YOUR VOTE IS VERY IMPORTANT.

 

Please complete, date, sign and return your proxy card(s), or vote your shares by telephone or over the Internet at your earliest convenience so that your shares are represented at the meeting.

YOUR VOTE IS VERY IMPORTANT.

 

Please complete, date, sign and return your proxy card(s) or vote your shares by telephone or over the Internet at your earliest convenience so that your shares are represented at the meeting.

 

This summary highlights selected information from this joint proxy statement/prospectus and may not contain all of the information that is important to you. You should carefully read this entire document and the other documents to which this document refers to fully understand the merger and the related transactions. See “Where You Can Find More Information” beginning on page 239. Most items in this summary include a page reference directing you to a more complete description of those items.

 

Founded in 1847, Cliffs is an international mining company, the largest producer of iron ore pellets in North America and a supplier of metallurgical coal to the global steelmaking industry. Cliffs operates six iron ore mines in Michigan, Minnesota and Eastern Canada, and three coking coal mines in West Virginia and Alabama. Cliffs also owns a majority control interest in Portman Limited, or Portman, a large iron ore mining company in Australia, serving the Asian iron ore markets with direct-shipping fines and lump ore. In addition, Cliffs has a 30 percent interest in MMX Amapá Mineração Limitada, a Brazilian iron ore project, which is referred to as Amapá, and a 45 percent economic interest in the Sonoma Coal Project, an Australian coking and thermal coal project, which is referred to as Sonoma. Cliffs’ principal executive offices are located at: 1100 Superior Avenue, Cleveland, Ohio 44114, and its telephone number is: (216) 694-5700.

 

Alpha is a leading Appalachian coal supplier. Alpha produces, processes and sells steam and metallurgical coal from eight regional business units, which, as of June 30, 2008, were supported by 32 active underground mines, 26 active surface mines and 11 preparation plants located throughout Virginia, West Virginia, Kentucky, and Pennsylvania, as well as a road construction business in West Virginia and Virginia that recovers coal. Alpha also sells coal produced by others, the majority of which Alpha processes and/or blends with coal produced from its mines prior to resale, providing Alpha with a higher overall margin for the blended product than if Alpha had sold the coals separately. Alpha’s principal executive offices are located at: One Alpha Place, P.O. Box 2345, Abingdon, Virginia 24212, and its telephone number is: (276) 619-4410.

 

On July 15, 2008, each of the boards of directors of Cliffs and Alpha approved the merger of merger sub, a newly formed and wholly-owned subsidiary of Cliffs, with and into Alpha, upon the terms and subject to the conditions contained in the merger agreement. Alpha will be the surviving company after the merger and will become a wholly-owned subsidiary of Cliffs. Under certain circumstances, the merger may be restructured so that merger sub will be converted from a Delaware corporation into a Delaware limited liability company, Alpha Merger Sub, LLC, and Alpha will merge with and into Alpha Merger Sub, LLC, with Alpha Merger Sub, LLC as the surviving company. The effects of the merger, if it is restructured in this way, are described in Annex G. Any such restructuring will not affect the merger consideration to be received by holders of Alpha common stock.

 

We encourage you to read the merger agreement, which governs the merger and is attached as Annex A to this joint proxy statement/prospectus, because it sets forth the terms of the merger.

 

Merger Consideration (page 82)

 

In the merger, holders of Alpha common stock (other than shares of Alpha common stock held by any dissenting Alpha stockholder that has properly exercised appraisal rights in accordance with Delaware law, held in treasury by Alpha or owned by Cliffs) will be entitled to receive for each share of Alpha common stock (which will be cancelled in the merger):

 

 

As a result, Cliffs will issue approximately 70,000,000 common shares of Cliffs and pay approximately $1.7 billion in cash in the merger, based upon the number of shares of Alpha common stock outstanding on the record date for the Alpha special meeting. We refer to the share and cash consideration to be paid to Alpha stockholders by Cliffs as the merger consideration.

 

The total value of the merger consideration that an Alpha stockholder receives in the merger may vary. The value of the cash portion of the merger consideration is fixed at $22.23 for each share of Alpha common stock. The share portion of the merger consideration is similarly fixed at 0.95 of a common share of Cliffs to be exchanged for each share of Alpha common stock, but its value may vary due to changes in the market value of Cliffs common shares.

