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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

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<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>As filed with the Securities and Exchange Commission on
    April&#160;16, 2010</B>
</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Registration
    No.&#160;333-&#160;&#160;&#160;&#160;&#160;&#160;</B>
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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

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    <B><FONT style="font-size: 14pt">UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">Washington,&#160;D.C.
    20549</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 18pt"><FONT style="white-space: nowrap">Form&#160;S-1</FONT></FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">REGISTRATION
    STATEMENT</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">UNDER</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">THE SECURITIES ACT OF
    1933</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 24pt">Molycorp, Inc.</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 8pt">(Exact name of registrant as
    specified in its charter)</FONT></I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

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<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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<TD nowrap align="center" valign="top">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    <B>Delaware</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <B>3390</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    <B>27-2301797</B>
</TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top">
    <I><FONT style="font-size: 8pt">(State or other jurisdiction
    of<BR>
    incorporation or organization)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <I><FONT style="font-size: 8pt">(Primary Standard Industrial<BR>
    Classification Code Number)</FONT></I>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <I><FONT style="font-size: 8pt">(I.R.S. Employer<BR>
    Identification Number)</FONT></I><FONT style="font-size: 8pt">
    </FONT>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">5619 Denver Tech Center
    Parkway</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Suite&#160;1000</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Greenwood Village, Colorado
    80111</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">(303)&#160;843-8040</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 8pt">(Address, including zip code,
    and telephone number, including area code, of registrant&#146;s
    principal executive offices)</FONT></I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Mark A. Smith</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">President and Chief Executive
    Officer</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">5619 Denver Tech Center
    Parkway</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Suite 1000</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">Greenwood Village, Colorado
    80111</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 9pt">(303) 843-8040</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I><FONT style="font-size: 8pt">(Name, address, including zip
    code, and telephone number, including area code, of agent for
    service)</FONT></I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><I><FONT style="font-size: 9pt">Copies to:</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
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    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
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<TR valign="bottom">
<TD align="center" valign="top">
    <B>John F. Ashburn, Jr.,&#160;Esq.<BR>
    Executive Vice President and General<BR>
    Counsel<BR>
    5619 Denver Tech Center Parkway<BR>
    Suite&#160;1000<BR>
    Greenwood Village, Colorado 80111<BR>
    Tel:
    <FONT style="white-space: nowrap">(303)&#160;843-8040</FONT><BR>
    Fax:
    <FONT style="white-space: nowrap">(303)&#160;843-8082</FONT></B>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>Christopher M. Kelly,&#160;Esq.<BR>
    Michael J. Solecki,&#160;Esq.<BR>
    Jones Day<BR>
    North Point<BR>
    901 Lakeside Avenue<BR>
    Cleveland, Ohio 44114<BR>
    Tel: (216) 586-3939<BR>
    Fax: (216) 579-0212</B>
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    <B>Michael Kaplan,&#160;Esq.<BR>
    Davis Polk &#038; Wardwell LLP<BR>
    450 Lexington Avenue<BR>
    New York, New York 10017<BR>
    Tel: (212) 450-4000<BR>
    Fax: (212) 701-5800</B>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 15%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Approximate date of commencement of proposed sale to the
    public</B>:&#160;&#160;As soon as practicable after this
    Registration Statement becomes effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If any of the securities being registered on this Form are to be
    offered on a delayed or continuous basis pursuant to
    Rule&#160;415 under the Securities Act of 1933, check the
    following
    box.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is filed to register additional securities for an
    offering pursuant to Rule&#160;462(b) under the Securities Act,
    check the following box and list the Securities Act registration
    statement number of the earlier effective registration statement
    for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(c) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If this Form is a post-effective amendment filed pursuant to
    Rule&#160;462(d) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.&#160;&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    &#147;large accelerated filer,&#148; &#147;accelerated
    filer&#148; and &#147;smaller reporting company&#148; in Rule
    <FONT style="white-space: nowrap">12b-2</FONT> of the
    Exchange Act. (Check one):
</DIV>

<DIV style="margin-top: 5pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="25%"></TD>
    <TD width="25%"></TD>
    <TD width="25%"></TD>
    <TD width="25%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <FONT style="font-size: 9pt; font-family: 'Times New Roman', Times">Large
    accelerated
    filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>
    </FONT></TD>
    <TD nowrap align="center">    <FONT style="font-size: 9pt; font-family: 'Times New Roman', Times">
    Accelerated
    filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>
    </FONT></TD>
    <TD nowrap align="center">    <FONT style="font-size: 9pt; font-family: 'Times New Roman', Times">
    <FONT style="white-space: nowrap">Non-accelerated</FONT>
    filer&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>
    </FONT></TD>
    <TD nowrap align="right">    <FONT style="font-size: 9pt; font-family: 'Times New Roman', Times">
    Smaller reporting
    company&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#254;</FONT>
    </FONT></TD>
</TR>

</TABLE>



<DIV align="center" style="margin-left: 22%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 9pt">(Do not check if a smaller
    reporting company)
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 9pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CALCULATION
    OF REGISTRATION FEE</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="70%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutterright -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutterright -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Proposed Maximum<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 3px double #000000">
    <B>Amount of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Title of Each Class of<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Registration<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
    <B>Securities to be Registered</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Offering Price(1)(2)</B>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Fee(3)</B>
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="top" style="border-top: 1px solid #000000">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Common Stock, par value $0.001 per share
</DIV>
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    $350,000,000
</TD>
<TD style="border-right: 1px solid #000000; padding-right: 2pt; border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-top: 1px solid #000000">
    $24,955
</TD>
</TR>
<TR style="font-size: 1pt">
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom" style="border-top: 3px double #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(1)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Includes shares of common stock
    that the underwriters have an option to purchase.
    </FONT></TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(2)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">This amount represents the proposed
    maximum aggregate offering price of the securities registered
    hereunder to be sold by the registrant and the selling
    stockholders. These figures are estimated solely for the purpose
    of calculating the registration fee pursuant to Rule 457(o)
    under the Securities Act of 1933.
    </FONT></TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    <FONT style="font-size: 9pt">(3)
    </FONT></TD>
    <TD></TD>
    <TD valign="bottom">
    <FONT style="font-size: 9pt">Calculated pursuant to
    Rule&#160;457(o) under the Securities Act of 1933 based on an
    estimate of the proposed maximum offering price.
    </FONT></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 3%; font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The registrant hereby amends this Registration Statement on
    such date or dates as may be necessary to delay its effective
    date until the registrant shall file a further amendment which
    specifically states that this Registration Statement shall
    thereafter become effective in accordance with Section&#160;8(a)
    of the Securities Act of 1933 or until the Registration
    Statement shall become effective on such date as the Securities
    and Exchange Commission, acting pursuant to said
    Section&#160;8(a), may determine.</B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 94%; margin-left: 3%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE style="color: #FF0000" width="100%" border="1" cellpadding="5"><TR><TD style=text-align:justify>
<FONT style="font-size: 8pt; font-family: Arial, Helvetica; color: #E8112D">The
information in this prospectus is not complete and may be
changed. We may not sell securities under this registration
statement until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus
is not an offer to sell any securities and it is not soliciting
an offer to buy these securities in any state where the offer or
sale is not permitted.<BR>
</FONT>
</TD></TR></TABLE>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="color: #E8112D">SUBJECT TO COMPLETION</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Prospectus Dated April&#160;16, 2010</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><U>PROSPECTUS</U></B>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Shares</FONT></B>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046914.gif" alt="(MOLYCORP, INC. LOGO)"><B><FONT style="font-size: 14pt">
    </FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 24pt">Molycorp, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This is the initial public offering of shares of our common
    stock. We are
    offering&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Currently, no public market exists for our common stock. We
    expect the public offering price to be between
    $&#160;&#160;&#160;&#160;&#160; and
    $&#160;&#160;&#160;&#160;&#160; per share. We intend to apply to
    list our common stock on The New York Stock Exchange under the
    symbol &#147;MCP.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 12pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Investing in our common stock involves risk. Please read
    carefully the section entitled &#147;Risk Factors&#148;
    beginning on page&#160;14 of this prospectus.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Per Share</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Public offering price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Underwriting discount
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to Molycorp, Inc.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters may also purchase up to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    from us and up to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    from the selling stockholders, at the public offering price,
    less the underwriting discount, within 30&#160;days from the
    date of this prospectus to cover over-allotments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Neither the Securities and Exchange Commission nor any state
    securities commission has approved or disapproved of these
    securities or determined if this prospectus is truthful or
    complete. Any representation to the contrary is a criminal
    offense.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters expect to deliver the shares of common stock
    against payment on or
    about&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD nowrap align="left">    <B><FONT style="font-size: 18pt; font-family: 'Times New Roman', Times">J.P.
    Morgan</FONT></B></TD>
    <TD nowrap align="right">    <B><FONT style="font-size: 18pt; font-family: 'Times New Roman', Times">
    Morgan Stanley</FONT></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prospectus
    dated&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#101'>Prospectus Summary</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#102'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#103'>Special Note Regarding Forward-Looking
    Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#104'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#105'>Capitalization</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#106'>Dividend Policy</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#107'>Dilution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#108'>Corporate Reorganization</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#109'>Selected Consolidated Financial Data</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#110'>Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    36
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#111'>Rare Earth Industry Overview</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#112'>Business</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#113'>Management</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    73
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#114'>Certain Relationships and Related-Party
    Transactions</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#115'>Principal and Selling Stockholders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    90
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#116'>Description of Capital Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#117'>Shares Eligible for Future Sale</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    98
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#118'>Material U.S. Federal Income Tax Consequences to
    <FONT style="white-space: nowrap">Non-U.S.</FONT>
    Holders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    100
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#119'>Underwriting</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    103
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#120'>Change in Accountants</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    107
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#121'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    108
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#122'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    108
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#123'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    108
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#124'>Glossary of Selected Mining Terms</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    G-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#125'>Index to Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    F-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv3w1.htm">EX-3.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv3w3.htm">EX-3.3</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv10w3.htm">EX-10.3</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv16w1.htm">EX-16.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv21w1.htm">EX-21.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv23w1.htm">EX-23.1</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv23w2.htm">EX-23.2</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="d70469exv24w1.htm">EX-24.1</A></FONT></TD></TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should rely only on the information contained in this
    prospectus or in any free writing prospectus that we provide to
    you. We have not, and the underwriters have not, authorized any
    other person to provide you with different information. If
    anyone provides you with different or inconsistent information,
    you should not rely on it. We are not, and the underwriters are
    not, making an offer to sell these securities in any
    jurisdiction where the offer or sale is not permitted. You
    should assume that the information appearing in this prospectus
    is accurate only as of the date on the front cover of this
    prospectus. Our business, financial condition, operating results
    and prospects may have changed since that date.
</DIV>
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    <BR>
    i
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='101'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROSPECTUS
    SUMMARY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>This summary highlights information contained elsewhere in
    this prospectus and does not contain all of the information that
    you should consider before investing in our common stock. You
    should read this entire prospectus carefully, including the
    sections entitled &#147;Risk Factors&#148; and
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations,&#148; and our historical
    consolidated financial statements and related notes included
    elsewhere in this prospectus. In this prospectus, unless the
    context requires otherwise, references to &#147;Molycorp,&#148;
    &#147;we,&#148; &#147;our&#148; or &#147;us&#148; refer to
    Molycorp, LLC and its consolidated subsidiaries prior to the
    corporate reorganization (as described below) and Molycorp, Inc.
    and its consolidated subsidiaries after the corporate
    reorganization. As used in this prospectus, the term
    &#147;ton&#148; means a ton (equal to 2,000 pounds), the term
    &#147;mt&#148; means a metric tonne (equal to 2,205 pounds), the
    term &#147;Roskill&#148; means Roskill Consulting Group Limited,
    a rare-earth market consultant, the term &#147;IMCOA&#148; means
    the Industrial Minerals Company of Australia Pty Ltd, a
    rare-earth market consultant, and the terms &#147;ROW&#148; and
    &#147;Rest of World&#148; mean the entire world except China.
    For definitions of certain rare earth-related and mining terms,
    see &#147;Glossary of Selected Mining Terms.&#148;</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Business</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are the only rare earth oxide, or REO, producer in the
    Western hemisphere and own the world&#146;s largest, most fully
    developed rare earth project outside of China. Furthermore,
    following the execution of our &#147;mine-to-magnets&#148;
    strategy and completion of our modernization and expansion
    efforts, we expect to be one of the world&#146;s most integrated
    producers of rare earth products, including oxides, metals,
    alloys and magnets. Our rare earths are critical inputs in
    existing and emerging applications including: clean energy
    technologies, such as hybrid and electric vehicles and wind
    power turbines; multiple high-tech uses, including fiber optics,
    lasers and hard disk drives; numerous defense applications, such
    as guidance and control systems and global positioning systems;
    and advanced water treatment technology for use in industrial,
    military and outdoor recreation applications. Global demand for
    rare earth elements, or REEs, is projected to steadily increase
    both due to continuing growth in existing applications and
    increased innovation and development of new end uses. We have
    made significant investments, and expect to continue to invest,
    in developing technologically advanced applications for
    individual REEs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2009, we generated
    approximately $7.1&#160;million of revenue from sales of
    products manufactured from stockpiled feedstocks, although this
    level of revenue is not representative of our planned level of
    operations after we restart mining operations. Following the
    finalization of our financing plan in connection with, and
    including, this offering, we expect to be fully funded through
    our modernization and expansion efforts, which we expect will
    continue through 2012.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Mine-to-Oxides</FONT></FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We and SRK Consulting (U.S.), Inc., or SRK Consulting, estimate
    total proven and probable reserves of 2.21&#160;billion pounds
    of REO, with an average ore grade of 8.24%, using a cut-off
    grade of 5.0%, at our Mountain Pass mine. Based on these
    estimated reserves and an expected annual production rate of
    19,090 mt of REO, our expected mine life is in excess of
    30&#160;years. According to Roskill, global REO production in
    2008 was approximately 124,000 mt, of which only approximately
    4,300 mt originated from outside of China, with Molycorp
    producing approximately 1,700 mt from its stockpiles and Russian
    producers producing approximately 2,500 mt. This contrasts with
    total demand outside of China in 2008 of approximately 50,000
    mt, according to Roskill, with rapid growth expected by industry
    analysts. Upon completion of our modernization and expansion
    efforts, we will have the ability to produce 19,090 mt of REO
    per year to supply this non-Chinese demand and expect to have
    the capability to increase production to 40,000 mt of REO per
    year, if warranted by market conditions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At our Mountain Pass facility, we have the ability to mine,
    crush, mill and separate rare earth ore to produce individual
    REEs. We hold a
    <FONT style="white-space: nowrap">30-year</FONT> mine
    plan permit and an associated environmental impact report, both
    of which were issued in 2004. Since our acquisition of the
    Mountain Pass facility, we have been producing and selling REOs
    from stockpiled feedstocks to significantly improve our solvent
    extraction
</DIV>
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    <BR>
    1
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    technologies and capabilities. We are now achieving greater than
    98% recovery in our solvent extraction units at commercial
    scale, which we believe is one of the highest recovery rates in
    the world. We have developed the expertise to produce the
    following REEs in many usable forms: bastnasite concentrate;
    cerium; lanthanum; neodymium; praseodymium; europium; samarium;
    gadolinium; dysprosium; and terbium.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Processing at our Mountain Pass facility entails mining the
    bastnasite ore followed by crushing and milling it to a fine
    powder. Milled bastnasite ore is then processed by flotation
    whereby the bastnasite, which is a mineral containing light and
    heavy rare earth elements, floats to the surface and is
    separated from the waste material, which sinks in a series of
    flotation cells. The resultant bastnasite concentrate is then
    processed by leaching with strong acid solutions followed by a
    series of solvent-extraction separation steps that produce
    various individual REO minerals, generally in a high purity
    (greater than 99%) oxide form. Beginning in the second quarter
    of 2010, we plan to begin processing bastnasite concentrate from
    our stockpiles in an effort to commercially demonstrate our new
    cracking technology while at the same time continue to further
    optimize our processing technologies and improve recovery rates
    compared to historical operations at the Mountain Pass facility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046917.gif" alt="(FIGURE 3)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with modernization of our
    processing capabilities to efficiently produce at a rate of
    19,090 mt of REO per year by the end of 2012. The
    U.S.&#160;Government Accountability Office, or U.S.&#160;GAO,
    April 2010 briefing titled &#147;Rare Earth Minerals in the
    Defense Supply Chain,&#148; which was prepared in accordance
    with the National Defense Reauthorization Act for Fiscal Year
    2010 (Pub. L.
    <FONT style="white-space: nowrap">No.&#160;111-84),</FONT>
    stated that, for a typical exploration-stage mine, once a
    company has secured the necessary capital to start a mine,
    government and industry officials said it can take from seven to
    15&#160;years to bring a property fully online, largely due to
    the time it takes to comply with multiple state and federal
    regulations. Since Molycorp&#146;s Mountain Pass facility is not
    an early stage rare earth project, we believe it has significant
    timeline advantages as it has a well-defined ore body, an
    existing open pit with over 50&#160;years of production history,
    an existing mine and reclamation plan, proven reserves,
    substantial permitting, and all necessary technology to
    successfully process and separate the rare earth elements at a
    commercial scale.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Oxides-To-Metals/Alloys</FONT></FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to sell and transport a portion of the REOs we produce
    to customers for use in their particular applications. The
    remainder of the REOs will be processed into rare earth metals.
    A portion of these metals will be sold to end users and we
    expect to process the rest into rare earth alloys. These rare
    earth alloys can be used in a variety of applications, including
    but not limited to: electrodes for nickel metal hydride, or
    NiMH, battery production; samarium cobalt magnet production; and
    neodymium iron boron, or NdFeB, magnet production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Initially, our modernization and expansion plans envisioned
    adding facilities and equipment for metal conversion and alloy
    production at the Mountain Pass facility. However, we have
    entered into a letter of intent to acquire a third-party
    producer of rare earth metals and alloys in the United States.
    If we complete the acquisition instead of adding such facilities
    and equipment at Mountain Pass, we plan to transport cerium,
    lanthanum, neodymium/praseodymium (didymium) and samarium oxide
    products from our Mountain Pass facility to our new off-site
    location that already possesses the technological capability to
    produce rare earth metals and alloys.
</DIV>
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    <BR>
    2
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Magnet
    Production</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are currently evaluating joint venture opportunities to
    integrate downstream into NdFeB magnet manufacturing in the
    United States. NdFeB magnets, which are critical components in
    &#147;green&#148; technologies and the miniaturization of
    electronics, are primarily manufactured in China (approximately
    80%) and Japan (approximately 20%). We are currently working to
    secure a collaborative joint venture agreement with a
    <FONT style="white-space: nowrap">third-party</FONT>
    manufacturer of NdFeB magnets. This joint venture will provide
    us with access to the intellectual property, technology, people
    and facilities to convert our rare earth materials into the
    high-performance permanent magnets required for production of
    hybrid and electric vehicles, wind power turbines, high-tech
    applications and numerous advanced defense systems on which the
    U.S.&#160;economy and national security depend. The consummation
    of such a joint venture, in conjunction with our current
    modernization plans and the potential acquisition of a
    third-party rare earth metals and alloys producer, is expected
    to provide us with the capability to mine, process, separate and
    alloy individual REEs before manufacturing them into NdFeB
    magnets. This downstream integration would make us the only
    fully integrated producer of NdFeB magnets outside of China,
    helping to secure rare earth supply for the Rest of World.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rare
    earth &#147;mine-to-magnets&#148; production supply
    chain</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046902.gif" alt="(FLOW CHART)"><B> </B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Industry
    Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The REE group includes 17 elements, namely the
    15&#160;lanthanide elements, which are cerium, lanthanum,
    neodymium, praseodymium, promethium (which does not occur
    naturally), samarium, europium, gadolinium, terbium, dysprosium,
    holmium, erbium, thulium, ytterbium and lutetium, and two
    elements that have similar chemical properties to the lanthanide
    elements&#160;&#151; yttrium and scandium. The oxides produced
    from processing REEs are collectively referred to as REOs. Light
    and heavy REEs are contained in all rare earth deposits. Cerium,
    lanthanum, neodymium, praseodymium and samarium are considered
    &#147;light REEs&#148; that are more predominant in bastnasite,
    while europium, gadolinium, terbium, dysprosium, holmium,
    erbium, thulium, ytterbium and lutetium are considered
    &#147;heavy REEs&#148; that are more predominant in monazite.
    Our reserves are bastnasite, but there are also known monazite
    occurrences on our property that we are currently examining.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    REEs have unique properties that make them critical materials to
    many existing applications upon which society has become
    dependent as well as emerging applications. Examples include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Clean-Energy Technologies:</I>&#160;hybrid and electric
    vehicles, wind power turbines and compact fluorescent lighting;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>High-Technology Applications:</I>&#160;miniaturization of
    cell phones, personal digital assistant devices, digital music
    players, hard disk drives used in computers, computing devices,
    &#147;ear bud&#148; speakers and microphones, as well as fiber
    optics, lasers and optical temperature sensors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Critical Defense Applications:</I>&#160;guidance and control
    systems, communications, global positioning systems, radar and
    sonar;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Advanced Water Treatment:</I>&#160;industrial, military,
    homeland security and domestic and foreign aid applications.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Global consumption of REEs is projected to steadily increase due
    to continuing growth in existing applications and increased
    innovation and development of new end uses. For example, the
    integration of rare earth permanent magnet drives into wind
    power turbines has substantially reduced the need for gearboxes,
    which increases overall efficiency and reliability. According to
    IMCOA and Roskill, total demand for rare earths outside of China
    is expected to increase at a compound annual growth rate, or
    CAGR, of approximately 4% to
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    5% between 2008 and 2014. In addition, according to Roskill,
    global demand for the more important magnetic rare earths,
    neodymium, praseodymium and dysprosium, is expected to grow at
    CAGRs of approximately 8%, 6% and 6%, respectively, over the
    same period. Both IMCOA and Roskill estimate that total global
    demand for rare earths is expected to increase at a CAGR of
    approximately 6% from 2008 through 2014, from approximately
    124,000 mt to approximately 180,000 mt per annum.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has dominated the global supply of REOs for the last ten
    years and, according to Roskill, accounted for approximately 97%
    of global REO production in 2008. Even with our planned
    production, global supply is expected by analysts to remain
    tight due to the combined effects of growing demand and actions
    taken by the Chinese government to restrict exports. The Chinese
    government heightened international supply concerns in August
    2009 when China&#146;s Interior Ministry signaled that it would
    further restrict exports of Chinese rare earth resources. Citing
    the importance of REE availability to internal industries and
    the desire to conserve resources, the Chinese government has
    announced export quotas, increased export tariffs and introduced
    a &#147;mining quotas policy.&#148; China&#146;s internal
    consumption of rare earths is expected to continue to grow,
    leaving the Rest of World with a supply gap within the next two
    years, during a period of projected increasing global demand.
