Contract analysis

1. Purpose and Confirmation of Investigation Closure We are writing to confirm the receipt of the letter from the United States Department of Justice, Antitrust Division, dated May 20, 2024, formally closing the grand jury investigation captioned above as to Torchlight Mining Corp. ("TMC" or the "Company"). This correspondence constitutes our formal written confirmation to the Company's senior leadership regarding th

2. Summary of Matter History Given the length and complexity of this engagement, we believe it is useful to provide a brief chronological recap of the principal milestones for your records and for the benefit of any TMC officers or directors to whom this letter is circulated. TMC first became aware of the investigation when it received Grand Jury Subpoena Duces Tecum No. GJ-22-0194-SD-003, served on the Company on Fe

3. Remaining NPA Obligations — Overview While we are pleased to report that the investigation has been formally closed, it is critically important that TMC's leadership and Board understand that the NPA imposes continuing obligations on the Company for a defined period, and that compliance with those obligations is essential to preserving the favorable resolution that has been achieved. The NPA has a term of three (3

4. Monetary Payment Obligation The NPA requires TMC to make a monetary payment of USD 48,500,000 (forty-eight million five hundred thousand United States dollars) to the United States Treasury. This payment is due within sixty (60) days of the NPA execution date—that is, by July 5, 2024. The calculation basis for the monetary payment is as follows. The DOJ's standard methodology for determining the monetary component

5. Cooperation Obligations The NPA imposes continuing cooperation obligations on TMC for the full three-year NPA term, running from May 6, 2024 through May 6, 2027. The scope of these cooperation obligations is broad, and TMC should be prepared for the possibility that the DOJ will call upon the Company to provide assistance on multiple occasions during this period. Specifically, the cooperation obligations require:

6. Gavin Holt Carve-Out We wish to draw particular attention to the treatment of Gavin Holt under the NPA. The NPA expressly does not extend its protections to Gavin Holt individually. The DOJ reserves the right to pursue criminal charges against Holt based on the conduct described in the NPA and in the Agreed Statement of Facts set forth in Appendix B. As you are aware, Holt served as TMC's Senior Vice President of

7. Enhanced Antitrust Compliance Program A cornerstone of the NPA is TMC's obligation to implement and maintain the Enhanced Antitrust Compliance Program described in Appendix A to the NPA (the "Compliance Program"). The Compliance Program was developed by Calderwood & Harkness in collaboration with Meridian Compliance Partners LLC, an independent compliance consulting firm led by Claudia Ferraro. The DOJ's approval

8. Independent Compliance Monitor The NPA requires TMC to retain an independent compliance monitor, approved by the DOJ, for a period of two (2) years from the date of NPA execution. The monitor term therefore runs from May 6, 2024 through May 6, 2026. Meridian Compliance Partners LLC has been pre-approved by the DOJ to serve as the independent compliance monitor. The engagement will be led by Claudia Ferraro, Managi

9. No-Prosecution Protections and Conditions The core protection afforded to TMC under the NPA is the DOJ's agreement not to bring criminal charges against TMC or any current TMC employee (other than Gavin Holt) based on the conduct described in the NPA and the Agreed Statement of Facts, provided that TMC complies with all terms and conditions of the NPA throughout the three-year NPA term. This protection is conditio

10. D&O Insurance and Ongoing Coverage We wish to remind you that TMC tendered notice of the investigation to Northland Mutual Insurance Co. on March 4, 2022, under Directors and Officers Liability Insurance Policy No. NMI-DO-2021-5547, which carries an aggregate limit of USD 50 million and a retention of USD 2.5 million. Northland acknowledged coverage for defense costs of individual directors and officers but reser

11. Public Disclosure Considerations TMC first publicly disclosed the existence of the DOJ investigation in its fiscal year 2021 annual report, filed on SEDAR+ (for Canadian securities-law purposes) and with the U.S. Securities and Exchange Commission on Form 40-F on March 28, 2022. Subsequent periodic filings have included updated disclosure regarding the status of the investigation and the litigation reserve establ

12. Key Dates and Deadlines Summary For ease of reference, we set forth below a consolidated table of all remaining key dates and deadlines arising from the NPA: We recommend that these dates be entered into the calendaring systems of the General Counsel's office, the CEO's office, the CFO's office, and the office of the Chief Compliance Officer (once appointed), with appropriate advance reminders. Calderwood & Harkn

13. Professional Fees Summary We set forth below a summary of professional fees and disbursements incurred in connection with this matter through the date of NPA execution: We note that Calderwood & Harkness's total fees of approximately USD 18.7 million exceeded the initial budget estimate of approximately USD 12 million. The budget overage was the result of the significant expansion of the matter's scope following

14. Calderwood & Harkness's Continuing Availability While the grand jury investigation has been formally closed, Calderwood & Harkness remains available to assist TMC with all matters arising from the NPA and its continuing obligations. Specifically, we are prepared to provide the following services: (a) NPA cooperation compliance: Assisting TMC in responding to DOJ requests for cooperation, including preparing witne

15. Closing and Acknowledgments In closing, we wish to express our sincere appreciation for the trust that TMC's leadership and Board of Directors have placed in Calderwood & Harkness throughout this engagement. The resolution of a grand jury investigation of this magnitude, without criminal charges against the Company or any current employee, and with a monetary payment reflecting an approximately 49.2% reduction fr