among the most important factors that determine the mining cost. Our geology department conducts the exploration program and provides geological models for the LOM process. Coal seam depth, thickness, dipping angle, partings and quality constrain the available mining methods and size of operations. Shallow coal is typically mined by surface mining methods by which the primary cost is overburden removal. Deep coal is typically mined by underground mining methods where the primary costs include coal extraction, conveyance and roof control.

•	Scale of operations and the equipment sizes. For surface mines, our dragline systems generally have a lower unit cost than truck-and-shovel systems for overburden removal. The longwall operations generally are more cost effective than room-and-pillar operations for underground mines.

•	Commodity prices. For surface mines, the costs of diesel fuel and explosives are major components of the total mining cost. For underground mines, the steel used for roof bolts represents a significant cost. Forecasted commodity prices are used to project those costs in the financial models we use to establish our reserves.

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•	Target product quality. By targeting a premium quality product, our mining and processing processes may experience more coal losses. By lowering product quality the coal losses can be minimized and therefore a lower cost per ton can be achieved. In our mine plans, the product qualities are estimated to correspond to existing contracts and forecasted market demands.

•	Transportation costs. Transportation costs vary by region. Most of our U.S. thermal operations sell coal at mine loadouts. Therefore, no transportation expenses are included in our U.S. thermal cost estimates. Our seaborne operations typically sell coal at designated ports. The estimated costs for our seaborne operations include rail and barge transportation and related fees at ports.

•	Royalty costs. Our royalty costs are based upon contractual agreements for the coal leased from governments or private owners. The royalty rates for coal leased from governments differ by country and, in some cases, by mining method. Estimated add-on taxes and other sales-related costs are determined according to government regulations or historical costs.

•	Exchange rates. Costs related to our Australian production are predominantly denominated in Australian dollars, while the Australian coal that we export is sold in U.S. dollars. As a result, Australian/U.S. dollar exchange rates impact the U.S. dollar cost of Australian production.

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(1)

Compliance coal is defined by Phase II of the CAA as coal having sulfur dioxide content of 1.2 pounds or less per million Btu. Non-compliance coal is defined as coal having sulfur dioxide content in excess of this standard. Electricity generators are able to use coal that exceeds these specifications by using emissions reduction technology, using emission allowance credits or blending higher sulfur coal with lower sulfur coal.

(2)	As-received Btu per pound includes the weight of moisture in the coal on an as sold basis. The range of variability of the moisture content in coal across a given region may affect the actual shipped Btu content of current production from assigned reserves.

(3)

The NGS is exclusively served by our Kayenta Mine, included in our Western U.S. Mining operations, that has no other customers. Given the mine’s location, it is currently unable to economically market its coal to other utility customers. This mine has a contract to supply coal to NGS through December 2019. NGS is owned by several private companies and one governmental entity. The owners of the customer have stated that they do not currently intend to operate the plant beyond December 2019. See Item 1A. “Risk Factors” for additional information.

(4)	On December 3, 2018, Peabody completed the acquisition of the Shoal Creek Mine from Drummond Company, Inc. The Shoal Creek Mine produced 0.2 million tons from December 4 to December 31, 2018 and 2.7 million tons for the entire year of 2018.

(5)	On November 27, 2017, Peabody completed the sale of the majority of its Burton Mine and related infrastructure to the Lenton Joint Venture.

(6)

Represents our 50% interest in Middlemount, which owns the Middlemount Mine in Queensland, Australia. Because that entity is accounted for as an unconsolidated equity affiliate, 2018, 2017 and 2016 tons produced by Middlemount have been excluded from the “Summary of Coal Production and Sulfur Content of Assigned Reserves” table. Middlemount produced 4.2 million tons, 4.3 million tons, and 4.5 million tons of coal in 2018, 2017 and 2016, respectively (on a 100% basis).

(7)	Includes the Wambo Open-Cut Mine and the Wambo Underground Mine areas.

(8)	Assigned reserves represent recoverable coal reserves that are controlled and accessible at active operations as of December 31, 2018. Unassigned reserves represent coal at currently non-producing locations that would require significant new mine development, mining equipment or plant facilities before operations could begin on the property.

