Natural Resource Partners (NRP) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01Cash distributions are not guaranteed and may fluctuate with our performance and the establishment of financial reserves. In addition, our debt agreements and our partnership agreement place restrictions on our ability to pay, and in some cases raise, the quarterly distribution under certain circumstances
2. 02Our partnership agreement requires our consolidated leverage ratio to be less than 3.25x in order to make quarterly distributions on the common units in an amount in excess of $0.45 per unit
3. 03Our leverage and debt service obligations may adversely affect our financial condition, results of operations and business prospects
4. 04limit management’s discretion in operating our business
5. 05Global pandemics have in the past and may continue to adversely affect our business
6. 06Prices for both metallurgical and thermal coal are volatile and depend on a number of factors beyond our control. Declines in prices could have a material adverse effect on our business and results of operations
7. 07the effect of worldwide energy conservation measures
8. 08Changes to trade regulations, including trade restrictions, sanctions, tariffs, or duties, could significantly harm our results of operations
9. 09Prices for soda ash are volatile. Any substantial or extended decline in soda ash prices could have an adverse effect on Sisecam Wyoming’s ability to continue to make distributions to its members and on our results of operations
10. 10We derive a large percentage of our revenues and other income from a small number of coal lessees
11. 11Bankruptcies in the coal industry, and/or the idling or closure of mines on our properties could have a material adverse effect on our business and results of operations
12. 12Mining operations are subject to operating risks that could result in lower revenues to us
13. 13mine safety incidents or accidents, including hazardous conditions, roof falls, fires and explosions
14. 14The adoption of climate change legislation and regulations restricting emissions of greenhouse gases and other hazardous air pollutants have resulted in changes in fuel consumption patterns by electric power generators and a corresponding decrease in coal production by our lessees and reduced coal-related revenues
15. 15Concerns about the environmental impacts of coal combustion, including perceived impacts on global climate issues, are also resulting in unfavorable lending and investment policies by institutions and insurance companies which could significantly affect our ability to raise capital or maintain current insurance levels
16. 16Increased attention to climate change, environmental, social and governance ("ESG") matters and conservation measures may adversely impact our business
17. 17If our lessees do not manage their operations well, their production volumes and our royalty revenues could decrease
18. 18mine closure and reclamation
19. 19Sisecam Wyoming's reserve and resource data are estimates based on assumptions that may be inaccurate and are based on existing economic and operating conditions that may change in the future, which could materially and adversely affect the quantities and value of Sisecam Wyoming's reserves and resources
20. 20Fluctuations in transportation costs and the availability or reliability of transportation could reduce the production of coal, soda ash and other minerals from our properties
21. 21Our lessees could satisfy obligations to their customers with minerals from properties other than ours, depriving us of the ability to receive amounts in excess of minimum royalty payments
22. 22A lessee may incorrectly report royalty revenues, which might not be identified by our lessee audit process or our mine inspection process or, if identified, might be identified in a subsequent period

Risks Related to Our Structure

1. 23Unitholders may not be able to remove our general partner even if they wish to do so
2. 24We may issue additional common units or other equity securities without common unitholder approval, which could dilute a unitholder’s existing ownership interests
3. 25Our general partner has a limited call right that may require unitholders to sell their units at an undesirable time or price
4. 26Cost reimbursements due to our general partner may be substantial and will reduce our cash available for distribution to unitholders
5. 27Conflicts of interest could arise among our general partner and us or the unitholders
6. 28The control of our general partner may be transferred to a third party without unitholder consent. A change of control may result in defaults under certain of our debt instruments and the triggering of payment obligations under compensation arrangements
7. 29Unitholders may not have limited liability if a court finds that unitholder actions constitute control of our business
8. 30Tax Risks to Our Unitholders
9. 31The tax treatment of publicly traded partnerships or an investment in our units could be subject to potential legislative, judicial or administrative changes or differing interpretations, possibly applied on a retroactive basis
10. 32Certain U.S. federal income tax preferences currently available with respect to coal exploration and development may be eliminated as a result of future legislation
11. 33Our unitholders are required to pay taxes on their share of our taxable income even if they do not receive any cash distributions from us. Our unitholders' share of our portfolio income may be taxable to them even though they receive other losses from our activities
12. 34If the IRS contests the U.S. federal income tax positions we take, the market for our units may be adversely impacted and the cost of any IRS contest will reduce our cash available for distribution to our unitholders
13. 35Tax gain or loss on the disposition of our common units could be more or less than expected
14. 36Our unitholders may be subject to limitation on their ability to deduct interest expense incurred by us
15. 37Tax-exempt entities face unique tax issues from owning our units that may result in adverse tax consequences to them
16. 38We will treat each purchaser of our common units as having the same tax benefits without regard to the actual common units purchased. The IRS may challenge this treatment, which could adversely affect the value of the common units
17. 39We have adopted certain valuation methodologies in determining a unitholder's allocations of income, gain, loss and deduction. The IRS may challenge these methodologies or the resulting allocations, and such a challenge could adversely affect the value of our common units
18. 40As a result of investing in our units, our unitholders are likely subject to state and local taxes and return filing requirements in jurisdictions where we operate or own or acquire property
19. 41Our business is subject to cybersecurity risks