    China also dominates the manufacture of rare earth metals,
    producing substantially all of the world&#146;s supply, and the
    manufacture of NdFeB magnets, producing approximately 80% of the
    world&#146;s supply. Neither capability currently exists in the
    United States, as confirmed by the April 2010 U.S.&#160;GAO
    briefing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S.&#160;Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    According to the April 2010 briefing prepared by the
    U.S.&#160;GAO:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Mountain Pass mine is the largest non-Chinese rare earth
    deposit in the world;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other U.S.&#160;rare earth deposits exist, but these deposits
    are still in early exploratory stages of development;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    officials emphasized the significance of the widespread use of
    commercial-off-the-shelf products in defense systems that
    include rare earth materials, such as computer hard drives;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    government and industry officials told the U.S.&#160;GAO that
    where rare earth materials are used in defense systems, the
    materials are responsible for the functionality of the component
    and would be difficult to replace without losing performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a 2009 National Defense Stockpile configuration report
    identified lanthanum, cerium, europium and gadolinium as having
    already caused some kind of weapon system production delay and
    recommended further study to determine the severity of the
    delays; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    defense systems will likely continue to depend on rare earth
    materials, based on their life cycles and lack of effective
    substitutes.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Current estimates indicate that global demand for REEs will
    exceed global supply by 2011. This shortage will continue unless
    Mountain Pass and other rare earths projects achieve projected
    production capacities. IMCOA and Roskill expect that this
    anticipated excess demand will underpin strong pricing.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Global
    Supply and Demand of Rare Earths
    <FONT style="white-space: nowrap">(2000-2015)</FONT>
    (mt)</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046919.gif" alt="(PERFORMANCE GRAPH)"><B> </B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: Roskill
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Roskill has assumed that our Mountain Pass facility will provide
    a significant portion of the increased supply after 2011.
</DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ROW
    Supply and Demand of Rare Earths
    <FONT style="white-space: nowrap">(2000-2015)</FONT>
    (mt)</FONT></B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046920.gif" alt="(PERFORMANCE GRAPH)"><B> </B>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: Roskill
</DIV>
<!-- XBRL Pagebreak Begin -->
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. According to Metal Pages, since the
    beginning of the fourth quarter of 2009, prices have risen by
    approximately 60% and continue to rise.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rare
    Earth Product Prices(1)</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="68%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Rare Earth Product</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2014</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2020</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2030</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Praseodymium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Samarium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Europium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    475.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    600.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    750.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Gadolinium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Terbium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    500.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    650.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    850.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,200.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Dysprosium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    155.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    200.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Yttrium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Rare earth product prices in US$/kg,
    <FONT style="white-space: nowrap">free-on-board</FONT>
    China (+/&#8722; 20%)</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: IMCOA. Although IMCOA and Roskill predict strong growth,
    their projections with respect to certain years are slightly
    different.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Strengths</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We believe that we possess a number of competitive strengths
    that position the Mountain Pass facility to regain its role as
    one of the leading global suppliers of REOs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have a proven source of REOs with high-grade ore and long
    reserve life.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the end of the last mining campaign at the Mountain
    Pass facility in 2002, the mine had been in continuous operation
    for over 50&#160;years. Since our acquisition of the Mountain
    Pass facility, we have been processing stockpiled feedstocks as
    part of our ongoing effort to significantly improve our solvent
    extraction technologies and other processing capabilities.
    Today, based on estimated reserves of 2.21&#160;billion pounds
    of REO with an average ore grade of 8.24%, using a cut-off grade
    of 5.0%, the Mountain Pass mine has a life in excess of
    30&#160;years at an annual production rate of 19,090 mt of REO.
    Our leadership team is committed to the continuous and
    sustainable manufacture of rare earth products at the Mountain
    Pass facility using advanced milling and processing technologies
    that will significantly increase the life of the known ore body
    at the Mountain Pass facility. Additionally, we have recently
    expanded our
    <FONT style="white-space: nowrap">on-site</FONT>
    exploratory drilling program to confirm the existence and extent
    of bastnasite, monazite and other rare earth phosphate mineral
    occurrences in unexplored areas of the Mountain Pass facility.
    This program will also help to establish that our measured,
    indicated and inferred resources can become proven or probable
    reserves.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    expect to be well-positioned to capitalize on the tightening
    balance of global supply and demand of rare earth
    products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As worldwide demand for rare earth products increases, the
    supply of REOs is limited by available production capacity,
    which is currently concentrated in China. According to Roskill,
    China accounted for approximately 97% of global REO production
    in 2008. China also dominates the manufacture of metals and
    NdFeB magnets from rare earths, capabilities that are not
    currently found in the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Chinese government policies will also impact the supply and
    demand of REOs and rare earth products. We believe that the
    Chinese government intends to increase wind generated power to
    100 gigawatts with an investment expected to be above $150
    billion and has also proposed a package of over $29&#160;billion
    to fund hybrid and electric vehicle production, placing
    additional strain on the REE supply chain. Citing the importance
    of REE availability to internal industries and the desire to
    conserve resources, the Chinese government has also announced
    export quotas, increased export tariffs and introduced a
    &#147;mining quotas policy.&#148;
</DIV>
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    <BR>
    6
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Given China&#146;s estimated consumption levels and the
    limitations its government has put on exports, Roskill projects
    a global deficit beginning in 2011 without the advent of
    production from new projects, such as Mountain Pass. Limits on
    rare earth exports from China and the lack of available
    substitutes make the development of new sources of REEs
    essential to meet the growing demand for existing and emerging
    technologies, such as hybrid and electric vehicles, wind power
    turbines, compact fluorescent light bulbs, hard disk drives and
    dual use electronics.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S.&#160;Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    U.S.&#160;federal government investments and policies may
    materially increase end-market demand for our rare earth
    products. For example, the U.S.&#160;federal government recently
    approved $45&#160;billion in grant funding and loan guarantees
    directed toward wind power generation projects and hybrid and
    electric vehicles. Pending energy legislation may also increase
    demand for clean technology applications, which use rare earth
    products.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon reaching full planned production rates for REOs in 2012, we
    expect to be in a position to supply a substantial portion of
    the U.S.&#160;demand and also sell to export markets.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have a highly experienced and qualified management
    team.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our President and Chief Executive Officer has 29&#160;years of
    experience, 24 of which are associated with the Mountain Pass
    facility. In addition, our Chief Technology Officer, General
    Counsel and Chief Financial Officer have over 75&#160;years of
    combined technical, operational, legal, financial and management
    experience. Many of our key employees have worked with the
    Mountain Pass facility for over 20&#160;years each. We also have
    a proven technology and product development group and as of
    April&#160;1, 2010, held 18 issued and pending U.S.&#160;patents
    and patent applications, and 146 issued and pending foreign
    patents and patent applications. Management has also created a
    work environment that prioritizes safety. Since July 2005, the
    Mountain Pass facility has not had a lost-time accident and has
    received the coveted &#147;Sentinels of Safety&#148; award from
    the Mine Safety and Health Administration, or MSHA, for three of
    the last four years.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Business Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our business strategy is to:
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Build
    the largest, most advanced and efficient fully integrated REO
    processing facility in the world.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to refurbish or replace existing equipment at the
    Mountain Pass facility in connection with our modernization and
    expansion efforts. We also intend to build the largest, most
    advanced and efficient fully integrated REO processing facility
    in the world to support our anticipated production requirements.
    Following the refurbishment of existing equipment and the
    purchase, delivery, installation, and
    <FONT style="white-space: nowrap">start-up</FONT> of
    new equipment, our fully integrated facility will allow us to
    reach full production, utilizing our newly optimized and
    commercially proven REO processing operations. Additionally, we
    expect that our proprietary production technology and our
    planned new paste tailings operation will reduce our
    environmental footprint and set the standard in the industry for
    environmental stewardship.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Successfully
    complete modernization and expansion efforts and reach full
    planned production rates for REOs at the Mountain Pass facility
    by the end of 2012.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After reaching full planned production rates for REOs at the
    Mountain Pass facility, we expect to produce 19,090 mt of REO
    per year. We operate the Mountain Pass facility pursuant to a
    <FONT style="white-space: nowrap">30-year</FONT>
    mining permit issued in 2004 that allows us to feed ore to the
    mill at a rate of 2,400 tons per day. While the Mountain Pass
    facility historically required 2,000 tons of mill feed per day
    to manufacture 19,090 mt of REO per year, we expect that new
    proprietary technologies we developed will allow us to extract
    the same 19,090 mt of REO per year
</DIV>
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    <BR>
    7
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    while only using approximately 1,100 to 1,500 tons of mill feed
    per day, thus allowing for potential increases in annual REO
    production beyond the planned 19,090 mt per year without any
    change in the permit limit.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Improve
    our operating efficiencies with technically advanced
    manufacturing techniques.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to continue to improve the efficiency of our
    operations through the creation and use of technically advanced
    manufacturing processes for production of rare earth products,
    which will allow us to deliver high-quality rare earth products
    at globally competitive prices. We have already invested
    significant resources towards perfecting our REO processing
    operations and developing new and proprietary applications for
    individual REEs. We expect that by advancing all of these
    technologies, we will continue to lower our operating costs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Manage
    our costs to be cost competitive.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The success of our business will depend on our ability to manage
    our costs. We will manage these costs through the use of new
    production technologies that have been developed by our research
    and development group, which will use less energy and raw
    materials and will result in a reduced environmental footprint.
    These production technologies will substantially reduce the
    amount of water consumption and waste water generation. We plan
    to use our proprietary technology to maximize our process
    recoveries and maximize REO concentrate production per unit of
    extracted ore. We plan to install a natural gas powered
    co-generation power plant as part of our modernization and
    expansion of the Mountain Pass facility to reduce energy
    consumption and costs as well as minimize or eliminate our
    reliance on the regional electric power grid. We intend to
    produce our own hydrochloric acid and sodium hydroxide at the
    Mountain Pass facility and recycle our acid and base, thereby
    reducing our reliance on external sources of reagents. After
    completion of our modernization and expansion efforts, we
    anticipate our most significant cash operating costs will
    consist of natural gas and labor.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Secure
    customer commitments to provide a stable revenue
    stream.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    at the Mountain Pass facility, we expect to produce
    approximately 19,090 mt of REO per year. As of April&#160;1,
    2010, we had 19 letters of intent to sell our rare earth
    products, representing approximately 138% of our anticipated
    production for 2013. We are continuing to seek additional
    letters of intent and, prior to commencing full production, we
    intend to enter into short- and long-term sales contracts with
    existing and new customers. In addition, we are in discussions
    with multiple large, globally diversified mining companies
    regarding the sale of
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>.

    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is protected by over 100 issued and pending U.S.&#160;and
    foreign patents and patent applications.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table compares the volume under our letters of
    intent to our anticipated production for 2013 (in mt):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>
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    <BR>
    8
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    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Volume Under<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Percent of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Letters of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Uncommitted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>2013<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Projected 2013<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Product Type</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Intent (1)(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Volume</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Production(1)(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Production</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum non-metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,427
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    368
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    436
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,071
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium non-metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,914
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,770
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,684
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    71
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    200
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium non-metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,318
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    313
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,060
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Praseodymium metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,091
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    116
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    941
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Europium oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
    (6)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Samarium metal(8)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    191
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    191
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    NdPr metal in NdFeB alloy
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    964
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,964
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    NdPr metal in NdFeB magnets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    291
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    TOTAL
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,727
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,898
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    138
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Alloy and magnet production and letter of intent volume are
    reported on a rare earth metal basis.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    There is a 14.2% loss of mass when REOs are converted to rare
    earth metal due to oxygen evolution.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Contained within mischmetal, a combination of lanthanum, cerium
    and iron, for battery alloy producers.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Volume shown is used in traditional glass or catalyst market
    segments and represents only a very small fraction of cerium
    buyers. Although IMCOA predicts that there will be a surplus of
    cerium in the future, we anticipate most of our production will
    serve the new, proprietary
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    market segment. This segment alone is expected to consume many
    times more cerium units than we can produce. We believe the new
    segment negates the need for additional letters of intent at
    this time.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    We have received letters of intent for 9,700,000 pounds of Nd
    and/or NdPr metal (otherwise known as didymium metal). To
    demonstrate the Nd and Pr breakdown, we have split the didymium
    requirement to the generally accepted ratio of 75/25 Nd to Pr in
    the didymium metal. Some of our metal production will be
    consumed internally for downstream NdFeB alloy/magnet production.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    We expect to receive letters of intent from a number of phosphor
    producers, which will easily consume our europium production. At
    this time, we are the only producer outside of China for this
    element, which enables energy efficient, compact fluorescent
    lights and straight tube T-8 lamps.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    This represents the estimated NdPr metal contained in the letter
    of intent volume for NdFeB alloy and magnets.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    IMCOA predicts that there will be a surplus of samarium metal.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Integrate
    downstream to profitably capture the full value
    chain.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to utilize vertical integration through further
    downstream processing of our REOs into rare earth metals, alloys
    and finished magnets. We have entered into a letter of intent to
    acquire a third-party producer of rare earth metals and alloys
    in the United States. This acquisition would provide us with a
    license to technology related to the production of rare earth
    metals and alloys. Additionally, we are currently working to
    secure a collaborative joint venture agreement with a
    third-party manufacturer to produce NdFeB magnets in the United
    States. This
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy will make us the first fully integrated supplier of
    NdFeB magnets in the world and the only producer of NdFeB
    magnets in the United States. In addition, we are working to
    identify and develop new downstream opportunities for the REOs,
    rare earth metals and alloys and rare earth products we will
    manufacture.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Develop
    new higher margin products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to develop new higher margin products and processes
    for REEs that historically have had lower demand. For example,
    cerium is used primarily for glass polishing and has typically
    sold at prices lower than those for other REEs. However, we have
    developed
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    9
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    and will allow our customers to more safely sequester arsenic
    and increase their production.
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is protected by over 100 issued and pending U.S.&#160;and
    foreign patents and patent applications. This product, which we
    have proven to be effective in removing arsenic and other
    contaminants from water, is applicable to a broad range of
    applications with higher margins. We have entered into a
    non-binding letter of intent with a water filtration company to
    jointly develop water treatment products. We will continue to
    focus on establishing proprietary markets for low-demand REEs to
    provide us with an opportunity to sell these REEs as higher
    margin products.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Corporate History and Structure</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp Minerals, LLC, a Delaware limited liability company
    formerly known as Rare Earth Acquisitions LLC, was formed on
    June&#160;12, 2008 to purchase the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc., a subsidiary of Chevron Corporation. Prior to the
    acquisition, the Mountain Pass facility was owned by Chevron
    Mining Inc. and, before 2005, by Unocal Corporation. Molycorp,
    LLC, the parent of Molycorp Minerals, LLC, is a Delaware limited
    liability company that was formed on September&#160;9, 2009.
    Molycorp, Inc. was formed on March&#160;4, 2010 as a new
    Delaware corporation that is not, to date, conducting any
    activities other than those incident to its formation and the
    preparation of this registration statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The members of Molycorp, LLC have contributed either
    (a)&#160;all of their member interests in Molycorp, LLC or
    (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class&#160;A common stock. Additionally, all of
    the holders of profits interests in Molycorp Minerals, LLC,
    which were represented by incentive shares, have contributed all
    of their incentive shares to Molycorp, Inc. in exchange for
    shares of Molycorp, Inc. Class&#160;B common stock. Accordingly,
    Molycorp, LLC and Molycorp Minerals, LLC have become
    subsidiaries of Molycorp, Inc. We refer to this process as the
    &#147;corporate reorganization&#148; throughout this prospectus.
    All of the shares of Class&#160;A common stock and Class&#160;B
    common stock will convert into shares of common stock
    immediately prior to the consummation of this offering. See
    &#147;Corporate Reorganization&#148; for further information.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Company
    Information</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our principal executive offices are located at 5619 Denver Tech
    Center Parkway, Suite&#160;1000, Greenwood Village, Colorado
    80111, and our telephone number is
    <FONT style="white-space: nowrap">(303)&#160;843-8040.</FONT>
    Our website address is www.molycorp.com. Information on or
    accessible through our website is not a part of this prospectus.
</DIV>
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    <BR>
    10
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The
    Offering</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="36%"></TD>
    <TD width="1%"></TD>
    <TD width="63%"></TD>
</TR>

<TR>
    <TD valign="top">
    Common stock offered by us</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Common stock offered by the selling stockholders if the
    underwriters exercise their option to purchase additional shares
    of common stock in this offering</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Common stock outstanding after this offering</TD>
    <TD></TD>
    <TD valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Use of proceeds</TD>
    <TD></TD>
    <TD valign="bottom">
    We estimate that the net proceeds to us from this offering,
    after deducting underwriting discounts and commissions and
    estimated offering expenses that we must pay, will be
    approximately $&#160;&#160;&#160;&#160;&#160;&#160;million,
    based on an assumed initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, which is the midpoint
    of the estimated price range set forth on the cover page of this
    prospectus. If the underwriters exercise their over-allotment
    option in full, we estimate that our net proceeds will be
    approximately $&#160;&#160;&#160;&#160;&#160;.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    We intend to use our net proceeds from this offering primarily
    to fund our modernization and expansion of the Mountain Pass
    facility as well as for general corporate purposes, including,
    without limitation, to fund our working capital requirements and
    to develop new products, processes and technologies, both
    through acquisitions and capital programs.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    We will not receive any proceeds from the sale of shares of
    common stock offered by the selling stockholders if the
    underwriters exercise their over-allotment option to purchase
    shares of common stock from the selling stockholders in this
    offering. See &#147;Use of Proceeds.&#148;</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Risk factors</TD>
    <TD></TD>
    <TD valign="bottom">
    See &#147;Risk Factors&#148; beginning on page&#160;14 and other
    information included in this prospectus for a discussion of
    factors you should carefully consider before deciding whether to
    invest in our common stock.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Proposed NYSE symbol</TD>
    <TD></TD>
    <TD valign="bottom">
    We intend to apply to list our common stock on The New York
    Stock Exchange, or NYSE, under the symbol &#147;MCP.&#148;</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise indicated, this prospectus reflects and assumes:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no exercise by the underwriters of their option to
    purchase&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares of common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share, the midpoint of the
    estimated price range set forth on the cover page of this
    prospectus;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the conversion of all of our Class&#160;A common stock and
    Class&#160;B common stock into an aggregate
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock immediately prior to the consummation of this
    offering as described under &#147;Corporate Reorganization.&#148;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The number of shares of common stock to be outstanding
    immediately after this offering does not reflect shares of
    common stock authorized and reserved for future issuance under
    our new stock incentive plan. See &#147;Management&#160;&#151;
    Compensation Discussion and Analysis&#160;&#151; Molycorp, Inc.
    2010 Equity and Performance Incentive Plan.&#148;
</DIV>
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    <BR>
    11
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    Consolidated Financial Data</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon the formation of Molycorp, LLC on September&#160;9, 2009,
    all members of Molycorp Minerals, LLC contributed their member
    interests to Molycorp, LLC in exchange for member interests in
    Molycorp, LLC. That exchange was treated as a reorganization of
    entities under common control and Molycorp Minerals, LLC is the
    predecessor to Molycorp, LLC. Accordingly, all financial
    information of Molycorp, LLC for periods prior to its formation
    is the historical financial information of Molycorp Minerals,
    LLC. Molycorp Minerals, LLC acquired the Mountain Pass,
    California rare earth deposit and associated assets from Chevron
    Mining Inc., a subsidiary of Chevron Corporation, on
    September&#160;30, 2008. The summary consolidated financial data
    as of December&#160;31, 2009 and 2008, for the year ended
    December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008, and cumulatively for
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009 has been derived from Molycorp,
    LLC&#146;s audited consolidated financial statements and the
    related notes included elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;15, 2010, the members of Molycorp, LLC contributed
    either (a)&#160;all of their member interests in Molycorp, LLC
    or (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc., and, as a result, Molycorp, LLC and Molycorp
    Minerals, LLC became wholly owned subsidiaries of Molycorp, Inc.
