1.0.0.3falseMergers and Acquisitionsfalse1$falsefalseUSDStandardhttp://www.xbrl.org/2003/iso4217USDiso42170USDEPSDividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli020anr_MergersAndAcquisitionsAbstractanrfalsenadurationstringMergers and Acquisitions.falsefalsefalsefalsefalsetruefalsefalsefalse1falsefalse00falsefalseMergers and Acquisitions.false31us-gaap_BusinessCombinationDisclosureTextBlockus-gaaptruenadurationstringNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalse00<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 20 - us-gaap:BusinessCombinationDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: .25in; width: 7.20in">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>(20) Mergers and Acquisitions</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><b><i>Merger with Foundation Coal Holdings, Inc.</i></b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On May 11, 2009, Old Alpha and Foundation executed an agreement and plan of merger pursuant to
which Old Alpha was to be merged with and into Foundation, with Foundation continuing as the
surviving corporation of the Merger. On July 31, 2009, the Merger was completed and Foundation was
renamed Alpha Natural Resources, Inc. The headquarters of the Company are located in Abingdon, VA.
The former headquarters of Foundation located in Linthicum Heights, MD will remain open for a
period of at least 18 months.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">At the effective time of the Merger on July 31, 2009 (the “Effective Time”), each issued and
outstanding share of common stock, par value $0.01, of Foundation, other than any shares owned by
Old Alpha, was converted into the right to receive 1.0840 (the “Exchange Ratio”) shares of common
stock, par value $0.01, of Alpha, and each issued and outstanding share of common stock, par value
$0.01, of Old Alpha, other than any shares owned by Foundation, automatically became one share of
common stock of Alpha. Immediately after the Effective Time, Old Alpha’s stockholders owned
approximately 59% of Alpha common stock and Foundation’s stockholders owned approximately 41% of
Alpha common stock. All currently issued and outstanding options to purchase Foundation common
stock vested and were converted into vested options to purchase Alpha common stock, with
adjustments to reflect the Exchange Ratio, and all outstanding options to purchase Old Alpha’s
common stock were converted into options to purchase Alpha common stock, without adjustment. Other
outstanding equity-based awards of Foundation either vested and were converted into the right to
receive 1.0840 shares of Alpha common stock, or were converted into vested and unvested awards with
respect to Alpha common stock, as applicable. Other outstanding equity-based awards of Old Alpha
were converted into awards with respect to Alpha common stock. No fractional shares of Alpha
common stock were issued in the Merger, and Foundation’s stockholders received cash in lieu of
fractional shares, if any, of Alpha common stock. The Merger qualified as a reorganization within
the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">For financial accounting purposes, the Merger is treated as a “reverse acquisition” and Old
Alpha is treated as the accounting acquirer. Accordingly, Old Alpha’s historical financial
statements became the historical financial statements of Alpha for comparative purposes.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company issued 48,452,298 shares of common stock to the shareholders of Foundation, after
adjustment to reflect the merger ratio. Certain outstanding equity-based awards of Foundation
vested and resulted in the issuance of an additional 451,300 shares of common stock. Additionally,
all issued and outstanding options to purchase Foundation common stock vested and were converted
into 1,118,497 vested options to purchase Company common stock, with adjustments to reflect the
Exchange Ratio. Other outstanding equity-based awards of Foundation consisting of 176,089
restricted stock units vested were converted into the right to receive 1.0840 shares of Company
common stock and 355,674 restricted stock units were converted into unvested awards with respect
to Company common stock.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The fair value of the total consideration transferred was $1,668,398. The acquisition date
fair value of each class of consideration transferred was as follows:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="77%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Common shares
</div></td>
<td> </td>
<td>$</td>
<td align="right">1,613,946</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Other equity awards
</div></td>
<td> </td>
<td> </td>
<td align="right">53,393</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Cash performance units
</div></td>
<td> </td>
<td> </td>
<td align="right">1,055</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Cash-fractional shares
</div></td>
<td> </td>
<td> </td>
<td align="right">4</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Total purchase price
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">1,668,398</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: .25in; width: 7.20in">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Fair value of common stock issued was determined by the closing price of Old Alpha’s common
stock on the day of the Merger. The total purchase price has been preliminarily allocated to the
net tangible and intangible assets of Foundation. The allocation of the purchase price has not been
finalized due to the final calculation of deferred taxes, therefore, the amounts recorded below are
provisional and will remain as such until a final tax return is filed for Foundation, which is
anticipated to occur by the end of the first quarter of 2010. The following table presents the
details of the preliminary allocation of the July 31, 2009 purchase price:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="77%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Cash
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">23,505</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Accounts receivable
</div></td>
<td> </td>
<td> </td>
<td align="right">83,531</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Coal inventories
</div></td>
<td> </td>
<td> </td>
<td align="right">47,433</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Other current assets
</div></td>
<td> </td>
<td> </td>
<td align="right">61,269</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Property and equipment
</div></td>
<td> </td>
<td> </td>
<td align="right">716,749</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Owned lands
</div></td>
<td> </td>
<td> </td>
<td align="right">76,134</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Owned and leased mineral rights
</div></td>
<td> </td>
<td> </td>
<td align="right">1,873,347</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Coal supply agreements
</div></td>
<td> </td>
<td> </td>
<td align="right">529,507</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Other non-current assets
</div></td>
<td> </td>
<td> </td>
<td align="right">14,296</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Goodwill
</div></td>
<td> </td>
<td> </td>
<td align="right">337,321</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Total assets
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">3,763,092</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Current liabilities
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(176,233</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Long-term debt, net (including current portion)
