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Business Description We are a limited partnership formed in 2008 to engage in the business of management and leasing of coal properties and collection of coal production royalties in the Western Kentucky region of the Illinois Basin. We currently own approximately 65 million tons of coal reserves and, as of March 31, 2012, had a 50.81% undivided interest in approximately 140 million tons of coal reserves owned by Armstrong Energy, all located in Ohio and Muhlenberg counties in Western Kentucky. Our coal is generally low chlorine, high sulfur coal. Our outstanding limited partnership interests (“common units”), representing 98.36% of our common units, are owned by investment funds managed by Yorktown Partners LLC (collectively, “Yorktown”). We are not engaged in the permitting, production or sale of coal, nor in the operation or reclamation of coal mining activity. We are a fee mineral and surface rights owning entity. It is our intention to remain a coal leasing enterprise and not to engage in coal production ourselves. We currently lease all of our reserves to Armstrong Energy, our sole lessee, in exchange for royalty payments in the amount of 7% of the revenue received from coal sold from those reserves. Armstrong Energy is a diversified producer of low chlorine, high sulfur thermal coal from the Illinois Basin with both surface and underground mines. Armstrong Energy is currently deferring the cash payment of those royalty payments. Partially as a result of those deferrals, as of December 31, 2011 we were owed approximately $5.7 million from Armstrong Energy. We intend to use the net proceeds from this offering to purchase an additional estimated 8% to 10% partial undivided interest in the reserves in which we had, as of March 31, 2012, a 50.81% interest. The actual percentage acquired will depend on the fair value of the reserves at the time of the acquisition and the net proceeds received in this offering. In addition, our interest as a joint tenant in common with Armstrong Energy in the majority of Armstrong Energy’s coal reserves could be increased as a result of an additional acquisition through the offset of unpaid deferred royalties owed to us. We expect Armstrong Energy to continue to defer royalty payments due to us and we do not plan to pay distributions to any of our unitholders, except for amounts necessary to enable unitholders to pay anticipated income tax liabilities, for the foreseeable future. As a result, we expect to continue to acquire an increasing percentage undivided interest in Armstrong Energy’s coal reserves for the foreseeable future through the offset of deferred royalties owed to us by Armstrong Energy. We are a co-borrower under Armstrong Energy’s $100.0 million term loan (the “Senior Secured Term Loan”) and a guarantor on the $50.0 million revolving credit facility (the “Senior Secured Revolving Credit Facility,” and together with the Senior Secured Term Loan, the “Senior Secured Credit Facility”) and the Senior Secured Term Loan. Substantially all of our assets and Armstrong Energy’s assets are pledged to secure borrowings under the Senior Secured Credit Facility. Under the terms of the Senior Secured Credit Facility, without the consent of all lenders (if there are fewer than three lenders at the time of any dividend or distribution) or the lenders having more than 50% of the aggregate commitments (if there are three or more lenders at the time of any dividend or distribution) under that facility, we are currently prohibited from making dividend payments or other distributions to our unitholders in excess of $5.0 million per year and $10.0 million in aggregate, except for dividends or other distributions in amounts necessary to enable unitholders to pay anticipated income tax liabilities arising from their ownership interests in the Partnership until February 9, 2016, the date on which the Senior Secured Credit Facility matures. We are not permitted to borrow additional funds under the Senior Secured Credit Facility and as such, it is not a source of liquidity for us. A wholly owned subsidiary of Armstrong Energy, Inc., Elk Creek GP, LLC (“Elk Creek GP”), is our general partner. Pursuant to our Second Amended and Restated Agreement of Limited Partnership, to be effective upon the closing of this offering (the “Partnership Agreement”), Elk Creek GP has the exclusive authority to conduct, direct and manage all of our activities. By virtue of Armstrong Energy’s control of Elk Creek, GP, our results are consolidated in Armstrong Energy’s historical consolidated financial statements. Pursuant to our existing partnership agreement, effective October 1, 2011 (the “Existing Partnership Agreement”), Yorktown unilaterally may remove Elk Creek GP as our general partner in some circumstances. As a result, Armstrong Energy will no longer consolidate our results in its financial statements (the “Deconsolidation”). 2011 was the first year we recognized revenue under our leases to Armstrong Energy. Based on its coal production during 2011 and the three months ended March 31, 2012, Armstrong Energy is obligated to pay us $7.2 million and $2.1 million, respectively, for production royalties under our leases for such period. In addition, we earned a credit and collateral support fee as a result of our financing activities in the amount of $1.15 million and $0.3 million in 2011 and the three months ended March 31, 2012, respectively. ----- Our principal executive offices are located at 7733 Forsyth Boulevard, Suite 1625, St. Louis, Missouri 63105 and our telephone number is (314) 721-8202. Our corporate website address is www.armstrongresourcepartners.com.