Announcement PDF Axel REE Limited ACN 665 921 273 ANNUAL REPORT 2024 2024 Annual Report CONTENTS Letter to Shareholders............................................................................................................................................3 Axel REE – Critical Minerals in Brazil ........................................................................................................................4 Directors’ Report ................................................................................................................................................. 14 Remuneration Report ........................................................................................................................................... 25 Auditor’s Independence Declatarion ..................................................................................................................... 32 Consolidated Statement of Profit or Loss and Other Comprehensive Income .......................................................... 33 Consolidated Statement of Financial Position ....................................................................................................... 34 Consolidated Statement of Changes in Equity ....................................................................................................... 35 Consolidated Statement of Cash Flows ................................................................................................................ 36 Notes to the financial statements ......................................................................................................................... 37 Consolidated Entity Disclosure Statement ............................................................................................................ 55 Directors’ Declaration .......................................................................................................................................... 56 Independent Auditor’s Report ............................................................................................................................... 57 Supplementary Information .................................................................................................................................. 60 Corporate Directory ............................................................................................................................................. 65 Page | 2 2024 Annual Report Letter to Shareholders Dear Shareholders, Market Outlook It is my pleasure to present the inaugural Annual Report for the financial year ended 30 June 2024 for Axel REE Limited (Axel), the first as an ASX-listed company, following our successful IPO on 23 July 2024. The rare earth elements market continues to show strong growth dynamics, driven by increasing demand in sectors such as electric vehicles, wind turbines, and consumer electronics. As governments worldwide push for greener technologies, the strategic importance of REEs is becoming ever more apparent, creating a favourable environment for companies like Axel REE. Axel has made significant strides in our mission to become a leading player in the critical minerals sector, with a focus on our four highly prospective rare earth elements (REE) and niobium projects in Brazil. Our strategic positioning in the critical minerals space has never been more relevant, as global demand for REE continues to grow, driven by their essential role in clean energy technologies, high-tech applications and strategic importance on the geopolitical landscape. Operational Highlights During the reporting period, Axels efforts have concentrated on securing and advancing our flagship Caladão Project in the Lithium Valley region in northern Minas Gerais. Extensive exploration work has revealed promising results, with clay-hosted REE intercepts grading up to 7,612 ppm TREO and notable concentrations of Neodymium and Praseodymium, which are crucial for high-value magnet applications. These initial results highlight the potential of our assets and reinforce our commitment to unlocking value for our shareholders. We have also made progress across our other key projects: • The Caldas REE Project in South Minas Gerais; and • The Itiquira REE/Niobium Project in Mato Grosso. Each of these assets contributes to our diverse portfolio and positions us strategically within Brazil's emerging REE and Niobium sector. We have built a strong team of over 20 experienced local staff and consultants that will be integral to our systematic exploration plans and deliver on our IPO strategy to aggressively develop our projects and become a global player in the critical minerals sector. Looking Ahead In the coming year, we will focus on: 1. Accelerating our exploration programs across all four projects; 2. Advancing the Caladão Project towards