    The unaudited pro forma balance sheet data as of
    December&#160;31, 2009 has been prepared to give effect to the
    corporate reorganization as if it had occurred on
    December&#160;31, 2009. The unaudited pro forma balance sheet
    data is for informational purposes only and does not purport to
    indicate balance sheet information as of any future date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a limited liability company, the taxable income and losses of
    Molycorp, LLC were reported on the income tax returns of its
    members. Molycorp, Inc. is subject to federal and state income
    taxes and will file consolidated income tax returns. If the
    corporate reorganization had been effective as of
    January&#160;1, 2009, our net loss of $28.6&#160;million would
    have generated a pro forma deferred income tax benefit of
    $11.3&#160;million, assuming a combined federal and state
    statutory income tax rate. However, as realization of such tax
    benefit would not have been assured, we would have also
    established a valuation allowance to eliminate such pro forma
    tax benefit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The unaudited pro forma per share data has been computed based
    upon the number of shares of common stock outstanding
    immediately after the corporate reorganization applied to our
    historical net loss amounts and gives retroactive effect to the
    corporate reorganization as if it had occurred on June&#160;12,
    2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The summary consolidated financial data set forth below should
    be read in conjunction with &#147;Selected Consolidated
    Financial Data,&#148; &#147;Management&#146;s Discussion and
    Analysis of Financial Condition and Results of Operations&#148;
    and the financial statements and the notes thereto included
    elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="56%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Statement of Operations Data</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands, except share and per share data)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net sales
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,093
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cost of goods sold(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (21,785
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,027
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,812
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Selling, general and administrative expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (12,685
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,979
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,664
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Accretion expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,006
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,256
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Depreciation and amortization expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (191
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (19
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (210
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (28,574
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,138
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (42,712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42,661
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Loss per share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Weighted average shares outstanding
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,017,959
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,011,561
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28.08
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14.07
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42.17
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28.08
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14.07
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42.17
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Pro forma loss per share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Weighted average shares outstanding:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak Begin -->
</DIV><!-- End box 1 -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    12
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV style="width: 100%; height: 9in; border-top: 1px solid #000000; padding-top: 12pt; border-right: 1px solid #000000; padding-right: 12pt; border-bottom: 1px solid #000000; padding-bottom: 12pt; border-left: 1px solid #000000; padding-left: 12pt"><!-- Begin box 1 -->
<!-- XBRL Pagebreak End -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="56%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Pro Forma<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Balance Sheet Data</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,189
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,520
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    97,666
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,355
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total non-current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,509
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,051
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,279
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74,615
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    78,076
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="52%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception) Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Other Financial Data</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Capital expenditures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,285
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    321
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,606
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Cost of goods sold includes write-downs of inventory to
    estimated net realizable value of $9.0&#160;million,
    $9.5&#160;million and $18.5&#160;million for the year ended
    December&#160;31, 2009 and for the period from June&#160;12,
    2008 (Inception) through December&#160;31, 2008, and
    cumulatively for the period from June&#160;12, 2008 (Inception)
    through December&#160;31, 2009, respectively.</TD>
</TR>

</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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    13
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='102'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RISK
    FACTORS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>An investment in our common stock involves a high degree of
    risk. Accordingly, you should carefully consider the following
    risk factors, together with all of the other information
    contained in this prospectus, including our consolidated
    financial statements and related notes, before making an
    investment in our common stock. If any of the following risks
    actually occurs, we may not be able to conduct our business as
    currently planned, and our business, operating results and
    financial condition could be harmed. In that case, the market
    price of our common stock could decline, and you could lose all
    or a part of your investment.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related to Our Business</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    production of rare earth products is a capital-intensive
    business and our ongoing modernization and expansion efforts at
    the Mountain Pass facility to reach full planned production
    rates by 2012 will require the commitment of substantial
    resources. Any unanticipated costs or delays associated with our
    ongoing modernization and expansion efforts at the Mountain Pass
    facility could have a material adverse effect on our financial
    condition or results of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our ongoing modernization and expansion efforts at the Mountain
    Pass facility to reach full planned production rates by 2012
    require the commitment of substantial resources for operating
    expenses and capital expenditures. We expect to incur
    approximately $511&#160;million in capital costs prior to the
    end of 2012. Our estimated expenses may increase in subsequent
    years as consultants, personnel and equipment associated with
    advancing development and commercial production are added. The
    progress of our modernization and expansion efforts at the
    Mountain Pass facility and the amounts and timing of
    expenditures will depend in part on the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the refurbishment or replacement of a significant portion of the
    existing process, plant and equipment that consists of aging or
    outdated facilities and equipment, retooling and development and
    the preparation of the mine pit for renewed production of ore;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    obtaining and maintaining required federal, state and local
    permits;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the results of consultants&#146; analysis and recommendations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    negotiating contracts for equipment, earthwork, construction,
    equipment installation, labor and completing infrastructure and
    construction work;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    negotiating sales and offtake contracts for our planned
    production;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the execution of any joint venture agreements or similar
    arrangements with strategic partners;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other factors, many of which are beyond our control.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Most of these activities require significant lead times and must
    be advanced concurrently. Any unanticipated costs or delays
    associated with our ongoing modernization and expansion efforts
    at the Mountain Pass facility could have a material adverse
    effect on our financial condition or results of operations and
    could require us to seek additional capital, which may not be
    available on commercially acceptable terms or at all.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    actual amount of capital required for the expansion and
    modernization of the Mountain Pass facility may vary materially
    from our current estimates, in which case we would need to raise
    additional funds, which may delay completion and have a material
    adverse effect on our business and financial
    condition.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The anticipated funding required to complete the expansion and
    modernization of the Mountain Pass facility is based on certain
    estimates and assumptions we have made about the additional
    facilities, equipment, labor, permits and other factors required
    to complete the project. If any of these estimates or
    assumptions change, the actual timing and amount of capital
    required to complete the expansion and modernization of the
    Mountain Pass facility may vary materially from what we
    anticipate. Additional funds may be required in the event of
    significant departures from our current expansion and
    modernization plan, unforeseen delays, cost overruns,
    engineering design changes or other unanticipated expenses.
    There can be no assurance that
</DIV>
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    <BR>
    14
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    additional financing will be available to us, or, if available,
    that it can be obtained on a timely basis and on commercially
    acceptable terms.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    growth depends on the modernization and expansion of our
    Mountain Pass facility, which is our only rare earth mining,
    manufacturing and processing facility.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our only rare earth mining, manufacturing and processing
    facility at this time is the Mountain Pass facility. Our
    continued viability is based on successfully implementing our
    strategy, including our modernization and expansion plans at the
    Mountain Pass facility, successfully commencing mining
    operations at the Mountain Pass facility and reaching full
    planned production rates in accordance with our expected
    timeframe. The deterioration or destruction of any part of the
    Mountain Pass facility may significantly hinder our ability to
    reach or maintain full planned production rates within the
    expected time frame or at all. If we are unsuccessful in
    reaching and maintaining full planned production rates for REOs
    at the Mountain Pass facility, within expected time frames or at
    all, we may not be able to build a sustainable or profitable
    business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    not successfully establish or maintain collaborative, joint
    venture and licensing arrangements, or establish new ones, which
    could adversely affect our ability to develop and commercialize
    our rare earth products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A key element of our business strategy is to utilize vertical
    integration through further downstream processing of our REOs
    into rare earth metal alloys and finished magnets for
    clean-energy, high-technology and defense applications. To
    implement this
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    vertical integration successfully, we will need to license
    certain intellectual property related to these downstream
    processes and form a joint venture with an existing magnet
    producer for the final production of finished rare earth
    magnets. While we have signed a letter of intent to acquire a
    producer of rare earth metals and alloys that will provide us
    with a license for certain technology related to the production
    of rare earth metals and alloys, we may not be able to finalize
    a definitive agreement and successfully consummate the
    acquisition. In addition, other licenses that may be necessary
    for some of these downstream processing steps have not yet been
    obtained, and we are currently only in negotiations with respect
    to a joint venture for the production of finished magnets. Any
    failure to establish or maintain collaborative, joint venture or
    licensing arrangements for the production of downstream products
    on favorable terms could adversely affect our business
    prospects, financial condition or ability to develop and
    commercialize downstream rare earth products.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    not be able to convert existing letters of intent with customers
    for the sale of REO products into binding contracts, which may
    have a material adverse effect on our financial position and
    results of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    and other planned downstream products at the Mountain Pass
    facility, we expect to produce 19,090 mt of REO per year. As of
    April&#160;1, 2010, we had 19 letters of intent to sell certain
    of our rare earth products, representing approximately 138% of
    our total anticipated production for 2013. Prior to reaching
    full planned production rates for REOs and other planned
    downstream products at the Mountain Pass facility, we intend to
    enter into short- and long-term sales contracts with existing
    and new customers. However, there can be no assurance that these
    customers will enter into binding sales contracts for the same
    amount of REO products as in the letters of intent, or at all.
    The failure to enter into such binding contracts may have a
    material adverse effect on our financial position and results of
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have limited commercial production and revenues and there can be
    no assurance that we will successfully reach full planned
    production rates for REOs and other planned downstream products
    at the Mountain Pass facility or other facilities and obtain
    profitability.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently have limited commercial production and revenues
    from the Mountain Pass facility and have carried on our business
    at a loss since inception. We expect to continue to incur losses
    unless and until we achieve full planned production rates and
    generate sufficient revenues to fund our continuing operations.
    We
</DIV>
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    <BR>
    15
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    expect to incur substantial losses for the foreseeable future
    related to operating expenses, modernization and expansion
    activities and other capital expenditures, which may increase in
    subsequent years as needed consultants, personnel and equipment
    are retained as we continue to implement our business plan. The
    amounts and timing of expenditures will depend on the progress
    of our ongoing modernization and expansion efforts, the results
    of consultants&#146; analysis and recommendations, the rate at
    which operating losses are incurred, the execution of any joint
    venture agreements with strategic partners and other factors,
    many of which are beyond our control. As a result, we may not
    ever achieve profitability.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    be adversely affected by fluctuations in demand for, and prices
    of, rare earth products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Because our sole source of revenue is the sale of rare earth
    minerals and products, changes in demand for, and the market
    price of, rare earth minerals and products could significantly
    affect our profitability. The value and price of our common
    stock and our financial results may be significantly adversely
    affected by declines in the prices of rare earth minerals and
    products. Rare earth minerals and product prices may fluctuate
    and are affected by numerous factors beyond our control such as
    interest rates, exchange rates, inflation or deflation,
    fluctuation in the relative value of the U.S.&#160;dollar
    against foreign currencies on the world market, global and
    regional supply and demand for rare earth minerals and products,
    and the political and economic conditions of countries that
    produce rare earth minerals and products.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. A prolonged or significant economic
    contraction in the United States or worldwide could put further
    downward pressure on market prices of rare earth minerals and
    products. Protracted periods of low prices for rare earth
    minerals and products could significantly reduce revenues and
    the availability of required development funds in the future.
    This could cause substantial reductions to, or a suspension of,
    REO production operations, impair asset values and reduce our
    proven and probable rare earth ore reserves.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Demand for our products may be impacted by demand for downstream
    products incorporating rare earths, including hybrid and
    electric vehicles, wind power equipment and other clean
    technology products, as well as demand in the general automotive
    and electronic industries. Lack of growth in these markets may
    adversely affect the demand for our products.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In contrast, extended periods of high commodity prices may
    create economic dislocations that may be destabilizing to rare
    earth minerals supply and demand and ultimately to the broader
    markets. Periods of high rare earth mineral market prices
    generally are beneficial to our financial performance. However,
    strong rare earth mineral prices also create economic pressure
    to identify or create alternate technologies that ultimately
    could depress future long-term demand for rare earth minerals
    and products, and at the same time may incentivize development
    of otherwise marginal mining properties.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    business will be adversely affected if we do not successfully
    implement new processing technologies and
    capabilities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our processing technologies and capabilities are key components
    of our competitive strengths and are expected to contribute to
    low operating costs and increasing the life of the ore body at
    the Mountain Pass facility. Beginning in the second quarter of
    2010, we expect to process bastnasite concentrate from our
    stockpiles in an effort to significantly improve these
    technologies and capabilities and optimize recovery rates.
    Although this effort has been successful at pilot-scale level
    with over 95% recovery, we may not be able to scale the new
    technology and recovery rates to commercial levels, or may not
    be able to do so by 2011, as planned. We are also working to
    optimize other steps in our production process. Any failure may
    affect our ability to achieve the expected benefits of the new
    technologies and may have a material adverse effect on our
    financial condition or results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    operate in a highly competitive industry.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The rare earths mining and processing markets are capital
    intensive and competitive. Our Chinese competitors may have
    greater financial resources, as well as other strategic
    advantages to maintain, improve
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    and possibly expand their facilities. Additionally, the Chinese
    producers have historically been able to produce at relatively
    low costs due to domestic economic factors. Even upon successful
    implementation of the new processing technologies and
    capabilities at the Mountain Pass facility, if we are not able
    to achieve anticipated costs of production, then any strategic
    advantages that our competitors may have over us, such as lower
    labor costs, could have a material adverse effect on our
    business.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    success of our business will depend, in part, on the
    establishment of new uses and markets for rare earth
    products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The success of our business will depend, in part, on the
    establishment of new markets by us or third parties for certain
    rare earth products that may be in low demand. For example,
    cerium is, and is expected to remain, in global surplus.
    Although we have developed
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production,
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    has not yet been sold and has yet to be fully commercialized. In
    addition, although we are developing rare earth products for use
    in NdFeB magnets, which are used in critical existing and
    emerging technologies, such as hybrid and electric vehicles,
    wind power turbines and compact fluorescent lighting, the
    success of our business depends on creating new markets and
    successfully commercializing rare earth products in existing and
    emerging markets. Any unexpected costs or delays in the
    commercialization of any of the foregoing products and
    applications could have a material adverse effect on our
    financial condition or results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">An
    increase in the global supply of rare earth products, dumping
    and predatory pricing by our competitors may materially
    adversely affect our profitability.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The pricing and demand for our products is affected by a number
    of factors beyond our control, including growth of economic
    development and the global supply and demand for REO products.
    According to Roskill, China accounted for approximately 97% of
    global REO production in 2008. China also dominates the
    manufacture of metals and NdFeB magnets from rare earths, a
    capacity that is not currently found in the United States. Once
    we reach full planned production rates for REOs and other
    planned downstream products, the increased competition may lead
    our competitors to engage in predatory pricing behavior. Any
    increase in the amount of rare earth products exported from
    other nations and increased competition may result in price
    reductions, reduced margins and loss of potential market share,
    any of which could materially adversely affect our
    profitability. As a result of these factors, we may not be able
    to compete effectively against current and future competitors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    not be able to adequately protect our intellectual property
    rights. If we fail to adequately enforce or defend our
    intellectual property rights, our business may be
    harmed.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Much of the technology used in the markets in which we compete
    is protected by patents and trade secrets, and our commercial
    success will depend in significant part on our ability to obtain
    and maintain patent and trade secret protection for our products
    and methods. To compete in these markets, we rely on a
    combination of trade secret protection, nondisclosure and
    licensing agreements, patents and trademarks to establish and
    protect our proprietary intellectual property rights, including
    our proprietary rare earth production processes that are not
    patented. We also have a proven technology and product
    development group and as of April&#160;1, 2010, held 18 issued
    and pending U.S.&#160;patents and patent applications, and 146
    issued and pending foreign patents and patent applications. We
    intend to rely on patented products, such as
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    and related licensing agreements to establish proprietary
    markets for low demand REEs. These intellectual property rights
    may be challenged or infringed upon by third parties or we may
    be unable to maintain, renew or enter into new license
    agreements with third-party owners of intellectual property on
    reasonable terms. In addition, our intellectual property may be
    subject to infringement or other unauthorized use outside of the
    United States. In such case, our ability to protect our
    intellectual property rights by legal recourse or otherwise may
    be limited, particularly in countries where laws or enforcement
    practices are undeveloped or do not recognize or protect
    intellectual property rights to the same extent as the United
    States. Unauthorized use of our intellectual property rights or
    our inability to preserve existing intellectual property rights
    could adversely impact our competitive position and results of
    operations. The loss of our patents could reduce the value of
    the
</DIV>
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    related products. In addition, the cost to litigate
    infringements of our patents, or the cost to defend ourselves
    against patent infringement actions by others, could be
    substantial.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Proprietary trade secrets and unpatented know-how are also very
    important to our business. We rely on trade secrets to protect
    certain aspects of our technology, especially where we do not
    believe that patent protection is appropriate or obtainable.
    However, trade secrets are difficult to protect. Our employees,
    consultants, contractors, outside scientific collaborators and
    other advisors may unintentionally or willfully disclose our
    confidential information to competitors, and confidentiality
    agreements may not provide an adequate remedy in the event of
    unauthorized disclosure of confidential or proprietary
    information. Enforcing a claim that a third party illegally
    obtained and is using our trade secrets is expensive and time
    consuming, and the outcome is unpredictable. Moreover, our
    competitors may independently develop equivalent knowledge,
    methods and know-how. Failure to obtain or maintain trade secret
    protection could adversely affect our competitive business
    position.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    not be able to obtain additional patents and the legal
    protection afforded by any additional patents may not adequately
    protect our rights or permit us to gain or keep any competitive
    advantage.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our ability to obtain additional patents is uncertain and the
    legal protection afforded by these patents is limited and may
    not adequately protect our rights or permit us to gain or keep
    any competitive advantage. In addition, the specific content
    required of patents and patent applications that are necessary
    to support and interpret patent claims is highly uncertain due
    to the complex nature of the relevant legal, scientific and
    factual issues. Changes in either patent laws or interpretations
    of patent laws in the United States or elsewhere may diminish
    the value of our intellectual property or narrow the scope of
    our patent protection. Even if patents are issued regarding our
    products and processes, our competitors may challenge the
    validity of those patents. Patents also will not protect our
    products and processes if competitors devise ways of making
    products without infringing our patents.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If we
    infringe, or are accused of infringing, the intellectual
    property rights of third parties, it may increase our costs or
    prevent us from being able to sell our existing products or
    commercialize new products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There is a risk that we may infringe, or may be accused of
    infringing, the proprietary rights of third parties under
    patents and pending patent applications belonging to third
    parties that may exist in the United States and elsewhere in the
    world that relate to our rare earth products and processes.
    Because the patent application process can take several years to
    complete, there may be currently pending applications that may
    later result in issued patents that cover our products and
    processes. In addition, our products and processes may infringe
    existing patents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Defending ourselves against third-party claims, including
    litigation in particular, would be costly and time consuming and
    would divert management&#146;s attention from our business,
    which could lead to delays in our expansion and modernization
    efforts. If third parties are successful in their claims, we
    might have to pay substantial damages or take other actions that
    are adverse to our business. As a result of intellectual
    property infringement claims, or to avoid potential claims, we
    might:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be prohibited from, or delayed in, selling or licensing some of
    our products or using some of our processes unless the patent
    holder licenses the patent to us, which it is not required to do;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be required to pay substantial royalties or grant a cross
    license to our patents to another patent holder;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be required to redesign a product or process so it does not
    infringe a third party&#146;s patent, which may not be possible
    or could require substantial funds and time.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, we could be subject to claims that our employees,
    or we, have inadvertently or otherwise used or disclosed trade
    secrets or other proprietary information of third parties.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we are unable to resolve claims that may be brought against
    us by third parties related to their intellectual property
    rights on terms acceptable to us, we may be precluded from
    offering some of our products or using some of our processes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Power
    shortages at the Mountain Pass facility may temporarily delay
    mining and processing operations and increase costs, which may
    materially adversely impact our business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Due to its position on the regional electric grid, the Mountain
    Pass facility faces occasional power shortages during peak
    periods. Instability in electrical supply in past years has
    caused sporadic outages and brownouts and higher costs. Such
    outages and brownouts have had a negative impact on production.
    We plan to install a natural gas powered co-generation power
    plant as part of our modernization and expansion of the Mountain
    Pass facility to reduce energy costs at the Mountain Pass
    facility as well as minimize or eliminate our reliance on the
    regional electric power grid. If the co-generation power plant
    is not installed, or is significantly delayed, we will remain
    subject to the effects of occasional power outages and brownouts
    and could experience temporary interruptions of mining and
    processing operations. We then may be unable to fill customer
    orders in a timely manner and may be subject to higher power
    costs at the Mountain Pass facility. As a result, our revenue
    could be adversely impacted and our relationships with our
    customers could suffer, adversely impacting our ability to
    generate future revenue. In addition, if power to the Mountain
    Pass facility is disrupted during certain phases of our REO
    extraction process, we may incur significant expenses that may
    adversely affect our business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Increasing
    costs or limited access to raw materials may adversely affect
    our profitability.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We use significant amounts of hydrochloric acid and sodium
    hydroxide as reagents to process REOs. We ultimately intend to
    produce our own hydrochloric acid and sodium hydroxide at the
    Mountain Pass facility. While the technology used to produce
    hydrochloric acid and sodium hydroxide is well developed, this
    technology has not yet been implemented at the Mountain Pass
    facility. Accordingly, we currently purchase hydrochloric acid
    and sodium hydroxide in the open market and, as a result, could
    be subject to significant volatility in the cost or availability
    of these reagents. We may not be able to pass increased prices
    for these reagents through to our customers in the form of price
    increases. A significant increase in the price, or decrease in
    the availability, of these reagents before we perfect our
    ability to produce them on site could materially increase our
    operating costs and adversely affect our profit margins from
    quarter to quarter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Fluctuations
    in transportation costs or disruptions in transportation
    services could increase competition or impair our ability to
    supply rare earth minerals or products to our customers, which
    could adversely affect our results of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Finding affordable and dependable transportation is important
    because it allows us to supply customers around the world. Labor
    disputes, derailments, adverse weather conditions or other
    environmental events and changes to rail or ocean freight
    systems could interrupt or limit available transport services,
    which could result in customer dissatisfaction and loss of sales
    potential and could materially adversely affect our results of
    operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    must process REOs to exacting specifications in order to provide
    customers with a consistently high quality product. An inability
    to perfect the mineral extraction process to meet individual
    customer specifications may have a material adverse effect on
    our financial condition or results of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We process REOs to meet customer needs and specifications and to
    provide customers with a consistently high quality product and a
    purity higher than previously achieved in prior mining
    operations at the Mountain Pass facility. An inability to
    perfect the mineral extraction process to meet individual
    customer specifications may have a material adverse effect on
    our financial condition or results of operations. In addition,
    customer needs and specifications may change with time. Any
    delay or failure in developing processes to meet changing
    customer needs and specifications may have a material adverse
    effect on our financial condition or results of operations.
</DIV>
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Diminished
    access to water may adversely affect our
    operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Currently, processing of REOs requires significant amounts of
    water. The technology we are developing to significantly reduce
    our need for fresh water, including proprietary production of
    our own hydrochloric acid and sodium hydroxide from waste water
    at our own chlor-alkali plant, has not yet been proven at
    commercial scale and has not yet been implemented. Although we
    believe our existing water rights and water supply are
    sufficient to meet our projected water requirements, any
    decrease or disruption in our available water supply until this
    technology is successfully developed may have a material adverse
    effect on our operations and our financial condition or results
    of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Inaccuracies
    in our estimates of REO reserves and resource deposits could
    result in lower than expected revenues and higher than expected
    costs.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We base our REO reserve and resource estimates on engineering,
    economic and geological data assembled and analyzed by outside
    firms, which are reviewed by our engineers and geologists. Ore
    reserve estimates, however, are necessarily imprecise and depend
    to some extent on statistical inferences drawn from available
    drilling data, which may prove unreliable. There are numerous
    uncertainties inherent in estimating quantities and qualities of
    REO reserves and non-reserve REO deposits and costs to mine
    recoverable reserves, including many factors beyond our control.