 

No fractional common shares of Cliffs will be issued in the merger. Any holder of Alpha common stock that would otherwise be entitled to receive fractional common shares of Cliffs as a result of the exchange of Alpha common stock for Cliffs common shares will receive, in lieu of any fractional shares, an amount in cash, without interest, equal to the fractional share interest multiplied by the closing price for a common share of Cliffs as reported on the NYSE Composite Transactions Reports as of the closing date of the merger or, if such date is not a trading day, the trading day immediately preceding the closing date of the merger.

 

Financing of the Merger (page 93)

 

Cliffs will fund the cash portion of the merger consideration with cash from committed debt financing in the form of a senior unsecured term loan facility for up to $1.9 billion and cash from operations.

 

Alpha’s Reasons for the Merger (beginning on page 59)

 

In reaching its decision to approve the merger agreement and recommend the merger to its stockholders, the Alpha board of directors consulted with Alpha’s management, as well as Alpha’s legal and financial advisors, and considered a number of factors, including those listed in “The Merger — Alpha’s Reasons for the Merger and Recommendation of Alpha’s Board of Directors” beginning on page 59.

 

Cliffs’ Reasons for the Merger (beginning on page 61)

 

In reaching its decision to approve the merger agreement and the transactions contemplated by the merger agreement and to recommend that Cliffs shareholders adopt the merger agreement and approve the issuance of Cliffs common shares in connection with the merger, the Cliffs board of directors consulted with Cliffs’ management, as well as Cliffs’ legal and financial advisors, and considered a number of factors, including those listed in “The Merger — Cliffs’ Reasons for the Merger and Recommendation of Cliffs’ Board of Directors” beginning on page 61.

 

Effect of the Merger on Alpha Equity Awards (page 107)

 

In general, upon completion of the merger, options to purchase shares of Alpha common stock will be converted into options to purchase common shares of Cliffs. Cliffs has agreed to assume each of Alpha’s stock option plans at the effective time of the merger. Each unvested Alpha stock option outstanding under any Alpha stock option plan will become fully vested and exercisable in connection with the merger.

 

Restricted shares of Alpha common stock granted by Alpha to its employees and directors will become fully vested in connection with the merger and the holders thereof will be entitled to receive the merger consideration with respect to such vested shares upon completion of the merger.

 

Performance shares of Alpha common stock granted by Alpha to its employees will vest according to the terms of the applicable performance share agreement, and the holder of each performance share agreement will be entitled to receive an amount in cash equal to the product of (i) the sum of (A) $22.23 plus (B) the product of 0.95 multiplied by the closing price for a common share of Cliffs as reported on the NYSE Composite Transactions Reports on the closing date of the merger or, if such date is not a trading day, the trading day immediately preceding the closing date of the merger, multiplied by (ii) the number of shares of Alpha common stock that would be issuable under such performance share agreement.

For a full description of the treatment of Alpha equity awards, see “The Merger Agreement — Covenants and Agreements — Effect of the Merger on Alpha Equity Awards” on page 107.

 

Recommendations of the Boards of Directors to Alpha Stockholders and Cliffs Shareholders

 

Alpha Stockholders.  The Alpha board of directors believes that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable and fair to, and in the best interests of, Alpha and its stockholders and has approved the merger agreement and the transactions contemplated by the merger agreement, including the merger. The Alpha board of directors has resolved to recommend that Alpha stockholders vote for the adoption of the merger agreement.

 

Cliffs Shareholders.  The Cliffs board of directors believes that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable and fair to, and in the best interests of, Cliffs and its shareholders and has approved the merger agreement and the transactions contemplated by the merger agreement, including the merger. The Cliffs board of directors has resolved to recommend that Cliffs shareholders vote for the adoption of the merger agreement and the approval of the issuance of Cliffs common shares pursuant to the merger agreement.

 

Opinion of Alpha’s Financial Advisor.  In deciding to approve the merger agreement, the Alpha board of directors considered the oral opinion of Citigroup Global Markets Inc., which is referred to as Citi, financial advisor to the Alpha board of directors, delivered on July 15, 2008, which was subsequently confirmed in writing on the same date, to the effect that, as of the date of the opinion and based upon and subject to the considerations and limitations set forth in the opinion, its work described below and other factors it deemed relevant, the merger consideration was fair, from a financial point of view, to the holders of Alpha common stock. The full text of Citi’s opinion, which sets forth the assumptions made, general procedures followed, matters considered and limits on the review undertaken, is included as Annex B to this joint proxy statement/prospectus. Holders of Alpha common stock are urged to read the Citi opinion carefully and in its entirety, as well as the information set forth under “Risk Factors” beginning on page 27. Citi provided its opinion for the information and assistance of the Alpha board of directors in connection with its consideration of the merger. Neither Citi’s opinion nor the related analyses constituted a recommendation of the proposed merger to the Alpha board of directors. Citi makes no recommendation to any stockholder regarding how such stockholder should vote with respect to the merger. For its services to date, Citi has been paid a customary fee, and will be entitled to receive a transaction fee upon the completion of the merger. In addition, in the event that the merger is not completed and Alpha receives termination or break-up fees, Citi will be entitled to a portion of such fees.