resource definition; 3. Strengthening our relationships with local communities and stakeholders; 4. Exploring potential strategic partnerships to fasttrack development; and 5. Evaluation of further opportunities in the critical minerals sector We are excited about the opportunities that lie ahead and remain committed to creating long-term value for our shareholders while adhering to the highest standards of environmental stewardship and social responsibility. On behalf of the Board, I would like to thank our dedicated team, whose hard work and expertise have been instrumental in our achievements this year. I also extend my gratitude to you, our shareholders, for your continued support and confidence in Axel. We look forward to sharing Axel’s successes with you in the year ahead as we unlock the full potential of our critical mineral assets in Brazil. Sincerely, Financial Position As of 30 June 2024, Axel maintains a strong financial position, with a robust cash balance following our $13.3M IPO that allows us to fund our ongoing exploration and development activities. We remain committed to prudent capital management while aggressively pursuing our growth strategy. Paul Dickson Chairman Page | 3 2024 Annual Report Axel REE – Critical Minerals in Brazil Review of Operations The Company’s primary focus is on discovering major critical minerals deposits, with the primary focus on exploring the Caladáo, Caldas, Itiquira and Corrente projects, and more recently, completing a $13.3 million Initial Public Offering (IPO) of the Company’s shares on the ASX to fund its proposed exploration activities on its project areas. Axel’s projects comprise the following: ● the Caladáo Project, located in the “Lithium Valley” region of the northern Minas Gerais State; ● the Caldas Project, located in the southern Minas Gerais State, bordering with São Paulo State; ● the Itiquira Project, located in the Mato Grosso State; and ● the Corrente Project, located in the Piauí State. The Projects are owned by the Company via its 100%-owned Brazilian subsidiary Axel REE Ltda. Together, the Projects cover 110,516 hectares (1,105 km²) of exploration tenure (54 granted exploration permits, 11 pending exploration permit applications) in Brazil, the equal third largest country globally in terms of REE resources. PROJECT Caladão Project TENEMENT APPLICATIONS GRANTED TENEMENTS TOTAL (HECTARES) 7,443 34,325 41,768 Caldas Project 1,143 22,093 23,236 Itiquira Project - 39,580 39,580 Corrente Project - 5,932 5,932 Total (hectares) 8,586 101,930 110,516 Page | 4 2024 Annual Report Figure 1 – Location of the Company’s Projects (1. Caladáo, 2. Caldas, 3. Itiquira, 4. Corrente) The Company’s flagship projects, the Caladáo Project and Caldas Project, are located near several main towns and provide and provide access to highways, hydroelectrical grid power, water from the nearby Jequitinhonha River and commercial ports (Porto de Ilhéus and Porto de Vitória). Caladão Project The Caladão Project is located near the town of Padre Paraíso in the Lithium Valley region of the Minas Gerais State and comprises approximately 417.68km² of granted exploration permits and exploration permit applications. Page | 5 2024 Annual Report Figure 2 – Caladáo Project area with soil and rock chip sampling locations at Area A and Area B The majority of the tenements are underlain by the Caladáo granite, a Cambrian I-type granite of the G5 supersuite, where large-scale greenfields REE mineralisation has been discovered in soils from the saprolite zone and the overlying unit. In March 2023, an extensive program over the Caladáo Project area was completed including geological mapping and reconnaissance soil and rock chip sampling (137 samples). Consistent REE mineralisation was discovered over the Caladáo project areas tested (all granted tenements) and two mineralised regions, Area A and Area B, were determined, spanning 25km in mineralised strike length. Following the encouraging reconnaissance sampling results, in August 2023 the Company completed follow-up shallow auger drill programs at Area A (23 auger holes at an average depth of 13 meters) and Area B (25 auger holes at an average depth of 10 meters). The programs covered 25km of mineralised strike and drilling was completed based on aeromagnetic survey anomalies and surface sampling anomalies previously discovered. Page | 6 2024 Annual Report Figure 3: (Left to right) August 2023 completed auger drill program at Area A over aeromagnetic analytical imaging, radiometric (thorium), and radiometric (potassium) Figure 4: (Left to right) August 2023 completed auger drill program at Area B over aeromagnetic analytical imaging, radiometric (thorium), and radiometric (potassium) MREO1 (ppm) From (M) To (M) Interval (M) TREO (ppm) CLD-AUG-005 0 10 10 3,012 742 CLD-AUG-008 0 4 4 1,250 136 and 6 14 8 2,835 810 CLD-AUG-010 8 13 5 1,383 236 CLD-AUG-011 6 10 4 1,136 48 CLD-AUG-016 2 9 7 1,616 256 CLD-AUG-018 0 6 6 1,610 359 CLD-AUG-019 0 10 10 2,423 708 CLD-AUG-020 2 6 4 1,082 63 and 8 16 8 2,303 445 CLD-AUG-021 0 4 4 1,806 142 and 6 12 6 2,152 615 Hole TREO represents total rare earth oxides and encompasses the sum of all oxides of rare earth elements (lanthanum – La to lutetium – Lu) and yttrium (Y). MREO represents rare earth elements used in magnet production and includes the sum of oxides of four specific rare earth elements, namely praseodymium (Pr), neodymium (Nd), dysprosium (Dy) and terbium (Tb). 