    Estimates of economically recoverable REO reserves necessarily
    depend upon a number of variable factors and assumptions, all of
    which may vary considerably from actual results, such as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    geological and mining conditions and/or effects from prior
    mining that may not be fully identified by available data or
    that may differ from experience;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumptions concerning future prices of rare earth products,
    operating costs, mining technology improvements, development
    costs and reclamation costs;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumptions concerning future effects of regulation, including
    the issuance of required permits and taxes by governmental
    agencies.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any inaccuracy in our estimates related to our REO reserves and
    non-reserve REO deposits could result in lower than expected
    revenues and higher than expected costs or a shortened estimated
    life for the mine at the Mountain Pass facility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="white-space: nowrap">Period-to-period</FONT>
    conversion of probable rare earth ore reserves to proven ore
    reserves may result in increases or decreases to the total
    reported amount of ore reserves. Conversion, an indicator of the
    success in upgrading probable ore reserves to proven ore
    reserves, is evaluated annually. Conversion rates are affected
    by a number of factors, including geological variability,
    applicable mining methods and changes in safe mining practices,
    economic considerations and new regulatory requirements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Work
    stoppages or similar difficulties could significantly disrupt
    our operations, reduce our revenues and materially adversely
    affect our results of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, approximately 60&#160;employees at
    the Mountain Pass facility were covered by a collective
    bargaining agreement with the United Steelworkers of America
    that expires in March 2012. A work stoppage at the Mountain Pass
    facility could significantly disrupt our operations, reduce our
    revenues and materially adversely affect our results of
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">A
    shortage of skilled technicians and engineers may further
    increase operating costs, which may materially adversely affect
    our results of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Efficient production of rare earth products using modern
    techniques and equipment requires skilled technicians and
    engineers. In addition, our expansion efforts will significantly
    increase the number of skilled technicians and engineers
    required to successfully operate our business. In the event that
    we are unable to hire and train the necessary number of skilled
    technicians and engineers, there could be an adverse impact on
    our
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    labor costs and our ability to reach full planned production
    levels in a timely manner, which could have a material adverse
    effect on our results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    depend on key personnel for the success of our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We depend on the services of our senior management team and
    other key personnel. We do not have an employment agreement with
    any of the members of our senior management team other than our
    President and Chief Executive Officer. The loss of the services
    of any member of senior management or a key employee could have
    an adverse effect on our business. We may not be able to locate,
    attract or employ on acceptable terms qualified replacements for
    senior management or other key employees if their services are
    no longer available.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Because
    of the inherent dangers involved in the mining of minerals and
    the manufacture of mineral products, there is a risk that we may
    incur liability or damages as we conduct our
    business.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The mining of minerals and the manufacture of mineral products
    involves numerous hazards, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    unusual and unexpected rock formations affecting ore or wall
    rock characteristics;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    ground or slope failures;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    environmental hazards;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    industrial accidents;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    processing problems;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    periodic interruptions due to inclement or hazardous weather
    conditions or other acts of God;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    mechanical equipment failure and facility performance problems.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we maintain insurance, we cannot be certain that our
    insurance will cover certain of the risks associated with our
    extraction and processing operations, nor that we will be able
    to maintain insurance to cover these risks at economically
    feasible premiums. We might also become subject to liability for
    environmental damage or other hazards that may be uninsurable or
    for which we may elect not to insure because of premium costs or
    commercial impracticality. The payment of such premiums, or the
    assumption of such liabilities, may have a material adverse
    effect on our financial position and results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related to Environmental Regulation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    operations are subject to extensive and costly environmental
    requirements; and current and future laws, regulations and
    permits will impose significant costs, liabilities or
    obligations or could limit or prevent our ability to continue
    our current operations or to undertake new
    operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are subject to numerous and detailed, federal, state and
    local environmental laws, regulations and permits, including
    those pertaining to employee health and safety, environmental
    permitting and licensing, air quality standards, greenhouse gas,
    or GHG, emissions, water usage and pollution, waste management,
    plant and wildlife protection, handling and disposal of
    radioactive substances, remediation of soil and groundwater
    contamination, land use, reclamation and restoration of
    properties, the discharge of materials into the environment and
    groundwater quality and availability. These requirements may
    result in significant costs, liabilities and obligations, impose
    conditions that are difficult to achieve or otherwise delay,
    limit or prohibit current or planned operations. Consequently,
    the modernization and expansion of the Mountain Pass facility
    may be delayed, limited or prevented and current operations may
    be curtailed. Failure to comply with these laws, regulations and
    permits may result in the assessment of administrative, civil
    and criminal penalties, the issuance of injunctions to limit or
    cease operations, the suspension or revocation of permits and
    other sanctions. Pursuant to such requirements, we may also be
    subject to third-party claims, including for damages to property
    or injury to persons arising from our operations. Moreover,
    these environmental requirements, and the interpretation and
    enforcement thereof, change frequently and have tended to become
    more stringent over time. For example, GHG emission regulation
    is becoming more rigorous. As a result of our planned
</DIV>
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    21
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    expansion, we expect to be required to report annual GHG
    emissions from our operations, and additional GHG emission
    related requirements are in various stages of development. The
    U.S.&#160;Congress is considering various legislative proposals
    to address climate change, including a nationwide limit on GHGs.
    In addition, the U.S.&#160;Environmental Protection Agency, or
    EPA, has issued vehicle emission regulations that would subject
    GHG emissions from stationary sources to the Prevention of
    Significant Deterioration and Title&#160;V provisions of the
    federal Clean Air Act. California also may establish GHG
    emission regulations pursuant to its Global Warming Solutions
    Act. If made effective, any such regulations could require us to
    modify existing permits or obtain new permits, implement
    additional pollution control technology, curtail operations or
    increase significantly our operating costs. Any regulation of
    GHG emissions, including through a
    <FONT style="white-space: nowrap">cap-and-trade</FONT>
    system, technology mandate, emissions tax, reporting requirement
    or other program, could adversely affect our business, financial
    condition, reputation, operating performance and product demand.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any future changes in these laws, regulations or permits (or the
    interpretation or enforcement thereof) or any sanctions,
    damages, costs, obligations or liabilities in respect of these
    matters could have a material adverse effect on our business,
    results of operations and financial condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We are
    subject to the Federal Mine Safety and Health Act of 1977 and
    the California Occupational Safety and Health Program, and
    regulations adopted pursuant thereto, which impose stringent
    health and safety standards on numerous aspects of our
    operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations at the Mountain Pass facility are subject to the
    Federal Mine Safety and Health Act of 1977, as amended by the
    Mine Improvement and New Emergency Response Act of 2006, and the
    regulations adopted by the California Occupational Safety and
    Health Administration, which impose stringent health and safety
    standards on numerous aspects of mineral extraction and
    processing operations, including the training of personnel,
    operating procedures, operating equipment and other matters. Our
    failure to comply with such standards, or changes in such
    standards or the interpretation or enforcement thereof, could
    have a material adverse effect on our business, financial
    condition or otherwise impose significant restrictions on our
    ability to conduct mining operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    operations may affect the environment or cause exposure to
    hazardous substances, any of which could result in material
    costs, obligations or liabilities.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations currently use, and in the past have used,
    hazardous materials and generate, and in the past have
    generated, hazardous and naturally occurring radioactive wastes.
    The Mountain Pass facility has been used for mining and related
    purposes since 1952, and contamination is known to exist around
    the facility. We may be subject to claims under environmental
    laws, regulations and permits for toxic torts, natural resource
    damages and other liabilities, as well as for the investigation
    and remediation of soil, surface water, groundwater and other
    environmental media. The Mountain Pass facility is currently
    subject to an order issued by the Lahontan Regional Water
    Quality Control Board pursuant to which we have conducted
    various investigatory and remedial actions. We are still in the
    process of delineating the extent of groundwater contamination
    at and around the facility and cannot assure you that we will
    not incur material costs relating to the remediation of such
    contamination. In addition to claims arising out of our current
    or former properties, such claims may arise in connection with
    contaminated third-party sites at which we have disposed of
    waste. As a matter of law, and despite any contractual indemnity
    or allocation arrangements or acquisition agreements to the
    contrary, our liability for these claims may be joint and
    several, so that we may be held responsible for more than our
    share of any contamination, or even for the entire share. These
    and similar unforeseen impacts that our operations may have on
    the environment, as well as human exposure to hazardous or
    radioactive materials or wastes associated with our operations,
    could have a material adverse effect on our business,
    reputation, results of operation and financial condition. In
    addition, although Chevron Mining Inc. is obligated to indemnify
    us for certain potential environmental losses associated with
    activities that occurred prior to our purchase of the Mountain
    Pass facility, the amount of such indemnity is limited and may
    not be sufficient to cover such losses.
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We may
    be unable to obtain, maintain or renew permits necessary for the
    development or operation of the Mountain Pass facility, which
    could have a material adverse effect on our business, results of
    operations and financial condition.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We must obtain a number of permits that impose strict
    conditions, requirements and obligations relating to various
    environmental and health and safety matters in connection with
    our current and future operations, including the modernization
    and expansion of the Mountain Pass facility. To obtain certain
    permits, we may be required to conduct environmental studies and
    collect and present data to governmental authorities pertaining
    to the potential impact of our current and future operations
    upon the environment and to take steps to avoid or mitigate
    those impacts. The permitting rules, and interpretation thereof,
    are complex and have tended to become more stringent over time.
    In some cases, the public (including environmental interest
    groups) has rights to comment upon and submit objections to
    permit applications and environmental impact statements prepared
    in connection therewith, and otherwise participate in the
    permitting process, including challenging the issuance of
    permits, validity of environmental impact statements and
    determinations and performance of permitted activities.
    Accordingly, permits required for our operations, including the
    modernization and expansion of the Mountain Pass facility, may
    not be issued, maintained or renewed in a timely fashion or at
    all, or may be issued or renewed upon conditions that restrict
    our ability to conduct our operations economically. Any such
    failure to obtain, maintain or renew permits, or other
    permitting delays or conditions, including in connection with
    any environmental impact analyses, could have a material adverse
    effect on our business, results of operations and financial
    condition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    inability to acquire, maintain or renew financial assurances
    related to the reclamation and restoration of mining property
    could have a material adverse effect on our business and results
    of operations.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are generally obligated to restore property after it has been
    mined in accordance with regulatory standards and our approved
    mining plan. We are required under federal, state and local laws
    to maintain financial assurances, such as surety bonds, to
    secure such obligations. The failure to acquire, maintain or
    renew such assurances, as required by federal, state and local
    laws, could subject us to fines and penalties as well as the
    revocation of our mining permits. Such failure could result from
    a variety of factors, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the lack of availability, higher expense or unreasonable terms
    of such financial assurances;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability of current and future financial assurance
    counterparties to increase required collateral;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the exercise by third-party financial assurance counterparties
    of any rights to refuse to renew the financial assurance
    instruments.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our inability to acquire or failure to maintain or renew such
    financial assurances could have a material adverse effect on our
    business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">If the
    assumptions underlying our reclamation plan and mine closure
    obligations are inaccurate, we could be required to expend
    materially greater amounts than anticipated to reclaim mined
    property, which could materially and adversely affect our
    business, results of operations and financial
    condition.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Federal, state and local laws and regulations establish
    reclamation and closure standards applicable to our surface
    mining and other operations as well. Estimates of our total
    reclamation and mine closing liabilities are based upon our
    reclamation plan, third-party expert reports, current applicable
    laws and regulations, certain permit terms and our engineering
    expertise related to these requirements. Any change in the
    underlying assumptions or other variation between the estimated
    liabilities and actual costs could materially and adversely
    affect our business, results of operations and financial
    condition.
</DIV>
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    <BR>
    23
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Risks
    Related to This Offering and Ownership of Our Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">There
    is no existing market for our common stock, and a trading market
    that will provide our stockholders with adequate liquidity may
    not develop. The price of our common stock may fluctuate
    significantly, and stockholders could lose all or part of their
    investment.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the offering, there has been no public market for our
    common stock. An active trading market for our common stock may
    never develop or be sustained, which could depress the market
    price of our common stock and could affect your ability to sell
    your shares of common stock. In the event that the number of
    shares of our common stock to be sold in this offering is
    decreased, liquidity could be adversely affected even further.
    Stockholders may not be able to resell their shares at or above
    the initial public offering price. Additionally, the lack of
    liquidity may result in wide bid-ask spreads, contribute to
    significant fluctuations in the market price of our common stock
    and limit the number of investors who are able to buy our common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The initial public offering price for our common stock will be
    determined by negotiations between us and the representative of
    the underwriters and may bear no relationship to the price at
    which our common stock will trade following the completion of
    this offering. The market price of our common stock may decline
    below the initial public offering price. The market price of our
    common stock following this offering is likely to be highly
    volatile and may be influenced by many factors, some of which
    are beyond our control, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our quarterly or annual earnings or those of other companies in
    our industry;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    loss of a large customer;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in accounting standards, policies, guidance,
    interpretations or principles;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general economic conditions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the failure of securities analysts to cover our stock after this
    offering or changes in financial estimates by analysts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    future sales of our common stock;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other factors described in this &#147;Risk Factors&#148; section.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Reports
    published by securities or industry analysts, including
    projections in those reports that exceed our actual results,
    could adversely affect our stock price and trading
    volume.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently expect securities research analysts, including
    those affiliated with our underwriters, to establish and publish
    their own quarterly projections regarding our operating results.
    These projections may vary widely from one another and may not
    accurately predict the results we actually achieve. Our stock
    price may decline if we fail to meet securities research
    analysts&#146; projections. Similarly, if one or more of the
    analysts who covers us downgrades our stock or publishes
    inaccurate or unfavorable research about our business, our stock
    price could decline. If one or more of these analysts ceases
    coverage of us or fails to publish reports on us regularly, our
    stock price or trading volume could decline. Additionally, while
    we expect securities research analyst coverage, if no securities
    or industry analysts commence coverage of us, the trading price
    of our stock and the trading volume could decline.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Future
    sales of shares of common stock by existing stockholders could
    depress the market price of our common stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If our existing stockholders sell, or indicate an intent to
    sell, substantial amounts of our common stock in the public
    market after the
    <FONT style="white-space: nowrap">180-day</FONT>
    contractual
    <FONT style="white-space: nowrap">lock-up</FONT>
    period and other legal restrictions on resale discussed in this
    prospectus lapse, the trading price of our common stock could
    decline significantly and could decline below the initial public
    offering price. Upon completion of this offering, we will have
    approximately&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock outstanding, assuming no exercise of the
    underwriters&#146; over-allotment option. J.P.&#160;Morgan
    Securities Inc. and Morgan Stanley&#160;&#038; Co. Incorporated
    may, in their sole discretion,
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    permit our executive officers, directors, employees and current
    stockholders to sell shares prior to the expiration of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements pertaining to this offering expire, an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    will be eligible for sale in the public
    market,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;of
    which are held by directors, executive officers and other
    affiliates and will be subject to volume limitations under
    Rule&#160;144 under the Securities Act and various vesting
    agreements. In addition,
    the&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    subject to outstanding restricted stock awards that have not
    vested and
    the&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    reserved for future issuance under our equity compensation plans
    will become eligible for sale in the public market in the
    future, subject to certain legal and contractual limitations. If
    these additional shares are sold, or if it is perceived that
    they will be sold, in the public market, the trading price of
    our common stock could decline substantially.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">The
    availability of shares of our common stock for sale in the
    future could reduce the market price of our common
    stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the future, we may issue additional securities to raise
    capital. We may also acquire interests in other companies by
    using a combination of cash and our common stock or just our
    common stock. We may also issue securities convertible into our
    common stock. Any of these events may dilute your ownership
    interest in our company and have an adverse impact on the price
    of our common stock. In addition, sales of a substantial amount
    of our common stock in the public market, or the perception that
    these sales may occur, could reduce the market price of our
    common stock. This could also impair our ability to raise
    additional capital through the sale of our securities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We do
    not intend to pay dividends in the foreseeable
    future.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the foreseeable future, we intend to retain any earnings to
    finance the development of our business, and we do not
    anticipate paying any cash dividends on our common stock. Any
    future determination to pay dividends will be at the discretion
    of our board of directors and will be dependent upon
    then-existing conditions, including our operating results and
    financial condition, capital requirements, contractual
    restrictions, business prospects and other factors that our
    board of directors considers relevant. Accordingly, investors
    must rely on sales of their common stock after price
    appreciation, which may never occur, as the only way to realize
    a return on their investment.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Anti-takeover
    provisions contained in our certificate of incorporation and
    bylaws after the corporate reorganization, as well as provisions
    of Delaware law, could impair a takeover attempt.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws provisions may have
    the effect of delaying, deferring or discouraging a prospective
    acquiror from making a tender offer for our shares or otherwise
    attempting to obtain control of us. To the extent that these
    provisions discourage takeover attempts, they could deprive
    stockholders of opportunities to realize takeover premiums for
    their shares. Moreover, these provisions could discourage
    accumulations of large blocks of common stock, thus depriving
    stockholders of any advantages which large accumulations of
    stock might provide.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a Delaware corporation, we will also be subject to provisions
    of Delaware law, including Section&#160;203 of the General
    Corporation Law of the State of Delaware. Section&#160;203
    prevents some stockholders holding more than 15% of our
    outstanding common stock from engaging in certain business
    combinations unless the business combination was approved in
    advance by our board of directors, results in the stockholder
    holding more than 85% of our outstanding common stock or is
    approved by the holders of at least
    66<FONT style="vertical-align: text-top; font-size: 70%;">2</FONT>/<FONT style="font-size: 70%;">3</FONT>%
    of our outstanding common stock not held by the stockholder
    engaging in the transaction.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any provision of our certificate of incorporation or our bylaws
    or Delaware law that has the effect of delaying or deterring a
    change in control could limit the opportunity for our
    stockholders to receive a premium for their shares of our common
    stock and could also affect the price that some investors are
    willing to pay for our common stock.
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    board of directors can issue, without stockholder approval,
    preferred stock with voting and conversion rights that could
    adversely affect the voting power of the holders of common
    stock.</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors can issue, without stockholder approval,
    preferred stock with voting and conversion rights that could
    adversely affect the voting power of the holders of common stock
    and reduce the likelihood that such holders will receive
    dividend payments or payments upon liquidation. Such issuance
    could have the effect of decreasing the market price of the
    common stock. The issuance of preferred stock or even the
    ability to issue preferred stock could also have the effect of
    delaying, deterring or preventing a change of control or other
    corporate action.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">You
    will experience immediate and substantial
    dilution.</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The initial public offering price will be substantially higher
    than the net tangible book value of each outstanding share of
    common stock immediately after this offering. If you purchase
    common stock in this offering, you will suffer immediate and
    substantial dilution. The dilution will be
    $&#160;&#160;&#160;&#160;&#160; per share in the net tangible
    book value of the common stock from the expected initial public
    offering price. In addition, if outstanding options to purchase
    shares of our common stock are exercised, there could be further
    dilution.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    board of directors and management will have broad discretion
    over the use of the proceeds we receive in this offering and
    might not apply the proceeds in ways that increase the value of
    your investment.</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors and management will have broad discretion
    to use the net proceeds from this offering, and you will be
    relying on their judgment regarding the application of these
    proceeds. Our board of directors and management might not apply
    the net proceeds of this offering in ways that increase the
    value of your investment. We expect to use the net proceeds from
    this offering for general corporate purposes, including, without
    limitation, to fund our capital expenditures and working capital
    requirements and to develop new products, processes and
    technologies, both through acquisitions and capital programs.
    Until we use the net proceeds from this offering, we plan to
    invest them, and these investments may not yield a favorable
    rate of return. If we do not invest or apply the net proceeds
    from this offering in ways that enhance stockholder value, we
    may fail to achieve expected financial results, which could
    cause our stock price to decline.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    identified a material weakness in our internal control over
    financial reporting which, if not satisfactorily remediated,
    could result in material misstatements in our consolidated
    financial statements in future periods.</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the preparation of our consolidated financial statements
    as of December&#160;31, 2009 and 2008 and for the year ended
    December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008, and cumulatively for
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009, we identified deficiencies in our
    internal control over financial reporting which, when considered
    in the aggregate, represent a material weakness. If not
    remediated, this material weakness could result in material
    misstatements in our consolidated financial statements in future
    periods. Specifically, we did not maintain a sufficient
    complement of personnel with an appropriate level of accounting
    and financial reporting knowledge, experience and training in
    the application of U.S.&#160;generally accepted accounting
    principles, or U.S.&#160;GAAP. We also did not maintain an
    adequate system of processes and internal controls sufficient to
    support our financial reporting requirements and to produce
    timely and accurate consolidated financial statements in
    accordance with U.S.&#160;GAAP.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A material weakness is a deficiency, or combination of
    deficiencies, in internal control over financial reporting, such
    that there is a reasonable possibility that a material
    misstatement of our financial statements will not be prevented
    or detected on a timely basis. A deficiency in internal control
    over financial reporting exists when the design or operation of
    a control does not allow management or employees, in the normal
    course of performing their assigned functions, to prevent or
    detect misstatements on a timely basis.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In late 2009, we commenced remediation actions which included
    hiring several individuals with significant accounting, auditing
    and financial reporting experience and devoting significant
    resources to improving our system of processes and internal
    controls. Specifically, we hired a chief financial officer, a
    corporate controller and a director of financial reporting, and
    in early 2010, we hired an accounting manager for the Mountain
    Pass facility, all of whom are certified public accountants. We
    also installed additional
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    functionality and increased the integration of our information
    technology systems to increase automation and accuracy within
    our processes. If our actions are not effective in correcting
    the material weakness and we continue to experience material
    weaknesses, investors could lose confidence in our financial
    reporting, particularly if such weaknesses result in a
    restatement of our financial results, and our stock price could
    decline. See &#147;Management&#146;s Discussion and Analysis of
    Financial Condition and Results of Operations&#160;&#151;
    Internal Controls.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    will be required by Section 404 of the Sarbanes-Oxley Act to
    evaluate the effectiveness of our internal controls. If we are
    unable to achieve and maintain effective internal controls,
    particularly in a period of anticipated rapid growth, our
    operating results and financial condition could be
    harmed.</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will be required to comply with Section 404 of the
    Sarbanes-Oxley Act beginning with the year ending
    December&#160;31, 2011. Section 404 requires that we evaluate
    our internal control over financial reporting to enable
    management to report on the effectiveness of those controls.
    Management is responsible for establishing and maintaining
    adequate internal control over financial reporting. Our internal
    control over financial reporting is a process designed to
    provide reasonable assurance regarding the reliability of
    financial reporting and the preparation of our consolidated
    financial statements in accordance with U.S.&#160;GAAP. While we
    have begun the comprehensive process of evaluating our internal
    controls, we are in the early phases of our review and will not
    complete our review until well after this offering is completed.
    We cannot predict the outcome of our review at this time. During
    the course of the review, we may identify additional control
    deficiencies of varying degrees of severity, in addition to the
    material weakness discussed above.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have taken steps to improve our internal control over
    financial reporting, including identification of deficiencies in
    the knowledge and expertise of personnel required in the
    accounting and finance functions of a public company. We have
    incurred significant costs to remediate our material weakness
    and deficiencies and improve our internal controls, and will
    incur additional expense as we undertake the modernization and
    expansion of the Mountain Pass facility.  As we implement this
    modernization and expansion, the resulting growth in our
    business will require us to implement additional internal
    controls. To comply with
    <FONT style="white-space: nowrap">Sarbanes-Oxley</FONT>
    requirements, especially during this period of anticipated rapid
    growth, we will need to further upgrade our systems, including
    information technology, implement additional financial and
    management controls, reporting systems and procedures and hire
    additional accounting, finance and legal staff. If we are unable
    to upgrade our systems and procedures or hire the necessary
    additional personnel in a timely and effective fashion, we may
    not be able to comply with our financial reporting requirements
    and other rules that apply to public companies.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a public company, we will be required to report internal
    control deficiencies that constitute material weaknesses in our
    internal control over financial reporting. See
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations&#160;&#151; Internal
    Controls.&#148; We will also be required to obtain an audit
    report from our independent registered public accounting firm
    beginning in 2011 regarding the effectiveness of our internal
    controls over financial reporting. If we fail to implement the
    requirements of Section 404 in a timely manner, if we or our
    independent registered public accounting firm are unable to
    conclude that our internal control over financial reporting are
    effective, or if we fail to comply with our financial reporting
    requirements, investors may lose confidence in the accuracy and
    completeness of our financial reports.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    will incur increased costs as a result of being a publicly
    traded corporation.</FONT></I></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have no history operating as a publicly traded corporation.
