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ASX: ARU Arafura Rare Earths Investor Presentation August 2025 Not for release to US wire services or distribution in the United States. For personal use only
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19 August 25 2 Disclaimer This presentation is dated 20 August 2025 and has been prepared by Arafura Rare Earths Limited (“Arafura”, “Arafura Rare Earths” or the “Company”) in relation to an offer of shares in the Company via an institutional placement of ~A$80m, and an offer of shares under a share purchase plan (the Offer). This presentation is of a summary form only and therefore contains general background information which may not be complete. It should be read in conjunction with, and full review made of, Arafura Rare Earths’ most recent financial report and other periodic disclosures and releases lodged with the Australian Securities Exchange (ASX) and available at www.asx.com.au. This presentation contains certain statements which may constitute “forward-looking statements.” Such statements are only expectations or beliefs and are subject to inherent risks and uncertainties which could cause actual values, results or performance achievements to differ materially from those expressed or implied in this presentation. No representation or warranty, express or implied is made by Arafura Rare Earths that any forward -looking statement contained in this presentation will occur, be achieved or prove to be correct. You are cautioned against relying upon any forward-looking statement. Content presented in this presentation is provided as at the time of this presentation (unless otherwise stated). Reliance should not be placed on information or opinions contained in this presentation and, subject only to any legal obligation to do so, Arafura Rare Earths accepts no responsibility to update any person regarding any inaccuracy, omission or change in information in this presentation or any other information made available to a person, nor any obligation to furnish the person with any further information. This presentation is for information purposes only and is not a prospectus, product disclosure statement or other offering document under Australian law or any other law (and will not be lodged with ASIC or any foreign regulator). This presentation does not constitute an offer of any securities in Arafura Rare Earths in any jurisdiction, nor an invitation to apply for such securities in any jurisdiction, and will not form part of any contract for the acquisition of Arafura shares. This presentation is of a general nature only, does not take into consideration the investment objectives, financial situation or particular needs of any particular investor, and does not constitute investment advice or financial product advice. You should obtain your own professional advice and carry out your own independent investigations and assessment of the information in this presentation (including any assumptions) before acting. Information in this presentation which is attributed to a third -party source has not been checked or verified by Arafura Rare Earths. This presentation has been prepared for publication in Australia and may not be released to US wire services or distributed in the United States. This presentation does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States or any other jurisdiction. Any securities described in this presentation have not been, and will not be, registered under the US Securities Act of 1933 and may not be offered or sold in the United States except in transactions exempt from, or not subject to, the registration requirements of the US Securities Act and applicable US state securities laws. Refer to Appendix B of this presentation for further details about international offer restrictions. Mineral Resources and Ore Reserves The information in this presentation that relates to Mineral Resources at the Nolans Project is extracted from the Company’s ASX announcement entitled Detailed Resource Assessment Completed, released to ASX on 7 June 2017 which is available to view at www.asx.com.au. The information in this presentation that relates to Ore Reserves at the Nolans Project is extracted from the Company’s ASX announcement entitled Major Increase in Mine Life for the Nolans Project released to ASX on 16 March 2020 which is available to view at www.asx.com.au. Arafura Rare Earths confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and that all material assumptions and technical parameters underpinning the estimates in the original market announcements continue to apply and have not materially changed. Arafura Rare Earths confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcements. It is a requirement of the ASX Listing Rules that the reporting of ore reserves and mineral resources in Australia comply with the JORC Code. Investors outside Australia should note that while ore reserve and mineral resource estimates of the Company in this document comply with the JORC Code, they may not comply with the relevant guidelines in other countries and, in particular, do not comply with (i) National Instrument 43 101 (Standards of Disclosure for Mineral Projects) of the Canadian Securities Administrators or (ii) Item 1300 of Regulation S -K, which governs disclosure of mineral reserves in registration statements filed with the US Securities and Exchange Commission. Information contained in this presentation describing mineral deposits may not be comparable to similar information made public by companies subject to the reporting and disclosure requirements of other countries. You should not assume that quantities reported as “resources” in this presentation will be converted to reserves under the JORC Code or any other reporting regime or that the Company will be able to legally and economically extract them. Production Targets and Forecast Financial Information The information in this presentation that relates to production targets at the Nolans Project is extracted from the Company’s ASX announcement dated 11 November 2022 (Nolans Project Update). The Company’s mineral resources includes 9% Measured Resources, 54% Indicated Resources and 37% Inferred Resources. The production target is based on 12% Proved Reserves, 62% Probable Reserves and 26% inferred resources as reported in the Company’s ASX announcement dated 11 November 2022. There is a low level of geological confidence associated with inferred mineral resources and there is no certainty that further exploration work will result in the determination of indicated mineral resources or that the production target itself will be realised. Arafura confirms that all material assumptions underpinning the production target set out in the Company’s ASX announcement dated 11 November 2022 (including any assumptions referred to in the Company’s ASX announcement dated 11 November 2022 that were used from the DFS as set out in the Company’s ASX announcement dated 7 February 2019 (Nolans Project Definitive Feasibility Study) or from the Updated Mining Study as set out in the Company’s ASX announcement dated 16 March 2020 (Major Increase in Mine Life for the Nolans Project)), continue to apply and have not materially changed. The information in this presentation that relates to forecast financial information (including forecast financial information derived from the production target) is extracted from the Company’s ASX presentation dated 23 July 2024 (Arafura achieves major debt funding milestone). Arafura confirms that, all material assumptions underpinning the forecast financial information (and forecast financial information derived from the production target) set out in the announcement released on 23 July 2024 continue to apply and have not materially changed. The Company believes it has a reasonable basis for making the forward - looking statements in this presentation (including with respect to forecast financial information). Disclaimer To the maximum extent permitted by law, the Company and the Joint Lead Managers and each of their respective related bodies corporate, shareholders and affiliates, and each of their respective officers, directors, partners, employees, representatives, affiliates, agents, consultants and advisers: (i) disclaim any and all responsibility and liability (including, without limitation, any liability arising from fault, negligence or negligent misstatement) for any direct, indirect, consequential or contingent loss or damage arising from this presentation or reliance on anything contained in or omitted from it or otherwise arising in connection with this presentation; (ii) disclaim any obligations or undertaking to release any updates or revisions to the information in this presentation to reflect any change in expectations or assumptions; (iii) do not make any representation or warranty, express or implied, as to the accuracy, reliability, completeness or fairness of the information, opinions and conclusions contained in this presentation or that this presentation contains all material information about Arafura Rare Earths or that a prospective investor or purchaser may require in evaluating a possible investment in Arafura Rare Earths or acquisition of shares in Arafura Rare Earths, or likelihood of fulfilment of any forward - looking statement or any event or results expressed or implied in any forward-looking statement; (iv) do not make any recommendation as to whether any potential investor should participate in the Offer, nor make any representation, assurance or guarantee in connection with the repayment of capital or any particular rate of income or capital return on an investment in Arafura Rare Earths (including an investment in Arafura Rare Earths shares); (v) disclaim any fiduciary agency, custodial or other legal obligations to, or any fiduciary, agency, custodial or other legal relationship between them and the recipients of this presentation or the participants in the Offer; and (vi) do not make or purport to make any statements in this presentation and there is no statement in this presentation which is based on any statement by any of them. Each Joint Lead Manager, together with its respective affiliates and related bodies corporate, is a full service financial institution engaged in various activities, which may include trading, financing, financial advisory, investment management, investment research, principal investment, hedging, market making, margin lending, brokerage and other financial and non-financial activities and services including for which they have received or may receive customary fees and expenses. Each Joint Lead Manager (and/or its respective affiliates and related bodies corporate) have performed, and may perform, other financial or advisory services for Arafura Rare Earths, and/or may have other interests in or relationships with Arafura Rare Earths or other entities mentioned in this presentation for which they have received or may receive customary fees and expenses. For personal use only
