The plan was filed with the U.S. Bankruptcy Court for the Eastern District of Missouri. Peabody is targeting emergence around the beginning of the second quarter of 2017.

"Today's proposed plan is an important achievement in our path toward emergence," said Peabody Energy President and Chief Executive Officer Glenn Kellow in a news release.

"The plan charts Peabody's course forward and reflects an enormous amount of work by the company and multiple creditor groups to advance a proposal that has broad consensus, maximizes the value of the enterprise and paves the way for a sustainable future. We look forward to moving toward confirmation of the plan."

The company is negogiating with three key stakeholder groups—the First Lien Creditors, the Second Lien Group and the Unsecured Noteholder Group. It is also updating its projections given changes to the industry and commodity prices.

"Eight months ago, we set out on a path to strengthen the balance sheet and position the company for long-term success amid historically challenged coal industry fundamentals," said Kellow.

"While we still have outstanding issues to resolve prior to emergence, this plan demonstrates that Peabody retains an unmatched asset base, leading U.S. platform, substantial Australian thermal and metallurgical coal business, and a team of skilled employees with a fundamental commitment to lasting values. We're pleased to reach this important step as we move to the next phase of Peabody's Chapter 11 process. And we appreciate all of our employees' actions in continuing to manage safe, low-cost operations and deliver the results that can best ensure our success."