Page 46 - 2019 Annual Report

NOTES TO FINANCIAL STATEMENTS (continued)

Note N: Shareholders’ Equity
The authorized capital structure of the Company includes 100.0 million shares of common stock, with a par value of $0.01 a
share. At December 31, 2019, approximately 1.5 million common shares were reserved for issuance under stock‐based
award plans.
Pursuant to authority granted by its Board of Directors, the Company can repurchase up to 20.0 million shares of common
stock. The Company repurchased 0.4 million, 0.5 million and 0.5 million shares of common stock during 2019, 2018 and
2017, respectively. At December 31, 2019, 13.7 million shares of common stock were remaining under the Company’s
repurchase authorization.

Note O: Commitments and Contingencies
Legal and Administrative Proceedings. The Company is engaged in certain legal and administrative proceedings incidental to
its normal business activities. In the opinion of management and counsel, based upon currently‐available facts, the likelihood
is remote that the ultimate outcome of any litigation and other proceedings, including those pertaining to environmental
matters (see Note A), relating to the Company and its subsidiaries, will have a material adverse effect on the overall results of
the Company’s operations, its cash flows or its financial position.

Asset Retirement Obligations. The Company incurs reclamation and teardown costs as part of its mining and production
processes. Estimated future obligations are discounted to their present value and accreted to their projected future obligations
via charges to operating expenses. Additionally, the fixed assets recorded concurrently with the liabilities are depreciated over
the period until retirement activities are expected to occur. Total accretion and depreciation expenses for 2019, 2018 and 2017
were $9.1 million, $8.0 million and $8.7 million, respectively, and are included in Other operating income and expenses, net, in
the consolidated statements of earnings.
The following shows the changes in the asset retirement obligations:

years ended December 31
(in millions) 2019 2018
Balance at beginning of year $ 121.8 $ 109.7
Accretion expense 5.6 5.1
Liabilities incurred and liabilities assumed in business combinations 0.6 4.6
Liabilities settled (1.2 ) (2.8 )
Revisions in estimated cash flows 17.1 5.2
Balance at end of year $ 143.9 $ 121.8

Other Environmental Matters. The Company’s operations are subject to and affected by federal, state and local laws and
regulations relating to the environment, health and safety and other regulatory matters. Certain of the Company’s operations
may, from time to time, involve the use of substances that are classified as toxic or hazardous within the meaning of these laws
and regulations. Environmental operating permits are, or may be, required for certain of the Company’s operations, and such
permits are subject to modification, renewal and revocation. The Company regularly monitors and reviews its operations,
procedures and policies for compliance with these laws and regulations. Despite these compliance efforts, risk of
environmental remediation liability is inherent in the operation of the Company’s businesses, as it is with other companies
engaged in similar businesses. The Company has no material provisions for environmental remediation liabilities and does not
believe such liabilities will have a material adverse effect on the Company in the future.

Insurance Reserves. At December 31, 2019 and 2018, reserves of $39.9 million and $48.3 million, respectively, were recorded
for insurance claims.

Letters of Credit. In the normal course of business, the Company provides certain third parties with standby letter of credit
agreements guaranteeing its payment for certain insurance claims, contract performance and permit requirements. At
December 31, 2019, the Company was contingently liable for $32.9 million in letters of credit.

Surety Bonds. In the normal course of business, at December 31, 2019, the Company was contingently liable for $395.1 million
in surety bonds required by certain states and municipalities and their related agencies. The bonds are principally for certain
insurance claims, construction contracts, reclamation obligations and mining permits guaranteeing the Company’s own

Page 44 ♦ Annual Report Celebrating 25 Years as a Public Company