(9)

The modifying factors reflect the assumptions which are utilized to convert coal quantities and qualities as in ground to run of mine (ROM) coal after mining, and eventually to saleable product coal after processing. Coal reserves are reported as an estimation of the final saleable quantity, which takes into account any losses and dilutions during mining and processing. We generally keep track of coal reserves through in place coal, ROM coal and product coal. In place coal for U.S. underground reserves excludes planned barrier pillars, but includes regular pillars from projected underground extractions. In place coal for Australian underground reserves is exclusive of all planned pillars. The difference is due to historic practice and software used by each country. The ROM factor represents the estimated ROM coal in relation to the coal in place with considerations of coal losses, dilutions and remaining pillars during mining processes. The yield is the ratio of estimated saleable product coal over ROM coal tons with mainly processing loss considered.

(10)	All coal reserves in Kentucky are leased to third parties.

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(1)	Prices expressed per tonne.

(2)	Prices expressed per ton.

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(1)	This is an operating/statistical measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.

(2)

Includes revenue-based production taxes and royalties; excludes depreciation, depletion and amortization; asset retirement obligation expenses; selling and administrative expenses; restructuring charges; asset impairment; provision for North Goonyella equipment loss; amortization of fresh start reporting adjustments related to coal inventory revaluation and take-or-pay contract-based intangibles; and certain other costs related to post-mining activities.

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(1)	This is a financial measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.

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(1)	Includes gains on certain surplus coal reserve and surface land sales and property management costs and revenues.

(2)

Includes results from equity affiliates (before the impact of related changes in deferred tax asset valuation allowance and reserves and amortization of basis difference), trading and brokerage activities, costs associated with post mining activities, certain coal royalty expenses, gains (losses) on certain asset disposals, minimum charges on certain transportation-related contracts and expenses related to our other commercial activities.

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(1)	Prices expressed per tonne.

(2)	Prices expressed per ton.

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(1)	This is an operating/statistical measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.

(2)

Includes revenue-based production taxes and royalties; excludes depreciation, depletion and amortization; asset retirement obligation expenses; selling and administrative expenses; restructuring charges; asset impairment; amortization of fresh start reporting adjustments related to coal inventory revaluation and take-or-pay contract-based intangibles; and certain other costs related to post-mining activities.

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(1)	This is a financial measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.

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(1)	Includes gains (losses) on certain surplus coal reserve and surface land sales and property management costs and revenues.

(2)

Includes results from equity affiliates (before the impact of related changes in deferred tax asset valuation allowance and reserves and amortization of basis difference), trading and brokerage activities, costs associated with post mining activities, certain coal royalty expenses, gains (losses) on certain asset disposals, minimum charges on certain transportation-related contracts and expenses related to our other commercial activities.

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(1)	This is a financial measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.

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(1)	Represents the original contractual maturities of our long-term debt obligations. The related interest on long-term debt was calculated using rates in effect at December 31, 2018 for the remaining contractual term of the outstanding borrowings.

(2)	Excludes contingent rents. Refer to Note 15. “Leases” to the accompanying consolidated financial statements for additional discussion of contingent rental agreements.

(3)

We routinely enter into purchase agreements with approved vendors for most types of operating expenses in the ordinary course of business. Our specific open purchase orders (which have not been recognized as a liability) under these purchase agreements, combined with any other open purchase orders, are not material and though they are considered enforceable and legally binding, the related terms generally allow us the option to cancel, reschedule or adjust our requirements based on our business needs prior to the delivery of goods or performance of services. Accordingly, the commitments in the table above relate to orders to suppliers for capital purchases.

(4)	Represents various short- and long-term take or pay arrangements in Australia and the U.S. associated with rail and port commitments for the delivery of coal, including amounts relating to export facilities.

(5)

Represents estimated cash outflows for long-term liabilities relating to our postretirement benefit plans, work-related injuries and illnesses, defined benefit pension plans, mine reclamation and end-of-mine closure costs and exploration obligations. Also includes $6 million of required payments to the VEBA established in connection with Patriot’s bankruptcy, as well as $45 million related to the settlement of the UMWA 1974 Pension Plan Litigation described in Note 6. “Discontinued Operations” to the accompanying consolidated financial statements.

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•	revising the severance benefits to include payment of a pro-rata, current-year annual incentive based upon actual performance for the year in which termination occurs;

•	reducing the advance written notice period for plan amendments from 12 months to six months; and

•	revising the definitions of “Change in Control,” “Disability,” “Cause” and “Confidential Information” to generally conform to or coordinate with the definitions in the Peabody Energy Corporation 2017 Incentive Plan.

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(1)	Shares issuable pursuant to outstanding performance units and vested but not issued deferred stock units. Performance units are shown at target and could change based on actual metrics achieved.

