RELATED PARTY TRANSACTIONS

Transactions with the Company's Former Parent (2017)

Separation

On November 28, 2017, in connection with the separation and distribution, the Company and/or certain of its subsidiaries entered into several agreements with its former parent and/or the Partnership and/or certain of its subsidiaries that govern the relationship of the various parties following the separation, including the following:


•	Separation and Distribution Agreement (“SDA”);


•	Transition Services Agreement (“TSA”);


•	Tax Matters Agreement (“TMA”);


•	Employee Matters Agreement (“EMA”);


•	Intellectual Property Matters Agreement (“IPMA”);


•	CNX Resources Corporation to CONSOL Energy Inc. Trademark License Agreement (“TLA 1”);


•	CONSOL Energy Inc. to CNX Resources Corporation Trademark License Agreement (“TLA 2”);


•	First Amendment to the First Amended and Restated Omnibus Agreement (“Omnibus Amendment”);


•	First Amendment to Contract Agency Agreement by and among CONSOL Energy Sales Company, CONSOL Thermal Holdings LLC (formerly known as CNX Thermal Holdings LLC) and the other parties thereto (“Contract Agency Amendment”);


•	First Amendment to Water Supply and Services Agreement by and between CNX Water Assets LLC and CONSOL Thermal Holdings LLC (formerly known as CNX Thermal Holdings LLC) (“Water Supply Amendment”);


•	Second Amendment to Pennsylvania Mine Complex Operating Agreement by and among CONSOL Pennsylvania Coal Company LLC, Conrhein Coal Company, CONSOL Thermal Holdings LLC (formerly known as CNX Thermal Holdings LLC) and CONSOL Coal Resources LP (formerly known as CNX Coal Resources LP) (the “Operating Agreement Amendment”);


•	Affiliated Company Credit Agreement, dated November 28, 2017, by and among CONSOL Coal Resources LP, certain of its affiliates party thereto, CONSOL Energy Inc. and PNC Bank, National Association (the “Affiliated Company Credit Agreement”); and


•	Second Amendment and Restatement of Master Cooperation and Safety Agreement, dated October 20, 2017, by and between CONSOL Energy Inc., CNX Gas Company LLC and certain other parties thereto (the “MCSA”).

Summaries of the material terms of the SDA, TSA, TMA, EMA, Omnibus Amendment, Contract Agency Amendment, Water Supply Amendment and MCSA may be found under the section entitled “Certain Relationships and Related Party Transactions” in that certain Information Statement of the Company, dated November 3, 2017, and the summaries of the material terms of the IPMA, TLA1, TLA2, the Operating Agreement Amendment and the Affiliated Company Credit Agreement may be found under Item 1.01 Entry into a Material Definitive Agreement to Form 8-K filed December 4, 2017.

Refer to Note 2 - Separation from the Company's Former Parent for further information on the separation. Also refer to Note 17 - Stock-Based Compensation for information regarding the conversion of share-based awards from the Company's former parent to the Company as of the date of the separation and distribution.

Cash Management and Treasury

For periods prior to the separation and distribution, the Company participated in its former parent's centralized treasury and cash management processes. Transactions occurring in periods prior to the separation and distribution were considered to be effectively settled for cash at the time the transactions were recorded. These transactions and net cash transfers to and from the Company's former parent's centralized cash management system are reflected as a component of the Company's former parent's net investment on the Consolidated Balance Sheets and as a financing activity within the accompanying Consolidated Statements of Cash Flows. In the Consolidated Statements of Stockholders' Equity, the Company's former parent's net investment on the Consolidated Balance Sheets represents the cumulative net investment by the Company's former parent in the Company, including net income through the completion of the separation and distribution and net cash transfers to and from the Company's former parent.

All significant transactions between the Company and its former parent have been included in the consolidated financial statements.

