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TO: All suppliers of Cline Mining Corporation, New Elk Coal Company LLC and North Central <br />Energy Company (collectively, the "Company ") <br />DATE: December 3, 2014 <br />Dear supplier: <br />I want to inform you of an important development and what it means to our Company. This news <br />is being made public and communicated to our stakeholders today. <br />Cline has entered into a Support Agreement with Marret Asset Management Inc. on behalf of the <br />Company's senior secured noteholders (the "Supporting Noteholders "), concerning a <br />recapitalization transaction (the "Recapitalization ") that will see the Supporting Noteholders <br />become the new owners of the Company. <br />The Recapitalization preserves the Company's business, significantly reduces the Company's <br />overall debt, lowers interest expenses and ensures that the Company has the financial stability to <br />continue, pending improvements in industry conditions. The Recapitalization has the following <br />key elements: <br />➢ The Supporting Noteholders will become the new owners of the Company; <br />➢ The Company will continue to pay suppliers for goods and services that are contracted <br />for and provided to the Company after today's commencement of the Recapitalization <br />process; and <br />➢ Implementation of the Recapitalization is expected to be completed within 60 to 90 days. <br />The Recapitalization will be implemented through a court- supervised process. To that end, the <br />Company has applied for and obtained an order of the Ontario Superior Court of Justice (the <br />"Court") initiating proceedings (the "CCAA Proceedings ") under the Companies' Creditors <br />Arrangement Act ( "CCAA "). As part of the CCAA Proceedings, FTI Consulting Canada Inc. <br />( "FTI') has been named the Court- appointed Monitor of the Company in Canada and foreign <br />representative of the Company with respect to ancillary proceedings in the United States. FTI's <br />role will be to monitor and report to the Court with respect to the Company's operations and to <br />oversee and assist us throughout the Recapitalization process. In addition, FTI will be initiating <br />proceedings in Colorado to give effect to the CCAA Proceedings under Chapter 15 Title 11 of <br />the United States Code (collectively with the CCAA Proceedings, the "Proceedings "). The <br />Company will be seeking further court orders within the coming weeks approving the <br />Recapitalization. <br />This process is not anticipated to affect the Company's day -to -day business. We have access to <br />the funds necessary to carry on business while the Recapitalization is being pursued. Please note <br />that certain obligations of the Company arising prior to the Proceedings will be stayed and <br />