Document:

Exhibit

Exhibit 10.7
Execution Copy

TERM SHEET
This term sheet (the “Agreement”) dated as of November 6, 2018 sets forth the terms of agreement among ANR, Inc. (“ANR”), Alpha Natural Resources Holdings, Inc. (“Holdings”), Contura Energy, Inc. (“Contura”) and the West Virginia Department of Environmental Protection (“WVDEP”) (hereinafter, collectively, the “Parties”) to fully and finally resolve the issues relating to ANR’s issuance of a dividend in connection with its impending merger with Contura.  The terms and conditions described herein are part of a comprehensive agreement, each element of which is consideration for the other elements and is an integral aspect of such agreement.  The Parties agree that the Agreement reflected herein shall be effective immediately.
	
		
	Consents
	Subject to the terms and conditions hereof and pursuant to Sections 7(a) and (c) of the Permitting and Reclamation Plan Settlement Agreement for the State of West Virginia dated as of July 12, 2016 (as heretofore amended, the “Amended Settlement Agreement”), WVDEP: (1) consents to the issuance by ANR and Holdings of a cash dividend of $2.725 per share for each share of Class C-1 Common Stock and Class C-2 Common stock of ANR and Common Stock of Holdings (the “Dividend”) on or about November 7, 2018; provided, however, that the aggregate amount of the cash dividends shall not exceed $60.2 million, and (2) acknowledges that it has determined that the successor entities that will exist after the merger of ANR and Holdings with Contura in accordance with the amended merger agreement dated September 27, 2018 (the “Merger”) have the ability to complete the obligations set forth in Section 7(a) of the Amended Settlement Agreement.

	Amendment
	Upon consummation of the Merger, WVDEP, ANR, and Holdings shall enter into a third amendment to the Amended Settlement Agreement, which amendment shall delete Section 7(c) of the Amended Settlement Agreement.  Except as so amended, the Amended Settlement Agreement shall remain in full force and effect and the amendment of Section 7(c) shall have no effect on any other provision of the Amended Settlement Agreement, the Amended Reclamation Funding Agreement, the Amendment, or any other existing agreement or document between the parties hereto, including, without limitation, the other limitations on certain transactions set forth in Section 7 of the Amended Settlement Agreement.

	Extension of Existing Collateral
	(1)  The first lien mortgage and deed of trust in the office and associated real estate in Julian, WV, previously granted by ANR to WVDEP to secure ANR’s obligations under the Amended Settlement Agreement through December 31, 2018 shall be extended and continue to secure ANR’s obligations under the Amended Settlement Agreement until ANR and Contura complete the payments required of them under the Reclamation Funding Agreement dated as of July 12, 2016 by and

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	among ANR, Contura, WVDEP, and the regulatory agencies of each of the States of Illinois, Tennessee (as administered by the Office of Surface Mining and Reclamation Enforcement), Kentucky and Virginia (as heretofore amended, the “Amended Reclamation Funding Agreement”). 
(2)  Contura shall continue to hold subject to the applicable Deposit Account Control Agreement(s) referenced in the Amendment of Agreements dated as of October 23, 2017 by and between Contura and WVDEP (the “Amendment”) the remaining balance of the Account Collateral (as defined in the Amendment) until ANR and Contura complete the payments required of them under the Amended Reclamation Funding Agreement.

	Performance Bond
	Concurrent with ANR’s issuance of the Dividend, Contura shall either post cash collateral in the amount of $9 million with WVDEP or cause to be issued a letter of credit permitted under applicable West Virginia law to WVDEP in the amount of $9 million for the benefit of WVDEP, in either case in form and substance acceptable to WVDEP (the “Letter of Credit”), to secure the payment obligations of Contura and ANR under the Amended Reclamation Funding Agreement and the Amended Settlement Agreement (as amended by this Agreement) until the Performance Bond is issued in accordance with the next paragraph.