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(595,817</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Asset retirement obligation (including current portion)
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(99,574</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Deferred income taxes
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(443,744</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Pension and post retirement obligations (including current
portion)
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(713,095</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Other long-term liabilities
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(66,231</td>
<td nowrap="nowrap">)</td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Total liabilities
</div></td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(2,094,694</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net tangible and intangible assets acquired
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">1,668,398</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">A portion of the goodwill was allocated to Old Alpha’s reporting units expected to benefit
from the synergies to be gained from the acquisition using a “with and with-out” approach. The
remaining goodwill was allocated to the acquired reporting units based on the relative fair value
of the net assets of the reporting units.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The following unaudited pro forma information has been prepared for illustrative purposes only
and assumes the Merger occurred at the beginning of each of the periods being presented. The
unaudited pro forma results have been prepared based on estimates and assumptions, which the
Company believes are reasonable; however, they are not necessarily indicative of the consolidated
results of operations had the Merger occurred at the beginning of each of the periods presented, or
of future results of operations.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: .25in; width: 7.20in">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%">The unaudited pro forma results for the years ended December 31, 2009 and 2008 are as follows:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="66%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Years Ended December 31,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2008</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Total revenues
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">As reported
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2,495,507</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,468,753</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">Pro forma
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">3,402,678</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4,041,014</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Income (loss) from continuing operations
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">As reported
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">66,807</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">198,599</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">Pro forma
</div></td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(58,187</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td align="left">$</td>
<td align="right">1,420</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Earnings per share from continuing operations-basic
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">As reported
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">0.74</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2.90</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">Pro forma
</div></td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(0.49</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td align="left">$</td>
<td align="right">0.01</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Earnings per share from continuing operations-diluted
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">As reported
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">0.73</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2.83</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px">Pro forma
</div></td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(0.49</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td align="left">$</td>
<td align="right">0.01</td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><i>Total revenues </i>reported in the Consolidated Statements of Operations for the year ended
December 31, 2009 included total revenues of $716,764 related to Foundation. The amount of earnings from
continuing operations related to Foundation included in the Consolidated Statement of Operations
for the year ended December 31, 2009 is not readily determinable due to various intercompany
transactions and allocations that have occurred in connection with the operations of the combined
company.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><b><i>Acquisition of Mingo Logan</i></b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On June 29, 2007, the Company completed the acquisition of certain coal mining assets in
southern West Virginia from Arch Coal, Inc. known as Mingo Logan for $43,893 including working
capital and assumed liabilities. The Mingo Logan purchase consisted of coal reserves, two mines and
a load-out and processing plant that is managed by the Callaway business unit.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The following table summarizes the fair values of the assets acquired and liabilities assumed
at the date of acquisition:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="77%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Current assets
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">9,555</td>
<td> </td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Property, plant, and equipment
</div></td>
<td> </td>
<td> </td>
<td align="right">41,892</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff; padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Intangible assets
</div></td>
<td> </td>
<td> </td>
<td align="right">4,182</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Total assets acquired
</div></td>
<td> </td>
<td> </td>
<td align="right">55,629</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Asset retirement obligation
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(11,636</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="padding-top: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px">Other liabilities
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(100</td>
<td nowrap="nowrap">)</td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Total liabilities assumed
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(11,736</td>
<td nowrap="nowrap">)</td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Net assets acquired
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">43,893</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><b><i>Sale of Coal Reserves</i></b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On September 30, 2008, the Company completed the sale of approximately 17.6 million tons of
underground coal reserves in eastern Kentucky to a private coal producer for $13,041 in cash. The
reserves were a portion of an estimated 73 million tons of reserves and other assets acquired from
Progress Fuels Corporation in May 2006. The Company recorded a gain of $12,936 on the sale.
</div>
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<b>
</b>
</div>
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