(2)	The weighted-average exercise price shown in the table does not take into account outstanding deferred stock units or performance awards.

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(1)	Summary of Significant Accounting Policies

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(2)	Emergence from the Chapter 11 Cases and Fresh Start Reporting

•	Series A Convertible Preferred Stock - $750.0 million for 30.0 million shares of Series A Convertible Preferred Stock

•	Common Stock and Warrants - $750.0 million for common stock and warrants issued in connection with a Rights Offering (as defined below), resulting in, together with other issuances of common stock, the issuance of 70.9 million shares of a single class of common stock and warrants to purchase 6.2 million shares of common stock

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•	11.6 million shares of Common Stock to holders of Allowed Claims (as defined in the Plan) in Classes 2A, 2B, 2C, 2D and 5B on account of such claims as provided in the Plan; and

•	51.2 million shares of Common Stock and 2.9 million Warrants (the 1145 Warrants) pursuant to the completed Rights Offering to certain holders of the Company’s prepetition indebtedness for total consideration of $704.4 million.

•	30.0 million shares of Series A Convertible Preferred Stock (the Convertible Preferred Stock) to parties to the Private Placement Agreement, dated as of December 22, 2016 (as amended, the Private Placement Agreement), among the Company and the other parties thereto, for total consideration of $750.0 million;

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3.3 million shares of Common Stock and 0.2 million Warrants (the Private Warrants, and together with the 1145 Warrants, the Warrants) to parties to the Backstop Commitment Agreement, dated as of December 22, 2016 (as amended, the Backstop Commitment Agreement), among the Company and the other parties thereto, on account of their commitments under that agreement, for total consideration of $45.6 million; and

•	4.8 million shares of Common Stock and 3.1 million additional Private Warrants to specified parties to the Private Placement Agreement and Backstop Commitment Agreement on account of commitment premiums contemplated by those agreements.

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•	Indenture governing $1,000.0 million outstanding aggregate principal amount of the Company’s 10.00% Senior Secured Second Lien Notes due 2022, dated as of March 16, 2015, among the Company, U.S. Bank National Association (U.S. Bank), as trustee and collateral agent, and the guarantors named therein, as supplemented;

•	Indenture governing $650.0 million outstanding aggregate principal amount of the Company’s 6.50% Senior Notes due 2020, dated as of March 19, 2004, among the Company, U.S. Bank, as trustee, and the guarantors named therein, as supplemented;

•	Indenture governing $1,518.8 million outstanding aggregate principal amount of the Company’s 6.00% Senior Notes due 2018, dated as of November 15, 2011, among the Company, U.S. Bank, as trustee, and the guarantors named therein, as supplemented;

•	Indenture governing $1,339.6 million outstanding aggregate principal amount of the Company’s 6.25% Senior Notes due 2021, dated as of November 15, 2011, by and among the Company, U.S. Bank, as trustee, and the guarantors named therein, as supplemented;

•	Indenture governing $250.0 million outstanding aggregate principal amount of the Company’s 7.875% Senior Notes due 2026, dated as of March 19, 2004, among the Company, U.S. Bank, as trustee, and the guarantors named therein, as supplemented;

•	Subordinated Indenture governing $732.5 million outstanding aggregate principal amount of the Company’s Convertible Junior Subordinated Debentures due 2066, dated as of December 20, 2006, among the Company and U.S. Bank, as trustee, as supplemented; and

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Amended and Restated Credit Agreement, as amended and restated as of September 24, 2013 (the 2013 Credit Facility), related to $1,170.0 million outstanding aggregate principal amount of term loans under a term loan facility (the 2013 Term Loan Facility) and $1,650.0 million under a revolving credit facility (the 2013 Revolver), which includes approximately $675.0 million of posted but undrawn letters of credit and approximately $947.0 million in outstanding borrowings, by and among the Company, Citibank, N.A., as administrative agent, swing line lender and letter of credit issuer, Citigroup Global Markets, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, BNP Paribas Securities Corp., Crédit Agricole Corporate and Investment Bank, HSBC Securities (USA) Inc., Morgan Stanley Senior Funding, Inc., PNC Capital Markets LLC and RBS Securities Inc., as joint lead arrangers and joint book managers, and the lender parties thereto, as amended by that certain Omnibus Amendment Agreement, dated as of February 5, 2015.

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•	options (including non-qualified stock options and incentive stock options);

•	stock appreciation rights;

•	restricted stock;

•	restricted stock units;

•	deferred stock;

•	performance units;

•	dividend equivalents; and

•	cash incentive awards.