Within forty-five (45) days of the issuance of the Dividend, Contura shall cause to be issued a performance bond permitted under applicable West Virginia law to WVDEP in the amount of $35 million for the benefit of WVDEP, in either case in form and substance acceptable to WVDEP (the “Performance Bond”), to secure the payment obligations of Contura and ANR under the Amended Reclamation Funding Agreement and the Amended Settlement Agreement (as amended by this Agreement).  The amount of the Performance Bond shall decrease on a dollar to dollar basis after the payment obligations of Contura and/or ANR fall below $35 million.  

If the Performance Bond is not issued within twenty-five (25) days of the issuance of the Dividend, Contura will post additional cash collateral in the amount of $26 million with WVDEP or cause to be issued an additional Letter of Credit in the amount of $26 million to be held until the Performance Bond is issued.
The Letter(s) of Credit or cash collateral provided above shall be returned to Contura within five (5) business days after receipt of the Performance Bond by WVDEP.

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	Unless earlier called upon or forfeited, the Performance Bond shall be returned to Contura upon the completion of the payments required of ANR and Contura under the Amended Reclamation Funding Agreement.
The remaining payments required under the Amended Reclamation Funding Agreement are:
ANR
July 26, 2019  - $17,500,000
July 26, 2020  - $17,500,000
July 26, 2021  - $17,500,000
July 26, 2022  - $10,000,000
Contura
July 26, 2019  - $10,000,000
July 26, 2020  - $12,000,000

	Rights to Call the Performance Bond
	WVDEP may draw down on the Performance Bond in the event ANR or Contura does not complete the payments required of ANR and Contura under the Amended Reclamation Funding Agreement.

	Minimum Liquidity
	Contura agrees that, prior to making any dividend payment to its shareholders, the company will provide evidence satisfactory to WVDEP that, inclusive of the effect of paying the dividend, Contura will have remaining total liquidity, including cash, cash equivalents and asset backed loan availability, that is greater than or equal to the total amount of the remaining payment obligations of both Contura and ANR under the Amended Reclamation Funding Agreement.  In the event Contura issues a dividend payment in violation of this requirement, WVDEP may draw on the Performance Bond in an amount equal to the difference between the amount owed to WVDEP by ANR and Contura at the time of the dividend payment and the amount of liquidity immediately after the payment of the dividend.

	Payment of Attorneys’ Fees
	ANR and Contura agree to pay the reasonable attorneys’ fees and costs incurred by WVDEP in connection with the Dividend and the Merger and the negotiation and documentation of the resolution thereof, this Agreement, and the transactions contemplated hereby, up to a maximum amount of $50,000.00.

	
		
	ANR, INC.

	 
	 

	By:
	/s/ Andrew B. McCallister

	Name: Andrew B. McCallister

	Its: SVP, Secretary & General Counsel

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	ALPHA NATURAL RESOURCES HOLDINGS, INC.

	 
	 
	 

	 
	 
	 

	By:
	/s/ Andrew B. McCallister
	 

	Name: Andrew B. McCallister
	 

	Its: SVP, Secretary & General Counsel
	 

	 
	 
	 

	 
	 
	 

	CONTURA ENERGY, INC.

	 
	 
	 

	 
	 
	 

	By:
	/s/ Mark M. Manno
	 

	Name: Mark M. Manno
	 

	Its: EVP, Chief Administrative and Legal Officer and Secretary

	 
	 
	 

	 
	 
	 

	WEST VIRGINIA DEPARTMENT OF ENVIRONMENTAL PROTECTION

	 
	 
	 

	 
	 
	 

	By:
	/s/ Jason E. Wandling
	 

	Name: Jason E. Wandling
	 

	Its: General Counsel
	 

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Exhibit 10.8

Contura Energy, Inc. 
FORM OF NON-EMPLOYEE DIRECTOR RESTRICTED STOCK UNIT AWARD AGREEMENT 

This Non-Employee Director Restricted Stock Unit Award Agreement (“Agreement”) is entered into by and between Contura Energy, Inc. (the “Company”) and the non-employee director whose name appears below (the “Director”) in order to set forth the terms and conditions of Restricted Stock Units (the “RSUs”) granted to the Director under the Contura Energy, Inc. 2018 Long-Term Incentive Plan (the “Plan”).
Director’s Name: [●]

	
					
	Award Type
	 
	“Date of Grant”
	 
	Number of RSUs

	RSUs– Prorated Annual Equity Award
	 
	[●]
	 
	[●]

	RSUs – In lieu of Prorated Cash Retainer
	 
	[●]
	 
	[●]

Subject to the attached Terms and Conditions and the terms of the Plan, which are incorporated herein by reference, the Company hereby grants to the Director, on the Date of Grant, the number of RSUs as set forth above.  Capitalized terms used but not otherwise defined herein or in the attached Terms and Conditions shall have the meanings ascribed to such terms in the Plan.
IN WITNESS WHEREOF, the Company has duly executed and delivered this Agreement as of the Date of Grant.