1 Page | 7 2024 Annual Report MREO1 (ppm) From (M) To (M) Interval (M) TREO (ppm) CLD-AUG-022 0 12 12 1,449 228 CLD-AUG-023 10 17 7 1,630 160 CLD-AUG-025 8 10 2 1,330 173 12 14 2 7,612 2,895 CLD-AUG-026 2 8 6 2,042 561 CLD-AUG-027 4 6 2 1,034 183 8 13 5 2,067 454 2 20 18 2,678 704 Hole and and CLD-AUG-028 Table 1: Area A significant intercepts of REE mineralisation (cutoff 1,000ppm TREO) From (M) To (M) Interval (M) TREO (ppm) MREO (ppm) CLD-AUG-029 0 10 10 2,872 1,012 CLD-AUG-030 0 3 3 1,475 343 CLD-AUG-032 10 17 7 1,613 283 CLD-AUG-033 2 12 10 1,793 298 CLD-AUG-034 8 10 2 1,126 269 CLD-AUG-035 12 15 3 1,380 358 CLD-AUG-036 8 12 4 1,054 172 CLD-AUG-037 2 11 9 1,575 443 CLD-AUG-038 4 10 6 2,449 862 CLD-AUG-042 2 6 4 1,197 229 and 8 10 2 1,155 265 CLD-AUG-044 0 2 2 1,352 293 CLD-AUG-045 4 10 6 1,425 316 CLD-AUG-046 2 6 4 1,565 161 CLD-AUG-048 2 4 2 1,084 51 CLD-AUG-049 0 7 7 1,993 392 CLD-AUG-050 2 6 4 1,121 108 CLD-AUG-051 2 4 2 1,518 313 and 8 11 3 1,057 77 CLD-AUG-052 0 14 14 1,582 476 CLD-AUG-053 12 13 1 1,195 217 Hole Table 2: Area B significant intercepts of REE mineralisation (cutoff 1,000ppm TREO) The exploration activities completed indicate the area is highly prospective for hosting IAC-type REE mineralisation. Subsequent to the reporting period, the Company commenced a Phase 1 diamond and auger drilling program at the Caladão REE Project as part of a 20,000m drill campaign planned over the next 2 years. The drilling program is planned to follow up on these historical auger results in Area A and Area B. The first phase of the program will comprise Page | 8 2024 Annual Report ~2,600m of diamond driling with an estimated average depth of 50 metres per vertical hole. However, the depth of the holes can, and will probably vary as we are yet to determine the true thickness of the REE-bearing clay profile. By employing diamond drilling we will have the opportunity to cross the entire weathering profile until we reach the fresh basement rock. Figure 5: Diamond drill rig in operation at Caladão Project Phase 1 drill program Page | 9 2024 Annual Report Caldas Project The Caldas Project is located nearby the city of Poços de Caldas in the south of Minas Gerais in Brazil and comprises 232km² of granted exploration permits and exploration permits applications. The Poços de Caldas Alkaline Complex is one of the most prominent alkaline igneous provinces in Brazil, covering an area of approximately 800 km² and is renowned for its unique geological features and mineral deposits. In September 2023, the Company undertook an initial reconnaissance program at the Caldas Project comprising 34 soil samples and five rock chip samples. Initial results from this program indicate that REE mineralisation is not limited to the Project areas withing the Poços de Caldas Alkaline Complex, but mineralisation could potentially extend within the weathering profile of the neighbouring gneissic rocks. The Caldas Project areas were strategically selected within the weathering profile surrounding the alkaline complex. Figure 6: Map of the Poços de Caldas Alkaline Complex, showing the distribution of Axel’s tenements and initial surface sampling results. Page | 10 2024 Annual Report Subsequent to the reporting period, the Company commenced a drill program at Caldas to target five priority prospect zones, where initial scouting completed following Axel’s IPO in July along the edges of the Alkaline Complex revealed zones of intense weathering developed along the contact zone with the host alkaline granite. The supergene profile has exposures up to 11m thick and is constantly very rich in kaolinite. Several channels were dug and samples were taken along these clay-rich profiles, with assays pending. Figure 7: A 9-m channel sample taken over kaolinite weathing profile at the East-Caldas prospect, assays pending. Itiquira Project Axel’s Itiquira Project has 396km2 of granted exploration permits covering a significant portion of the Itiquira Complex. Itiquira is interpreted to be an Alkaline Igneous Complex, associated with the Transbrasiliano Lineament. This deep transcontinental structure, together with the 125 AZ Lineament, controlled the ascent and emplacement of mantlederived magmas during the Cretaceous. Intrusive complexes controlled