Ann: RareX to Spin-Out Nickel-Copper PGE and Gold Assets, page-43

I think what is really going on is not about Orange East or Byro. This is about clearing these out of REE so that when It gets partially sold, sold or joint ventured with Shenge or another company the deal is clean with only the rare earth assets they want.

If the directors do a really good deal for the Cummins Range assets then they may well have earned the free shares and shareholders may well win big. Time will tell. As a shareholder I would have preferred they award the shares after they have been earned by the announcement of a good deal, although of course it can be argued that only a good deal will make the price target happen and so these are the same thing.

The directors have been clear that they have held discussions about investment in Cummins Range. Perhaps the clear out is to meet some expectations of the other parties. Of course there is no requirement to announce the content of non-binding preliminary discussions having already announced that these discussions were being held.

REE must either get paid cash for the assets put into the IPO or shares in the new company. To obtain nothing is a breach of the directors duty because it does not act in the interests of shareholders as a whole, it would be giving away assets. Arguably the shares in the new company could be worth more than the assets are currently valued at and with cash for exploration more upside is possible.