	
				
	CONTURA ENERGY, INC.
	 
	DIRECTOR

	 
	 
	 

	By:
	 
	 
	 

	 
	Name:  [●]
	 
	Name: [●]

	 
	Title:  [●]
	 
	 

	 
	 
	 
	 

	 
	PLEASE RETURN ONE SIGNED COPY OF THIS AGREEMENT TO:

	 
	 
	 
	 

	 
	Contura Energy, Inc.
	 
	 

	 
	340 Martin Luther King Jr., Blvd.
	 
	 

	 
	Bristol, TN 37620 
	 
	 

	 
	Attn: [●]
	 
	 

Contura Energy, Inc. 
CONTURA ENERGY, INC. 2018 LONG-TERM INCENTIVE PLAN  
Terms and Conditions of Non-Employee Director RSU Grant
		
	1.
	GRANT OF RSUs.  The RSUs have been granted to the Director as an incentive for the Director to continue to provide services to the Company and to align the Director’s interests with those of the Company.  Each RSU corresponds to one Common Share.  Each RSU constitutes a contingent and unsecured promise by the Company to deliver one Common Share on the settlement date, as set forth in Section ‎4. 

		
	2.
	VESTING.  Subject to the provisions of Section ‎3 hereof, the RSUs shall vest on April 30, [●]1, subject to the Director’s continuous service with the Company through such date and, except as set forth in Section ‎3 hereof, all unvested RSUs shall be immediately forfeited upon a Director’s termination of service with the Company.

		
	3.
	ACCELERATED VESTING.  Notwithstanding anything to the contrary contained herein, the RSUs shall fully vest, subject to the Director’s continuous service with the Company through such date, upon the earliest of (i) the Director’s Separation from Service due to the Director’s death or physical or mental incapacity to perform his or her usual duties, such condition likely to remain continuously and permanently, as determined by the Company or (B) a Change in Control.

		
	4.
	SETTLEMENT. Except as otherwise set forth in the Plan, the RSUs will be settled in Common Shares, and the Director shall receive the number of Common Shares that corresponds to the number of RSUs that have become vested as of the applicable vesting date, which Common Shares shall be delivered on the date that is no later than [●] days following the applicable vesting date, as determined in the Committee’s sole discretion. 

		
	5.
	DIVIDEND EQUIVALENT PAYMENTS. Until the RSUs settle in Common Shares, if the Company pays a dividend on Common Shares, the Director will be entitled to a payment in the same amount as the dividend the Director would have received if he or she held Common Shares in respect of his or her vested and unvested RSUs held but not previously forfeited immediately prior to the record date of the dividend (a “Dividend Equivalent”). No such Dividend Equivalents will be paid to the Director with respect to any RSU that is thereafter cancelled or forfeited prior to the applicable vesting date. The Committee will determine the form of payment in its sole discretion and may pay Dividend Equivalents in Common Shares, cash or a combination thereof. The Company will pay the Dividend Equivalents within [●] days of the vesting date of the RSUs to which such Dividend Equivalents relate.  

__________________
1 The vesting schedule presented in this form of Award Agreement is indicative. The vesting schedule applicable to awards may vary.

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	6.
	NONTRANSFERABILITY. No portion of the RSUs may be sold, assigned, transferred, encumbered, hypothecated or pledged by the Director, other than to the Company as a result of forfeiture of the RSUs as provided herein, unless and until payment is made in respect of vested RSUs in accordance with the provisions hereof and the Director has become the holder of record of the vested Common Shares issuable hereunder, unless otherwise provided by the Committee.

