Contract analysis

Section 1: Description of the Litigation and Regulatory Proceedings 1.1 Case Caption and Court The principal litigation matter within the scope of our engagement is captioned as follows: United States of America and State of Montana v. Torchlight Mining Corp., Torchlight Mining (U.S.) Inc., Torchlight Specialty Chemicals, Inc., Ridgecrest Mine Holdings, LLC, and Bonanza Creek Mining, LLC; consolidated with the State

Section 2: Terms of the Consent Decree — Settlement Amounts The consent decree, as lodged with the Court on February 19, 2025, imposes the following financial and remedial obligations on the Company and its subsidiaries. We summarize these obligations below for the convenience of the auditor. Please note that the following descriptions are intended as summaries of key terms and do not purport to be comprehensive rest

Section 3: Assessment of Liability — Probable and Estimable 3.1 Standard Applied Consistent with applicable accounting guidance under ASC 450 (Contingencies) (formerly SFAS No. 5) and IAS 37 (Provisions, Contingent Liabilities and Contingent Assets), the Company has evaluated the likelihood and estimability of the environmental obligations described in this letter. We understand that, under both ASC 450 and IAS 37, a

Section 4: Additional Matters for Auditor's Consideration In addition to the litigation and consent decree matters described above, we bring the following matters to Ridgeline's attention for purposes of its audit. While these matters are ancillary to the principal subject of our engagement, they intersect with the environmental litigation in ways that may be relevant to the auditor's evaluation of the Company's fina

Section 5: Limitations and Qualifications This letter is furnished in accordance with and subject to the limitations of the ABA Statement of Policy Regarding Lawyers' Responses to Auditors' Requests for Information, originally adopted in December 1975 and as subsequently amended. We call your attention to the following specific limitations and qualifications:

1. The information set forth herein is as of the date of this letter, March 3, 2025, and is limited to matters to which Calderwood & Harkness has given substantive attention in the form of legal representation. We have not undertaken any independent investigation of matters beyond the scope of our engagement, and we have relied on information provided to us by the Company's management, its other advisors, and the gov

2. There may exist unasserted possible claims or assessments that are not described in this letter because they do not meet the criteria for inclusion under the ABA Statement of Policy. Specifically, the ABA Statement of Policy provides that a lawyer should not disclose to the auditor information concerning an unasserted possible claim or assessment unless the client has specifically requested or authorized such disc

3. This letter is solely for the use of Ridgeline Accounting Partners LLP in connection with its audit of TMC's consolidated financial statements for the fiscal year ended December 31, 2024, and should not be used, quoted, cited, or relied upon by any other party for any other purpose without the prior written consent of Calderwood & Harkness LLP. This letter does not create any attorney-client relationship between C

4. Calderwood & Harkness does not express any opinion on questions of fact, the probability of an unfavorable outcome (except to the extent expressly stated herein with respect to the assessment of the consent decree obligations as probable and reasonably estimable), or the adequacy of the Company's financial reserves for environmental liabilities. Such determinations are within the province of management and the Com

5. This letter does not address any matters arising under Canadian federal or provincial environmental law, including the Canadian Environmental Protection Act, 1999 (S.C. 1999, c. 33), the Fisheries Act (R.S.C. 1985, c. F-14), or any provincial environmental legislation. Our engagement is limited to the U.S. federal and state environmental enforcement action described herein.

6. The limitations of this letter are consistent with and integral to our professional responsibilities, and are not intended to suggest any limitation on the auditor's responsibilities in conducting its audit. We reserve the right to supplement or amend this letter in the event of material developments in the matters described herein occurring prior to the issuance of the Company's audited financial statements for t