The Benefits of an MLP A major reason that investors buy MLPs (versus bonds) is the potential to see their distributions grow faster than inflation. Generally, a company chooses to be a master limited partnership to avoid double taxation of dividends. So instead of the partnership paying taxes on its profits (like a corporation), each limited partner is responsible on his or her individual income tax for a proportional share of the MLP's income allowing a higher cash flow payout to unitholders. The MLP format is more tax-efficient. MLP Advantages   °   Desirable to income-oriented investors   °   Offers investors an interest in a group of diversified assets controlled by the partnership   °   When publicly traded, MLP units may be bought and sold like stock providing investors investment liquidity   °   Tax-advantaged income stream   °   A portion of the distribution may be shielded from ordinary income taxes and treated as a reduction in a unitholder's original cost basis in the investment  Other Factors   °   MLP's grow mainly by making effective acquisitions   °   Distributions (similar to dividends) are not guaranteed however common unit holders receive priority in distributions   °   Unitholders could be subject to reporting in states in which the MLP has operations   °   Investors may have to pay taxes on their proportional share of the MLP's income, even if the MLP does not distribute cash Investors should consult with a tax advisor concerning their individual tax situations.

NRP is an MLP   About NRP We are a master limited partnership that engages principally in the business of owning and managing coal properties in the three major coal-producing regions of the United States, Appalachia, the Illinois Basin and the Western United States.           Unique to NRP A significant portion of the distribution will be subject to section 1231 gains (capital gains) treatment, rather than ordinary income

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