by these structures include the Araxá and Catalão Carbonatitic Complexes, which contain world class niobium and phosphate mines. The Itiquira Project combines several geological, geophysical, and geotechnical attributes that underscore its high niobium prospectivity. This potential alkaline intrusive complex has an oval to rounded shape and a diameter of 25km in the NS- and 20km in the EW-direction, analogous to many other Alkaline intrusions that occur along the margins of the Phanerozoic Paraná Basin. Page | 11 2024 Annual Report Figure 8: Map of the Itiquira Project tenements over analytical signal Subsequent to the reporting period, the Company initiated a geological reconnaissance and scouting program for REE and niobium. The program comprises mapping, soil and rock chip sampling and, subject to results, will be subsequently followed up by systematic soil grid sampling and initial auger drilling. Compliance Statement This report contains information on the Caladão, Caldas and Itiquira Projects extracted from the Company’s Replacement Prospectus dated 7 June 2024 (Prospectus) and ASX market announcements dated 31 July 2024, 2 September 2024 and 6 Septemeber 2024 released by the Company and reporting in accordance with the 2012 edition of the “Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC Code). The Prospectus and original market announcements are available to view on www.axelreelimited.com.au and www.asx.com.au. The Company is not aware of any new information or data that materially affects the information included in the Prospectus or original market announcements. Competent Persons Statement The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources, or Ore Reserves is based on information compiled by Dr. Fernando Tallarico, who is a member of the Association of Professional Geoscientists of Ontario, and Dr. Paul Woolrich, who is a Competent Person and a Member of the Australian Institute of Mining and Metallurgy (AusIMM). Dr Tallarico is a full-time employee of the company. Dr. Tallarico and Dr. Woolrich have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources, and Ore Reserves. Dr. Tallarico and Dr Page | 12 2024 Annual Report Woolrich consent to the inclusion in the report of the matters based on their information in the form and context in which it appears. Where reference is made to the Prospectus or previous announcements of Exploration Results and Geological Data, the Company confirms that it is not aware of any new information or data that materially affects the information included in those announcements and all material assumptions and technical parameters underpinning the estimates included in those announcements continue to apply and have not materially changed. Page | 13 2024 Annual Report Directors’ Report The Directors present their report on Axel REE Limited (Axel or the Company) and the entities it controlled (the Group) at the end of, and during the year ended 30 June 2024. Directors The Directors of Axel at any time during the reporting period up to the date of this report, unless otherwise stated were: • Paul Dickson (appointed 6 March 2024) • Dr. Fernando Tallarico (appointed 15 February 2024) • Patrick John Volpe • Ian Kiers (appointed 18 December 2023) • Dr. Paul Woolrich (resigned 8 March 2024) • Patrick Antonio Volpe (resigned 18 December 2023) Paul Dickson (Non-Executive Director, appointed 6 March 2024) B.Ed. SF Fin Grad Dip TA Paul Dickson has over 35 years of experience in the finance services industry. He has worked with a number of stock broking firms including Ord Minett Ltd and Colonial Stock-broking Limited and more recently has been a director of a number of corporate advisory boutiques. Mr Dickson is currently independent non-executive chair of Alligator Energy Ltd (ASX:AGE) and was appointed nonexecutive chair in 2018, where he oversaw the development of the Samphire Uranium Project’s Blackbush Deposit and has progressed to scoping study. Mr Dickson was a founder/director of Paradigm Capital Pty Ltd and DDM Capital Pty Ltd, which provided a range of services including capital raising and general corporate advice for small-cap companies and Proserpine Capital Partners Pty Ltd, a private equity business based in Melbourne. Mr Dickson currently consults to the equity markets area for Henslow Pty Ltd. Former directorships in last 3 years: Cobold Metals Limited Dr. Fernando Tallarico (Managing Director, appointed 15 February 2024) B.Sc. Geology, M.Sc., Ph.D. and P.Geo. Dr. Fernando Tallarico is a resident of Brazil and a geologist with over 30 years international experience, who has been responsible for grass roots discoveries for Vale, Falconbridge/Noranda and BHP in Brazil. Dr. Tallarico was CEO/Managing Director of Aguia Resources Limited (ASX:AGR) from 2019 to 2023 following his role of Technical Director from 2010 to 2019 and was