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3 The Nolan’s Project 1 Refer to ASX Announcement dated 23 July 2024 2 In the 2022 Nolans Project Update (Refer to ASX Announcement dated 11 November 2022), SEG was reported as 474 tpa (as that figure did not include the 99 tpa Heavy Rare Earth (HRE) component of the line item). The figure reported above now includes the 99 tpa HRE component. 3 CRU Rare Earths Cost Curve, April 2024. Based on CRU independent estimate of Nolans operating costs in 2030. May not be consistent with Arafura’s published costs. Nolans is forecast to sit comfortably in first quartile of cost curve3 Mine Life +38 years NdPr Oxide 4,440 tpa Capex1 US$1,226 m (including contingency) NPV8 after tax1 US$1,729 m (base) US$2,549 m (incentive) ✓ Strategic location in proximity to critical infrastructure ✓ Nation building initiative ✓ Potential Phase 2 Processing Hub set to transform Australia’s rare earths sector1 Phos acid 144,393 tpa (54% P2O5 MGA) SEG/HRE Oxide2 573 tpa (Includes Dy and Tb) For personal use only
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4 Stuart Highway 10km east Water supply 25km southwest Alice Springs railyard, airport and other services 135km south Amadeus natural gas pipeline adjacent to site T ailings and waste management at site Deep water port and associated infrastructure at Darwin Single site, ore to oxideFor personal use only
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5 Once financed, we are ready to go Environmental permits and approvals in place Granted mineral lease / license Access to existing infrastructure >US$40m on site works completed de-risking project schedule Experienced Board and leadership team supported by Hatch Project well defined with process plant engineering enabling stable capital forecast Construction to commence when funding complete Construction ready 4 For personal use only
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6 Demand doubling....and that’s before robotics takes off NdPr Supply and Demand1,2 Additional supply of over 60kt NdPr oxide required by 2035 Demand growth of 7% CAGR from 2024 to 2035 driven by the transition to low-carbon economy (EV , wind & robotics) More than one Nolans project required every year Emerging thematic: between 2024 and 2035 CAGR for robotics is ~22%1 with Humanoids forecast to be a US$5 Trillion market by 20503 1 CRU - 2025 Rare Earths Special Report, 2 Adamas Intelligence, “Rare Earth Magnet Market Outlook to 2040” (Q3 2024), Project Blue - Rare Earths Report 2025 Q2 used for the demand breakdown by segment (end-use) 3 Morgan Stanley Research – Humanoids: A $5 Trillion Market (May 14, 2025) 39% 19% 17% 13% 11% 12% 9% 8% 8% 7% 0 20 40 60 80 100 120 140 160 % 143kt 61 kt Additional Supply Required Arafura Rare Earths ROW producers MP Materials Lynas China Required Projects Industrial Wind Turbines Magnetocaloric chillers Advanced Air Mobility Other E-Motor Robotics Other Consumer Electronics & appliances Other Vehicles Automotive Drivetrain Supply 2024 2035 Demand 2035 For personal use only
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7 Vital Metals RareX Australian Rare Earths Commerce Resources Leading Edge Energy Transition Minerals Ionic Rare Earths Mkango Northern Minerals Aclara Meteoric Brazilian Rare Earths VHM Hastings ASM Lindian Peak Pensana Arafura Lynas MP World’s most advanced construction ready , single site, ore-to-oxide project2 Development pipeline challenging Stage of project within each category is illustrative only and not intended to represent relative progress/development 1 Based on share prices as at 30 July 2025 2 There is no guarantee that Arafura’s market capitalisation following production will increase, or that its market capitalisation will be similar to MP or Lynas. MP and Lynas are already in production and so are not identical in nature to Arafura. Excludes companies/projects without a long term mine supply. 3 Groups sitting in funding/construction phase are subject to funding, offtake activities, completion of construction and development, commissioning and general market conditions 4 www.spglobal.com/market-intelligence/en/news-insights/research/from-6years-to-18years-the-increasing-trend-of-mine-lead-times Exploration / Study Funding / Construction3 Commercial Production LEGEND Bubble size = Market cap1,2 Ore-to- oxide 18 years4 For personal use only
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8 Scarcity driving geographically captured supply1 Arafura: a strategic supply for Europe, Korea & RoW CHINA MP MATERIALS LYNAS RARE EARTHS ARAFURA RARE EARTHS3 • Restrictions on rare earth exports • Ban on export of rare earths processing technology • VAT rebate • Tariff on China magnets and RE’s • Inflation Reduction Act (IRA) Critical Raw Materials Act (CRMA) State-supported project financing & policy 1. Geographic representation indicates majority of target NdPr product flow. Specified companies may sell product into other regions. 2. Customers are indicative only based on publicly announced sales agreements and arrangements. 3. Arafura is still in the funding/construction phase. Accordingly, the ability to obtain finance from the parties listed below is subject to a number of conditions precedent, including ARU raising the equity component of the funding package required for t he development of Nolans. In addition, supply of product to end users is subject to funding, completion of construction and development, commissioning and general market conditions. CompanyFunding/ PolicyEnd Users2 For personal use only
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9 $0.00 $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 $140.00 $160.00 $180.00 $200.00 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 US$/kg $110/kg MP transaction1 accelerates discussion of ex China price DoD Investment & Strategic Capital: • US$400m convertible preferred equity inc warrant • US$150m loan NdPr Price Floor: • DoD guarantees minimum NdPr price of US$110/kg • Price sharing arrangement above US$110/kg • 10-year term commencing Q4 2025 “10X” Magnet Plant: • 100% DoD offtake for defense consumption and commercial syndication • Minimum US$140m EBITDA guarantee US$110/kg creates a market reference price – Benchmark Minerals Intelligence to launch new ex China rare earth prices2 Historical NdPr Oxide Pricing, EXW China (USD/kg) 1. https://s25.q4cdn.com/570172628/files/doc_events/2025/Jul/10/FINAL -Transformational-Public-Private-Partnership-7-9-25-440pm.pdf 2. https://source.benchmarkminerals.com/article/benchmark-to-launch-ex-china-rare-earth-prices For personal use only
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10 Nolans in first quartile of cost curve • Nolans to sit in first quartile net of phosphoric acid by- product credits2 • China dominates market share • Significant production today is marginal or loss making hence unsustainable at recent market prices Nolans is forecast to sit comfortably in the first quartile 1 CRU Rare Earths Cost Curve, April 2024. US$/kg NdPr oxide (real 2024) with a third-party separation charge applied by CRU for those projects only producing an intermediate product e.g. concentrate or MREC. 2 Based on CRU independent estimate of Nolan’s operating costs in 2030. May not be consistent with Arafura’s published costs. NdPr Cost Curve 2030, $/kg NdPr Cost, Real 20241 CRU Cost Curve 2030 (US$/kg NdPr oxide)1 Cost ($/kg NdPr) Cumulative production (t NdPr) Nolans For personal use only
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11 Focus on strategic value and equity investment • TargetingNdPr users not aligned with ‘Made in China 2025 Strategy’. • Offtake discussions now focused on parties that qualify for GRMF investment4 and strategic value. Binding offtake target Offtake Discussion Group Location NdPr Oxide (tpa)1 % of Binding Offtake Target2 Secured Offtake (Binding Agreement) Hyundai & Kia Korea 1,500 43% Siemens Gamesa RE Germany 520 15% Traxys Europe S.A Luxembourg 300 8% Sub-total 2,320 66% Target Market Engagement for Remaining Offtake3 GRMF – Industry Groups Germany/Europe 500 14% OEM Wind/Auto, Tier 1 & Trading Asia, Europe & US 730 20% Sub-total 1,230 34% TOTAL BINDING OFFTAKE 3,550 100% Uncontracted Production Spot Market Sales 890 TOTAL PRODUCTION 4,440 1Product may be supplied as NdPr Oxide or Metal equivalent. 2The Company is targeting 80% of Planned Production as binding offtake. Planned Production refers to the average annual production from Nolans, being 4,440 tpa of NdPr oxide (refer ASX Announcement dated 11 November 2022). 3The Company, at this stage, has no certainty as to the timing and likelihood of successfully concluding binding offtake agreements. 4German Raw Material Fund (GRMF) Update (refer ASX Announcement dated 8 July 2025) For personal use only
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12 Debt conditionally approved • ECA Direct lend & ECA Covered Tranches • Cost Overrun Facility and Standby Liquidity Facility - US$360m including equity component • Contingent Instrument Facilities • Full suite of institutional banking services Conditional credit approvals received for more than US$1B in debt finance for Nolans 1 All debt facilities remain conditional on final documentation and other conditions precedent customary for secured project financing. 2 NAIF commitment of A$150 million converted to US$ for comparison purposes only at AUD/USD 0.67. 3 US$10m of EDC funding is included in the COF. 4 Commercial bank lenders supported by untied loan guarantees from Euler Hermes and KEXIM. 5 US$160m total Cost Overrun funding, 50% debt funded (COF) with the remaining US$80 million to be funded by equity (together the Cost Overrun Account). COF debt includes A$ tranche with NAIF commitment up to A$50 million. 6 Excludes Contingent Instrument Facilities to support the provision of bank guarantees. Facilities Tenor (Years) Amount (US$ million) Senior Debt Facilities Export Finance Australia 15 125 Northern Australia Infrastructure Facility 15 100 2 Export Development Canada 12 290 3 KEXIM 10 75 ECA Covered Tranches Euler Hermes 10 110 KEXIM 10 75 Total ECA Covered Tranches3 185 TOTAL BASE SENIOR DEBT 775 Cost Overrun Facility (COF) 8 80 4 TOTAL SENIOR DEBT 855 5 Subordinated Debt EFA Standby Liquidity Facility (SLF) 15 200 TOTAL DEBT 1,055 For personal use only