    As a publicly traded corporation, we will incur additional
    legal, accounting and other expenses that we did not incur as a
    private company. This increase will be due to the increased
    accounting support services, filing annual and quarterly reports
    with the SEC, increased audit fees, investor relations,
    directors&#146; fees, directors&#146; and officers&#146;
    insurance, legal fees, stock exchange listing fees and registrar
    and transfer agent fees, which we expect to incur after the
    completion of this offering. In addition, we expect that
    complying with the rules and regulations implemented by the SEC
    and NYSE will increase our legal and financial compliance costs
    and make activities more time-consuming and costly. For example,
    as a result of becoming a publicly traded corporation, we are
    required to have a board containing a majority of independent
    directors, create additional board committees and adopt policies
    regarding internal controls and disclosure controls and
    procedures, including the preparation of reports on internal
    control over financial reporting. In addition, we will incur
    additional costs associated with our publicly traded corporation
    reporting requirements.
</DIV>
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    <BR>
    27
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='103'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SPECIAL
    NOTE&#160;REGARDING FORWARD-LOOKING STATEMENTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This prospectus, including the sections entitled
    &#147;Prospectus Summary,&#148; &#147;Risk Factors,&#148;
    &#147;Management&#146;s Discussion and Analysis of Financial
    Condition and Results of Operations,&#148; &#147;Rare Earth
    Industry Overview&#148; and &#147;Business,&#148; contains
    forward-looking statements that represent our beliefs,
    projections and predictions about future events or our future
    performance. You can identify forward-looking statements by
    terminology such as &#147;may,&#148; &#147;will,&#148;
    &#147;would,&#148; &#147;could,&#148; &#147;should,&#148;
    &#147;expect,&#148; &#147;intend,&#148; &#147;plan,&#148;
    &#147;anticipate,&#148; &#147;believe,&#148;
    &#147;estimate,&#148; &#147;predict,&#148;
    &#147;potential,&#148; &#147;continue&#148; or the negative of
    these terms or other similar expressions or phrases. These
    forward-looking statements are necessarily subjective and
    involve known and unknown risks, uncertainties and other
    important factors that could cause our actual results,
    performance or achievements or industry results to differ
    materially from any future results, performance or achievement
    described in or implied by such statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Factors that may cause actual results to differ materially from
    expected results described in forward-looking statements
    include, but are not limited to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to secure sufficient capital to implement our
    business plans;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to complete our modernization and expansion efforts
    and reach full planned production rates for REOs and other
    planned downstream products;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    uncertainties associated with our reserve estimates and
    non-reserve deposit information;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    uncertainties regarding global supply and demand for rare earth
    materials;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to maintain appropriate relations with unions and
    employees;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our ability to successfully implement our
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    environmental laws, regulations and permits affecting our
    business, directly and indirectly, including, among others,
    those relating to mine reclamation and restoration, climate
    change, emissions to the air and water and human exposure to
    hazardous substances used, released or disposed of by
    us;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    uncertainties associated with unanticipated geological
    conditions related to mining.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See &#147;Risk Factors&#148; for a more complete discussion of
    these risks and uncertainties and for other risks and
    uncertainties. Any forward-looking statement you read in this
    prospectus reflects our current views with respect to future
    events and is subject to these and other risks, uncertainties
    and assumptions relating to our operations, operating results,
    growth strategy and liquidity. We assume no obligation to
    publicly update or revise these forward-looking statements for
    any reason, or to update the reasons actual results could differ
    materially from those anticipated in these forward-looking
    statements, even if new information becomes available in the
    future, except as otherwise required by applicable law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This prospectus also contains statistical data and estimates we
    obtained from industry publications and reports generated by
    third parties. Although we believe that the publications and
    reports are reliable, we have not independently verified their
    data.
</DIV>
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    <BR>
    28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='104'>
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">USE OF
    PROCEEDS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We estimate that we will receive net proceeds of approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million from the sale
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock in this offering, based on an assumed
    initial public offering price of $&#160;&#160;&#160;&#160;&#160;
    per share, which is the midpoint of the estimated price range
    set forth on the cover page of this prospectus, and after
    deducting underwriting discounts and commissions and estimated
    offering expenses that we must pay. If the underwriters exercise
    their over-allotment option in full, we estimate that we will
    receive additional net proceeds of approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million. We will not
    receive any proceeds from the sale of shares of common stock
    offered by the selling stockholders if the underwriters exercise
    their over-allotment option to purchase shares of common stock
    from the selling stockholders in this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to use the net proceeds from this offering primarily
    to fund our modernization and expansion of the Mountain Pass
    facility as well as for general corporate purposes, including,
    without limitation, to fund our working capital requirements and
    to develop new products, processes and technologies, both
    through acquisitions and capital programs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each $1.00 increase or decrease in the assumed initial public
    offering price of $&#160;&#160;&#160;&#160;&#160; per share
    would increase or decrease, as applicable, the net proceeds to
    us from this offering, after deducting underwriting discounts
    and commissions and estimated offering expenses that we must pay
    and assuming that the number of shares offered by us, as set
    forth on the cover page of this prospectus, remains the same, by
    approximately $&#160;&#160;&#160;&#160;&#160;, or approximately
    $&#160;&#160;&#160;&#160;&#160; assuming full exercise of the
    underwriters&#146; over-allotment option. In addition, an
    increase or decrease in the number of shares of our common stock
    sold by us in this offering by 10% would cause the net proceeds
    from this offering, after deducting underwriting discounts and
    commissions and estimated offering expenses, to increase or
    decrease by approximately $&#160;&#160;&#160;&#160;&#160;, or
    approximately $&#160;&#160;&#160;&#160;&#160; assuming full
    exercise of the underwriters&#146; over-allotment option. Any
    additional net proceeds would be used for general corporate
    purposes, including, without limitation, to fund capital
    expenditures and working capital requirements and to develop new
    products, processes and technologies, both through acquisitions
    and capital programs. If the net proceeds are less than the
    estimated amount, the amount of net proceeds that we would use
    for general corporate purposes, including, without limitation,
    to fund capital expenditures and working capital requirements
    and to develop new products, processes and technologies, both
    through acquisitions and capital programs, would be reduced.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pending our use of the net proceeds from this offering as
    described above, we plan to invest the proceeds in a variety of
    capital preservation investments, including short-term
    interest-bearing obligations, investment-grade instruments,
    certificates of deposit and direct guaranteed obligations of the
    United States.
</DIV>
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    <BR>
    29
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='105'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CAPITALIZATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth our consolidated cash and cash
    equivalents and our capitalization as of December&#160;31, 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on an actual basis reflecting the capitalization of Molycorp,
    LLC;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    on a pro forma as adjusted basis reflecting the capitalization
    of Molycorp, Inc. to give effect to the following:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the corporate reorganization as described in &#147;Corporate
    Reorganization&#148;; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the issuance
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock and the receipt of the net proceeds by us in
    this offering, after deducting underwriting discounts and
    commissions and estimated offering expenses that we must pay.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The information in this table should be read in conjunction with
    &#147;Use of Proceeds,&#148; &#147;Selected Historical
    Consolidated Financial Data,&#148; &#147;Management&#146;s
    Discussion and Analysis of Financial Condition and Results of
    Operations&#148; and the consolidated financial statements and
    the related notes included elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro Forma<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Actual</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>as Adjusted</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <U>Cash and cash equivalents</U>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 12pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total debt
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Stockholders&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Common stock, $0.001 par
    value;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    authorized;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    issued and outstanding
    actual;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    issued and outstanding as adjusted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Additional paid-in capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Deficit accumulated during the development stage
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Total stockholders&#146; equity (deficit)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total capitalization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    30
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='106'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DIVIDEND
    POLICY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the foreseeable future, we intend to retain any earnings to
    finance the development of our business. We do not anticipate
    paying any cash dividends on our common stock. Any future
    determination to pay dividends will be at the discretion of our
    board of directors and will depend upon then-existing
    conditions, including our operating results and our financial
    condition, capital requirements, contractual restrictions,
    business prospects and other factors that our board of directors
    may deem relevant.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    31
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='107'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DILUTION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Dilution is the amount by which the portion of the offering
    price paid by the purchasers of the common stock to be sold in
    this offering exceeds the net tangible book value or deficiency
    per share of common stock after the offering. Net tangible book
    value or deficiency per share of our common stock is determined
    at any date by subtracting total liabilities from our total
    assets less our intangible assets and dividing the difference by
    the number of shares of common stock deemed to be outstanding at
    that date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our net tangible book value as of December&#160;31, 2009 (after
    giving effect to the corporate reorganization) was approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or
    $&#160;&#160;&#160;&#160;&#160; per share of common stock. After
    giving effect to our receipt and intended use of approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million of estimated net
    proceeds (after deducting underwriting discounts and commissions
    and estimated offering expenses that we must pay) from our sale
    of common stock in this offering based on an assumed initial
    public offering price of $&#160;&#160;&#160;&#160;&#160; per
    share of common stock, which is the midpoint of the estimated
    range set forth on the cover page of this prospectus, our
    adjusted net tangible book value as of December&#160;31, 2009
    would have been approximately
    $&#160;&#160;&#160;&#160;&#160;&#160;million, or
    $&#160;&#160;&#160;&#160;&#160; per share of common stock. This
    amount represents an immediate increase in net tangible book
    value of $&#160;&#160;&#160;&#160;&#160; per share of common
    stock to existing stockholders and an immediate dilution of
    $&#160;&#160;&#160;&#160;&#160; per share of common stock to new
    investors purchasing shares of common stock in this offering at
    the assumed initial public offering price.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table illustrates this dilution on a per share
    basis:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="93%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Assumed initial public offering price per share
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net tangible book value per share as of December&#160;31, 2009
    (after giving effect to the corporate reorganization)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Increase per share attributable to cash payments made by
    investors in this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Adjusted net tangible book value per share after this offering
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dilution per share to new investors
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the underwriters exercise their over-allotment option in
    full, the adjusted tangible book value per share after giving
    effect to the offering would be $&#160;&#160;&#160;&#160;&#160;
    per share. This represents an increase in adjusted net tangible
    book value of $&#160;&#160;&#160;&#160;&#160; per share to
    existing stockholders and dilution in adjusted net tangible book
    value of $&#160;&#160;&#160;&#160;&#160; per share to new
    investors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A $1.00 increase or decrease in the assumed initial public
    offering of $&#160;&#160;&#160;&#160;&#160; per share would
    increase or decrease, as applicable, our adjusted net tangible
    book value per share after this offering and dilution to new
    investors by $&#160;&#160;&#160;&#160;&#160; , assuming the
    number of shares of common stock offered by us, as set forth on
    the cover page of this prospectus, remains the same and after
    deducting the underwriting discounts and commissions and
    estimated offering expenses that we must pay.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes, on an as adjusted basis as of
    December&#160;31, 2009, the differences between the number of
    shares of common stock purchased from us, the total
    consideration paid to us and the average price per share paid by
    existing stockholders and by new investors in this offering. As
    the table shows, new investors purchasing shares of common stock
    in this offering will pay an average price per share
    substantially higher than our existing stockholders paid. The
    table below assumes an initial public offering price of
    $&#160;&#160;&#160;&#160;&#160; per share for shares of common
    stock purchased in this offering and excludes underwriting
    discounts and commissions and estimated offering expenses that
    we must pay:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="51%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares Purchased</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total Consideration</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Average Price<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percent</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percent</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>per Share</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Existing investors
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    New investors
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    32
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='108'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CORPORATE
    REORGANIZATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp Minerals, LLC, a Delaware limited liability company
    formerly known as Rare Earth Acquisitions LLC, was formed on
    June&#160;12, 2008 to purchase the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc., a subsidiary of Chevron Corporation. Prior to the
    acquisition, the Mountain Pass facility was owned by Chevron
    Mining Inc. and, before 2005, by Unocal Corporation. Molycorp,
    LLC, the parent of Molycorp Minerals, LLC, is a Delaware limited
    liability company that was formed on September&#160;9, 2009.
    Molycorp, Inc. was formed on March&#160;4, 2010 as a new
    Delaware corporation that is not, to date, conducted any
    activities other than those incident to its formation and the
    preparation of this registration statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The members of Molycorp, LLC have contributed either
    (a)&#160;all of their member interests in Molycorp, LLC or
    (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class&#160;A common stock. Additionally, all of
    the holders of profits interests in Molycorp Minerals, LLC,
    which were represented by incentive shares, have contributed all
    of their incentive shares to Molycorp, Inc. in exchange for
    shares of Molycorp, Inc. Class&#160;B common stock. Accordingly,
    Molycorp, LLC and Molycorp Minerals, LLC have become
    subsidiaries of Molycorp, Inc. We refer to this process as the
    &#147;corporate reorganization&#148; throughout this prospectus.
    All of the shares of Class&#160;A common stock and Class&#160;B
    common stock will convert into shares of common stock
    immediately prior to the consummation of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The incentive shares had been issued by Molycorp, LLC to some of
    its key employees, including certain of our executive officers,
    and non-employee directors. These incentive shares would have
    entitled the incentive shareholders to share in cash
    distributions with the initial investors, who received
    Class&#160;A common stock, in amounts ranging from 3.2% to 7.0%
    of the distributions once the initial investors had received an
    annually compounded 10% return and their initial capital
    contributions. The terms of the Class&#160;A common stock and
    Class&#160;B common stock generally replicate the economics of
    the original incentive shares in that the shares of Class&#160;A
    common stock and Class&#160;B common stock will convert into
    shares of common stock in connection with the corporate
    reorganization at a conversion ratio dependent on the return
    that the initial investors receive. This return will be
    determined on the value of the initial investors&#146; shares
    based on the initial public offering price. Accordingly,
    although the aggregate number of shares of common stock into
    which the Class&#160;A common stock and Class&#160;B common
    stock will be fixed
    at&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    in the aggregate, the actual number of shares of common stock
    that the holders of Class&#160;A common stock and Class&#160;B
    common stock will receive will vary depending on the initial
    public offering price and the amount of the deemed return to the
    initial investors. Based on an assumed initial offering price
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    per share, which is the midpoint of the estimated price range
    set forth on the cover of this prospectus, we estimate that,
    immediately prior to the consummation of this offering, the
    holders of Class&#160;A common stock will receive
    approximately&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon conversion and the holders of Class&#160;B
    common stock will receive
    approximately&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock upon conversion.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    33
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='109'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SELECTED
    CONSOLIDATED FINANCIAL DATA</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon the formation of Molycorp, LLC on September&#160;9, 2009,
    all members of Molycorp Minerals, LLC contributed their member
    interests to Molycorp, LLC in exchange for member interests in
    Molycorp, LLC. That exchange was treated as a reorganization of
    entities under common control and Molycorp Minerals, LLC is the
    predecessor to Molycorp, LLC. Accordingly, all financial
    information of Molycorp, LLC for periods prior to its formation
    is the historical financial information of Molycorp Minerals,
    LLC. Molycorp Minerals, LLC acquired the Mountain Pass,
    California rare earth deposit and associated assets from Chevron
    Mining Inc., a subsidiary of Chevron Corporation, on
    September&#160;30, 2008. The selected consolidated financial
    data as of December&#160;31, 2009 and 2008, and for the year
    ended December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008 and cumulatively for
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009 has been derived from Molycorp,
    LLC&#146;s audited consolidated financial statements and the
    related notes included elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;15, 2010, the members of Molycorp, LLC contributed
    either (a)&#160;all of their member interests in Molycorp, LLC
    or (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc., and, as a result, Molycorp, LLC and Molycorp
    Minerals, LLC became wholly owned subsidiaries of Molycorp, Inc.
    The unaudited pro forma balance sheet data as of
    December&#160;31, 2009 has been prepared to give effect to the
    corporate reorganization as if it had occurred on
    December&#160;31, 2009. The unaudited pro forma balance sheet
    data is for informational purposes only and does not purport to
    indicate balance sheet information as of any future date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a limited liability company, the taxable income and losses of
    Molycorp, LLC were reported on the income tax returns of its
    members. Molycorp, Inc. is subject to federal and state income
    taxes and will file consolidated income tax returns. If the
    corporate reorganization had been effective as of
    January&#160;1, 2009, our net loss of $28.6&#160;million would
    have generated a pro forma deferred income tax benefit of
    $11.3&#160;million, assuming a combined federal and state
    statutory income tax rate. However, as realization of such tax
    benefit would not have been assured, we would have also
    established a valuation allowance to eliminate such pro forma
    tax benefit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The unaudited pro forma per share data has been computed based
    upon the number of shares of common stock outstanding
    immediately after the corporate reorganization applied to our
    historical net loss amounts and gives retroactive effect to the
    corporate reorganization as if it had occurred on June&#160;12,
    2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The selected historical consolidated financial data set forth
    below should be read in conjunction with &#147;Management&#146;s
    Discussion and Analysis of Financial Condition and Results of
    Operations&#148; and the financial statements and the notes
    thereto included elsewhere in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="56%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Statement of Operations Data</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands, except share and per share data)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net sales
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,093
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cost of goods sold(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (21,785
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,027
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,812
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Selling, general and administrative expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (12,685
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,979
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,664
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Accretion expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,006
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,256
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Depreciation and amortization expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (191
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (19
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (210
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (28,574
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,138
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (42,712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42,661
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Loss per share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Weighted average shares outstanding
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,017,959
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,011,561
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28.08
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14.07
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42.17
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28.08
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14.07
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42.17
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Pro forma loss per share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Weighted average shares outstanding:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    34
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="56%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Pro Forma<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Balance Sheet Data</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,189
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,520
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    97,666
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,355
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total non-current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,509
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Total liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,051
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,279
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74,615
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    78,076
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="52%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>(Inception) Through<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Other Financial Data</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Capital expenditures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,285
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    321
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,606
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Cost of goods sold includes write-downs of inventory to
    estimated net realizable value of $9.0&#160;million and
    $9.5&#160;million for the year ended December&#160;31, 2009 and
    for the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2008, respectively.</TD>
</TR>

</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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    35
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='110'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MANAGEMENT&#146;S
    DISCUSSION AND ANALYSIS OF<BR>
    FINANCIAL CONDITION AND RESULTS OF OPERATIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>The following discussion and analysis should be read in
    conjunction with our consolidated financial statements and
    related notes included elsewhere in this prospectus. The
    following discussion and analysis contains forward-looking
    statements that reflect our plans, estimates and beliefs and
    involves risks and uncertainties. Our actual results could
    differ materially from those discussed in these forward-looking
    statements as a result of various factors, including those
    discussed below, under the headings &#147;Risk Factors&#148; and
    &#147;Special Note Regarding Forward-Looking Statements&#148;
    and in other parts of this prospectus</I>.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Overview</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    Business</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are the only REO producer in the Western hemisphere and own
    the world&#146;s largest, most fully developed rare earth
    project outside of China. Following the execution of our
    &#147;mine-to-magnets&#148; strategy and completion of our
    modernization and expansion efforts, we expect to be one of the
    world&#146;s most integrated producers of rare earth products,
    including oxides, metals, alloys and magnets. Our rare earths
    are critical inputs in existing and emerging applications
    including: clean energy technologies, such as hybrid and
    electric vehicles and wind power turbines; multiple high-tech
    uses, including fiber optics, lasers and hard disk drives;
    numerous defense applications, such as guidance and control
    systems and global positioning systems; and advanced water
    treatment technology for use in industrial, military and outdoor
    recreation applications. Global demand for REEs is projected to
    steadily increase both due to continuing growth in existing
    applications and increased innovation and development of new end
    uses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our goals are to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    develop innovative rare earth technologies and products vital to
    green energy, high-tech, defense and industrial applications;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    be commercially sustainable, globally competitive, profitable
    and environmentally superior;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    act as a responsible steward of our rare earth
    resources;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    use our technology to improve the daily lives of people
    throughout the world.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have made significant investments, and expect to continue to
    invest, in developing technologically advanced and proprietary
    applications for individual REEs. We are in the process of
    modernizing and expanding our production capabilities at our
    Mountain Pass, California facility in order to integrate the
    rare earths supply chain: mining; oxide processing; production
    of metals and alloys; and, as part of our
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy, the production of rare earth-based magnets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our vision is to be the rare earth products and technology
    company recognized for its &#147;ETHICS&#148;&#160;&#151;
    Excellence, Trust, Honesty, Integrity, Creativity and Safety.