 

Opinion of Cliffs’ Financial Advisor.  In connection with the merger, the Cliffs board of directors retained J.P. Morgan Securities Inc., which is referred to as J.P. Morgan, as its financial advisor. In deciding to approve the merger, the Cliffs board of directors considered the oral opinion of J.P. Morgan provided to the Cliffs board of directors on July 15, 2008, subsequently confirmed in writing on the same date, that, as of the date of the opinion and based upon and subject to the various factors and assumptions set forth in the written opinion, the consideration to be paid by Cliffs to Alpha stockholders in the proposed merger was fair, from a financial point of view, to Cliffs. The full text of J.P. Morgan’s written opinion, dated July 15, 2008, is attached to this joint proxy statement/prospectus as Annex C. Cliffs shareholders are urged to read the J.P. Morgan opinion carefully in its entirety for a description of, among other things, the assumptions made, general procedures followed, matters considered and limitations on the scope of the review undertaken by J.P. Morgan in conducting its financial analysis and rendering its opinion. J.P. Morgan’s opinion is addressed to the Cliffs board of directors and is one of many factors considered by the Cliffs board of directors in deciding to approve the transactions contemplated by the merger agreement. J.P. Morgan provided its opinion for the information and assistance of the Cliffs board of directors in connection with its consideration of the merger, and the opinion does not constitute a recommendation to any holder of Alpha common stock or Cliffs common shares as to how that holder should vote or act on any matter relating to the merger. For its services, J.P. Morgan will be entitled to receive a transaction fee, the principal portion of which is payable upon the completion of the merger. In addition, in the event Alpha pays a break-up fee or other payment to Cliffs

following or in connection with the termination, abandonment or failure to consummate the merger, J.P. Morgan will be entitled to a portion of such fee or other payment.

 

Alpha Stockholders.  The record date for the meeting of Alpha stockholders is October 10, 2008. This means that you must have been a stockholder of record of Alpha’s common stock at the close of business on October 10, 2008, in order to vote at the special meeting. You are entitled to one vote for each share of common stock you own. On Alpha’s record date, there were 70,495,814 shares of common stock (no shares of treasury stock) outstanding and entitled to vote at the special meeting.

 

Cliffs Shareholders.  The record date for the meeting of Cliffs shareholders is October 6, 2008. This means that you must have been a shareholder of record of Cliffs’ common shares or Series A-2 preferred stock at the close of business on October 6, 2008, in order to vote at the special meeting. You are entitled to one vote for each common share or share of Series A-2 preferred stock you own. On Cliffs’ record date, Cliffs’ voting securities carried 113,502,668 votes, which consisted of 113,502,463 common shares (excluding 21,121,065 shares of treasury stock) and 205 shares of Series A-2 preferred stock.

 

Alpha.  At the close of business on the record date for the Alpha special meeting, directors and executive officers of Alpha beneficially owned and were entitled to vote approximately 651,036 shares of Alpha common stock, collectively representing 0.92% of the shares of Alpha common stock outstanding on that date.

 

Cliffs.  At the close of business on the record date for the Cliffs special meeting, directors and executive officers of Cliffs beneficially owned and were entitled to vote approximately 1,574,181 common shares of Cliffs, collectively representing approximately 1.39% of the common shares of Cliffs outstanding on that date. Directors and executive officers of Cliffs did not hold any shares of Series A-2 preferred stock as of the close of business on the record date.

 

Based on the number of common shares of Cliffs and shares of Alpha common stock outstanding on their respective record dates, and assuming that Cliffs will issue approximately 70,000,000 common shares of Cliffs in the merger, after the merger, former Alpha stockholders are expected to own approximately 37% of the then-outstanding common shares of Cliffs.

 

Alpha’s executive officers and members of the Alpha board of directors, in their capacities as such, may have financial interests in the merger that are in addition to or different from their interests as stockholders of Alpha generally. Alpha’s board of directors was aware of these interests and considered them, among other matters, in approving the merger agreement and the transactions contemplated thereby.