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13 • T argeting 60% of equity funding through Cornerstone Investors • More than US$1bn of debtand completion support conditionally approved • Proformacash balance of A$107m3 following receipt of proceeds from placement Funding in focus BASE DEBT CORNERSRONE INVESTORS PUBLIC Base debt from nine international Export Credit Agencies and commercial lenders US$133m1 | NRFC • January 2025 • Initial cornerstone investment • Hybrid equity / convertible note US$113m2 | KFW • July 2025 • Ordinary equity • Appraisal Phase entered Institutional & Private Investors Strategic Offtake & Equity Partners US$775m Conditionally Approved US$1.1bn3 1 Refer to ASX announcement dated 15 January 2025. Assumed exchange rate USD:AUD 66.5 2 Refer to ASX announcement dated 8 July 2025. Assumed EUR$100m investment size and exchange rate EUR:USD 113. Investment remains subject to additional 500tpa of NdPr oxide being supplied into the German market, detailed due diligence, approval from Germany’s Interministerial Committee and the execution of definitive agreements. 3 Proforma cash includes cash and cash equivalents as at 30 June 2025 of A$27m and A$80m proceeds from the Placement. US$1.1bn includes the Company’s proforma cash balance at assumed exchange rate USD:AUD 66.5 4 Refer to ASX Announcement dated 12 August 2025 Refer to ASX Announcement dated 12 August 2025. Quantum to be confirmed post due diligence. It is anticipated that the EFA investment will be substantial, in line with other government seeded funds. • Ordinary equity / Negotiations advanced US$1.5bn REQUIRED CAPITAL US$280M US$0.36bn COMPLETION SUPPORT ~US$80m Equity EFA 4 • August 2025 • Ordinary equity • Due Diligence underway For personal use only
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14 Joint Venture being pursued in parallel and remains an alternative funding pathway Customer Cornerstone & Other Strategic Cornerstone Group Public Market • Substantial holders • Government seeded funds with supply chain diversification mandate • Other customer cornerstones • Resources funds, corporates, large institutional and family offices • Institutional investors with an energy transition mandate • Balance to be raised through offer to new and existing shareholders Industry Cornerstone Institutional Investors Existing Shareholders 6 month+ process with extensive due diligence Timetable to accelerate following establishment of cornerstone group Executing on funding strategy Joint Lead Managers For personal use only
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15 Robust project economics • Fall in net operating costs to <US$30/kg driven by stronger phosphoric acid price outlook • NdPr price forecast based on average of 4 independent market forecasts (CRU, Project Blue, Argus and Adamas) delivering: – Post-tax NPV8 of US$1.7 billion – Post-tax, pre-finance IRR of 17.2% – Average annual EBITDA of US$460m • Incentive price delivers increase in NPV8 to US$2.5bn and IRR to 20.6% • Excludes any Nolans’ expansion potential 1 The Project Economics table is based on the assumptions and estimates set out in the Company’s ASX presentation dated 23 July 2024 (Arafura achieves major debt funding milestone). 2 Numbers may not compute because of rounding. Revenue, costs and EBITDA are calculated as the arithmetic annual average following the anticipated two year ramp up period and excluding the final years of production from low grade stockpiles. 3 Product prices during the offtake period refer to the first seven years of production when offtake agreements will include discounts and other contract mechanisms put in place to underpin project finance for up to approximately 80% of NdPr oxide production with averages calculated as the weighted average over the specified period. 4 In the 2022 Nolans Project Update (Refer to ASX Announcement dated 11 November 2022), SEG was reported as 474tpa (as that fig ure did not include the 99tpa Heavy Rare Earth (HRE) component of the line item). The Project Economics table above now includes the 99tpa HRE component. Key Project Information1, 2 Mining and Production Mine Life (years) 38 NdPr Oxide (tpa) 4,440 SEG/HRE Oxide (tpa) 5734 Phosphoric Acid (tpa 54% P2O5 MGA) 144,393 Realised Product Pricing Base (US$/kg) Incentive (US$/kg) NdPr Oxide price – offtake period3 104 130 NdPr Oxide price – LOM 133 163 Financial Base (US$m) Incentive (US$m) Capital Cost Pre-Production Capital 1,044 1,044 Other Pre-Production Costs and Escalation 90 90 Contingency 92 92 Total 1,226 1,226 Revenue Rare Earth Sales Revenue (per annum) 610 747 Phosphoric Acid Sales Revenue (per annum) 79 79 Operating Costs Mining Costs (per annum) (30) (30) Processing Costs (per annum) (139) (139) General and Administration Costs (per annum) (24) (24) Product transport, royalties and selling costs (per annum) (35) (40) EBITDA (per annum) 460 592 Post Tax Free Cash Flows (LOM) 10,229 13,480 KPI Analysis Base Incentive Operating Cost US$/kg NdPr 43.7 43.7 Operating Cost US$/kg NdPr net of P2O5 credit 28.6 28.6 NPV8 after tax (US$m) 1,729 2,549 IRR after tax (%) 17.2% 20.6% Long life, high margin projectFor personal use only
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16 Equity raising overview Offer structure and size • Arafura is undertaking a non-underwritten two-tranche institutional placement to raise ~A$80m ("Placement"), via the issue of approximately: – 369.6m fully paid ordinary shares (“New Shares”) to raise approximately ~A$70.2m pursuant to the Company’s existing placement capacity under ASX Listing Rule 7.1 (“Tranche One Placement”); and – 51.4m New Shares to raise approximately ~A$9.8m, subject to shareholder approval (“Tranche Two Placement”)1 • Up to approximately 421.1m New Shares to be issued under the Placement, representing ~17.1% of existing shares on issue • In addition to the Placement, Arafura will also be undertaking a non-underwritten share purchase plan to raise approximately A$5m (“SPP”) • New Shares issued under the Placement and SPP will rank equally with Arafura’s existing shares on issue Offer price • Offer price of A$0.19 per share, which represents a: – 13.6% discount to Arafura’s last closing share price of A$0.22 per share on 15 August 2025; and – 9.2% discount to Arafura’s 5-day volume weighted average price (“VWAP”) of A$0.209 per share up to and including 15 August 2025 Share Purchase Plan • Existing eligible shareholders, being those Arafura shareholders that have a registered address in Australia or New Zealand at 7.00pm AEST on Tuesday 19 August 2025, will be invited to subscribe for up to A$30,000 of New Shares under the SPP at the same price as the Placement (A$0.19 per share)2 • Arafura may decide to accept applications (in whole or in part) that result in the SPP raising more than A$5m, and also reserves the right (in its absolute discretion) to scale back applications under the SPP • Further information in relation to the SPP will be contained in the SPP offer booklet, which will be sent to eligible Arafura shareholders on or around Wednesday 27, August 2025 Joint Lead Managers • Barrenjoey Markets Pty Limited and Canaccord Genuity (Australia) Limited are acting as Joint Lead Managers and Bookrunners to the Placement 1 Shareholder approval will be sought at an Extraordinary General Meeting expected to be held on or around late September 2025. 2 The Company notes that it issued shares under a previous share purchase plan on 11 September 2024. In order to fall within ASX Listing Rule 7.2, Exception 5, the Company is restricted from issuing or agreeing to issue any Shares under the offer contained in this SPP until after 11 September 2025. Accordingly, application monies received under the SPP before 12 September 2025 will be held on trust by the Company and applications received before 12 September 2025 will only be deemed to be received by the Company under the SPP on that date. Applicants who have made an application under the SPP before 12 September 2025 may withdraw their application. For personal use only
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17 Sources and use of funds Sources of funds A$m Proceeds from the Placement (before costs) 80 Cash and cash equivalents (as at 30 June 2025, unaudited) 27 Total 107 Uses of funds1 A$m Corporate, working capital and transaction costs2 20 Allocation to project development capital upon FID3 87 Total2 107 T able excludes up to A$5m of funds raised under the SPP – launched to enable eligible shareholders the opportunity to participate in the equity raising at the same price as the Placement. Any funds raised under the SPP will be applied towards the line items outlined in the table Placement proceeds partially de-risk the final equity raise and enhances the Company’ s negotiating leverage with potential strategic equity partners to deliver on the equity funding strategy 1 Estimated use of funds assuming a minimum A$80m raising under the Placement. Arafura has launched a SPP so may raise more than A$5m. Any funds raised under the SPP will be applied towards the line items noted in the table. 2 Estimated use of funds through to 30 April 2026. 3 A decision on FID is subject to a number of conditions including being fully funded. There is no certainty this will be achieved by April 2026. For personal use only
