1324212--3/31/2006--Alpha_NR_Holding

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{cost, regulation, environmental}

{cost, contract, operation}

{acquisition, growth, future}

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Any change in coal consumption patterns by steel producers or North American electric power generators resulting in a decrease in the use of coal by those consumers could result in lower prices for our coal, which would reduce our revenues and adversely impact our earnings and the value of our coal reserves. A decline in demand for metallurgical coal would limit our ability to sell our high quality steam coal as higher-priced metallurgical coal and could affect the economic viability of certain of our mines that have higher operating costs. Acquisitions that we have completed since our formation, as well as acquisitions that we may undertake in the future, involve a number of risks, any of which could cause us not to realize the anticipated benefits. The inability of the sellers of our Predecessor and acquired companies to fulfill their indemnification obligations to us under our acquisition agreements could increase our liabilities and adversely affect our results of operations and financial position. Our inability to continue or expand the existing road construction and mining business of the Nicewonder Companies could adversely affect the expected benefits from the Nicewonder Acquisition. The loss of, or significant reduction in, purchases by our largest customers could adversely affect our revenues and profitability. Changes in purchasing patterns in the coal industry may make it difficult for us to extend existing supply contracts or enter into new long-term supply contracts with customers, which could adversely affect the capability and profitability of our operations. Certain provisions in our long-term supply contracts may reduce the protection these contracts provide us during adverse economic conditions or may result in economic penalties upon our failure to meet specifications. Disruption in supplies of coal produced by contractors and other third parties could temporarily impair our ability to fill customers orders or increase our costs. Competition within the coal industry may adversely affect our ability to sell coal, and excess production capacity in the industry could put downward pressure on coal prices. Fluctuations in transportation costs and the availability or reliability of transportation could affect the demand for our coal or temporarily impair our ability to supply coal to our customers. Our business will be adversely affected if we are unable to develop or acquire additional coal reserves that are economically recoverable. We face numerous uncertainties in estimating our recoverable coal reserves, and inaccuracies in our estimates could result in decreased profitability from lower than expected revenues or higher than expected costs. Defects in title of any leasehold interests in our properties could limit our ability to mine these properties or result in significant unanticipated costs. Mining in Central and Northern Appalachia is more complex and involves more regulatory constraints than mining in other areas of the United States, which could affect our mining operations and cost structures in these areas. Our work force could become increasingly unionized in the future, which could adversely affect the stability of our production and reduce our profitability. Our unionized work force could strike in the future, which could disrupt production and shipments of our coal and increase costs. Our ability to collect payments from our customers could be impaired if their creditworthiness deteriorates. The government extensively regulates our mining operations, which imposes significant costs on us, and future regulations could increase those costs or limit our ability to produce and sell coal. Extensive environmental regulations affect our customers and could reduce the demand for coal as a fuel source and cause our sales to decline. Our operations may impact the environment or cause exposure to hazardous substances, and our properties may have environmental contamination, which could result in material liabilities to us. We may be unable to obtain and renew permits necessary for our operations, which would reduce our production, cash flow and profitability. We may not be able to implement required public-company internal controls over financial reporting in the required time frame or with adequate compliance, and implementation of the controls will increase our costs. Our ability to operate our company effectively could be impaired if we fail to attract and retain key personnel. A shortage of skilled labor in the Appalachian region could pose a risk to achieving improved labor productivity and competitive costs and could adversely affect our profitability. Our significant indebtedness could harm our business by limiting our available cash and our access to additional capital and could force us to sell material assets or take other actions to attempt to reduce our indebtedness. Despite our current leverage, we may still be able to incur substantially more debt. This could further exacerbate the risks associated with our significant indebtedness. The covenants in our credit facility and the indenture governing the notes impose restrictions that may limit our operating and financial flexibility. Failure to obtain or renew surety bonds on acceptable terms could affect our ability to secure reclamation and coal lease obligations, which could adversely affect our ability to mine or lease coal. Failure to maintain capacity for required letters of credit could limit our available borrowing capacity under our credit facility, limit our ability to obtain or renew surety bonds and negatively impact our ability to obtain additional financing to fund future working capital, capital expenditure or other general corporate requirements. If our assumptions regarding our likely future expenses related to benefits for non-active employees are incorrect, then expenditures for these benefits could be materially higher than we have predicted. Demand for our coal changes seasonally and could have an adverse effect on the timing of our cash flows and our ability to service our existing and future indebtedness. Our earnings will be reduced in future periods as a result of our parent s issuance of shares of its common stock to members of management as part of the Internal Restructuring. The AMCI Parties may have significant influence on our company and may have conflicts of interest with us or you in the future. Terrorist attacks and threats, escalation of military activity in response to such attacks or acts of war may negatively affect our business, financial condition and results of operations.

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1324212--3/31/2006--Alpha_NR_Holding_Inc