		
	7.
	TAX AND WITHHOLDING.  The Company is not responsible for tax or other withholding obligations arising upon vesting or settlement (as applicable) of the RSUs.  The Director acknowledges that he or she will be solely responsible for any tax associated with the RSUs.

		
	8.
	RIGHTS AS STOCKHOLDER.  Except as set forth herein, the Director will not have any rights as a stockholder in the Common Shares corresponding to the RSUs prior to settlement of the RSUs.

		
	9.
	SECURITIES LAW COMPLIANCE.  The Company may, if it determines it is appropriate, affix any legend to the stock certificates representing Common Shares issued upon settlement of the RSUs and any stock certificates that may subsequently be issued in substitution for the original certificates.  The Company may advise the transfer agent to place a stop order against such Common Shares if it determines that such an order is necessary or advisable.

		
	10.
	COMPLIANCE WITH LAW.  Any sale, assignment, transfer, pledge, mortgage, encumbrance or other disposition of Common Shares issued upon settlement of the RSUs (whether directly or indirectly, whether or not for value and whether or not voluntary) must be made in compliance with any applicable constitution, rule, regulation or policy of any of the exchanges, associations or other institutions with which the Company has membership or other privileges, and any applicable law, or applicable rule or regulation of any governmental agency, self-regulatory organization or state or federal regulatory body.

		
	11.
	MISCELLANEOUS.

		
	(a)
	No Right To Continued Service. This Agreement shall not confer upon the Director any right to continue in the service of the Company or any Affiliate or Subsidiary or to be entitled to any remuneration or benefits not set forth in this Agreement or the Plan.

		
	(b)
	No Advice Regarding Grant.  The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Director’s participation in the Plan or acquisition or sale of the underlying Common Shares.  The Director is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.

		
	(c)
	Plan to Govern. This Agreement and the rights of the Director hereunder are subject to all of the terms and conditions of the Plan as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for the administration of the Plan.

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	(d)
	Amendment. Subject to restrictions set forth in the Plan, the Company may from time to time suspend, modify or amend this Agreement or the Plan. Subject to the Company’s rights pursuant to Sections 12(b) and 21 of the Plan, no amendment of the Plan or this Agreement may, without the consent of the Director, adversely affect the rights of the Director in a material manner with respect to the RSUs granted pursuant to this Agreement.

		
	(e)
	Severability. In the event that any provision of this Agreement shall he held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.

		
	(f)
	Entire Agreement. This Agreement and the Plan contain all of the understandings between the Company and the Director concerning the RSUs granted hereunder and supersede all prior agreements and understandings.

		
	(g)
	Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the Director’s death, acquire any rights hereunder in accordance with this Agreement or the Plan.

		
	(h)
	Governing Law. To the extent not preempted by federal law, this Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to any conflicts or choice of law, rule or principle that might otherwise refer the interpretation of the award to the substantive law of another jurisdiction.

		
	(i)
	Compliance with Section 409A of the Internal Revenue Code. The Award is intended to comply with Section 409A of the Code (“Section 409A”) to the extent subject thereto, and shall be interpreted in accordance with Section 409A and treasury regulations and other interpretive guidance issued thereunder, including without limitation any such regulations or other guidance that may be issued after the Date of Grant.  The Company reserves the right to modify the terms of this Agreement, including, without limitation, the payment provisions applicable to the RSUs, to the extent necessary or advisable to comply with Section 409A.  For purposes of this Agreement, each amount to be paid or benefit to be provided shall be construed as a separate identified payment for purposes of Section 409A.  Notwithstanding any provision in the Plan to the contrary, no payment or distribution under this Agreement that constitutes an item of deferred compensation under Section 409A and becomes payable by reason of the Director’s termination of service with the Company shall be made to the Director until his or her termination of service constitutes a “separation from service” within the meaning of Section 409A.  Notwithstanding any provision of the Plan or this Agreement to the contrary, in no event shall the Company or any affiliate be liable to the Director on account of failure of the RSUs to (i) qualify for favorable U.S. or foreign tax treatment or (ii) avoid adverse tax treatment under U.S. or foreign law, including, without limitation, under Section 409A.

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