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18 Timetable and pro-forma capital structure Event Date Placement Trading halt lifted and announcement of completion of Placement Wednesday, 20 August 2025 Settlement of New Shares under the Tranche One Placement Monday, 25 August 2025 Issue, quotation and trading of New Shares under the Tranche One Placement Tuesday, 26 August 2025 EGM to approve issue of New Shares under the Tranche Two Placement Friday, 26 September 2025 Settlement of New Shares under the Tranche Two Placement Wednesday, 1 October 2025 Issue, quotation and trading of New Shares under the Tranche Two Placement Thursday, 2 October 2025 SPP Record Date 7pm AEST on Tuesday, 19 August 2025 SPP offer opens, SPP Offer Booklet is dispatched Wednesday, 27 August 2025 SPP offer closes 5pm AEST on Friday, 3 October 2025 Issue and allotment of New Shares issued under SPP Friday, 10 October 2025 Commencement of trading of New Shares issued under SPP Tuesday, 14 October 2025 Indicative Timetable1 Pro-forma capital structure2 Shares Cash Current3 2,464m A$27m Placement4 421m A$80m Pro-forma4 2,885m A$107m 1 Indicative only and dates are subject to change by the Joint Lead Managers and/or the Company. 2 Pro-forma excludes incremental proceeds of up to A$5m and New Shares issued under the SPP. 3 Unaudited cash balance as at 30 June 2025. 4 Cash balance shown before costs. For personal use only
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19 We are poised to make a positive difference in the communities where we operate and live As a greenfield developer we have a unique opportunity to create and deliver value for all stakeholders We recognise the interdependencies of ESG in our business We are building capability to deliver best- practice ESG We are aligning our governance to international standards ESG – an integrated approach focusing upon what matters most For personal use only
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20 The Nolans Project is ready to go Large, high grade, scalable resource 38-year mine life underpinned by Mineral Resource of 56Mt1 at a grade of 2.6% TREO (26.4% NdPr enrichment) Life of mine average production of 4,440 tpa NdPr oxide2 Construction ready, ore-to-oxide project One of the only construction- ready, fully-permitted, ore-to- oxide NdPr rare earths projects in the western world 135km north of Alice Springs in the Northern Territory Nolans is close to existing infrastructure, with a high-level of engineering completed Projected first quartile of cost curve Revised project economics released in July 20243 Low-cost operation placing Nolans in the first quartile of the cost curve underpinning attractive economics through the cycle Debt funding and binding offtakes secured >US$1 billion in debt funding conditionally approved3 NRFC A$200m investment commitment4 Secured binding offtake agreements with tier 1 customers Hyundai & Kia and Siemens Gamesa Renewable Energy and global trading group Traxys5 Project delivery to drive re-rate of market valuation Existing rare earth producers have elevated EV/EBITDA trading multiples due to strategic importance and strong fundamentals Potential for significant re-rate in Arafura’s market valuation to EV/EBITDA once production achieved Environment, social, governance Building capability to deliver best-practice ESG Aligning governance to international standards Net zero pathway published in 20236 Rare earths from Nolans is differentiated by ESG credentials Unique opportunity to create and deliver value for all stakeholders 1 Mineral Resource comprises 4.9Mt Measured Resource, 30Mt Indicated Resource and 21Mt Inferred Resource 2 Refer to ASX Announcement dated 11 November 2022 . 3 Refer to ASX Announcement dated 23 July 2024. 4 Refer to ASX announcement dated 15 January 2025. 5 Refer to ASX Announcements dated 7 November 2022, 11 April 2023 and 20 March 2025 6 Refer to ASX Announcement dated 31 January 2023. For personal use only
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19 August 25 21 Appendices For personal use only
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22 Funding risk The Nolans Project is a large and complex project with total capital expenditure currently estimated at US$1.2 billion (refer to the Company’s ASX announcement “Arafura achieves major debt funding milestone presentation” dated 23 July 2024). The business of the Company and its subsidiaries (Group), and the ability of the Group to procure the finance required to develop the Nolans Project, relies on access to debt and equity funding. As rare earths (including Neodymium-Praseodymium (NdPr)) are not traded on any commodity exchange, traditional debt and equity market sources may not be available which may make it difficult for financiers and investors to assess and understand market risk. Therefore, the Group has sought to fund a significant portion of the Nolans Project’s capital expenditure through Export Credit Agencies. There can be no assurance that additional debt, equity or other forms of funding (including by way of government grants) will be available to the Group (over any timeframe) on favourable terms or at all. The Company has received conditional credit approvals from several financiers for US$775 million in senior debt facilities, an additional US$80 million for a cost overrun facility (COF) and a further US$200 million in the form of a standby liquidity facility (SLF). The COF and SLF are to be used to manage any increases in capital expenditure and operating costs incurred during ramp up. The credit approvals received for these facilities have expiry dates and, while a number have been extended, there remains a risk that further extensions may not be obtained as and when required. Customary terms of the debt financing require the Company to raise a significant portion of the capital cost required to fund the Nolans Project from the equity market before debt drawdowns will be available. No assurance can be given that the required equity component of the Nolans Project financing will be raised by the Company in full or at all. Failure to obtain sufficient funds from the equity market or failure to achieve other conditions precedent customary for secured project financing arrangements of this nature, such as final loan documentation and satisfaction of other conditions to drawdown (including providing an updated financial model based off, amongst other things, independent commodity price forecasts which demonstrate compliance with financial ratios and debt sizing criteria, entry into material project contracts with associated tripartite agreements, project authorisations, representations and undertakings), may preclude the Company from being able to drawdown on the financing facilities it has secured. Any additional equity financing, if secured, may dilute existing shareholdings. Failure to obtain debt, equity and/or other forms of financing may cause the Group to postpone any development plans, forfeit rights to some or all of its projects or reduce its operating structures, including staff and overhead levels, which may delay or suspend the Group’s business strategy, have a material adverse effect on the Group’s activities or require the Group to sell down an interest in its projects or assets. This may adversely impact the Group’s financial condition and the value of the Company’s shares, and could ultimately result in the Group being unable to develop the Nolan’s Project. In addition, any delays in obtaining debt, equity and/or other forms of financing, or any delays in receiving (or the non-receipt of) anticipated government grants, may require the Company to decrease its planned expenditure on certain project related activities while such funding is being secured. This may lead to scheduling disruptions, timetable overruns and an overall delay in the execution of the Nolans Project. Offtake The Company must secure sufficient binding offtake volumes to comply with its offtake policy, which requires that at least 80% of planned production be covered by binding offtake agreements (Binding Offtake Target). Compliance with the offtake policy is a condition precedent to the financing facilities for the Nolans Project. Additionally, certain financing facilities which have been conditionally approved by export credit agencies require offtake volumes to be placed into specific jurisdictions. Failure to comply with the Offtake Policy or to meet the jurisdictional placement requirements may preclude the Company from accessing these financing facilities. To date, the Company has secured binding offtake agreements covering 66% of its Binding Offtake Target. These agreements are subject to conditions precedent, including the delivery of first product by specified sunset dates. There is a risk that the Company may be unable to satisfy these conditions. The Group may also fail to meet the product quality requirements and material specifications of its offtake partners. Communicable disease outbreaks The outbreak of communicable diseases around the world (such as COVID- 19) may lead to interruptions in operations, exploration, development and production activities, inability to source supplies or consumables and higher volatility in the global capital markets and price of rare earth elements or demand for the product of the Group, which may materially and adversely affect the Group’s business, financial condition and results of operations. In addition, such outbreaks may result in restrictions on travel and public transport and prolonged closures of facilities or other workplaces which may have a material adverse effect on the Group and the global economy more generally. Any material change in the Group’s operating conditions, the financial markets or the economy as a result of these events or developments may materially and adversely affect the Group’s business, financial condition and results of operations. APPENDIX A: Material Business Risks Company Specific Risks For personal use only