Transition Services Agreements

The Company also entered into the TSA and certain other agreements in connection with the SDA with its former parent to cover certain continued corporate services provided by the Company and its former parent to each other following the completion of the separation and distribution. In connection with the separation and distribution, the Company began to set up its own corporate functions, and pursuant to the TSA, its former parent provided various corporate support services, including certain accounting, human resources, information technology, office and building, risk, security, tax and treasury, building security and tax services, as well as certain regulatory compliance services required during the period in which the Company remained a majority-owned subsidiary of its former parent. Additional services may be identified from time to time and also be provided under the TSA. For the years ended December 31, 2018 and 2017, the charges associated with these services were $2,632 and $216, respectively.

Receivables and Payables to the Company's Former Parent

At December 31, 2018 and 2017, the Company had a payable to its former parent of $235 and $12,540, respectively, recorded in other current liabilities on the Consolidated Balance Sheets. The Company also had a receivable from its former parent of $11,788 and $15,415, of which $5,500 and $4,500 was recorded in current assets and $6,288 and $10,915 was included in other assets on the Consolidated Balance Sheets at December 31, 2018 and 2017, respectively. These items relate to the reimbursement of the one-time transaction costs as well as other reimbursements per the terms of the SDA.

The one-time transaction costs related to the separation and distribution were approximately $40,545 for the year ended December 31, 2017. During the year ended December 31, 2018, the Company paid its former parent $18,234 related to the final settlement of shared, spin-related fees. Per the SDA, these costs are split equally by the two companies. These costs consist of consulting and professional fees associated with preparing for and executing the separation and distribution, as well as various other items.

Corporate Allocations

Prior to the completion of the separation and distribution, the Company utilized centralized functions of its former parent to support its operations, and in return, its former parent allocated certain of its expenses to the Company. Such expenses represent costs related, but not limited, to treasury, legal, accounting, insurance, information technology, payroll administration, human resources, incentive plans and other services. These costs, together with an allocation of the Company's former parent's overhead costs, are included within the Selling, General and Administrative Costs caption on the Consolidated Statements of Income. Where it was possible to specifically attribute such expenses to activities of the Company, amounts have been charged or credited directly to the Company without allocation or apportionment. Allocation of all other such expenses was based on a reasonable reflection of the utilization of service provided or benefits received by the Company during the periods presented on a consistent basis, such as a percentage of total revenue and a percentage of total projected capital expenditures. The Company's management supports the methods used in allocating expenses and believes these methods to be reasonable estimates.

CONSOL Coal Resources LP

In 2015, CCR entered into a $400,000 senior secured revolving credit facility with certain lenders and PNC Bank, National Association (“PNC”), as administrative agent (the “Original CCR Credit Facility”). Obligations under the revolving credit facility were guaranteed by CCR's subsidiaries (the “Guarantor Subsidiaries”) and were secured by substantially all of CCR's and CCR's subsidiaries' assets pursuant to a security agreement and various mortgages. CCR made an initial draw of $200,000, and after origination fees of $3,000, the net proceeds were $197,000, which CCR distributed to the Company's former parent.

In September 2016, CCR and its wholly owned subsidiary, CONSOL Thermal, entered into a Contribution Agreement with the Company's former parent, CONSOL Pennsylvania Coal Company LLC and Conrhein Coal Company under which CONSOL Thermal acquired an additional 5% undivided interest in and to the Pennsylvania Mining Complex, in exchange for (i) cash consideration in the amount of $21,500 and (ii) CCR's issuance of 3,956,496 Class A Preferred Units representing limited partnership interests in CCR at an issue price of $17.01 per Class A Preferred Unit (the “Class A Preferred Unit Issue Price”), or an aggregate $67,300 in equity consideration (the “PAMC acquisition”). The Class A Preferred Unit Issue Price was calculated as the volume-weighted average trading price of CCR's common units (the “Common Units”) over the trailing 15-day trading period ending on September 29, 2016 (or $14.79 per unit), plus a 15% premium.

In October 2017, the Company's former parent elected to have the 3,956,496 Class A Preferred Units, representing its limited partnership interest in CCR, converted into an equal number of Common Units under the terms of the Second Amended and Restated Agreement of Limited Partnership of CCR.