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(a)	Represents the Predecessor consolidated balance sheet at April 1, 2017.

(b)	Represents amounts recorded for the implementation of the Plan on the Effective Date. This includes the settlement of liabilities subject to compromise through a combination of cash payments, the issuance of new common stock and warrants and the issuance of new debt. The following is the calculation of the total pre-tax gain on the settlement of the liabilities subject to compromise.

(c)	Represents the fresh start reporting adjustments required to record the assets and liabilities of the Company at fair value.

(d)	The following table reflects the sources and uses of cash and restricted cash at emergence:

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(e)	Primarily represents the write off of deferred financing costs associated with the cancellation and discharge of Predecessor revolving debt obligations.

(f)	Represents the payment of deferred financing costs associated with the Receivables Purchase Agreement.

(g)

Represents a $950.0 million Senior Secured Term Loan, net of an original issue discount and deferred financing costs of $37.3 million, as contemplated by the Plan. Under the Plan, the Company also issued $1.0 billion of Successor Notes, net of $49.5 million of deferred financing costs. The Successor Notes and the related proceeds held in escrow were included on the Company’s unaudited condensed consolidated balance sheet at March 31, 2017. The debt instruments issued in accordance with the Plan, and the subsequent amendments, are further described in Note 14. “Long-term Debt.”

(h)	Represents an accrual to account for amounts paid subsequent to the Effective Date for professional fees and certain unsecured claims and settlements set forth in the Plan.

(i)

Liabilities subject to compromise included secured and unsecured liabilities incurred prior to the Petition Date. These liabilities represented the amounts expected to be allowed on known or potential claims to be resolved through the Chapter 11 Cases and remained subject to future adjustments based on negotiated settlements with claimants, actions of the Bankruptcy Court, rejection of executory contracts, proofs of claims or other events. Additionally, liabilities subject to compromise also included certain items that were assumed under the Plan, and as such, were subsequently reclassified to liabilities not subject to compromise. Generally, actions to enforce or otherwise effect payment of prepetition liabilities were subject to the injunction provisions set forth in the Plan. Liabilities subject to compromise consisted of the following immediately prior to emergence:

(1)	Includes $7,768.3 million of first lien, second lien and unsecured debt, $257.3 million of derivative contract terminations, and $51.8 million of liabilities secured by prepetition letters of credit at April 1, 2017.

(2)	Includes liabilities for unfunded non-qualified pension plans, all the participants of which are former employees.

(j)	Reflects the impacts of the reorganization adjustments:

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

(l)

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

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

(n)

Primarily to recognize fair value of $314.9 million inherent in certain U.S. coal supply agreements as a result of favorable differences between contract terms and estimated market terms for the same coal products, partially offset by a reduction in the fair value of certain equity method investments. The intangible asset related to coal supply agreements will be amortized on a per ton shipped basis through 2025. See also Note 10. “Intangible Contract Assets and Liabilities.”

(o)

Represents $32.6 million to account for the short-term portion of the value of certain contract-based intangibles primarily consisting of unutilized capacity of certain port and rail take-or-pay contracts, partially offset by $15.7 million related to liabilities classified as held-for-sale at March 31, 2017 which were reclassified as held-for-use and considered in connection with the valuations described in (m) above, and various other fair value adjustments. The intangible liabilities related to port and rail take-or-pay contracts will be amortized ratably over the terms of each contact, which vary in duration through 2043.

(p)	Represents the tax impact of fresh start reporting. See also Note 12. “Income Taxes.”

(q)	Represents the fair value adjustment related to the Company’s asset retirement obligations which was calculated using DCF models based on current mine plans. The credit-adjusted, risk-free interest rates utilized to estimate the Company’s asset retirement obligations were 9.36% for its U.S. reclamation obligations and 4.36% for its Australia reclamation obligations.

(r)

Represents the remeasurement of liabilities associated with the Company’s postretirement benefits obligations as of the Effective Date as the reorganization of the Company pursuant to the Plan represented a remeasurement event under ASC 715 “Compensation - Retirement Benefits.” The relevant discount rate was adjusted to 4.1% from 4.15% used in the Company’s remeasurement process for the year ended December 31, 2016.