 

Application will be made to have the common shares of Cliffs issued in the merger approved for listing on the NYSE, where Cliffs common shares currently are traded under the symbol “CLF.” If the merger is completed, Alpha common stock will no longer be listed on the NYSE and will be deregistered under the Securities Exchange Act of 1934, as amended, which is referred to as the Exchange Act, and Alpha may no longer file periodic reports with the SEC.

 

Holders of Alpha common stock who do not wish to accept the consideration payable pursuant to the merger may seek, under Section 262 of the General Corporation Law of the State of Delaware, which we refer to as the DGCL, judicial appraisal of the fair value of their shares by the Delaware Court of Chancery. This value could be

more than, less than or the same as the merger consideration for the Alpha common stock. Failure to strictly comply with all the procedures required by Section 262 of the DGCL will result in a loss of the right to appraisal.

 

Merely voting against adoption of the merger agreement will not preserve the right of Alpha stockholders to appraisal under Delaware law. Also, because a submitted proxy not marked “against” or “abstain” will be voted “for” the proposal to adopt the merger agreement, the submission of a proxy not marked “against” or “abstain” will result in the waiver of appraisal rights. Alpha stockholders who hold shares in the name of a broker or other nominee must instruct their nominee to take the steps necessary to enable them to demand appraisal for their shares.

 

Annex D to this joint proxy statement/prospectus contains the full text of Section 262 of the DGCL, which relates to the rights of appraisal. We encourage you to read these provisions carefully and in their entirety.

 

Cliffs shareholders who (1) are record holders of the Cliffs shares as of the record date; (2) do not vote to adopt the merger agreement and approve the issuance of Cliffs common shares in the merger, and (3) deliver a written demand for payment of the fair cash value of their Cliffs shares not later than ten days after the Cliffs special meeting, will be entitled, if and when the merger is completed, to receive the fair cash value of their Cliffs shares. The right as a Cliffs shareholder to receive the fair cash value of Cliffs shares, however, is contingent upon strict compliance by the dissenting Cliffs shareholder with the procedures set forth in Section 1701.85 of the Ohio General Corporation Law. If you wish to submit a written demand for payment of the fair cash value of your Cliffs shares, you should deliver your demand no later than December 1, 2008.

 

Annex E to this joint proxy statement/prospectus contains the full text of Section 1701.85 of the Ohio General Corporation Law, which relates to the dissenters’ rights of Cliffs shareholders. We encourage you to read these provisions carefully and in their entirety.

 

Completion of the merger depends on a number of conditions being satisfied or waived. These conditions include the following:

 

 

 

Antitrust Clearances (page 92)

 

The completion of the merger is subject to compliance with the HSR Act. The notifications required under the HSR Act to the U.S. Federal Trade Commission, which is referred to as the FTC, and the Antitrust Division of the U.S. Department of Justice, which is referred to as the Antitrust Division, were filed on July 25, 2008. On August 22, 2008, the FTC granted an early termination of the waiting period under the HSR Act without the imposition of any conditions or restrictions on the consummation of the merger.

 

In addition, Cliffs and Alpha were required to submit a pre-merger notification in Turkey and obtain antitrust clearance from the Turkish Competition Authority. The pre-merger notification in Turkey was submitted on August 19, 2008, and the antitrust clearance was granted by the Turkish Competition Authority effective as of September 11, 2008.

 

Cliffs and Alpha may agree in writing to terminate the merger agreement at any time without completing the merger, even after the Alpha stockholders have approved the adoption of the merger agreement and the Cliffs shareholders have adopted the merger agreement and approved the issuance of Cliffs common shares in connection with the merger.

 

The merger agreement may also be terminated at any time before the effective time of the merger under the following circumstances, among others:

 

 

 

 

 

 

 

 

In connection with the termination of the merger agreement in certain circumstances involving a takeover proposal by a third party for Alpha, a change of the Alpha board of directors’ recommendation to the Alpha stockholders in favor of the adoption of the merger agreement, or certain breaches of the merger agreement by Alpha, Alpha will be required to pay Cliffs a termination fee of $350 million. Similarly, in connection with the termination of the merger agreement in certain circumstances involving certain alternative transactions for Cliffs, a change of the Cliffs board of directors’ recommendation to the Cliffs shareholders in favor of the adoption of the merger agreement and the approval of the issuance of Cliffs common shares in connection with the merger, or certain breaches of the merger agreement by Cliffs, Cliffs will be required to pay Alpha a termination fee of $350 million.