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23 Exploration, production and project development The future profitability of the Group is directly related to the results of exploration, development and production activities and costs. Exploration, project development and production involves significant risk. Exploration is a speculative endeavour with an associated risk of not discovering NdPr and other products in economic quantities and/or grades. There are also risks associated with development of a project to exploit any discovery of NdPr or other products. No assurances can be given that funds spent on exploration and development will result in discoveries or projects that will be commercially viable. During each stage of a project’s development there is a risk that forecast capital or operating expenditure estimates may increase, rendering a discovery uneconomic. Development and production of NdPr and other mining projects may be exposed to low side reserve outcomes, cost and timetable overruns, production decreases or stoppages, which may be the result of commissioning, facility shutdowns, mechanical or technical failure, scheduling disruptions (which may result from delays to funding or decreased spend while funding is secured), technical risks and other unforeseen events. Few rare earths processing plants have been constructed and commissioned outside of the People’s Republic of China and, as a result, there may be increased execution risk for the Nolans Project. A significant poor development outcome or failure to maintain production could result in the Group lowering reserve and production forecasts, loss of revenue, increased working capital requirements, and additional operating costs to restore production. In some instances, a loss of production may result in additional capital expenditure being incurred, which could require the Group to seek additional funding, which may not be available on favourable terms (or at all). Volatility of the price of rare earth elements NdPr and other rare earth products are not exchange traded commodities. The Group will require contracts for sale of these mineral commodities. There is no guarantee the Group will secure contracts on terms favourable to the Group or at all. NdPr and other rare earth product prices will depend on available markets at acceptable prices and distribution and other costs. Pricing of NdPr can also be impacted by government intervention in NdPr markets, such as through direct or indirect support of producers and exporters of NdPr, stockpiling of NdPr, and trade policies, barriers and sanctions. Historically (and at present), the supply of NdPr has been dominated by producers in the People’s Republic of China. Policy changes, actions or events that affect that supply may have a significant effect on NdPr prices. Further uncertainty in the forecast price of NdPr has been introduced by recent geopolitical activity including trade tariffs imposed by the United States of America (US), the transaction between the US Department of Defense and US-based rare earths producer MP Materials, and rare earth export controls introduced by the People’s Republic of China. Additionally, technological developments may result in substitution risk and decrease the demand for (and therefore the price of) NdPr and other rare earth products. Demand for NdPr and other rare earth products may also be impacted by demand for downstream products incorporating rare earths, including (but not limited to) hybrid and electric vehicles, wind turbines, robotics, permanent magnets, medical equipment, military equipment and other high-growth advanced motion technologies as well as demand in the general automotive and electronic industries. Any substantial variation in the price of NdPr and other rare earth products or an increase in the cost of production could have a material impact on the Group. Metallurgy and hydrometallurgy Metallurgical testwork is used to develop the mineral processing and hydrometallurgical processes required to convert ore into final products. Scale up, technology and materials handling risks remain as the Group moves from development to construction, commissioning and production. Product recoveries are dependent upon the mineral processing and hydrometallurgical processes, and by their nature contain elements of significant risk such as: • developing and identifying mineral processing and hydrometallurgical processes through testwork to produce a saleable product; • scale-up and design of novel processes into a commercial flowsheet based on laboratory and pilot scale testwork results; • the representative nature of the samples used for the metallurgical testwork of the ore that is mined for processing over the life of mine; • developing an economic process route to produce a saleable product; and • changes in mineralogy in the ore deposit result in inconsistent product recovery, adversely affecting the economic viability of the Nolans Project. Capital cost risk While the Group has completed Front End Engineering and Design activities and is continuing detailed design and tendering activities for procurement and construction contracts (including infrastructure contracts) as part of advancing the design and cost of the Nolans Project. Until such time a design definition is complete and construction contracts are signed, there is a risk that the capital expenditure for the Nolans Project increases above the previous disclosed capital requirements (refer to the Company’s ASX announcements “Nolans Project Update” dated 11 November 2022 and “Arafura achieves major debt funding milestone presentation” dated 23 July 2024) due to various macro-economic factors that have directly or indirectly impacted the construction industry. In addition, even following the completion of design and the execution of construction contracts, there is a risk of a cost overrun on the Nolans Project given the inflationary environment which may impact on labour costs, supply costs, transport costs and other costs associated with the construction of the Nolans Project. The Group is following an industry standard contracting approach to execution which will likely include the use of a specialised project management organisation. There are cost and schedule risks to a successful project outcome if the project management organisation does not effectively manage all aspects of the project delivery. The Company continues to monitor capital cost market trends. APPENDIX A: Material Business Risks Company Specific Risks For personal use only
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24 Operating Cost Risk As the Nolans Project progresses towards production, there is a risk that ongoing operating costs may exceed prior estimates (refer to the Company’s ASX announcements “Nolans Project Update” dated 11 November 2022 and “Arafura achieves major debt funding milestone presentation” dated 23 July 2024). This may arise due to sustained inflationary pressure on inputs such as reagents, consumables, energy, labour, and logistics. Any significant increase in operating costs could adversely impact the economic performance of the Nolans Project and its ability to meet financing and offtake obligations. The Company continues to monitor operating cost market trends. Operating risks Industry operating risks include, but are not limited to, fires, explosions, environmental hazards, technical failures, unusual or unexpected geological conditions, adverse weather conditions and other accidents. The occurrence of any of these risks could result in substantial losses to the Group due to: • injury or loss of life; • damage to or destruction of property, natural resources or equipment; • pollution or other environmental damage; • clean-up responsibilities; • regulatory investigation and penalties; or • suspension of operations. Damages occurring to third parties as a result of such risks may also give rise to claims against the Group. The occurrence of any of these circumstances could result in the Group not realising its operational or development plans or in such plans costing more than expected or taking longer to realise than expected. Any of these outcomes could have an adverse effect on the Group's financial and operational performance. Reliance on key personnel and advisors The ability of the Group to achieve its objectives depends on the engagement of key employees, directors and external contractors that provide management and technical expertise. If the Group cannot secure external technical expertise (for example to carry out development activities) or if the services of the present management or technical team cease to be available to the Group, this may affect the Group’s ability to achieve its objectives either fully or within the timeframes and the budget that it has forecast. Additionally, industrial disruptions, work stoppages and accidents in the course of operations may adversely affect the Group’s performance. Reliance on third party infrastructure The Group will rely on third party transportation and other infrastructure, primarily in order to deliver its products to the market and incoming reagents and supplies to the Nolans Project site. Any delay or failure to access or properly maintain operating infrastructure or shared facilities may have a material adverse effect on the Group. Reserves and resource estimates Mineral reserve and resource estimates are expressions of judgement based on knowledge, experience and industry practice. Estimates may change or become uncertain when new information becomes available on the tenements through additional exploration, investigations, research, testing or engineering over the life of a project. This applies equally to the Group’s production targets in relation to the Nolans Project and any forecast financial information derived from a production target. In addition, reserve and contingent resource estimates (and production targets and forecast financial information derived from a production target) are necessarily imprecise and depend to some extent on interpretations, which may prove inaccurate. The actual reserves or contingent resources may differ from those estimated which may result in the Group altering its plans which could have either a positive or negative effect on its operations. Changes in reserve or resource estimates could also impact the Group’s ability to maintain its borrowing capacity with lenders. Native Title The Native Title Act 1993 (Cth), Northern Territory Native Title legislation, Aboriginal land rights and Aboriginal heritage legislation may affect the Group’s ability to gain access to prospective exploration areas or obtain any additional mineral leases required. The Group has entered into a Native Title Agreement with the Nolans Project’s native title holders and the Central Land Council under which the native title holders provide their consent to the grant of the primary mineral lease, ancillary mineral leases and related access authorities for the Nolans Project (refer to the Company’s ASX announcement “Native Title Agreement Executed for Nolans Project” dated 26 June 2020). An amendment to the Native Title Agreement was subsequently executed with the native title holders to cover the mineral leases and extractive mineral permits, the explosives magazine, the proposed stage 1 solar farm, the borrow pits and to effect minor changes to various access authorities. On 22 July 2020, the Company announced that the mineral leases for the Nolans Project had been granted by the Northern Territory Government and, on 9 February 2021, the Company announced that the mineral leases for areas supporting the Nolans Project (which will host the Nolans borefield) had been granted by the Northern Territory Government (refer to the Company’s ASX announcements “Nolans Mineral Leases granted by NT Government” dated 22 July 2020 and “Mineral Leases granted by NT Government secures Borefield” dated 9 February 2021). The Group will need to comply with the Native Title Agreement to avoid any potentially adverse consequences. The Group may, from time to time, need to negotiate with native title claimants for access rights to certain tenements, or for certain activities or granting of additional leases, outside those covered by the Native Title Agreement. There may be significant delays and costs associated with these negotiations and to reach agreement acceptable to all relevant parties. At this stage, it is not possible to quantify the potential impact that these developments may have on the operations of the Group. APPENDIX A: Material Business Risks Company Specific Risks For personal use only
