Navajo Transitional Energy Company, LLC won the bid to acquire substantially all assets of Cloud Peak Energy Inc. (OTCPK:CLDP.Q) for $55.7 million on August 16, 2019. On August 19, 2019 a definitive has been signed. The financial terms of the consideration include, among others, a $15.7 million cash payment at closing, a $40 million second lien promissory note and a 5-year term royalty on future tons produced. Navajo Transitional Energy Company, LLC additionally agreed to the assumption of pre and post-petition tax liabilities and federal and state coal royalty payments, all reclamation obligations, and up to $20 million in post-petition accounts payables. Navajo Transitional Energy Company, LLC shall deposit an amount equal to $5.7 million at closing. Navajo Transitional Energy Company, LLC also agreed to a carve-out of certain real estate parcels, which will be marketed separately by Cloud Peak Energy Inc. In connection with the closing of the sale, Cloud Peak agreed to terminate substantially all of its employees, Navajo Transitional Energy agreed to make offers of employment to substantially all of the terminated employees of Cloud Peak. The transaction is subject to the signing of a definitive asset purchase agreement, which will in turn be subject to approval by the United States Bankruptcy Court for the District of Delaware and certain other closing conditions including to the extent applicable, the waiting period applicable to the transactions under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 shall have expired or early termination shall have been granted and the Bankruptcy Court shall have entered the Sale Order. A hearing to seek required court approvals is scheduled for August 19, 2019. As of August 19, 2019, the Bankruptcy Court has approved the transaction. On September 30, 2019, the sale order was filed with the Bankruptcy Court and remains subject to approval and entry by the Bankruptcy Court. On October 2, 2019, the Bankruptcy Court approved the sale of substantially all of the company’s operating assets. As of October 21, 2019, the agreement was amended to provide for Navajo to acquire certain additional assets and assume certain additional liabilities, to modify Navajo’s assumption and rejection of certain contracts and leases, to provide for certain post-closing insurance matters and to modify the terms of the promissory note to be made by Navajo , including making the Note an unsecured obligation, increasing the interest rate thereon to 9% per annum, instituting cumulative increases in principal amount outstanding if the Note is not paid off upon applicable anniversaries of the closing date, providing for $2 million of quarterly amortization through maturity. The transaction is expected to close in October 2019. Paul E. Heath, David S. Meyer, Jessica C. Peet, Lauren R. Kanzer and John A. Kupiec of Vinson & Elkins LLP and Daniel J. DeFranceschi; John H. Knight; and David T. Queroli of Richards, Layton & Finger, P.A. acted as legal advisors to Cloud Peak Energy. Marc Puntus, Ryan Kielty and Johannes Preis of Centerview Partners LLC and FTI Consulting, Inc. acted as financial advisors to Cloud Peak Energy. Nora Pincus of Parsons Behle & Latimer acted as legal advisor to Navajo Transitional Energy Company, LLC. Damian S. Schaible, Christian Fischer, Samuel A. Wagreich, Jarret Erickson, William L. Taylor, Monica Holland, Lucy W. Farr, Leslie J. Altus and Nicholas A. of Davis Polk & Wardwell LLP acted as legal advisor to Cloud Peak Energy Inc. Morrsion & Foerster represented the official committee of unsecured creditors in a $15.7 million Chapter 11 sale of most of Cloud Peak Energy Inc.'s assets. Navajo Transitional Energy Company, LLC completed the acquisition of substantially all assets of Cloud Peak Energy Inc. (OTCPK:CLDP.Q) on October 24, 2019.