 

Furthermore, each party will have to pay a termination fee of $100 million to the other party if its stockholders or shareholders, as applicable, voting at their respective special meetings, fail to approve the adoption of the merger agreement (in the case of Alpha) or the adoption of the merger agreement and the approval of the issuance of common shares of Cliffs in connection with the merger (in the case of Cliffs), but no such fee will be payable by such party if the shareholders of both parties, voting at their respective special meetings, fail to make such approvals.

 

Cliffs and Alpha intend for the merger to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, or the Code. If the merger qualifies as a reorganization, the U.S. federal income tax consequences to Alpha stockholders generally will be as follows: Alpha stockholders will generally recognize gain only to the extent of the cash consideration that they receive, and will not recognize any loss.

 

Tax matters are complicated, and the tax consequences of the merger to each Alpha stockholder will depend on the facts of each shareholder’s situation. Alpha stockholders are urged to read carefully the discussion in the section titled “Material United States Federal Income Tax Consequences” beginning on page 93 and to consult their own tax advisors for a full understanding of the tax consequences of their participation in the merger.

 

The merger will be accounted for as a business combination using the “purchase” method of accounting. Cliffs will be the acquirer for financial accounting purposes.

 

In evaluating the merger, the merger agreement or the issuance of Cliffs common shares in the merger, you should carefully read this joint proxy statement/prospectus and especially consider the factors discussed in the section titled “Risk Factors” beginning on page 27.

 

As a result of the merger, the holders of Alpha common stock will become holders of Cliffs common shares and their rights will be governed by the Ohio General Corporation Law and by Cliffs’ amended articles of incorporation and regulations. Following the merger, Alpha stockholders will have different rights as shareholders of Cliffs than as stockholders of Alpha.

 

Some of the material differences in the rights of Alpha stockholders and Cliffs shareholders include, but are not limited to, the following:

 

 

The foregoing list is not intended to be exhaustive, but, rather serves as an illustration of some of the material differences in the rights of Alpha stockholders and Cliffs shareholders. For further discussion of the material differences between the rights of Alpha stockholders and Cliffs shareholders, please see “Comparison of Rights of Shareholders” beginning on page 217.

 

Cliffs common shares are traded on the NYSE under the symbol “CLF.” The following table shows the high and low sales prices at any time during the period indicated for Cliffs common shares as reported on the NYSE. For current price information, you are urged to consult publicly available sources.

 

On May 9, 2006, the board of directors of Cliffs approved a two-for-one stock split of its common shares. The record date for the stock split was June 15, 2006 with a distribution date of June 30, 2006. On March 11, 2008, the board of directors of Cliffs declared a two-for-one stock split of its common shares. The record date for the stock split was May 1, 2008 with a distribution date of May 15, 2008. Accordingly, unless indicated otherwise, all Cliffs common share and per share amounts in this joint proxy statement/prospectus that relate to dates prior to the stock splits have been adjusted retroactively to reflect the stock splits.

 

 

In addition, on September 9, 2008, Cliffs declared a regular quarterly cash dividend of $0.0875 per Cliffs common share that will be payable on December 1, 2008 to Cliffs shareholders of record as of the close of business on November 14, 2008.

 

The last reported sales prices of Cliffs common shares on the NYSE on July 15, 2008 and October 21, 2008 were $111.46 and $34.42, respectively. July 15, 2008 was the last full trading day prior to the public announcement of the merger. October 21, 2008 was the last full trading day for which this information could be calculated prior to the date of this joint proxy statement/prospectus.

 

The Cliffs board of directors has the power to determine the amount and frequency of the payment of dividends. Decisions regarding whether or not to pay dividends and the amount of any dividends are based on compliance with the Ohio General Corporation Law, compliance with agreements governing Cliffs’ indebtedness, earnings, cash requirements, results of operations, cash flows, financial condition and other factors that the board of directors considers important. While Cliffs intends to maintain dividends at this level for the foreseeable future, it cannot assure that it will continue to pay dividends at this level, or at all.

 

Under the merger agreement, Cliffs has agreed that, until the effective time of the merger, it will not declare, set aside or pay any dividends on, or make any other distributions in respect of, any of its capital stock, other than regular quarterly cash dividends with respect to Cliffs common shares not in excess of $0.25 per share and Series A-2 preferred stock in accordance with the terms thereof.