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(s)

Represents $83.6 million to account for the long-term portion of the value of contract-based intangibles related to unutilized capacity of port and rail take-or-pay contracts as described in (o) above and $58.7 million to account for the fair value inherent in certain U.S. coal supply agreements as a result of unfavorable differences between contract terms and estimated market terms for the same coal products as described in (n) above, partially offset by a remeasurement reduction of $9.2 million of the Company’s pension liabilities in accordance with ASC 715 as described in (r) above, as the relevant discount rate was adjusted to 4.1% from 4.15% used in the Company’s remeasurement process for the year ended December 31, 2016, and certain other valuation adjustments.

(t)	Represents the elimination of remaining equity balances in accordance with fresh start reporting requirements.

(u)	Represents adjustment to increase the book value of noncontrolling interests to fair value based on an estimate of the rights of the noncontrolling interests.

(3)	Acquisition of Shoal Creek Mine

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(4)	Revenue Recognition

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(1)	Corporate and Other revenue includes realized and unrealized gains and losses related to mark-to-market activity from economic hedge activities intended to hedge future coal sales. Refer to Note 9. “Derivatives and Fair Value Measurements” for additional information regarding the economic hedge activities.

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

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(5)	Asset Impairment

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(6)	Discontinued Operations

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(7)	Inventories

(8)	Investments

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(9)	Derivatives and Fair Value Measurements

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•	Foreign currency option contracts: valued utilizing inputs obtained in quoted public markets (Level 2) except when credit and non-performance risk is considered to be a significant input, then the Company classifies such contracts as Level 3.

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

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

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

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

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

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(10)	Intangible Contract Assets and Liabilities

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(12)	Income Taxes

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•

Repeal of the corporate AMT system: Existing AMT credits as of December 31, 2017 will be refunded over the next four years. The Company has determined that it will receive a refund of existing AMT credits of approximately $91.1 million. A valuation allowance of $85.6 million previously recorded against these credits was released during the period April 2 through December 31, 2017. During 2018, the IRS determined that the sequestration reduction would not apply to the AMT credit refunds and an additional tax benefit of $5.5 million valuation allowance release was recorded as a component of income tax expense from continuing operations. The Company’s accounting policy regarding the balance sheet presentation of the credits is to continue to reflect the balance as a deferred tax asset until the completion of the taxable year determining the credit, at which time the amount will be presented as a tax receivable.

•

Remeasurement of deferred tax assets and liabilities: Deferred tax assets and liabilities attributable to the U.S. were remeasured from 35% to the reduced tax rate of 21%. The Company recorded a provision of $473.5 million and an offsetting valuation allowance adjustment for the remeasurement for the period April 2 through December 31, 2017. The Company recorded an additional provision of $9.5 million during the year ended December 31, 2018 upon completion of the filing of both U.S. and foreign tax returns for the 2017 tax year and an offsetting valuation allowance.

•

Elimination of executive compensation exemptions: The Act made major changes to the $1 million limit on deductible compensation paid to certain “covered” employees. The Act eliminated exemptions for qualified performance based compensation and compensation paid after termination and expanded the number of employees to which the limit applies. The Company recorded a provision of $0.5 million and an offsetting valuation allowance adjustment for the impact of these changes for the period April 2 through December 31, 2017. This amount is equal to the elimination of deferred tax assets associated with deferred compensation amounts that will likely exceed the $1 million limit when paid and did not change as the assessment was finalized during the year ended December 31, 2018.

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(13)	Accounts Payable and Accrued Expenses

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(14)	Long-term Debt

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(15)	Leases

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(17)	Postretirement Health Care and Life Insurance Benefits

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(1)	In accordance with Accounting Standards Update 2015-07, investments that are measured at fair value using the net asset value per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the total value of assets of the plans.

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(19)	Stockholders’ Equity

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(20)	Share-Based Compensation

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(21)	Accumulated Other Comprehensive Income (Loss)

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(22)	Other Events

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(23)	Earnings per Share (EPS)

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(1)	The reallocation adjustment for participating securities to arrive at the numerator to calculate diluted EPS was $0.1 million and $1.2 million for the year ended December 31, 2018 and the period April 2 through December 31, 2017, respectively.

(2)	The two-class method assumes that participating securities are not exercised or converted. As such, weighted average diluted shares outstanding excluded 2.1 million shares and 33.5 million shares related to the participating securities for the year ended December 31, 2018 and the period April 2 through December 31, 2017, respectively.

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(1)	Hourly workers at the Company’s Kayenta Mine in Arizona are represented by the UMWA under the Western Surface Agreement, which is effective through September 16, 2019. This agreement covers approximately 7% of the Company’s U.S. subsidiaries’ hourly employees, who generated approximately 4% of the Company’s U.S. production during the year ended December 31, 2018.

