AGM 2021

May 6, 2021

Good morning, and welcome to the 2021 CNX Resources Corporation Annual Meeting of Shareholders. My name is Will Thorndike, Chairman of the Board of Directors, and I now call the meeting to order. Representatives of our auditors, Ernst and Young LLP, are present. They have informed me they do not wish to make a statement, but they are available to questions during the Q and A portion of the meeting. In connection with this meeting, I wanted to mention a few housekeeping items. We're excited to be hosting our 3rd virtual shareholder meeting. This virtual approach provides a convenient way to access our proxy materials and vote, enables greater shareholder participation in the proceedings and reduces the cost and environmental impact of our annual meeting. In addition, the virtual meeting format is consistent with public health best practices relating to the ongoing COVID-nineteen pandemic and in line with our commitment to sustainable business practices. In order to provide a fair, informative and orderly meeting, we have established rules of conduct for the meeting. The rules of conduct along with the meeting agenda and other meeting materials can be found in the lower right hand corner of your screen. We will conduct a meeting in accordance with these documents and your cooperation in observing the rules of conduct is greatly appreciated. During the meeting, shareholders have the opportunity to submit questions in writing where indicated on the website portal. Please submit your questions by typing the question into the Ask a Question field and clicking Submit. Questions regarding personal matters, including those related to employment, product or landowner issues are not pertinent to meeting matters and therefore will not be addressed. We will do our best to respond to appropriate questions received relating to the business of the meeting in the time permitted, and we'll address any unanswered questions on our Investor Relations page under Events and Presentations as soon as practicable after the meeting. Since our earnings release was recently issued and we make a number of management presentations regarding CNX throughout the year, all of which are available to you on our website, We will not hold a management presentation at this meeting. I'm now going to ask Alexander Reyes, our Executive Vice President, General Counsel and Corporate Secretary to handle the business portion of today's meeting. Alex? Thank you, Will. This meeting is being held pursuant the notice of annual meeting of shareholders and proxy statement dated March 23, 2021, which provided to shareholders of record as of close of business on March 9, 2021. In accordance with Delaware law, a list of shareholders as of the record date has been made available for the examination by shareholders for any purpose germane to this meeting for a period of at least 10 days prior to this meeting. A list of shareholders as of the record date is also available to shareholders during this meeting and can be accessed on your screen. CNX has appointed Mr. Tony Caridio of the Caridio Group Inc. To serve as the Inspector of Elections at the meeting. As the Inspector of Elections, Mr. Curitio will determine the presence of a quorum and judge the voting on all matters requiring a shareholder vote at this meeting. I've been informed by the Inspector of Elections that a majority of the outstanding shares of common stock entitled to vote at this meeting is represented. Therefore, a quorum is present for purposes of transacting the business of this meeting, and I declare that this meeting is legally convened. As described in detail in our proxy statement, there are 3 matters properly before this meeting for action by the shareholders. The Board recommends that the strict shareholders vote for each of the director nominees named in proposal 1 and 4 Proposals 23. To summarize, the proposals are as follows: 1st, election of the 6 director nominees named in the proxy statement. 2nd, ratification of the anticipated appointment of Ernst and Young LLP as CNX's independent auditor for the fiscal year ending December 31, 2021. 3rd, advisory approval of CNX's 2020 named executive compensation. The time is now 10:0:5 a. M. And the polls are open for the voting on these matters. For purposes of efficiency, since most shareholders have voted prior to the meeting, we will conduct a vote on all of these matters simultaneously. If you haven't voted yet or wish to change your vote, you may do so now by clicking on the voting button on the web portal and following the instructions there. Remember, if you have voted, you should not vote through the web portal unless you specifically desire to revoke a proxy or change a vote. We will now take a minute to allow shareholders voting through the web portal an opportunity to finish doing so. The time is now 10:0:06 a. M, and I declare the polls closed and the director and direct the Inspector of Elections to tabulate the votes. We have been informed by the Inspector of Elections that the preliminary vote report shows the following: Each of the 6 director nominees has been elected the anticipated appointment of Ernst and Young LLP as CNX's independent auditor for the fiscal year ending December 31, 2021, has been approved. And CNX's 2020 named executive compensation has been approved on an advisory basis. These results are preliminary until we receive a final report from the Inspector of Elections. After we receive this report, CNX will disclose the final results on a Form 8 ks filed with the SEC within 4 business days after this meeting. There being no further business to come before the meeting, a formal part of the meeting is adjourned. We will now move to Q and A and address any appropriate questions. The first Q and A question received. Mr. Chairman, the topic of stakeholder capitalism as an alternative to shareholder capitalism has received considerable attention recently. As