instrumental in assembling the Aguia phosphate and copper portfolio, that resulted in greenfield discoveries in Southern Brazil. Dr. Tallarico has also held positions as Technical Director at Forbes & Manhattan Brazil, Project Manager at BHP Billiton, Senior Geologist at Falconbridge and Vale, leading world-class discoveries in potash, diamonds, nickel laterite and PGE respectively. Former directorships in last 3 years: Aguia Resources Limited Patrick John Volpe (Non-Executive Director) CPA, Post Grad Taxation Pat Volpe is the Founder of the Company and has over 35 years’ experience in minerals and metals exploration globally, including spending the previous 10 years developing strong relationships in Brazil where he accumulated the Company’s portfolio across four states. Mr Volpe has intimate knowledge of Brazil’s Mining laws and regulations and brings his strong relationships with local explorers and governments to the Company. Page | 14 Directors’ Report (Continued) 2024 Annual Report Mr Volpe was the founding director of A-Cap Resources Limited (acquired by Lotus Resources Limited ASX:LOT), who led the discovery and development of what is now known as one of the top 10 largest undeveloped uranium deposits in the world. Pat was the executive chairman of Botswana Metals Limited (renamed SI6 Metals Ltd, ASX:SI6), which made base and precious metals discoveries (nickel, copper and PGE’s) in north-eastern Botswana and attracted a joint venture with Botswana’s largest miner and smelting operation - BCL Limited, which is government owned. Mr Volpe also chairs a private venture which has made a district scale graphite discovery in Botswana. He was also the founder and chairman of ASX-listed Cardia Bioplastics Limited (renamed Secos Limited, ASX:SES). Former directorships in last 3 years: Nil Ian Kiers (Non-Executive Director, appointed 18 December 2023) LB, BComm Ian Kiers is an experienced private equity and mergers and acquisition specialist. He is currently Non-Executive Chairman of SI6 Metals Ltd (ASX:SI6) and has been the Chief Executive Officer of a private family office (GBM Group) for 19 years having previously held positions as Head of Mergers and Acquisitions and Head of Group Strategy. Prior to GBM Group, Mr Kiers was employed at National Australia Bank Limited in its structured finance and project finance division in Melbourne. While at the NAB he worked on numerous project financings in the resources sector. Mr Kiers holds a Bachelor of Laws and Bachelor of Commerce from Melbourne University and was admitted to the Supreme Court of Victoria as a Barrister and Solicitor in 1989. Former directorships in last 3 years: Nil Dr. Paul Woolrich (Non-Executive Director, resigned 8 March 2024) BSc (Honours), MSc, Ph.D. Dr. Woolrich has over 45 years’ experience in the international exploration and mining industry focused on gold, base metals, platinum group elements (PGEs), uranium and coal. Dr Woolrich has previously held senior management roles in Western Mining Corporation, Ranger Minerals, Orion Resources, Gallery Gold, Platmin Ltd, A-Cap Resources Ltd and Botswana Metals Ltd. In 1990, he was credited with discovering the 4Moz Damang Gold deposit in Ghana, for Ranger Minerals, which is still an operating mine today. Dr Woolrich served as Group Exploration Manager of Gallery Gold Limited from 2003 to 2005 and as Project Manager/Consultant in charge of the Feasibility Study of the Pilanesberg PGE Project for Platmin Ltd. in South Africa from 2005 to 2006. Dr Woolrich also served as an Independent Consultant to the mining and exploration industry for several years with clients including Perilya Ltd and Boynton Investments of South Africa. Dr Woolrich subsequently served as a Non-Executive Director of Botswana Metals Limited from 2008 until January 2017 and as a Director of ACap Resources Limited from 2007 to September 2016 with the latter years as an Executive Director. Dr. Woolrich is a Geologist/Metallurgist and holds a BSc honours in Geology, MSc in Geochemistry and a PhD in Metallurgy. Former directorships in last 3 years: Nil Company Secretary Mr Patrick Antonio Volpe was Company Secretary furing the whole reporting period up to the date of this report. Patrick Volpe (Company Secretary)(Non-executive Director, resigned 18 December 2023) MB Econ, BCom (Eco, Fin), AGIA, MAICD Patrick Volpe is an experienced corporate governance and financial services professional and has provided corporate governance management and company secretary services for private, not-for-profit, unlisted public and ASX-listed entities. He is currently Managing Director of a boutique corporate advisory firm and currently holds directorships and company secretarial positions in a range of ventures in metals and minerals resources exploration including graphite, Page | 15 2024 Annual Report Directors’ Report (Continued) lithium, gold and base metals, as well as biotech and managed investments. He is currently Non-Executive Director of Si6 Metals Ltd (ASX:SI6). Mr Volpe holds a Master of Business Economics from Monash University, Bachelor of Commerce (Majoring in Economics and Finance) from Deakin University, is an Affiliated member of the Governance Institute of Australia and Member of the Australian Institute of Company Directors. Former directorships in last 3 years: Nil Meetings of Directors The number of meetings of the Company’s Directors held during the year ended 30 June 2024, and the number of meetings attended by each Director are as follows: Board of Directors Meetings Director P Dickson1 Eligible to attend Attended F Tallarico2 2 2 3 3 7 7 4 6 5 4 3 3 P J Volpe I Kiers3 P Woolrich4 P A Volpe5 Mr Dickson was appointed a Director on 6 March 2024. 1 Mr Tallarico was appointed Director on 15 February 2024. 2 Mr Kiers attended two meeting during the period prior to his appointment as Director on 18 December 2023. 3 Mr Woolrich resigned on 8 March 2024. 4 Mr Patrick A Volpe resigned as Director on 18 December 2023. 5 Principal Activities The principal activities of the Company during the financial year included the acquisition, exploration and development of critical minerals resource projects in Brazil. There were no significant changes in these activities during the financial year. Review of activities The Company’s primary focus is on discovering major critical minerals deposits, with the primary focus on exploring the Caladáo, Caldas, Itiquira and Corrente projects, and more recently, completing an initial public offer raising $13.3 million (before costs) and listing on the Australian Securities Exchange (ASX) . Corporate activities During the year the following significant corporate events occurred: ● On 1 September 2023, the Company established Axel REE Ltda, a wholly owned subsidiary in Brazil for the purposes of acquiring, holding and operating exploration tenements in Brazil. ● On 9 October 2023, the Company issued 89,961,666 ordinary shares to shareholders of Foxfire Metals Pty Ltd (Foxfire Metals) for nil consideration as part of a one-for-one bonus share issue that formed part of the Foxfire Metals restructure. Page | 16 Directors’ Report (Continued) ● 2024 Annual Report On 2 November 2023, Foxfire Metals, Foxfire Metals Ltda (a Brazilian entity) (Foxfire Metals Brazil), the Company and Axel REE Ltda (Axel Brazil), entered into an asset sale and joint venture agreement pursuant to which Foxfire Metals Brazil agreed to sell and Axel Brazil agreed to acquire a: o 100% legal and 70% beneficial joint venture interest in 46 granted exploration licences and 16 applications which are prospective for lithium and rare earth elements (FMB Licences); and o 70% beneficial joint venture interest in the rights to conduct exploration for and mining operations in respect of rare earth elements and any other minerals (excluding lithium) on two granted exploration licences and one exploration licence application (with the exception of the rights to conduct exploration for and mining operations in respect of lithium) (REE Licences). The asset sale agreement was amended and restated on 6 February 2024 (refer below). ● On 8 November 2023, the Company issued 8 million Class B shares as part of a pre-IPO seed raising of $1.28 million (before costs) at $0.16 per Class B share. ● On 15 December 2023, the Company issued 9,873,945 ordinary shares at an issue price of $0.06 per share as a result of the early conversion of 1,974,789 convertible notes held by professional and sophisticated investors in Foxfire Metals. ● On 18 December 2023, Ian Kiers was appointed Non-executive Director and Patrick Volpe resigned as Nonexecutive Director of the Company. ● On 6 February 2024, the Company and its wholly owned subsidiary Axel Brazil entered into an amended and restated asset sale agreement with Foxfire Metals and Foxfire Metals Brazil pursuant to which Axel Brazil agreed to acquire: o a 100% interest in 49 granted exploration licences and 13 applications which are prospective forlithium and rare earth elements (REE Licences); and o a 100% beneficial joint venture interest in the rights to conduct exploration for and mining operations in respect of rare earth elements and any other minerals (excluding lithium) on two granted exploration licences and one exploration licence application (with the exception of the rights to conduct exploration for and mining operations in respect of lithium) (REE Rights). In consideration for the acquisition of an interest in the REE Licences and the REE Rights (together, the REE Projects), the Company has agreed to pay the following consideration: o an amount of $319,168.50, of which: ▪ $309,736.09 was paid on execution of the asset sale and joint venture agreement; and ▪ $9,432.41 was pa