(2)	Hourly workers at the Company’s Shoal Creek Mine in Alabama are represented by the UMWA under the Shoal Creek Wage Agreement, which is effective through April 1, 2021. This agreement covers approximately 9% of the Company’s U.S. subsidiaries’ hourly employees. The Company acquired the Shoal Creek Mine on December 3, 2018, as further described in Note 3. “Acquisition of Shoal Creek Mine”.

(3)

Employees of the Wambo Open-Cut Mine operate under a separate enterprise agreement which expired in December 2018. Negotiations for a new agreement are progressing as planned with only a few outstanding matters to be negotiated. Negotiations are expected to conclude in the first quarter of 2019. There were no wage increases over the three-year term of the current labor agreement. Employees of the Company's Wambo Underground Mine operate under a separate labor agreement. That new agreement will expire in March 2021. There have been no disruptions in the mine’s operations during the negotiations. The Wambo coal handling and preparation plant hourly employees are under a separate labor agreement that expired in December 2018. The Company negotiated a new three-year agreement with employees in December 2018, which is currently going through an approval process with the Fair Work Commission. Hourly employees of these mines comprise approximately 23% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 18% of the Company’s Australian production during the year ended December 31, 2018.

(4)

Employees of the North Goonyella Mine operate under a separate labor agreement which expired in December 2018. Negotiations for an extension of the existing agreement until December 2019 are progressing and are expected to conclude in the first quarter of 2019. Hourly employees of this mine comprise approximately 8% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 5% of the Company’s Australian production during the year ended December 31, 2018.

(5)

Employees of the Company’s Metropolitan Mine operate under a separate labor agreement, which expires in January 2021. There is also a deputy labor agreement which expired in September 2015. The parties have concluded negotiations in December 2018 for a new three-year agreement and is awaiting approval from the Fair Work Commission. There have been no disruptions to the mine’s operations as a result of the negotiations. Hourly employees of this mine comprise approximately 12% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 6% of the Company’s Australian production during the year ended December 31, 2018.

(6)

The existing two-year labor agreement for Millennium Mine expires in March 2019. The negotiations for an extension of the current agreement through the end of 2019 will commence in the first quarter of 2019. Hourly employees of this mine comprise approximately 1% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 6% of the Company’s Australian production during the year ended December 31, 2018.

(7)	In May 2017, the Company entered into a new three-year labor agreement for Wilpinjong Mine which expires in May 2020. The new agreement has minimal wage increases. Hourly employees of this mine comprise approximately 23% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 48% of the Company’s Australian production during the year ended December 31, 2018.

(8)

Employees of the Company’s Coppabella Mine operate under a separate enterprise agreement. The Company successfully negotiated a new three-year term agreement that will expire in June 2021. There were no disruptions to the mine’s operations as a result of the negotiations. Hourly employees of this mine comprise approximately 20% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 9% of the Company’s Australian production during the year ended December 31, 2018.

(9)

Employees of the Company’s Moorvale Mine operate on individual contracts underpinned by a non-union enterprise agreement. Employees are managed according to their individual contracts rather than the enterprise agreement. In July 2017, all employees signed a memorandum of understanding agreeing to a rollover of the existing enterprise agreement until June 2020. The Moorvale coal handling and preparation plant hourly employees operate under a separate labor agreement which expires in October 2019. Negotiations for a new agreement will commence in the third quarter of 2019. Hourly employees of this mine comprise approximately 14% of the Company’s Australian subsidiaries’ hourly employees, who generated approximately 7% of the Company’s Australian production during the year ended December 31, 2018.

(25)	Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees

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(26)	Commitments and Contingencies

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(27)	Summary of Quarterly Financial Information (Unaudited)

(1)	EPS for the quarters may not sum to the amounts for the year as each period is computed on a discrete basis.

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(1)	EPS for the quarters may not sum to the amounts for the year as each period is computed on a discrete basis.

(28)	Segment and Geographic Information

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(29)	Subsequent Events

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(1)	Reserves utilized, unless otherwise indicated.

(2)	Deductions to advance royalty recoupment reserve represents the termination of federal and state leases.

(3)	Includes the impact of the decrease in Australian dollar exchange rates.

(4)	Fresh start reporting adjustments.

(5)	Release of valuation allowance primarily related to carrybacks of U.S. net operating losses.

(6)	Includes the impact of the decrease in Australian dollar exchange rates, partially offset by the impact of final attribute reduction adjustments in the U.S.

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