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25 Environmental The Group’s exploration, development and production activities are subject to legislation regarding environmental matters. The legal framework governing this area is complex and constantly developing. There is a risk that the environmental regulations may become more onerous, making the Group’s operations more expensive and/or subject to potential delays. The Group may become subject to liability for pollution, CO2 emissions or other hazards against which it is not insured or cannot insure, including those in respect of past activities for which it was not responsible. The Group’s operations are subject to the Northern Territory and Commonwealth laws and regulations regarding the environment, including hazards and discharge of hazardous waste and materials. The mining and processing of Normally Occurring Radioactive Materials and the disposal of radioactive waste is subject to additional laws and regulations regarding environmental matters. The cost of compliance with these laws and regulations may impact the cost of exploration, development, construction, operation of the production facilities and mine closure costs and may result in these costs exceeding what has been allowed for in the estimates used to develop forward looking statements around the economic performance of the Nolans Project. Tenure Securing and maintaining tenure over mining tenements is critical to the future development of the Group’s projects. All mining tenements which the Group may acquire either by application, sale and purchase or by way of farm-in arrangements are regulated by the applicable state or territory mining legislation. There is no guarantee that future applications for ungranted tenements will be granted as applied for (although the Group has no reason to believe that any tenements required for the Nolans Project or identified as being required in the future will not be granted in due course). Various conditions may also be imposed as a condition of grant. In addition, the relevant minister may need to consent to any transfer of a tenement to the Group. Renewal of titles is made by way of application to the relevant department. There is no guarantee that a renewal will be automatically granted other than in accordance with the applicable state or territory mining legislation. In addition, the relevant department may impose conditions on any renewal, including relinquishment of ground. Under the Mineral Titles Act 2010 (NT) (MT Act), a ‘person who has an interest in land’ (as defined in the MT Act) is entitled to compensation from the holder of a mineral title for: • damage to the land, and any improvements on the land, caused by activities conducted under the title; and • any loss suffered as a result of that damage. The compensation to which a person is entitled depends upon the type of land in question (for example, whether it is freehold land or a pastoral lease) and the nature of the activities that caused the damage to the land (for example, whether they were exploration activities or mining activities). The MT Act does not require the Group to enter into landholder agreements with all or any of the persons who have interests in the land, prior to the commencement of development of, or operations for, the Nolans Project. The Group has a right of access to its mineral titles and a right to occupy and use its mineral titles in accordance with their terms, the MT Act, the Mining Management Act 2001 (NT) and the Environmental Protection Act 2019 (NT). Should the Group not be able to enter into a landholder agreement with a person who has an interest in any relevant land, that person will be entitled to compensation as described above. Such persons will be able to apply to the Northern Territory Civil and Administrative Tribunal for a decision in respect of the compensation payable to the person (and associated matters) in the event that the parties are unable to reach agreement on the compensation payable by the Group to the person. There is a risk that the compensation payable to the persons who have interests in the relevant land may exceed the estimates included in the operating cost estimates used to develop forward looking statements around the Nolans Project’s economic performance. Legislative changes, government policy and approvals The Group requires government regulatory approvals for its operations. Changes in government, monetary policies, taxation and other laws in Australia or internationally may impact the Group’s operations. The impact of actions by state, territory and federal governments may affect the Group’s activities including such matters as access to lands and infrastructure, compliance with environmental regulations, production and exploration activities. This may from time to time affect timing and scope of work to be undertaken. No guarantee can be given that all necessary permits, authorisations, agreements or licences will be provided to the Group by government bodies, or if they are, that they will be renewed or not revoked if already granted. The Group has received environmental approval from the Australian Government and the Northern Territory Environment Protection Authority under the Environment Protection and Biodiversity Conservation Act 1999 (Cth). The Group has received approval from the Northern Territory Government for its Mining Management Plan, which provides its Mining Authorisation for the Nolans Project The Group’s Groundwater Extraction Licence relating to the water supply for the Nolans Project was approved in March 2023 for a period of 10 years after which extension of the approval is required. There is a risk that non-compliance by the Group with all issued approvals will result in fines, disciplinary action and/or loss of social licence to operate, and a risk that all approvals or licences with expiry dates will not be able to be extended or re-negotiated . APPENDIX A: Material Business Risks Company Specific Risks For personal use only
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26 Occupational health and safety Exploration and production activities may expose the Group's staff and contractors to potentially dangerous working environments. Occupational health and safety legislation and regulations differ in each jurisdiction. If any of the Group’s employees or contractors suffers injury or death, compensation payments or fines may be payable and such circumstances could result in the loss of a licence or permit required to carry on the business. Such an incident may also have an adverse effect on the Group’s business (including financial position) and reputation. Third party risk The Group will rely significantly on strategic relationships with other entities and on a good relationship with regulatory and government departments and other interest holders. The Group will also rely on third parties to provide essential contracting services. There can be no assurance that its existing relationships will be maintained, or that new ones will be successfully formed. The Group could be adversely affected by changes to such relationships or difficulties in forming new ones. Insurance Insurance of all risks associated with mineral exploration and production is not always available and, where available, the cost can be high. The Group maintains insurance within a coverage range that it considers to be consistent with industry practice and appropriate for its needs and will update this insurance as required as Group activities evolve through the development and operation of the Nolans Project. The occurrence of an event that is uninsurable, not covered, or only partially covered by insurance could have a material adverse effect on the Group’s business and financial position. Litigation risks The Company is exposed to possible litigation risks including native title claims, tenure disputes, environmental claims, occupational health and safety claims and employment claims. Further, the Company may be involved in disputes with other parties in the future which may result in litigation. Any such claim or dispute if proven, may impact adversely on the Company’s operations, financial performance and financial position. The Company is not currently engaged in any litigation. Climate change risk Climate change is a risk the Group has considered, particularly related to its operations in the mining industry. A key climate change risk particularly attributable to the Group is the emergence of new or expanded regulations associated with transitioning to a lower-carbon economy and market changes related to climate change mitigation. The Group may be impacted by changes to local or international compliance regulations related to climate change mitigation efforts, or by specific taxation or penalties for carbon emissions or environmental damage. These examples sit amongst an array of possible restraints on industry that may further impact the Group and its profitability. While the Group will endeavour to manage these risks and limit any consequential impacts, there can be no guarantee that the Group will not be impacted by these occurrences; and climate change may cause certain physical and environmental risks that cannot be predicted by the Group, including events such as increased severity of weather patterns and incidence of extreme weather events and longer-term physical risks such as shifting climate patterns. All risks associated with climate change may significantly change the industry in which the Group operates. Financial risks The Group’s activities expose it to a variety of financial risks, including: • Market risk: The risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices, interest rate risk, price risk, credit risk and liquidity risk (maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities). The Group's future activities will be subject to volatility and fluctuations in those particular areas. • Foreign exchange/currency risk: The Group operates internationally and is exposed to foreign exchange risk arising from currency exposures with respect to changes in foreign exchange rates. The Group’s future commercial transactions include product sales, capital expenditure, purchase of foreign sourced inputs and debt facilities. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the entity’s functional currency. • Interest rate and credit risk: This relates to the risk that interest rates applicable to the Group may fluctuate and have an impact on the value of the Group’s assets and liabilities. • Liquidity risk: This relates to the ability of the Group to maintain sufficient cash and the availability of funding through an adequate amount of committed credit facilities to support the Group’s operations. APPENDIX A: Material Business Risks Company Specific Risks For personal use only
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27 General market and economic factors The operating and financial performance of the Group is influenced by a number of general economic and business conditions. Generally applicable factors which may affect the operating and financial performance of the Group include: • general movements in Australian and international stock markets; • investor sentiment; • Australian and international economic conditions and outlook; • commodity prices; • changes in interest rates and the rate of inflation; • changes in government legislation and policies, including taxation laws, the imposition of tariffs and foreign investment legislation; • announcement of new technologies; and • geo-political instability, including international hostilities and acts of terrorism. Further, the effect of these conditions on the Group’s ability to obtain new debt financing, and the terms on which any such financing can be obtained, is uncertain. If these conditions result in the Group being unable to obtain new debt financing, or to do so on reasonable terms, this may have an adverse impact on its financial position, financial performance and/or share price. The Group’s operational and financial performance and position may be adversely affected by a worsening of international economic and market conditions and related factors. It is also possible that new risks might emerge as a result of global markets experiencing extreme stress, or existing risks may manifest themselves in ways that are not currently foreseeable. Dividends Any future determination as to the payment of dividends by the Company will be at the discretion of the Directors and will depend on the financial condition of the Company, future capital requirements and general business and other factors considered relevant by the Directors. No assurance in relation to the payment of dividends or franking credits attaching to dividends can be given by the Company. Taxation The disposal of New Shares will have tax consequences, which will differ depending on the individual financial affairs of each investor. All investors are urged to obtain independent financial advice about the consequences of disposing of New Shares from both a taxation viewpoint and generally. To the maximum extent permitted by law, the Company, its officers and each of their respective advisors accept no liability and responsibility with respect to the taxation consequences of acquiring or disposing of New Shares under this equity raising. Competition The Company will compete with other companies, including major mining companies in Australia and internationally. Some of these companies will have greater financial and other resources than the Group and, as a result, may be in a better position to compete for future business opportunities. There can be no assurance that the Group can compete effectively with these companies. Force majeure The Group's projects now or in the future may be adversely affected by risks outside the control of the Group, including fires, labour unrest, civil disorder, war, subversive activities or sabotage, floods, pandemics, explosions or other catastrophes, epidemics or quarantine restrictions. Russia-Ukraine and Israel-Palestine conflict The ongoing Russia-Ukraine and Israel-Palestine conflicts have had and will continue to have a significant impact on global economic markets. Although the Group considers the current impact of the conflicts on the Group to be limited, given that the conflicts are ongoing and volatile in nature, the future effect of the conflicts on the Group is uncertain. The conflicts may have an adverse effect on the Company’s share price or operations which will likely be out of the Group’s control. Data and information technology The Group’s computer systems are subject to the risks of unauthorised access, computer hackers, computer viruses, malicious code, organised cyber-attacks and other security problems and system disruptions, including possible unauthorised access to proprietary or classified information. Any of these events could damage the Group’s reputation and have a material adverse effect on its business, reputation, results of operations and financial condition. There is also a risk that the Group’s systems for capturing data and intellectual property for project development are ultimately not effective. Speculative investment The above list of risk factors ought not to be taken as an exhaustive list of the risks faced by the Group or by investors in the Company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the Group and the value of the Company’s securities. An investment in the Company is speculative and investors should consult their professional adviser before applying for or disposing of securities in the Company. APPENDIX A: Material Business Risks General Risks For personal use only
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28 APPENDIX B: International Offer Restrictions This document does not constitute an offer of new ordinary shares (“New Shares”) of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may not be offered or sold, in any country outside Australia except to the extent permitted below. Canada (Alberta, British Columbia, Ontario and Quebec provinces) This document constitutes an offering of New Shares only in the Provinces of Alberta, British Columbia, Ontario and Quebec (the “Provinces”), only to persons to whom New Shares may be lawfully distributed in the Provinces, and only by persons permitted to sell such securities. This document is not a prospectus, an advertisement or a public offering of securities in the Provinces. This document may only be distributed in the Provinces to persons who are (i) “accredited investors” (as defined in National Instrument 45-106 – Prospectus Exemptions) and (ii) “permitted clients” (as defined in National Instrument 31-103 – Registration Requirements, Exemptions and Ongoing Registrant Obligations) if a lead manager offering the New Shares in Canada is relying upon the international dealer exemption under NI 31-103. No securities commission or authority in the Provinces has reviewed or in any way passed upon this document, the merits of the New Shares or the offering of the New Shares and any representation to the contrary is an offence. No prospectus has been, or will be, filed in the Provinces with respect to the offering of New Shares or the resale of such securities. Any person in the Provinces lawfully participating in the offer will not receive the information, legal rights or protections that would be afforded had a prospectus been filed and receipted by the securities regulator in the applicable Pr ovince. Furthermore, any resale of the New Shares in the Provinces must be made in accordance with applicable Canadian securities laws. While such resale restrictions generally do not apply to a first trade in a security of a foreign, non-Canadian reporting issuer that is made through an exchange or market outside Canada, Canadian purchasers should seek legal advice prior to any resale of the New Shares. The Company as well as its directors and officers may be located outside Canada and, as a result, it may not be possible for purchasers to effect service of process within Canada upon the Company or its directors or officers. All or a substantial portion of the assets of the Company and such persons may be located outside Canada and, as a result, it may not be possible to satisfy a judgment against the Company or such persons in Canada or to enforce a judgment obtained in Canadian courts against the Company or such persons outside Canada. Statutory rights of action for damages and rescission. Securities legislation in certain Provinces may provide a purchaser with remedies for rescission or damages if an offering memorandum contains a misrepresentation, provided the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s Province. A purchaser may refer to any applicable provision of the securities legislation of the purchaser’s Province for particulars of these rights or consult with a legal adviser. Certain Canadian income tax considerations. Prospective purchasers of the New Shares should consult their own tax adviser with respect to any taxes payable in connection with the acquisition, holding or disposition of the New Shares as there are Canadian tax implications for investors in the Provinces. Language of documents in Canada. Upon receipt of this document, each investor in Canada hereby confirms that it has expressly requested that all documents evidencing or relating in any way to the sale of the New Shares (including for greater certainty any purchase confirmation or any notice) be drawn up in the English language only. Par la réception de ce document, chaque investisseur canadien confirme par les présentes qu’il a expressément exigé que tous les documents faisant foi ou se rapportant de quelque manière que ce soit à la vente des valeurs mobilières décrites aux présentes (incluant, pour plus de certitude, toute confirmation d’achat ou tout avis) soient rédigés en anglais seulement. For personal use only