    Since July 2005, the Mountain Pass facility has not had a
    lost-time accident and has received the coveted &#147;Sentinels
    of Safety&#148; award from the MSHA for three of the last four
    years.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    Mine Process and Development Plans</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with the modernization of our
    processing capabilities in order to efficiently produce at a
    rate of 19,090 mt of REO per year by the end of 2012, and we
    expect to have the capability to increase production to 40,000
    mt of REO per year, if warranted by market conditions. Prior to
    the expected completion of our modernization and expansion
    efforts by the end of 2012, we expect to produce approximately
    3,000 mt in the aggregate of cerium products, lanthanum
    concentrate, didymium oxide and heavy rare earth concentrates in
    each of 2010 and 2011 from stockpiled feedstock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Initially, our modernization and expansion plans envisioned
    adding facilities and equipment for metal conversion and alloy
    production at the Mountain Pass facility. However, we have
    entered into a letter of intent
</DIV>
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    <BR>
    36
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    to acquire a third-party producer of rare earth metals and
    alloys in the United States. If we complete the acquisition
    instead of adding such facilities and equipment at Mountain
    Pass, we plan to transport cerium, lanthanum,
    neodymium/praseodymium (didymium) and samarium oxide products
    from our Mountain Pass facility to our new off-site location
    that already possesses the technological capability to produce
    rare earth metals and alloys.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We anticipate the cost of restarting mining operations, the
    modernization and expansion of our Mountain Pass facility and
    the addition of rare earth metal, composite and alloy production
    capabilities to be approximately $511&#160;million. We are
    finalizing our financing plans, including this offering, so that
    we will have sufficient capital to cover such costs upon
    completion of this offering and our financing plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are currently working to secure a collaborative joint venture
    agreement with a third-party manufacturer of NdFeB magnets in
    the United States. This joint venture will provide us with
    access to the intellectual property, technology, people and
    facilities to convert our rare earth materials into the
    high-performance permanent magnets required for production of
    hybrid and electric vehicles, wind power turbines, high-tech
    applications and numerous advanced defense systems on which the
    U.S.&#160;economy and national security depend. The consummation
    of such a joint venture, in conjunction with our current
    modernization plans and the potential acquisition of a
    third-party rare earth metal and alloys producer, is expected to
    provide us with the capability to mine, process, separate and
    alloy individual REEs before manufacturing them into NdFeB
    magnets. This downstream integration would make us the only
    fully integrated producer of NdFeB magnets outside of China,
    helping to secure rare earth supply for the Rest of World.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Our
    Products and Markets</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since our acquisition of the Mountain Pass facility, we have
    been producing and selling small quantities of REOs from our
    pilot processes using stockpiled feedstocks. The purpose of this
    effort has been to significantly improve our solvent extraction
    technology and to develop other key technologies that will be
    utilized in the new process. We recently completed processing
    stockpiled lanthanum to recover neodymium and praseodymium and
    produce didymium oxide (a combination of neodymium and
    praseodymium). We are commencing a second pilot processing
    campaign in the second quarter of 2010 to recover cerium,
    lanthanum, neodymium, praseodymium and a
    samarium/europium/gadolinium concentrate from bastnasite
    concentrate stockpiles.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Key
    Industry Factors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Demand
    for Rare Earth Products</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Global consumption of REEs is projected to steadily increase
    both due to continuing growth in existing applications and
    development of new end uses. For example, the integration of
    rare earth permanent magnet drives into wind power turbines has
    substantially reduced the need for gearboxes, which increases
    overall efficiency and reliability. According to IMCOA and
    Roskill, total demand for rare earths outside of China is
    expected to increase at a CAGR of approximately 4% to 5% between
    2008 and 2014. In addition, according to Roskill, global demand
    for the more important magnetic rare earths, neodymium,
    praseodymium and dysprosium is expected to grow at CAGRs of
    approximately 8%, 6% and 6%, respectively, over the same period.
    Both IMCOA and Roskill estimate that total global demand for
    rare earths is expected to increase at a CAGR of approximately
    6% from 2008 through 2014, from approximately 124,000&#160;mt to
    approximately 180,000&#160;mt per annum.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Current estimates indicate that global demand for REEs will
    exceed global supply by 2011. This shortage will continue unless
    Mountain Pass and other rare earths projects achieve projected
    production capacities. IMCOA and Roskill expect that this
    anticipated excess demand will underpin strong pricing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. According to Metal Pages, since the
    beginning of the fourth quarter of 2009, prices have risen by
    approximately 60% and continue to rise.
</DIV>
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    <BR>
    37
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rare
    Earth Product Prices(1)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Rare Earth Product</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2014</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2020</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2030</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Praseodymium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Samarium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Europium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    475.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    600.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    750.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Gadolinium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Terbium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    500.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    650.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    850.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,200.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Dysprosium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    155.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    200.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Yttrium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Rare earth product prices in US$/kg,
    <FONT style="white-space: nowrap">free-on-board</FONT>
    China (+/&#8722; 20%)</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: IMCOA. Although IMCOA and Roskill predict strong growth,
    their projections with respect to certain years are slightly
    different.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Supply
    of Rare Earth Products</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has dominated the global supply of REOs for the last ten
    years and, according to Roskill, accounted for approximately 97%
    of global REO production in 2008. Even with our planned
    production, global supply is expected by analysts to remain
    tight due to the combined effects of growing demand and actions
    taken by the Chinese government to restrict exports. The Chinese
    government heightened international supply concerns in August
    2009 when China&#146;s Interior Ministry signaled that it would
    further restrict exports of Chinese rare earth resources. Citing
    the importance of REE availability to internal industries and
    the desire to conserve resources, the Chinese government has
    announced export quotas, increased export tariffs and introduced
    a &#147;mining quotas policy.&#148; China&#146;s internal
    consumption of rare earths is expected to continue to grow,
    leaving the Rest of World with a supply gap within the next two
    years, during a period of increasing global demand. China also
    dominates the manufacture of rare earth metals, producing
    substantially all of the world&#146;s supply, and the
    manufacture of NdFeB magnets, producing approximately 80% of the
    world&#146;s supply. Neither capability currently exists in the
    United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S.&#160;Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the global projected REE deficit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    According to Metal Pages, the price of rare earths rose
    significantly in the three years before the recent financial
    turmoil due to constraints placed on mining, processing and
    exporting by the Chinese authorities. According to Metal Pages,
    since the beginning of the fourth quarter of 2009, prices for
    REOs have risen by approximately 60% on average.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a result of the internal industrial development and economic,
    environmental and regulatory factors in China, there is
    uncertainty with respect to the availability of rare earth
    products from China. Although Chinese production of rare earth
    materials is increasing, export quotas imposed by the Chinese
    government are decreasing, thus reducing the amount of rare
    earth materials that China may export to the rest of the world.
    This reduction is occurring at a time when the demand for REEs
    is growing significantly.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Factors
    Affecting Our Results</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We anticipate a dramatic change in our business and results of
    operations upon the completion of our planned modernization and
    expansion of our Mountain Pass facility that we acquired on
    September&#160;30, 2008 from Chevron Mining Inc. As discussed
    under the heading &#147;Business <B>&#151;&#160;</B>Our
    Corporate History and Structure <B>&#151;&#160;</B>The Mountain
    Pass Facility,&#148; Unocal Corporation had suspended most
    operations at the Mountain Pass
</DIV>
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    <BR>
    38
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    facility by 2002 and, except for pilot processing activities,
    they remained suspended under Chevron Mining Inc.&#146;s
    ownership. Additionally, significant reclamation work was
    completed at the Mountain Pass facility under Chevron Mining
    Inc.&#146;s ownership.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We plan to utilize the assets we acquired from Chevron Mining
    Inc. as a foundation to build an integrated rare earth products
    and technology company, which requires considerable additional
    capital investment. We believe the application of improved
    technologies, along with the capital investment, will allow us
    to create a sustainable business by cost effectively producing
    high purity rare earth products. In addition to the
    modernization and expansion of the Mountain Pass facility, we
    expect to significantly broaden our operations through the
    addition of a number of downstream activities and products,
    including metal production, alloying and magnet production.
    Accordingly, we expect our products and customer base to change
    significantly upon full implementation of our
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We processed lanthanum, which comprised 82% and 72% of our sales
    for the year ended December&#160;31, 2009 and the period ended
    December&#160;31, 2008, respectively, from the stockpiled
    lanthanum material held in ponds since suspension of processing
    operations by Unocal Corporation in 2002. As a result of this
    campaign, we were able to significantly improve our solvent
    extraction technologies and capabilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon completion of the modernized extraction and separations
    facilities, we will begin producing cerium oxide for the glass
    polish market and
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    products for water treatment. We will also package a portion of
    the lanthanum oxide and all of the europium oxide products for
    direct sale to our customers. Upon completion of our proposed
    acquisition of a
    <FONT style="white-space: nowrap">U.S.-based</FONT>
    producer of rare earth metals and alloys, we plan to transport
    by truck cerium, lanthanum, neodymium/praseodymium (didymium)
    and samarium oxide products from our Mountain Pass facility to
    our off-site location that possesses the technological
    capability to produce rare earth metals and alloys.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Revenues</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our prices and product mix are determined by a combination of
    global and regional supply and demand factors. Our revenue is
    currently derived principally from the sale of lanthanum and is
    based on the price and quantities of lanthanum we sell. The
    percentage of our revenues from sales of lanthanum were 82% and
    72% for the year ended December&#160;31, 2009 and the period
    ended December&#160;31, 2008, respectively. These revenues are
    net of any transportation costs that we incur. The quantities we
    sell are determined by the production capabilities of the
    Mountain Pass facility and by demand for our product, which is
    also influenced by the level of purity and consistency we are
    able to achieve. Our revenue also consists of sales of finished
    products acquired as part of our acquisition of the Mountain
    Pass facility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prices for lanthanum we sold to our two largest customers were
    primarily based on fixed-price contracts. Our contract with one
    of these customers expired on December&#160;31, 2009. Our
    contract with the other customer expires in April 2010. Product
    sales to those customers and other customers that are not
    subject to existing contracts are based on current prevailing
    prices for the applicable product. Although prices for REOs have
    generally increased since October 2009, this increase followed a
    period of generally lower prices corresponding with the global
    financial crisis beginning in 2008. Many factors influence the
    market prices for REOs and, in the absence of established
    pricing in customer contracts, our sales revenue will fluctuate
    based upon changes in the prevailing prices for REOs. We use
    various industry sources, including certain publications, in
    evaluating prevailing market prices and establishing prices for
    our products because there are no published indices for rare
    earth alloys or magnets. In order to mitigate against the risk
    of fluctuations in market prices, we will likely use fixed price
    contracts for short durations, or longer term contracts that
    include periodic opportunities to adjust prices.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cost
    of Goods Sold</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our cost of goods sold reflects the cost allocated to our
    inventory acquired as part of our acquisition of the Mountain
    Pass facility and, with respect to our lanthanum sales, the
    subsequent processing costs incurred to produce the product.
    Because many of our costs are fixed costs as opposed to variable
    costs, as our production increases or decreases, our average
    cost per ton decreases or increases, respectively. Primary
</DIV>
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    <BR>
    39
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    production costs include direct labor and benefits, maintenance,
    natural gas, electricity, operating supplies, chemicals,
    depreciation and amortization and other plant overhead expenses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Currently, our most significant variable costs are chemicals and
    electricity. In the future, we intend to produce more of our
    chemicals at a plant on-site, which will reduce our variable
    chemical costs. We also intend to build a co-generation facility
    to provide power. Following such steps, natural gas will replace
    electricity and become our most significant variable cost.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect our labor and benefit costs to increase in 2010 due to
    the addition of personnel as we prepare to increase production
    to a rate of 19,090 mt of REO per year by the end of 2012. In
    addition to volume fluctuations, our variable costs, such as
    electricity, operating supplies and chemicals, are influenced by
    general economic conditions that are beyond our control. Other
    events outside our control, such as power outages, have in the
    past interrupted our operations and increased our total
    production costs, and we may experience similar events in the
    future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Selling,
    General and Administrative Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our selling, general and administrative expenses consist
    primarily of: personnel and related costs; legal, accounting and
    other professional fees; occupancy costs; and information
    technology costs. We anticipate an increase in selling, general
    and administrative expenses as we expand our business and
    operate as a publicly traded company. These expenses will
    include additional legal, compliance and corporate governance
    expenses, additional accounting and audit expenses, stock
    exchange listing fees, transfer agent and other
    stockholder-related fees and increased premiums for certain
    insurance coverages, among others.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Income
    Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the corporate reorganization completed in connection
    with this offering, we operated entirely within limited
    liability companies, which were not directly liable for the
    payment of federal or state income taxes and our taxable income
    or loss was included in the state and federal tax returns of
    Molycorp, LLC&#146;s members. The newly formed holding company,
    Molycorp, Inc., will be subject to U.S.&#160;federal and state
    income taxes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Environmental
    </FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations are subject to numerous and detailed federal,
    state and local environmental laws, regulations and permits,
    including those pertaining to employee health and safety,
    environmental permitting and licensing, air quality standards,
    GHG emissions, water usage and pollution, waste management,
    plant and wildlife protection, handling and disposal of
    radioactive substances, remediation of soil and groundwater
    contamination, land use, reclamation and restoration of
    properties, the discharge of materials into the environment and
    groundwater quality and availability.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We retain, both within Molycorp and outside Molycorp, the
    services of reclamation and environmental, health and safety, or
    EHS, professionals to review our operations and assist with
    environmental compliance, including with respect to product
    management, solid and hazardous waste management and disposal,
    water and air quality, asbestos abatement, drinking water
    quality, reclamation requirements, radiation control and other
    EHS issues.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have spent, and anticipate that we will continue to spend,
    financial and managerial resources to comply with environmental
    requirements. The majority of these resources will be expended
    through our capital investment budget. We expect to spend
    approximately $187&#160;million not including the costs of air
    emissions offset credits, which may become necessary and, if
    required, could cost up to $20&#160;million, on
    environmentally-driven capital projects between 2010 and 2012.
    See &#147;Business&#160;&#151; Environmental, Health and Safety
    Matters.&#148; In addition, in 2009 we incurred operating
    expenses of approximately $3&#160;million associated with
    environmental compliance requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We cannot predict the impact of new or changed laws, regulations
    or permit requirements, including the matters discussed below,
    or changes in the way such laws, regulations or permit
    requirements are enforced,
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    interpreted or administered. Environmental laws and regulations
    are complex, change frequently and have tended to become more
    stringent over time. It is possible that greater than
    anticipated environmental expenditures will be required in 2010
    or in the future. We expect continued government and public
    emphasis on environmental issues will result in increased future
    investment for environmental controls at our operations.
    Additionally, with increased attention paid to emissions of
    GHGs, including carbon dioxide, new regulations could go into
    effect that may affect our operations. We will continue to
    monitor developments in these various programs and assess their
    potential impacts on our operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Violations of environmental laws, regulations and permits can
    result in substantial penalties, court orders to install
    pollution-control equipment, civil and criminal sanctions,
    permit revocations, facility shutdowns and other sanctions. In
    addition, environmental laws and regulations may impose joint
    and several liability, without regard to fault, for costs
    relating to environmental contamination at our facility or from
    wastes disposed of at third-party waste facilities. The proposed
    expansion of our operations is also conditioned upon securing
    the necessary environmental and other permits and approvals. In
    certain cases, as a condition to procuring such permits and
    approvals, we are required to comply with financial assurance
    requirements. The purpose of these requirements is to assure the
    government that sufficient company funds will be available for
    the ultimate closure, post-closure care
    <FONT style="white-space: nowrap">and/or</FONT>
    reclamation at our facilities. We typically obtain bonds as
    financial assurance for these obligations and, as of
    December&#160;31, 2009, we had placed $27.4&#160;million of
    surety bonds with California state and regional municipalities.
    These bonds are currently collateralized by letters of credit or
    cash accounts provided by our initial investors, and we intend
    to replace such collateral arrangements with collateral provided
    directly by us. These bonds require annual payment and renewal.
    The EPA has announced its intention to establish a new financial
    assurance program for hardrock mining, extraction and processing
    facilities under the Federal Comprehensive Environmental
    Response Compensation and Liability Act, known as CERCLA, or the
    &#147;Superfund&#148; law, which may require us to establish
    additional bonds or other sureties. We cannot predict the effect
    of any such requirements on our operations at this time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Impact
    of Inflation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The cost estimates associated with the modernization and
    expansion of the Mountain Pass facility described under the
    heading &#147;&#151;&#160;Liquidity and Capital
    Resources&#160;&#151; Capital Expenditures&#148; have not been
    adjusted for inflation. If there is a significant rate of
    inflation over the near term, the funds obtained from this
    offering may not be sufficient to execute our business plan over
    the next few years. This could delay or preclude our business
    expansion efforts, or require us to raise additional capital. In
    addition, historical inflation rates have been used to estimate
    the future liability associated with our future remediation and
    reclamation obligations as reflected in the asset retirement
    obligations in our consolidated financial statements included
    elsewhere in this prospectus. If inflation rates significantly
    exceed the historical inflation rates, our future obligations
    could significantly increase.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Foreign
    Currency Fluctuations</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Substantially all of our product sales are denominated in
    U.S.&#160;dollars, so we have minimal exposure to fluctuations
    in foreign currency exchange rates. Our results are indirectly
    influenced by currency fluctuations, as the relative cost of our
    exports for a foreign buyer will increase as the
    U.S.&#160;dollar strengthens and decrease as the
    U.S.&#160;dollar softens in comparison to the applicable foreign
    currency.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Critical
    Accounting Policies and Estimates</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Revenue
    and Costs of Goods Sold</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Revenue is recognized when persuasive evidence of an arrangement
    exists, the risks and rewards of ownership have been transferred
    to the customer, which is generally when title passes, the
    selling price is fixed or determinable and collection is
    reasonably assured. Title generally passes upon shipment of
    product from our Mountain Pass facility. Prices are generally
    set at the time of or prior to shipment. Transportation and
    distribution costs are incurred only on sales for which we are
    responsible for delivering the product. Our reported revenues
    are presented net of freight and shipping costs.
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Cost of goods sold includes the cost of production as well as
    inventory write-downs caused by market price declines. Primary
    production costs include labor, supplies, maintenance costs,
    depreciation, and plant overhead.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Reclamation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our asset retirement obligations, or AROs, arise from our
    San&#160;Bernardino County conditional use permit, approved
    mining plan and state laws and regulations, which establish
    reclamation and closure standards for all aspects of our surface
    mining operation. Comprehensive environmental protection and
    reclamation standards require that we, upon closure of the
    Mountain Pass facility, restore the property in accordance with
    an approved reclamation plan issued in conjunction with our
    conditional use permit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our AROs are recorded initially at fair value, or the amount at
    which we estimate we could transfer our future reclamation
    obligations to informed and willing third parties. We use
    estimates of future third party costs to arrive at the AROs
    because the fair value of such costs generally reflects a profit
    component. It has been our practice, and we anticipate it will
    continue to be our practice, to perform a substantial portion of
    the reclamation work using internal resources. Hence, the
    estimated costs used in determining the carrying amount of our
    AROs may exceed the amounts that are eventually paid for
    reclamation costs if the reclamation work were performed using
    internal resources.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To determine our AROs, we calculate the present value of the
    estimated future reclamation cash flows based upon our permit
    requirements, which is based upon the approved mining plan,
    estimates of future reclamation costs and assumptions regarding
    the useful life of the asset to be remediated. These cash flow
    estimates are discounted on a credit-adjusted, risk-free
    interest rate based on U.S.&#160;Treasury bonds with a maturity
    similar to the expected life of the asset.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The amount initially recorded as an ARO for the Mountain Pass
    facility may change as a result of changes to the mine permit,
    and changes in the estimated costs or timing of reclamation
    activities. We periodically update estimates of cash
    expenditures associated with our ARO obligations in accordance
    with U.S.&#160;GAAP, which generally requires a measurement of
    the present value of any increase in estimated reclamation costs
    using the current credit-adjusted, risk-free interest rate.
    Adjustments to the ARO for decreases in the estimated amount of
    reclamation costs are measured using the credit-adjusted,
    risk-free interest rate as of the date of the initial
    recognition of the ARO.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, our accrued ARO obligation was
    $14.2&#160;million. Of this amount, approximately
    $4.4&#160;million is associated with the demolition and removal
    of buildings and equipment, approximately $4.7&#160;million is
    associated with groundwater remediation and $5.1&#160;million is
    associated with the remediation of tailing ponds, removal of
    land improvements and revegetation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Property,
    Plant and Equipment</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Property, plant and equipment associated with the acquisition of
    the Mountain Pass facility is stated at estimated fair value as
    of the acquisition date. Expenditures for new property, plant
    and equipment and improvements that extend the useful life or
    functionality of the asset are capitalized. Depreciation on
    plant and equipment is calculated using the straight-line method
    over the estimated useful lives of the assets. Maintenance and
    repair costs are expensed as incurred.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Reserves,
    Mineral Properties and Development Costs</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mineral properties represent the estimated fair value of the
    mineral resources associated with the Mountain Pass facility. We
    will begin to amortize such mineral properties using the units
    of production basis over estimated proven and probable reserves
    once mining operations resume, which is currently expected to
    occur in late 2010 or in 2011.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Inventory</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Inventories consist of
    <FONT style="white-space: nowrap">work-in-process,</FONT>
    finished goods, stockpiles of bastnasite and lanthanum
    concentrate and materials and supplies. Inventory cost is
    determined using the lower of weighted average cost or estimated
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    net realizable value. Inventory expected to be sold in the next
    12&#160;months is classified as a current asset in the
    consolidated balance sheet. Cash flows related to the sale of
    inventory are classified as operating activities in the
    consolidated statements of cash flows.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Write-downs to estimated net realizable value are charged to
    cost of goods sold. Many factors influence the market prices for
    REOs and, in the absence of established prices contained in
    customer contracts, management uses an independent pricing
    source to evaluate market prices for REOs at the end of each
    quarter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We evaluate the carrying value of materials and supply
    inventories each quarter giving consideration to slow-moving
    items, obsolescence, excessive levels and other factors and
    recognize related write-downs as necessary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Asset
    Impairments</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We account for asset impairment in accordance with ASC&#160;360,
    <I>Property Plant and Equipment</I>.
    <FONT style="white-space: nowrap">Long-lived</FONT>
    assets such as property, plant and equipment, mineral properties
    and purchased intangible assets subject to amortization are
    reviewed for impairment whenever events or changes in
    circumstances indicate that the carrying amount of an asset may
    not be recoverable. Impairment is considered to exist if the
    total estimated future cash flow on an undiscounted basis is
    less than the carrying amount of the related assets. An
    impairment loss is measured and recorded based on the discounted
    estimated future cash flows. Changes in significant assumptions
    underlying future cash flow estimates or fair values of assets
    may have a material effect on our financial position and results
    of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Factors we generally consider important in our evaluation and
    that could trigger an impairment review of the carrying value of
    long-lived assets include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    significant underperformance relative to expected operating
    results;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    significant changes in the way assets are used;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    underutilization of our tangible assets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    discontinuance of certain products by us our by our customers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a decrease in estimated mineral reserves; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    significant negative industry or economic trends.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we believe the carrying values of our long-lived assets
    were realizable as of the relevant balance sheet date, future
    events could cause us to conclude otherwise.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    43
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Results
    of Operations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Due to the timing of our formation on June&#160;12, 2008 and
    completion of the acquisition of the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc. on September&#160;30, 2008, the results of our operations
    for the year ended December&#160;31, 2009 are not directly
    comparable to our results of operations for the period from our
    inception on June&#160;12, 2008 to December&#160;31, 2008, which
    we refer to as the period ended December&#160;31, 2008. We did
    not have any revenue or cost of goods sold until the fourth
    quarter of 2008. Accordingly, the following discussion focuses
    on significant trends in our revenues, cost of sales and other
    operating expenses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="62%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net sales
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,093
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cost of goods sold
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (21,785
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,027
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,812
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Selling, general and administrative expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (12,685
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,979
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,664
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Depreciation and amortization expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (191
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (19
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (210
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Accretion expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,006
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,256
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (28,574
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,138
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (42,712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Other income (expense):
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Interest (expense) income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (194
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (184
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 16pt">
    Other income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    54
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42,661
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Revenues</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2009 and for the period
    ended December&#160;31, 2008, our revenues were approximately
    $7.1&#160;million and $2.1&#160;million, respectively. Sales of
    lanthanum accounted for 82% and 72% of our sales for the year
    ended December&#160;31, 2009 and the period ended
    December&#160;31, 2008, respectively. There is a limited market
    for our lanthanum and two customers comprised 81.2% and 70.4% of
    our total product revenue for the year ended December&#160;31,
    2009 and the period ended December&#160;31, 2008, respectively.