In connection with the PAMC acquisition, in September 2016, CCR's general partner and CCR entered into the First Amended and Restated Omnibus Agreement (the “Amended Omnibus Agreement”) with the Company's former parent and certain of its subsidiaries. Under the Amended Omnibus Agreement, the Company's former parent indemnified CCR for certain liabilities. The Amended Omnibus Agreement also amended CCR's obligations to the Company's former parent with respect to the payment of an annual administrative support fee and reimbursement for the provisions of certain management and operating services provided, in each case to reflect structural changes in how those services are provided to CCR by the Company's former parent. The Company assumed this agreement as part of the separation and distribution.

On November 28, 2017, the Company entered into an Affiliated Company Credit Agreement with the Partnership and certain of its subsidiaries (the Partnership Credit Parties) under which the Company provides as lender a revolving credit facility in an aggregate principal amount of up to $275 million to the Partnership Credit Parties. In connection with the completion of the separation, the Partnership drew an initial $201 million, the net proceeds of which were used to repay outstanding amounts under the Original CCR Credit Facility and to provide working capital for the Partnership following the separation and for other general corporate purposes. The Original CCR Credit Facility was then terminated.

The Affiliated Company Credit Agreement matures on February 27, 2023. Interest accrues at a rate ranging from 3.75% to 4.75%, subject to the Partnership's net leverage ratio. For the years ended December 31, 2018 and 2017, $7,709 and $746 of interest expense is included in the Consolidated Statements of Income, respectively. The collateral obligations under the Affiliated Company Credit Agreement generally mirror the Original CCR Credit Facility, as does the list of entities that will act as guarantors thereunder. The Affiliated Company Credit Agreement is subject to financial covenants relating to a maximum first lien gross leverage ratio and a maximum total net leverage ratio, which will be calculated on a consolidated basis for the Partnership and its restricted subsidiaries at the end of each fiscal quarter. The Partnership was in compliance with each of these financial covenants at December 31, 2018 and 2017. The Affiliated Company Credit Agreement also contains a number of customary affirmative covenants and negative covenants, including limitations on the ability of the Partnership to incur additional indebtedness, grant liens, and make investments, acquisitions, dispositions, restricted payments, and prepayments of junior indebtedness (subject to certain limited exceptions).

CCR is a party to a number of other agreements with CONSOL Energy, or its subsidiaries, that are described in detail in the section titled “Agreements with Affiliates” in Item 13 of CCR's Form 10-K filed on February 8, 2019.

Charges for services from the Company to CCR include the following:



	For the Years Ended December 31,
	2018		2017		2016
Operating and Other Costs	$	2,918	$	3,503	$	4,251
Selling, General and Administrative Costs	8,300		3,109		3,826
Total Services from CONSOL Energy	$	11,218	$	6,612	$	8,077

Operating and Other Costs include service costs for pension and insurance expenses. Selling, General and Administrative Costs include charges for incentive compensation, an annual administrative support fee and reimbursement for the provision of certain management and operating services provided by the Company's former parent prior to the separation and by CONSOL Energy following the separation. As of November 28, 2017, certain administrative services historically incurred by the Partnership are now incurred by CONSOL Energy and the Partnership's portion is reimbursed to CONSOL Energy.

At December 31, 2018 and 2017, CCR had a net payable to the Company in the amount of $3,831 and $3,071, respectively. This payable includes reimbursements for business expenses, executive fees, stock-based compensation and other items under the Omnibus Agreement.

In July 2018, CONSOL Energy Inc.'s Board of Directors approved an expansion of the stock and debt repurchase program (See Note 5 - Stock, Unit and Debt Repurchase). The program expansion allows the Company to use up to $25 million of the program to purchase CONSOL Coal Resources LP's outstanding common units in the open market. During the year ended December 31, 2018, 167,958 of the Partnership's common units were repurchased at an average price of $18.33 per unit.