 

Alpha common stock is traded on the NYSE under the symbol “ANR.” The following table shows the high and low sales prices at any time during the period indicated for Alpha common stock on the NYSE. For current price information, you are urged to consult publicly available sources.

 

 

The last reported sales prices Alpha common stock on the NYSE on July 15, 2008, and October 21, 2008 were $94.92 and $40.47, respectively. July 15, 2008 was the last full trading day prior to the public announcement of the merger. October 21, 2008 was the last full trading day for which this information could be calculated prior to the date of this joint proxy statement/prospectus.

 

The Alpha board of directors has the power to determine the amount and frequency of the payment of dividends. Decisions regarding whether or not to pay dividends and the amount of any dividends are based on compliance with the DGCL, compliance with agreements governing Alpha’s indebtedness, earnings, cash requirements, results of operations, cash flows, financial condition and other factors that the board of directors considers important. Alpha does not currently pay dividends. While Alpha anticipates that if the merger were not consummated it would continue not to pay dividends, it cannot assure that is the case. Under the merger agreement, until the closing of the merger Alpha is not permitted to declare, set aside or pay any dividends on, or make any other distributions in respect of, any of its capital stock.

 

The following table shows selected historical financial data for Cliffs. The selected financial data as of December 31, 2007, 2006, 2005, 2004, and 2003 and for each of the five years then ended were derived from the audited historical consolidated financial statements and related footnotes of Cliffs. The data as of and for the six months ended June 30, 2008 and 2007 were derived from Cliffs’ unaudited condensed consolidated financial statements. In the opinion of management, the unaudited financial information as of and for the six months ended June 30, 2008 and 2007 includes all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the data for such periods. The operating results for the six months ended June 30, 2008 are not necessarily indicative of results for the full year ending December 31, 2008.

 

Detailed historical financial information is included in the audited consolidated statements of financial position as of December 31, 2007 and 2006, and the related consolidated statements of operations, shareholders’ equity and cash flows for each of the years in the three-year period ended December 31, 2007 and the unaudited condensed consolidated statements of financial position as of June 30, 2008 and the related unaudited condensed consolidated statements of operations and cash flows for the six-month periods ended June 30, 2008 and 2007 included elsewhere in this joint proxy statement/prospectus. You should read the following selected financial data together with Cliffs’ historical consolidated financial statements, including the related notes.

 

 

 

 

The following table shows selected historical financial and other data for Alpha. The selected financial data as of December 31, 2007, 2006, and 2005, and for the years then ended has been derived from the audited consolidated financial statements and related footnotes of Alpha. The selected historical financial data as of December 31, 2004 and for the year then ended has been derived from the combined financial statements of ANR Fund IX Holdings, L.P. and Alpha NR Holding, Inc. and subsidiaries (the owners of a majority of the membership interests of ANR Holdings, LLC prior to the February 11, 2005 restructuring) and the related notes, which are not included or incorporated by reference in this joint proxy statement/prospectus. The selected historical financial data as of December 31, 2003 and for the year then ended has been derived from the audited combined balance sheet of ANR Fund IX Holdings, L.P. and Alpha NR Holding, Inc. and subsidiaries, which are not included or incorporated by reference in this joint proxy statement/prospectus. The data as of and for the six months ended June 30, 2008 and 2007 has been derived from Alpha’s unaudited condensed consolidated financial statements included in Alpha’s quarterly report on Form 10-Q for the period ended June 30, 2008 incorporated by reference in this joint proxy statement/prospectus and, in the opinion of Alpha’s management, includes all adjustments, consisting of normal and recurring adjustments, necessary to present fairly the data for such periods. The operating results for the six months ended June 30, 2008 are not necessarily indicative of results for the full year ending December 31, 2008.

 

Detailed historical financial information included in the audited consolidated balance sheets as of December 31, 2007 and 2006, and the related consolidated statements of income, stockholders’ equity and partners’ capital and comprehensive income, and cash flows for each of the years in the three-year period ended December 31, 2007, are included in Alpha’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 and incorporated by reference in this joint proxy statement/prospectus. You should read the following selected financial data together with Alpha’s historical consolidated financial statements, including the related notes, and the other information contained or incorporated by reference in this joint proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 239.

 

Prior period coal revenues and cost of coal sales have been reclassified to exclude changes in the fair value of coal and diesel fuel derivatives contracts to conform to current year presentation. These reclassification adjustments had no effect on previously reported income from operations or net income.