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29 APPENDIX B: International Offer Restrictions European Union (excluding Austria) This document has not been, and will not be, registered with or approved by any securities regulator in the European Union. Accordingly, this document may not be made available, nor may the New Shares be offered for sale, in the European Union except in circumstances that do not require a prospectus under Article 1(4) of Regulation (EU) 2017/1129 of the European Parliament and the Council of the European Union (the “Prospectus Regulation”). In accordance with Article 1(4)(a) of the Prospectus Regulation, an offer of New Shares in the European Union is limited to persons who are “qualified investors” (as defined in Article 2(e) of the Prospectus Regulation). Hong Kong WARNING: This document has not been, and will not be, registered as a prospectus under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong, nor has it been authorised by the Securities and Futures Commission in Hong Kong pursuant to the Securities and Futures Ordinance (Cap. 571) of the Laws of Hong Kong (the “SFO”). Accordingly, this document may not be distributed, and the New Shares may not be offered or sold, in Hong Kong other than to “professional investors” (as defined in the SFO and any rules made under that ordinance). No advertisement, invitation or document relating to the New Shares has been or will be issued, or has been or will be in the possession of any person for the purpose of issue, in Hong Kong or elsewhere that is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to New Shares that are or are intended to be disposed of only to persons outside Hong Kong or only to professional investors. No person allotted New Shares may sell, or offer to sell, such securities in circumstances that amount to an offer to the public in Hong Kong within six months following the date of issue of such securities. The contents of this document have not been reviewed by any Hong Kong regulatory authority. You are advised to exercise cauti on in relation to the offer. If you are in doubt about any contents of this document, you should obtain independent professional advice. New Zealand This document has not been registered, filed with or approved by any New Zealand regulatory authority under the Financial Markets Conduct Act 2013 (the “FMC Act”). The New Shares are not being offered or sold in New Zealand (or allotted with a view to being offered for sale in New Zealand) other than to a person who: • is an investment business within the meaning of clause 37 of Schedule 1 of the FMC Act; • meets the investment activity criteria specified in clause 38 of Schedule 1 of the FMC Act; • is large within the meaning of clause 39 of Schedule 1 of the FMC Act; • is a government agency within the meaning of clause 40 of Schedule 1 of the FMC Act; or • is an eligible investor within the meaning of clause 41 of Schedule 1 of the FMC Act. For personal use only
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30 APPENDIX B: International Offer Restrictions Norway This document has not been approved by, or registered with, any Norwegian securities regulator under the Norwegian Securities Trading Act of 29 June 2007 no. 75. Accordingly, this document shall not be deemed to constitute an offer to the public in Norway within the meaning of the Norwegian Securities Trading Act. The New Shares may not be offered or sold, directly or indirectly, in Norway except to “professional clients” (as defined in the Norwegian Securities Trading Act). Singapore This document and any other materials relating to the New Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this document and any other document or materials in connection with the offer or sale, or invitation for subscription or purchase, of New Shares, may not be issued, circulated or distributed, nor may the New Shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore except pursuant to and in accordance with exemptions in Subdivision (4) Division 1, Part 13 of the Securities and Futures Act 2001 of Singapore (the “SFA”) or another exemption under the SFA. This document has been given to you on the basis that you are an “institutional investor” or an “accredited investor” (as such terms are defined in the SFA). If you are not such an investor, please return this document immediately. You may not forward or circulate this document to any other person in Singapore. Any offer is not made to you with a view to the New Shares being subsequently offered for sale to any other party in Singapore. On-sale restrictions in Singapore may be applicable to investors who acquire New Shares. As such, investors are advised to acquaint themselves with the SFA provisions relating to resale restrictions in Singapore and comply accordingly. Switzerland The New Shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange or on any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the New Shares constitutes a prospectus or a similar notice, as such terms are understood under art. 35 of the Swiss Financial Services Act or the listing rules of any stock exchange or regulated trading facility in Switzerland. No offering or marketing material relating to the New Shares has been, nor will be, filed with or approved by any Swiss regulatory authority or authorised review body. In particular, this document will not be filed with, and the offer of New Shares will not be supervised by, the Swiss Financial Market Supervisory Authority (FINMA). Neither this document nor any other offering or marketing material relating to the New Shares may be publicly distributed or otherwise made publicly available in Switzerland. The New Shares will only be offered to investors who qualify as “professional clients” (as defined in the Swiss Financial Services Act). This document is personal to the recipient and not for general circulation in Switzerland. United Arab Emirates This document does not constitute a public offer of securities in the United Arab Emirates and the New Shares may not be offered or sold, directly or indirectly, to the public in the UAE. Neither this document nor the New Shares have been approved by the Securities and Commodities Authority (“SCA”) or any other authority in the UAE. No marketing of the New Shares has been, or will be, made from within the UAE other than in compliance with the laws of the UAE and no subscription for any securities may be consummated within the UAE. This document may be distributed in the UAE only to “professional investors” (as defined in the SCA Board of Directors’ Decision No.13/RM of 2021, as amended). No offer of New Shares will be made to, and no subscription for New Shares will be permitted from, any person in the Abu Dhabi Global Market or the Dubai International Financial Centre. For personal use only
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31 APPENDIX B: International Offer Restrictions United Kingdom Neither this document nor any other document relating to the offer has been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as amended (“FSMA”)) has been published or is intended to be published in respect of the New Shares. The New Shares may not be offered or sold in the United Kingdom by means of this document or any other document, except in ci rcumstances that do not require the publication of a prospectus under section 86(1) of the FSMA. This document is issued on a confidential basis in the United Kingdom to “qualified investors” within the meaning of Article 2(e) of the UK Prospectus Regulation. This document may not be distributed or reproduced, in whole or in part, nor may its contents be disclosed by recipients, to any other person in the United Kingdom. Any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) received in connection with the issue or sale of the New Shares has only been communicated or caused to be communicated and will only be communicated or caused to be communicated in the United Kingdom in circumstances in which section 21(1) of the FSMA does not apply to the Company. In the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (“relevant persons”). The investment to which this document relates is available only to relevant persons. Any person who is not a relevant person should not act or rely on this document. United States This document does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States. The New Shares have not been, and will not be, registered under the US Securities Act of 1933 or the securities laws of any state or other jurisdiction of the United States. Accordingly, the New Shares may not be offered or sold in the United States except in transactions exempt from, or not subject to, the registration requirements of the US Securities Act and applicable US state securities laws. The New Shares may be offered and sold in the United States only to: • “qualified institutional buyers” (as defined in Rule 144A under the US Securities Act); and • dealers or other professional fiduciaries organized or incorporated in the United States that are acting for a discretionary or similar account (other than an estate or trust) held for the benefit or account of persons that are not US persons and for which they exercise investment discretion, within the meaning of Rule 902(k)(2)(i) of Regulation S under the US Securities Act. For personal use only
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arafura@arultd.com nolansproject@arultd.com Contact Level 6, 432 Murray St Perth WA 6000 PO Box 5773 St Georges Terrace Perth WA 6831 T: +61 8 6370 2800 E: arafura@arultd.com (All corporate and general enquiries) E: nolansproject@arultd.com (Nolans Project enquiries only) ASX: ARU For personal use only