The Property is situated in the southern portion of the Appalachian Basin, which contains two-fifths of the nations’ bituminous coal deposits and extends over 900 miles from northern Alabama to Pennsylvania.

The primary coal-bearing formations on the property are Carboniferous in age, being in the Pennsylvanian system, which includes the Breathitt Formation. The average mineable seam thickness for coal horizons in these formations ranges from 1 foot to over 6 feet. The coal seams are generally continuous and non-complex but may vary in thickness and may also be locally absent. Seams retain normal stratigraphic sequence throughout the Property and no evidence has been observed that seams have been modified from pre-deformational thicknesses.

Mineable coal seams within the Property are typically low-ash with the exception of the Joyner seam, and highthermal content bituminous coals. The maximum seam thic ness may reach over 6.0 feet in the Upper Jellico underground mines; however, the average mineable thickness of the seams in this evaluation generally ranges from 1 foot to 4 feet. Seams are generally continuous, but may be locally absent. Secondary discontinuity due to erosional features is present in most areas, resulting in seam outcropping, or visible exposure of the seam at the surface. Other than oxidation of the coal exposed at the surface, erosion of the seams has no significant impact on the mineralized deposits. All seams outcrop on the property, with the exception of the Cumberland Gap seam, which is below drainage. Coal seams are characterized by both single bench and multiple-bench coal horizons with parting (non-coal) material varying by seam and area. Seam parting is common within the coal seams on the Property with intra-seam parting material increasing drastically in some areas. Roof strata are typically shale or sandy shale with zones of sandstone roof being common. Floor strata are typically sandstone, shale, sandy shale, or fireclay.

The resource base for the Property consists of seven coal seams extending from the Joyner seam at the top of the stratigraphic column down through the Cumberland Gap seam . The topographic location of the many coal seams and the physical characteristics of the coal seams provide abundant opportunities to apply several of the coal mining methods routinely employed in Southern Appalachia.

Underground mine reserves are mined using continuous mining methods. One mine is presently active in the Rich Mountain seam (Double Mountain Mine). Production sections are configured as single-unit sections, employing one continuous miner and one roof bolter per section. The basic production design employed at the active mines was applied to projected operations where possible. In addition to future production at the active mine, underground mining was projected at four other resource areas in the Lower Mason, Jellico, and Cumberland Gap seams. The mine plan and financial model includes 23.64 million underground tons.

In the first quarter of 2015, underground mine operations were active at the Double Mountain Mine.

The projected mines are set-up similarly to the present operations. Each mine is scheduled to operate one to four production sections. The production sections are configured as single continuous miner sections.

CAPP currently operates the Double Mountain Deep Mine, an underground mine utilizing the room and pillar mining method.

Production from surface mines is crushed for railroad car loading and direct shipment to customers without coal preparation. All underground mine and highwall mining production will be washed at the Kopper Glo coal preparation facilities.

Coal is transported to the coal preparation plant and load-out facilities by coal trucks and conveyor belts. Surface mine production is transported by coal trucks to the truck dump and crushing facilities for railcar loading at the Kopper Glo unit train load-out.

Production from the active Double Mountain Mine and projected underground and highwall mines will be transported by coal trucks to the Kopper Glo plant. A new coal preparation plant will be constructed when the Cumberland Gap mine commences production.

Raw coal is fed directly into the coal preparation plant via a truck dump. Stockpile capacity includes approximately 20,000 tons of raw coal storage and 40,000 tons of clean coal storage at the plant.

The Kopper Glo Coal Preparation Plant is designed for 350 tons per hour (tph) raw coal feed. Raw coal is screened to provide sized material to each of three cleaning circuits.

Clean coal and refuse products are dewatered with vibratory screens, sieve screens, and centrifugal dryers. The thickener underflow is concentrated by belt presses and is transported to the combined refuse disposal facility by conveyor belt. The combined refuse disposal facility, located approximately 1.2 miles southwest of the plant on the Rock Creek, is reported to have life-of-mine capacity.

Clean coal is transported by a 42-inch wide conveyor, approximately 5,400 feet, to the 7,000-ton silo located at the load-out. The Kopper Glo load out facility is comprised of a single car load out and a batch weigh load-out. Coal is sampled and batch-weighed for loading railroad cars at the rate of 5,400 tph.