    We anticipate lanthanum and didymium oxide to make up a
    significant percentage of our total sales until we complete the
    modernization and expansion of the Mountain Pass facility, at
    which time we will no longer manufacture those products. We sell
    100% of our lanthanum to customers in the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect increased revenues in 2010, primarily attributable to
    sales of additional products to be produced during our second
    pilot processing campaign. Upon completion of the modernization
    and expansion of the Mountain Pass facility and the full
    implementation of our
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy, we expect to produce cerium, lanthanum, neodymium,
    praseodymium, samarium, dysprosium and terbium oxide and metal
    products, europium and gadolinium oxide products and NdFeB and
    samarium cobalt alloys. We intend to use some of the NdFeB alloy
    and dysprosium metal product in our magnet production plant. Our
    new products are expected to have significantly more
    applications than our current products, exposing us to a larger
    population of potential customers. In addition, we estimate that
    generally higher REE prices in 2010, as compared to early 2009,
    will contribute to our increased revenue in 2010.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Cost
    of Goods Sold</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our cost of goods sold for the year ended December&#160;31, 2009
    and for the period ended December&#160;31, 2008 totaled
    approximately $21.8&#160;million and $13.0&#160;million,
    respectively. Included in the cost of sales for the year ended
    December&#160;31, 2009 and the period ended December&#160;31,
    2008 are write-downs of inventory to estimated net realizable
    value of $9.0&#160;million and $9.5&#160;million, respectively.
    Our principal production costs include chemicals, direct labor
    and employee benefits, maintenance labor and materials, contract
    labor, operating supplies, depreciation, utilities and plant
    overhead expenses.
</DIV>
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    <BR>
    44
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Total production costs charged to inventory were
    $23.4&#160;million and $5.4&#160;million for the year ended
    December&#160;31, 2009 and the period ended December&#160;31,
    2008, respectively. We produced 3.4&#160;million pounds of
    lanthanum and 1.1&#160;million pounds of didymium oxide in 2009
    and 0.8&#160;million pounds of lanthanum and 0.1&#160;million of
    didymium oxide in the period ended December&#160;31, 2008.
    Inventory purchases were $0.2&#160;million and $0.6&#160;million
    for the respective periods. We primarily purchase lanthanum
    oxide, cerium oxide and praseodymium oxide that undergo further
    processing either at our facility or at an off-site location.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our chemical costs were $6.7&#160;million and $1.4&#160;million
    for the year ended December&#160;31, 2009 and for the period
    ended December&#160;31, 2008, respectively. Unit chemical costs
    do not vary significantly based on production volumes and are
    primarily driven by market prices. In 2008, the most significant
    chemical cost related to caustic soda, representing
    approximately 67% of total reagent costs. We launched a program
    in 2009 that has allowed us to lower the quantity and costs
    associated with the use of caustic soda in our production
    process.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Labor costs, including related employee benefits, allocated to
    production were $9.2&#160;million and $1.9&#160;million for the
    year ended December&#160;31, 2009 and the period ended
    December&#160;31, 2008, respectively. Included in the labor
    costs is a bonus, which was granted to all union employees for
    working on our neodymium from lanthanum, or NFL, pilot
    processing project, of $0.8&#160;million and $0.4&#160;million
    for the year ended December&#160;31, 2009 and the period ended
    December&#160;31, 2008, respectively. The bonus was paid out in
    March 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Maintenance costs, including maintenance labor and supplies,
    were $1.9&#160;million and $0.5&#160;million for the year ended
    December&#160;31, 2009 and the period ended December&#160;31,
    2008, respectively. Maintenance costs remained consistent
    throughout this time period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Other costs allocated to production include depreciation charges
    of $3.2&#160;million and $0.9&#160;million for the year ended
    December&#160;31, 2009 and the period ended December&#160;31,
    2008, respectively. Depreciation allocated to products is
    primarily related to buildings, equipment and machinery used in
    the production process. We also accrued waste disposal charges
    of $1.5&#160;million as of December&#160;31, 2009 for disposal
    of by-products of production that are potentially hazardous.
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Selling,
    General and Administrative Expenses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our selling, general and administrative expenses for the year
    ended December&#160;31, 2009 and for the period ended
    December&#160;31, 2008 totaled approximately $12.6&#160;million
    and $2.9&#160;million, respectively. Legal and accounting fees
    were approximately $1.8&#160;million and $0.6&#160;million,
    respectively. Other consulting expenses, primarily related to
    engineering and technical consultants were $1.5&#160;million and
    $0.5&#160;million. These costs related primarily to engineering
    and resource studies as well as process development projects.
    Costs associated with research and development projects were
    $1.5&#160;million and $0.4&#160;million and primarily are
    attributed to labor costs and materials and supplies. Management
    salaries and related benefits not capitalizable in inventory
    were $2.5&#160;million and $0.9&#160;million for the respective
    periods.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Operating
    Losses</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since our inception and our acquisition of the Mountain Pass
    facility, we have incurred significant operating losses. Our
    operating losses for the year ended December&#160;31, 2009 and
    for the period ended December&#160;31, 2008 were
    $28.6&#160;million and $14.1&#160;million, respectively. We have
    funded our operating losses entirely with proceeds from equity
    contributions from our initial investors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Liquidity
    and Capital Resources</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Most of the facilities and equipment acquired with the Mountain
    Pass facility are at least 20&#160;years old and must be
    modernized or replaced. Under our current business plan, we
    intend to spend approximately $511&#160;million through 2012 to
    restart mining operations, construct and refurbish processing
    facilities and other infrastructure at the Mountain Pass
    facility and expand into metals and alloys production. Capital
    expenditures under this plan total approximately
    $53&#160;million in 2010. We expect to finance these estimated
    total expenditures, as well as our working capital requirements,
    with proceeds from planned public and/or private
</DIV>
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    <BR>
    45
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    offerings of our securities or project financing as part of a
    financing plan we will finalize in connection with, and
    including, this offering. If the assumptions on which we based
    our estimated capital expenditures of $511&#160;million change
    or are inaccurate, we may require additional funding. There can
    be no assurance that we will be successful in the anticipated
    offering or that we will be successful in raising additional
    capital in the future on terms acceptable to us, or at all.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our financial statements have been prepared on a going concern
    basis under which we are expected to be able to realize our
    assets and satisfy our liabilities in the normal course of
    business. To continue as a going concern beyond 2010 and in
    order to continue the restart of mining operations and
    modernization of the Mountain Pass facility, we will need to
    complete the planned securities offering and the remainder of
    our financing plan or obtain alternative sources of financing.
    Absent the additional financing, we will not have the resources
    to execute our current business plan.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Capital
    Expenditures</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2009, we acquired equipment with a total cost of
    approximately $3.5&#160;million in preparation for our second
    pilot processing campaign. Other capital expenditures totaled
    $3.8&#160;million including: purchase of an accounting
    information system in the amount of $0.8&#160;million;
    production equipment of $0.5&#160;million; as well as other
    capital improvement projects at the facility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to make significant capital expenditures under our
    plan to modernize and expand our Mountain Pass facility, as well
    as consistent expenditures to replace assets necessary to
    sustain safe and reliable production. Most of the facilities and
    equipment acquired in connection with the acquisition of the
    Mountain Pass facility are at least 20&#160;years old. We have
    developed an accelerated modernization plan that includes the
    refurbishment of the Mountain Pass mine and related processing
    facilities in 2010 through 2012 in order to increase REO
    production. We anticipate the cost of this project to be
    approximately $511&#160;million, as shown in the table below (in
    millions):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2011</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2012</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Refurbishment of existing facility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    18
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Refurbishment and expansion of extraction plant
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Refurbishment and expansion of separations plant
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    128
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    64
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    213
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    New heating and power facility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expansion into metal and alloy production
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Construction of plant infrastructure
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    69
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    116
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Overburden removal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mining and miscellaneous equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Annual Totals
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    53
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    316
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    142
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    511
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect that the high levels of spending associated with the
    refurbishment process to improve and modernize equipment will
    decrease in the future as we complete our modernization and
    expansion plans.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Contractual
    Obligations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, we had the following contractual
    obligations:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="19" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Payments Due by Period</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Less Than<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>More Than<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Contractual Obligations</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>1&#160;Year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>1-3&#160;Years</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>4-5&#160;Years</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>5&#160;Years</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="21" align="left" valign="bottom">
    <B>(In thousands)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating lease obligations(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    281
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    153
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    128
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Purchase obligations(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Employee bonus obligations(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,400
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligations(4)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    29,247
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    639
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,191
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,597
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22,820
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    30,928
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,192
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,319
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,597
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    22,820
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    46
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents all operating lease payments for office space, land
    and office equipment.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents non-cancelable contractual commitments for the
    purchase of materials and services from vendors.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents payments due to employees as a result of our NFL
    pilot processing campaign.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Under applicable environmental laws and regulations, we are
    subject to reclamation and remediation obligations resulting
    from our operations. The amounts presented above represent our
    estimated future undiscounted cash flows required to satisfy the
    obligations currently known to us.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Off-Balance
    Sheet Arrangements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of the date of this prospectus, our only off-balance sheet
    arrangement in addition to the operating leases included in
    &#147;&#151;&#160;Contractual Obligations&#148; above, is our
    agreement to compensate our initial investors for providing
    collateral relating to our bonding obligations to various
    government agencies. This arrangement is described in the notes
    to consolidated financial statements included in this prospectus.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Quantitative
    and Qualitative Disclosures about Market Risk</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations may be impacted by commodity prices, geographic
    concentration, changes in interest rates and foreign currency
    exchange rates.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Commodity
    Price Risk</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our principal products, including cerium, lanthanum,
    praseodymium, neodymium, europium, samarium, gadolinium,
    dysprosium, and terbium, are commodities but are not traded on
    any commodity exchange. As such, direct hedging of the prices
    for future production cannot be undertaken. We do not currently
    have any long-term sales contracts with customers, so prices
    will vary with the transaction and individual bids received. Our
    products are primarily marketed to manufacturer as component
    materials. Prices will vary based on the demand for the end
    products being produced with the mineral resources we mine and
    process.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our net sales and profitability are determined principally by
    the price of the rare earth products that we produce and, to a
    lesser extent by the price of natural gas and other supplies
    used in the production process. The prices of our rare earth
    products are influenced by the price and demand of the end
    products that our products support, including clean energy
    technologies. A significant decrease in the global demand for
    these products may have a material adverse effect on our
    business. We currently have no hedging contracts in place and
    intend to consider hedging strategies in future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our costs and capital investments are subject to market
    movements in other commodities such as natural gas and
    chemicals. We may enter into derivative contracts for a portion
    of the expected usage of these products, but we do not currently
    have any derivative contracts and we do not anticipate entering
    into derivative agreements before the end of 2010.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Interest
    Rate Risk</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We do not currently have any debt obligations. As a result, we
    would not be directly impacted by variation in interest rates at
    this time. Our exposure to interest rate risk would increase if,
    for example, we obtain and utilize debt facilities in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Internal
    Controls</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a public company, we will be required to comply with the
    record keeping, financial reporting, corporate governance and
    other rules and regulations of the SEC, including the
    requirements of the
    <FONT style="white-space: nowrap">Sarbanes-Oxley</FONT>
    Act, and other regulatory bodies. These entities generally
    require that financial information be reported in accordance
    with U.S.&#160;GAAP. As a private company, we were not required
    to have, and until late 2009 did not have, sufficient personnel
    with SEC and
    <FONT style="white-space: nowrap">Sarbanes-Oxley</FONT>
    experience. In addition, we were not required to comply with the
    internal control design, documentation and testing requirements
    imposed by
</DIV>
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    47
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sarbanes-Oxley. In connection with this offering as a
    publicly-held company, we will become subject to these
    requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Effective internal control over financial reporting is necessary
    for us to provide reliable annual and interim financial reports
    and to prevent fraud. If we cannot provide reliable financial
    reports or prevent fraud, our operating results and financial
    condition could be materially misstated and our reputation could
    be significantly harmed. A material weakness in internal control
    over financial reporting is defined as a deficiency, or a
    combination of deficiencies, such that there is a reasonable
    possibility that a material misstatement of the annual or
    interim financial statements will not be prevented or detected
    on a timely basis. A significant deficiency is a deficiency, or
    a combination of deficiencies, in internal control over
    financial reporting that is less severe than a material
    weakness, yet important enough to merit attention by those
    responsible for oversight of a company&#146;s financial
    reporting. A deficiency in internal control over financial
    reporting exists when the design or operation of a control does
    not allow management or employees, in the normal course of
    performing their assigned functions, to prevent or detect
    misstatements on a timely basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the preparation of our consolidated financial statements
    as of December&#160;31, 2009 and 2008 and for the year ended
    December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008, and cumulatively for
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009, we identified deficiencies in our
    internal control over financial reporting which, when considered
    in the aggregate, represent a material weakness. If not
    remediated, this material weakness could result in material
    misstatements in our consolidated financial statements in future
    periods. Specifically, we did not maintain a sufficient
    complement of personnel with an appropriate level of accounting
    and financial reporting knowledge, experience and training in
    the application of U.S.&#160;GAAP. We also did not maintain an
    adequate system of processes and internal controls sufficient to
    support our financial reporting requirements and to produce
    timely and accurate consolidated financial statements in
    accordance with U.S.&#160;GAAP. If our efforts are not adequate
    to remediate this material weakness, we could experience
    material misstatements in our consolidated financial statements
    in future periods.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In late 2009, we hired a chief financial officer, a corporate
    controller and a director of financial reporting, and in early
    2010, we hired an accounting manager for the Mountain Pass
    facility as part of the actions being taken to remediate the
    material weakness. All of these individuals are certified public
    accountants possessing significant experience with accounting
    and financial reporting matters. We also continued the process
    of reviewing our existing processes and system of internal
    control in order to implement related improvements where needed.
    We installed additional functionality and increased the
    integration of our information technology systems to increase
    automation and accuracy within our processes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under current requirements, our independent registered public
    accounting firm will not be required to evaluate and assess our
    internal control over financial reporting until we file our
    annual report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the year ended December&#160;31, 2011. Consequently, we will
    not be evaluated independently in respect of our controls for a
    substantial period of time after this offering is completed. As
    a result, we may not become aware of other material weaknesses
    or significant deficiencies in our internal controls that may be
    later identified by our independent registered public accounting
    firm as part of the evaluation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The actions we have taken to date, or any future measures or
    actions we will take, may not remediate the material weakness
    mentioned above. See &#147;Risk Factors&#160;&#151; Risks
    Related to Our Business&#151;&#160;We identified a material
    weakness in our internal control over financial reporting which,
    if not satisfactorily remediated, could result in material
    misstatements in our consolidated financial statements in future
    periods&#148; and &#147;We will be required by Section&#160;404
    of the Sarbanes-Oxley Act to evaluate the effectiveness of our
    internal controls. If we are unable to achieve and maintain
    effective internal controls, our operating results and financial
    condition could be harmed&#148; included elsewhere in this
    prospectus.
</DIV>
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    <BR>
    48
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='111'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RARE
    EARTH INDUSTRY OVERVIEW</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The Rare
    Earth Elements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The REE group includes 17 elements, namely the
    15&#160;lanthanide elements, which are cerium, lanthanum,
    neodymium, praseodymium, promethium (which does not occur
    naturally), samarium, europium, gadolinium, terbium, dysprosium,
    holmium, erbium, thulium, ytterbium and lutetium, and two
    elements that have similar chemical properties to the lanthanide
    elements&#160;&#151; yttrium and scandium. The oxides produced
    from processing REEs are collectively referred to as REOs. Light
    and heavy REEs are contained in all rare earth deposits. Cerium,
    lanthanum, neodymium, praseodymium and samarium are considered
    &#147;light REEs&#148; that are more predominant in bastnasite,
    while europium, gadolinium, terbium, dysprosium, holmium,
    erbium, thulium, ytterbium and lutetium are considered
    &#147;heavy REEs&#148; that are more predominant in monazite.
    Our reserves are bastnasite, but there are also known monazite
    occurrences on our property that we are currently examining.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046907.gif" alt="(CHART)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Global
    Rare Earth Market</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    REEs have unique properties that make them critical materials to
    many existing applications upon which society has become
    dependent and emerging applications that are rapidly gaining
    traction. Examples include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Clean-Energy Technologies:</I>&#160;hybrid and electric
    vehicles, wind power turbines and compact fluorescent lighting;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>High-Technology Applications:</I>&#160;miniaturization of
    cell phones, personal digital assistant devices, digital music
    players, hard disk drives used in computers, computing devices,
    &#147;ear bud&#148; speakers and microphones, as well as fiber
    optics, lasers and optical temperature sensors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Critical Defense Applications:</I>&#160;guidance and control
    systems, communications, global positioning systems, radar and
    sonar;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>Advanced Water Treatment:</I>&#160;industrial, military,
    homeland security and domestic and foreign aid applications.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Rechargeable
    Batteries</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    One of the most effective rechargeable batteries is the NiMH
    battery, which is used in nearly all hybrid and electric
    vehicles and many other electronic products. A mixed rare earth
    metal alloy is used as the anode in the NiMH battery. Cerium and
    lanthanum are the main REEs used in the NiMH battery.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Magnets</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    REEs are critical elements in the world&#146;s strongest
    permanent magnets. These magnets are utilized in electric
    motors, a key component of all motor vehicles, especially hybrid
    and electric vehicles. A new and rapidly expanding use of rare
    earth permanent magnets is in wind turbine permanent magnet
    generators. Owing to the high
    <FONT style="white-space: nowrap">power-to-weight</FONT>
    ratio of the magnets, less material is required, permitting
    engines and
</DIV>
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    generators to be considerably more powerful while at the same
    time smaller and lighter. The powerful
    <FONT style="white-space: nowrap">REE-based</FONT>
    magnets have made possible the miniaturization of hard disk
    drives used in computers and many other electrical devices such
    as personal digital assistant devices and digital music players.
    Neodymium, praseodymium, samarium, and dysprosium are critical
    to the permanent magnet industry due to their unique magnetic
    properties. Based on estimates by IMCOA, by 2014, global demand
    for rare earths used in magnets is estimated at 40,000 mt of
    REO, excluding demand from the wind energy sector. The wind
    energy sector could consume up to an additional 9,000&#160;mt of
    REO, 1,350&#160;mt of which is estimated solely for the United
    States. According to IMCOA, the wind energy sector in the United
    States alone could lead to a 3% to 4% increase in global demand
    for REOs used in magnets. If China succeeds with its current
    target, then this could lead to additional consumption of REOs
    used in magnets of 8% to 10% by 2014. Today, nearly all magnetic
    rare earth products are produced from Chinese-sourced REOs, and
    there is no U.S.&#160;domestic manufacturer of NdFeB magnets.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Catalysts</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    REEs are commonly used as a form of catalyst, referred to as a
    fluid bed cracking catalyst. Fluid bed cracking catalysts are
    being used increasingly in the oil industry because they enhance
    the efficiency of separating various fractions from crude oil
    during the refining process. Lanthanum is the main REE used in
    fluid bed cracking catalysts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    REEs are also used in another form of catalyst in vehicles. A
    catalytic converter is a device fitted to the exhaust system of
    a combustion engine that reduces the toxicity of emissions.
    Recent technological advances have seen the emergence of the
    three-way catalytic converter. This device reduces toxic
    nitrogen oxides to more benign nitrogen and oxygen, oxidizes
    toxic carbon monoxide to carbon dioxide and oxidizes unburnt
    hydrocarbons. Cerium is the REE used in catalytic converters,
    where it forms part of the catalyst. Increasingly stringent
    vehicle emission laws are being introduced throughout the world,
    and, according to the Manufacturers of Emission Controls
    Association, 100% of new vehicles sold in the United States are
    equipped with three-way catalytic converters while many
    developing nations are also mandating that new passenger cars be
    equipped with three-way catalytic converters.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Water
    Treatment</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have developed
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is protected by over 100 issued and pending U.S.&#160;and
    foreign patents and patent applications. This product, which we
    have proven to be effective in removing arsenic and other
    contaminants from water, is applicable to a broad range of
    applications. There are several opportunities for us to
    commercialize this technology in the industrial, defense,
    foreign aid and outdoor enthusiast sectors. For example, we have
    applied the technology in the mining and smelting industries as
    a means to improve management of arsenic-laden process streams
    and have also developed a portable drinking water filtration
    system for U.S.&#160;defense applications and for the outdoor
    recreation industry.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Demand
    for Rare Earth Products</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The lack of available substitutes makes REEs essential for
    existing and emerging technologies. According to Roskill, global
    demand in 2010 is estimated to be approximately 124,000 mt of
    REO, roughly equivalent to the 2008 demand level.
</DIV>
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Global demand for rare earths by market (in thousands of tons
    of REO)</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046908.gif" alt="(PERFORMANCE GRAPH)"><B> </B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: IMCOA and Roskill
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Factors that could influence upward demand for rare earth
    products include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the use of neodymium, praseodymium and dysprosium in
    high-strength NdFeB magnets that are critical to hybrid and
    electric vehicles and the increased construction of wind power
    generation facilities, particularly off-shore installations;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the use of lanthanum and cerium for NiMH batteries that are
    utilized in hybrid and electric vehicles;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the use of europium, terbium and yttrium in the production of
    compact fluorescent light bulbs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the use of high-strength NdFeB magnets in the miniaturization of
    electronic products;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the use of lanthanum by refineries processing lower quality
    crude oil that consumes greater quantities of fluid cracking
    catalysts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the increased use of REEs in the drive to improve energy
    efficiency and reduce GHGs by the United States and the European
    Union;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the use of cerium in advanced water filtration
    applications;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continued research and commercialization of new applications for
    rare earths products.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Global consumption of REEs is projected to steadily increase
    both due to continuing growth in existing applications and
    increased innovation and development of new end uses. For
    example, the integration of rare earth permanent magnet drives
    into wind power turbines has substantially reduced the need for
    gearboxes, which increases overall efficiency and reliability.