long term pension fund investors, the Carpenter Funds appreciate the sentiments embodied in the stakeholder capitalism perspective, but feel that the execution could be complicated. Could you discuss the Board's perspective on the concept of stakeholder capitalism and what principles the Board would use to balance the interests of varied stakeholders as it develops and implements the company's long term business strategy? Thank you. Yes. Thanks, Alex. I think that's a very good and certainly timely question. The Board focuses intently at CNX on sort of the long term perspective for the business for across all stakeholders. I think our communications are very consistent on that dimension. So we are, of course, focused on optimizing outcomes for our shareholders over the longer term, but we believe very strongly that outcomes for shareholders are very closely correlated with outcomes for all other stakeholders and that the closeness of those links tightens very much over time. So we're intensely focused on optimizing outcomes for our employees, our customers and the local communities we operate in and sort of all stakeholder constituencies are critically important to optimizing outcomes for shareholders in the long term. We believe those are highly consistent objectives and that's very much our focus as a Board. Thank you, Will. The next Q and A question. The Carpenter Pension Funds hold a total of 100 and 54,228 shares of the company's stock. As long term investors, we strongly believe that the company's executive compensation plan should be designed primarily to drive the successful execution of the Board's long term strategic business plan. Today's public company executive compensation plans are largely formulae peer related plans with simplistic annual say on paid voting reinforcing plan on homogeneity. Would you call or would you speak to whether CNX Resources might be better served by an executive compensation plan tailored specifically to the company's particular circumstances and its unique long term strategic business plan? Thank you. Alex, do you want to have take that one? I can well, I can take a shot at that one. Yes, go ahead, Nick. Thanks. Sure. This is Nick Piolios, I'm the CEO of the company. And this is another great question from the Carpenter's pension. And to the Carpenter's, thank you. We do an awful lot of partnering and work with all the building trades, including the Carpenter's. What you all do day in and day out is very important to our industry, to our company and to our community. So thank you for all that on your membership, if you could. The question on executive comp, our executive compensation plans are indeed tailored to the unique strategic plans of CNX Resources. And I think there's a couple of different attributes that display or illustrate that. The first one is just the overall methodology that we apply, which is pay for performance. And performance in light of what we consider to be the key metric or metrics that drive intrinsic per share value on behalf of our ownership and metrics that track how our share price is performing for our ownership as well. And you see that tactically first with our short term incentive plans. The short term incentive compensation plans are annual based and those go and measure the performance of the company on the very important metric of free cash flow per share, which also of course happens to be the metric that we spend an awful lot of time emphasizing with the capital markets and with our ownership on a quarterly basis and a continual communication basis. So there's symmetry there and consistency there. And the targets that we set for that short term incentive target mimic and mirror the targets that we basically put out there for guidance with our ownership and with the capital markets. The second tactic is the long term incentive compensation plan for executives and that's stock based. And there's a restricted stock based portion of that and a performance share unit component of that. And on the performance share unit aspect of it, we're looking to 2 things that will determine what payout, if any, would occur. First is what the absolute share price is doing. So again, trying to put ourselves in the same shoes as the ownership with respect to the returns that they see over the course of a multiyear period. And then 2, the relative performance of CNX Resources stock to sort of an industry, indices or a number of peers. And that over time has evolved to be a very broad index of S and P industrial type indices that we're tracking, because we view ourselves as competing for the capital of all types of different options that are out there for investors, not just natural gas or E and P or Appalachian options. So again, I think the program designs have been basically created to reflect this question that you're asking about tailoring it to the specifics of the company and what we try to do strategically. And then the last comment I'll make is that the ownership with respect to executives should also be long term focused and should grow over time. We want, so to speak, skin in the game. And I think we've got that with respect to holding requirements that we put into our executive compensation plans in terms of holding the stock for prolonged periods of time to take that long term view, as well as ownership levels based off of multiples of base compensation, which we also meet regularly and comply with on a regular basis. So great question and thank you again for submitting it. Thank you, Nick. Are there any further Q and A questions in the queue? Great. There being no further questions in the Q and A session, I will now turn the meeting back over to Will Thorndyke to close the meeting. Will? Thanks, Alex. This concludes the annual meeting of shareholders for 2021. We very much appreciate your attendance at this meeting and thank you for your investment in CNX Resources Corporation and for your support. Thank you.