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 Lower Mason seam is accessed via drift entry. Rich Gap is a thermal coal operation and operates on the WPP lease.

Production is scheduled for 255 days each year, which represents production on Monday through Friday and occasional Saturdays and idle holidays. On each day, one production section is scheduled to produce coal on two shifts; the third shift is reserved for maintenance and mine conveyor belt and power moves. The section is with one continuous miner available for production. Productivity is planned at the rate of 205 feet of advance for each unit-shift of operation. A total of 46 employees are assigned to the mine.

Principal production equipment on each section includes a continuous miner, two roof bolters, three shuttle cars, and two scoops. Coal is extracted from the production face with the continuous miner and hauled to the mine conveyor in shuttle cars. At the conveyor belt, the coal is discharged from the shuttle cars onto a feeder breaker for transfer onto the conveyor. The conveyors carry the coal to the outside, where it is stacked on the ground to await transport to the Kopper Glo coal preparation plant and load-out.

Expected annual production averages approximately 202,000 marketable tons. Rich Gap is projected to begin operations in 2018 and continue into 2021, after which the equipment and personnel will proceed to the Ben’s Branch Mine.

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.

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.