    According to IMCOA and Roskill, total demand for rare earths
    outside of China is expected to increase at a CAGR of
    approximately 4% to 5% between 2008 and 2014. In addition,
    according to Roskill, global demand for the more important
    magnetic rare earths, neodymium, praseodymium and dysprosium, is
    expected to grow at CAGRs of approximately 8%, 6% and 6%,
    respectively, over the same period. Both IMCOA and Roskill
    estimate that total global demand for rare earths is expected to
    increase at a CAGR of approximately 6% from 2008 through 2014,
    from approximately 124,000 mt to approximately 180,000 mt per
    annum.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Supply
    for Rare Earth Products</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has dominated the global supply of REOs for the last ten
    years and, according to Roskill, accounted for approximately 97%
    of global REO production in 2008. Even with our planned
    production, global supply is expected by analysts to remain
    tight due to the combined effects of growing demand and actions
    taken by the Chinese government to restrict exports. The Chinese
    government heightened international supply concerns in August
    2009 when China&#146;s Interior Ministry signaled that it would
    further restrict exports of Chinese rare earth resources. Citing
    the importance of REE availability to internal industries and
    the desire to conserve resources, the Chinese government has
    announced export quotas, increased export tariffs and
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    51
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    introduced a &#147;mining quotas policy.&#148; China&#146;s
    internal consumption of rare earths is expected to continue to
    grow, leaving the Rest of World with a supply gap within the
    next two years, during a period of projected increasing global
    demand. China also dominates the manufacture of rare earth
    metals, producing substantially all of the world&#146;s supply,
    and the manufacture of NdFeB magnets, producing approximately
    80% of the world&#146;s supply. Neither capability currently
    exists in the United States, as confirmed by the April&#160;2010
    U.S. GAO briefing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S.&#160;Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    According to the April 2010 briefing prepared by the
    U.S.&#160;GAO:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Mountain Pass mine is the largest non-Chinese rare earth
    deposit in the world;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other U.S.&#160;rare earth deposits exist, but these deposits
    are still in early exploratory stages of development;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    officials emphasized the significance of the widespread use of
    commercial-off-the-shelf products in defense systems that
    include rare earth materials, such as computer hard drives;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    government and industry officials told the U.S.&#160;GAO that
    where rare earth materials are used in defense systems, the
    materials are responsible for the functionality of the component
    and would be difficult to replace without losing performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a 2009 National Defense Stockpile configuration report
    identified lanthanum, cerium, europium and gadolinium as having
    already caused some kind of weapon system production delay and
    recommended further study to determine the severity of the
    delays; and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    defense systems will likely continue to depend on rare earth
    materials, based on their life cycles and lack of effective
    substitutes.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The price of rare earths rose significantly in the three years
    before the recent financial turmoil due to constraints placed on
    mining, processing and exporting by the Chinese authorities.
    According to Metal Pages, since October 2009, prices for REOs
    have risen by approximately 60% on average.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Current estimates indicate that global demand for REEs will
    exceed global supply by 2011. This shortage will continue unless
    Mountain Pass and other rare earths projects achieve projected
    production capacities. IMCOA and Roskill expect that this
    anticipated excess demand will underpin strong pricing.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    52
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Global
    Supply and Demand of Rare Earths
    <FONT style="white-space: nowrap">(2000-2015)</FONT>
    (mt)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046919.gif" alt="(PERFORMANCE GRAPH)"><B> </B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: Roskill
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Roskill has assumed that our Mountain Pass facility will provide
    a significant portion of the increased supply after 2011.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ROW
    Supply and Demand of Rare Earths
    <FONT style="white-space: nowrap">(2000-2015)</FONT>
    (mt)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046920.gif" alt="(PERFORMANCE GRAPH)"><B> </B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: Roskill
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    53
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. According to Metal Pages, since the
    beginning of the fourth quarter of 2009, prices have risen by
    approximately 60% and continue to rise.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rare
    Earth Product Prices(1)</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Rare Earth Product</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2014</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2020</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2030</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    10.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Praseodymium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    22.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Samarium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Europium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    475.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    600.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    750.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Gadolinium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Terbium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    500.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    650.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    850.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,200.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Dysprosium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    120.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    155.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    200.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Yttrium Oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27.50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    35.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50.00
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Rare earth product prices in US$/kg,
    <FONT style="white-space: nowrap">free-on-board</FONT>
    China (+/&#8722; 20%)</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Source: IMCOA. Although IMCOA and Roskill predict strong growth,
    their projections with respect to certain years are slightly
    different.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2008, global production of rare earths was estimated at
    approximately 124,000 mt of REO according to Roskill. China
    accounted for approximately 97% of this total. As a result of
    economic, environmental and regulatory factors in China, as well
    as internal industrial development, there is uncertainty with
    respect to the availability of rare earth products from China.
    Although Chinese production of rare earth materials is
    increasing, export quotas imposed by the Chinese government are
    decreasing, thus reducing the amount of rare earth materials
    that China may export for the rest of the world. This is
    occurring at a time when the demand for REEs is growing
    significantly.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In expectation of increasing demand, there are a limited number
    of rare earth projects outside of China that are in various
    stages of development. None of these deposits are currently in
    production. The success of any other rare earth projects depends
    on a number of factors, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    REO grade;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    obtaining and maintaining operating and environmental permits;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    acceptance in the marketplace as a long-term viable alternative
    to Chinese production;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the amount of recoverable high-value REEs contained in ore (such
    as neodymium, praseodymium, europium and dysprosium);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reserve life;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability to separate and concentrate rare earth minerals;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability to economically crack rare earth mineral
    concentrates and produce high yields;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ability to separate REEs and manufacture finished products;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    natural radioactive material content of the ore and the ability
    to responsibly and economically manage radioactive waste;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the cost of bringing the property into production;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    access to critical infrastructure, including electricity, fuel
    and transportation.
</TD>
</TR>

</TABLE>
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    <BR>
    54
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='112'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">BUSINESS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Business</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are the only REO producer in the Western hemisphere and own
    the world&#146;s largest, most fully developed rare earth
    project outside of China. Furthermore, following the execution
    of our &#147;mine-to-magnets&#148; strategy and completion of
    our modernization and expansion efforts, we expect to be one of
    the world&#146;s most integrated producers of rare earth
    products, including oxides, metals, alloys and magnets. Our rare
    earths are critical inputs in existing and emerging applications
    including: clean energy technologies, such as hybrid and
    electric vehicles and wind power turbines; multiple high-tech
    uses, including fiber optics, lasers and hard disk drives;
    numerous defense applications, such as guidance and control
    systems and global positioning systems; and advanced water
    treatment technology for use in industrial, military and outdoor
    recreation applications. Global demand for REEs is projected to
    steadily increase both due to continuing growth in existing
    applications and increased innovation and development of new end
    uses. We have made significant investments, and expect to
    continue to invest, in developing technologically advanced
    applications for individual REEs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2009, we generated
    approximately $7.1&#160;million of revenue from sales of
    products manufactured from stockpiled feedstocks, although this
    level of revenue is not representative of our planned level of
    operations after we restart mining operations. Following the
    finalization of our financing plan in connection with, and
    including, this offering, we expect to be fully funded through
    our modernization and expansion efforts, which we expect will
    continue through 2012.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Mine-to-Oxides</FONT></FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We and SRK Consulting estimate total proven and probable
    reserves of 2.21&#160;billion pounds of REO, with an average ore
    grade of 8.24%, using a cut-off grade of 5.0%, at our Mountain
    Pass mine. Based on these estimated reserves and an expected
    annual production rate of 19,090 mt of REO, our expected mine
    life is in excess of 30&#160;years. According to Roskill, global
    REO production in 2008 was approximately 124,000 mt, of which
    only approximately 4,300 mt originated from outside of China,
    with Molycorp producing approximately 1,700 mt from its
    stockpiles and Russian producers producing approximately 2,500
    mt. This contrasts with total demand outside of China in 2008 of
    approximately 50,000 mt, according to Roskill, with rapid growth
    expected by industry analysts. Upon completion of our
    modernization and expansion efforts, we will have the ability to
    produce 19,090 mt of REO per year to supply this non-Chinese
    demand and expect to have the capability to increase production
    to 40,000 mt of REO per year, if warranted by market conditions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At our Mountain Pass facility, we have the ability to mine,
    crush, mill and separate rare earth ore to produce individual
    REEs. We hold a
    <FONT style="white-space: nowrap">30-year</FONT> mine
    plan permit and an associated environmental impact report, both
    of which were issued in 2004. Since our acquisition of the
    Mountain Pass facility, we have been producing and selling REOs
    from stockpiled feedstocks to significantly improve our solvent
    extraction technologies and capabilities. We are now achieving
    greater than 98% recovery in our solvent extraction units at
    commercial scale, which we believe is one of the highest
    recovery rates in the world. We have developed the expertise to
    produce the following REEs in many usable forms: bastnasite
    concentrate; cerium; lanthanum; neodymium; praseodymium;
    europium; samarium; gadolinium; dysprosium; and terbium.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Processing at our Mountain Pass facility entails mining the
    bastnasite ore followed by crushing and milling it to a fine
    powder. Milled bastnasite ore is then processed by flotation
    whereby the bastnasite, which is a mineral containing light and
    heavy rare earth elements, floats to the surface and is
    separated from the waste material, which sinks in a series of
    flotation cells. The resultant bastnasite concentrate is then
    processed by leaching with strong acid solutions followed by a
    series of solvent-extraction separation steps that produce
    various individual REO minerals, generally in a high purity
    (greater than 99%) oxide form. Beginning in the second quarter
    of 2010, we plan to begin processing bastnasite concentrate from
    our stockpiles in an effort to commercially demonstrate our new
    cracking technology while at the same time continue to further
    optimize our processing technologies and improve recovery rates
    compared to historical operations at the Mountain Pass facility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>
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    <BR>
    55
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046917.gif" alt="(FIGURE 3)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with modernization of our
    processing capabilities to efficiently produce at a rate of
    19,090 mt of REO per year by the end of 2012. The U.S.&#160;GAO
    April 2010 briefing stated that, for a typical exploration-stage
    mine, once a company has secured the necessary capital to start
    a mine, government and industry officials said it can take from
    seven to 15&#160;years to bring a property fully online, largely
    due to the time it takes to comply with multiple state and
    federal regulations. Since Molycorp&#146;s Mountain Pass
    facility is not an early stage rare earth project, we believe it
    has significant timeline advantages as it has a well-defined ore
    body, an existing open pit with over 50&#160;years of production
    history, an existing mine and reclamation plan, proven reserves,
    substantial permitting, and all necessary technology to
    successfully process and separate the rare earth elements at a
    commercial scale.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Oxides-To-Metals/Alloys</FONT></FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to sell and transport a portion of the REOs we produce
    to customers for use in their particular applications. The
    remainder of the REOs will be processed into rare earth metals.
    A portion of these metals will be sold to end users and we
    expect to process the rest into rare earth alloys. These rare
    earth alloys can be used in a variety of applications, including
    but not limited to: electrodes for NiMH battery production;
    samarium cobalt magnet production; and NdFeB magnet production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Initially, our modernization and expansion plans envisioned
    adding facilities and equipment for metal conversion and alloy
    production at the Mountain Pass facility. However, we have
    entered into a letter of intent to acquire a third-party
    producer of rare earth metals and alloys in the United States.
    If we complete the acquisition instead of adding such facilities
    and equipment at Mountain Pass, we plan to transport cerium,
    lanthanum, neodymium/praseodymium (didymium) and samarium oxide
    products from our Mountain Pass facility to our new off-site
    location that already possesses the technological capability to
    produce rare earth metals and alloys.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Magnet
    Production</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are currently evaluating joint venture opportunities to
    integrate downstream into NdFeB magnet manufacturing in the
    United States. NdFeB magnets, which are critical components in
    &#147;green&#148; technologies and the miniaturization of
    electronics, are primarily manufactured in China (approximately
    80%) and Japan (approximately 20%). We are currently working to
    secure a collaborative joint venture agreement with a
    <FONT style="white-space: nowrap">third-party</FONT>
    manufacturer of NdFeB magnets. This joint venture will provide
    us with access to the intellectual property, technology, people
    and facilities to convert our rare earth materials into the
    high-performance permanent magnets required for production of
    hybrid and electric vehicles, wind power turbines, high-tech
    applications and numerous advanced defense systems on which the
    U.S.&#160;economy and national security depend. The consummation
    of such a joint venture, in conjunction with our current
    modernization plans and the potential acquisition of a
    third-party rare earth metals and alloys producer, is expected
    to provide us with the capability to mine, process, separate and
    alloy individual REEs before manufacturing them into NdFeB
    magnets. This downstream integration would make us the only
    fully integrated producer of NdFeB magnets outside of China,
    helping to secure rare earth supply for the Rest of World.
</DIV>
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    56
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rare
    earth &#147;mine-to-magnets&#148; production supply
    chain</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046902.gif" alt="(FLOW CHART)"><B> </B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Strengths</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We believe that we possess a number of competitive strengths
    that position the Mountain Pass facility to regain its role as
    one of the leading global suppliers of REOs.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have a proven source of REOs with high-grade ore and long
    reserve life.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the end of the last mining campaign at the Mountain
    Pass facility in 2002, the mine had been in continuous operation
    for over 50&#160;years. Since our acquisition of the Mountain
    Pass facility, we have been processing stockpiled feedstocks as
    part of our ongoing effort to significantly improve our solvent
    extraction technologies and other processing capabilities.
    Today, based on estimated reserves of 2.21&#160;billion pounds
    of REO with an average ore grade of 8.24%, using a cut-off grade
    of 5.0%, the Mountain Pass mine has a life in excess of
    30&#160;years at an annual production rate of 19,090 mt of REO.
    Our leadership team is committed to the continuous and
    sustainable manufacture of rare earth products at the Mountain
    Pass facility using advanced milling and processing technologies
    that will significantly increase the life of the known ore body
    at the Mountain Pass facility. Additionally, we have recently
    expanded our
    <FONT style="white-space: nowrap">on-site</FONT>
    exploratory drilling program to confirm the existence and extent
    of bastnasite, monazite and other rare earth phosphate mineral
    occurrences in unexplored areas of the Mountain Pass facility.
    This program will also help to establish that our measured,
    indicated and inferred resources can become proven or probable
    reserves.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    expect to be well-positioned to capitalize on the tightening
    balance of global supply and demand of rare earth
    products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As worldwide demand for rare earth products increases, the
    supply of REOs is limited by available production capacity,
    which is currently concentrated in China. According to Roskill,
    China accounted for approximately 97% of global REO production
    in 2008. China also dominates the manufacture of metals and
    NdFeB magnets from rare earths, capabilities that are not
    currently found in the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Chinese government policies will also impact the supply and
    demand of REOs and rare earth products. We believe that the
    Chinese government intends to increase wind generated power to
    100&#160;gigawatts with an investment expected to be above
    $150&#160;billion and has also proposed a package of over
    $29&#160;billion to fund hybrid and electric vehicle production,
    placing additional strain on the REE supply chain. Citing the
    importance of REE availability to internal industries and the
    desire to conserve resources, the Chinese government has also
    announced export quotas, increased export tariffs and introduced
    a &#147;mining quotas policy.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Given China&#146;s estimated consumption levels and the
    limitations its government has put on exports, Roskill projects
    a global deficit beginning in 2011 without the advent of
    production from new projects, such as Mountain Pass. Limits on
    rare earth exports from China and the lack of available
    substitutes make the development of new sources of REEs
    essential to meet the growing demand for existing and emerging
    technologies, such as hybrid and electric vehicles, wind power
    turbines, compact fluorescent light bulbs, hard disk drives and
    dual use electronics.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S.&#160;Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    57
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    U.S.&#160;federal government investments and policies may
    materially increase end-market demand for our rare earth
    products. For example, the U.S.&#160;federal government recently
    approved $45&#160;billion in grant funding and loan guarantees
    directed toward wind power generation projects and hybrid and
    electric vehicles. Pending energy legislation may also increase
    demand for clean technology applications, which use rare earth
    products.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon reaching full planned production rates for REOs in 2012, we
    expect to be in a position to supply a substantial portion of
    the U.S.&#160;demand and also sell to export markets.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">We
    have a highly experienced and qualified management
    team.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our President and Chief Executive Officer has 29&#160;years of
    experience, 24 of which are associated with the Mountain Pass
    facility. In addition, our Chief Technology Officer, General
    Counsel and Chief Financial Officer have over 75&#160;years of
    combined technical, operational, legal, financial and management
    experience. Many of our key employees have worked with the
    Mountain Pass facility for over 20&#160;years each. We also have
    a proven technology and product development group and as of
    April&#160;1, 2010, held 18 issued and pending U.S.&#160;patents
    and patent applications, and 146 issued and pending foreign
    patents and patent applications. Management has also created a
    work environment that prioritizes safety. Since July 2005, the
    Mountain Pass facility has not had a lost-time accident and has
    received the coveted &#147;Sentinels of Safety&#148; award from
    the MSHA for three of the last four years.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Business Strategy</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our business strategy is to:
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Build
    the largest, most advanced and efficient fully integrated REO
    processing facility in the world.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to refurbish or replace existing equipment at the
    Mountain Pass facility in connection with our modernization and
    expansion efforts. We also intend to build the largest, most
    advanced and efficient fully integrated REO processing facility
    in the world to support our anticipated production requirements.
    Following the refurbishment of existing equipment and the
    purchase, delivery, installation, and
    <FONT style="white-space: nowrap">start-up</FONT> of
    new equipment, our fully integrated facility will allow us to
    reach full production, utilizing our newly optimized and
    commercially proven REO processing operations. Additionally, we
    expect that our proprietary production technology and our
    planned new paste tailings operation will reduce our
    environmental footprint and set the standard in the industry for
    environmental stewardship.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Successfully
    complete modernization and expansion efforts and reach full
    planned production rates for REOs at the Mountain Pass facility
    by the end of 2012.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After reaching full planned production rates for REOs at the
    Mountain Pass facility, we expect to produce 19,090 mt of REO
    per year. We operate the Mountain Pass facility pursuant to a
    <FONT style="white-space: nowrap">30-year</FONT>
    mining permit issued in 2004 that allows us to feed ore to the
    mill at a rate of 2,400 tons per day. While the Mountain Pass
    facility historically required 2,000 tons of mill feed per day
    to manufacture 19,090 mt of REO per year, we expect that new
    proprietary technologies we developed will allow us to extract
    the same 19,090 mt of REO per year while only using
    approximately 1,100 to 1,500 tons of mill feed per day, thus
    allowing for potential increases in annual REO production beyond
    the planned 19,090 mt per year without any change in the permit
    limit.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Improve
    our operating efficiencies with technically advanced
    manufacturing techniques.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to continue to improve the efficiency of our
    operations through the creation and use of technically advanced
    manufacturing processes for production of rare earth products,
    which will allow us to deliver high-quality rare earth products
    at globally competitive prices. We have already invested
    significant resources towards perfecting our REO processing
    operations and developing new and proprietary applications for
    individual REEs. We expect that by advancing all of these
    technologies, we will continue to lower our operating costs.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    58
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Manage
    our costs to be cost competitive.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The success of our business will depend on our ability to manage
    our costs. We will manage these costs through the use of new
    production technologies that have been developed by our research
    and development group, which will use less energy and raw
    materials and will result in a reduced environmental footprint.
    These production technologies will substantially reduce the
    amount of water consumption and waste water generation. We plan
    to use our proprietary technology to maximize our process
    recoveries and maximize REO concentrate production per unit of
    extracted ore. We plan to install a natural gas powered
    co-generation power plant as part of our modernization and
    expansion of the Mountain Pass facility to reduce energy
    consumption and costs as well as minimize or eliminate our
    reliance on the regional electric power grid. We intend to
    produce our own hydrochloric acid and sodium hydroxide at the
    Mountain Pass facility and recycle our acid and base, thereby
    reducing our reliance on external sources of reagents. After
    completion of our modernization and expansion efforts, we
    anticipate our most significant cash operating costs will
    consist of natural gas and labor.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Secure
    customer commitments to provide a stable revenue
    stream.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    at the Mountain Pass facility, we expect to produce
    approximately 19,090 mt of REO per year. As of April&#160;1,
    2010, we had 19 letters of intent to sell our rare earth
    products, representing approximately 138% of our anticipated
    production for 2013. We are continuing to seek additional
    letters of intent and, prior to commencing full production, we
    intend to enter into short- and long-term sales contracts with
    existing and new customers. In addition, we are in discussions
    with multiple large, globally diversified mining companies
    regarding the sale of
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>.

    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is protected by over 100 issued and pending U.S.&#160;and
    foreign patents and patent applications.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table compares the volume under our letters of
    intent to our anticipated production for 2013 (in mt):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Volume Under<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Percent of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Letters of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Uncommitted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>2013<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Projected 2013<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Product Type</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Intent (1)(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Volume</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Production(1)(2)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Production</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum non-metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,427
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,104
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    368
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Lanthanum metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    436
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,071
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,507
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium non-metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,914
</TD>
<TD nowrap align="left" valign="bottom">
    (4)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,770
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,684
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    71
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Cerium metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    200
</TD>
<TD nowrap align="left" valign="bottom">
    (3)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium non-metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Neodymium metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,318
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    313
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,060
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Praseodymium metal
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,091
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    116
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    941
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Europium oxide
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
    (6)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Samarium metal(8)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    191
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    191
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    NdPr metal in NdFeB alloy
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    964
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,964
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    NdPr metal in NdFeB magnets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    291
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    TOTAL
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,727
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,015
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,898
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    138
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Alloy and magnet production and letter of intent volume are
    reported on a rare earth metal basis.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    There is a 14.2% loss of mass when REOs are converted to rare
    earth metal due to oxygen evolution.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Contained within mischmetal, a combination of lanthanum, cerium
    and iron, for battery alloy producers.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Volume shown is used in traditional glass or catalyst market
    segments and represents only a very small fraction of cerium
    buyers. Although IMCOA predicts that there will be a surplus of
    cerium in the future, we anticipate most of our production will
    serve the new, proprietary
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    market segment. This segment alone is expected to consume many
    times more cerium units than we can produce. We believe the new
    segment negates the need for additional letters of intent at
    this time.</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    59
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    We have received letters of intent for 9,700,000 pounds of Nd
    and/or NdPr metal (otherwise known as didymium metal). To
    demonstrate the Nd and Pr breakdown, we have split the didymium
    requirement to the generally accepted ratio of 75/25 Nd to Pr in
    the didymium metal. Some of our metal production will be
    consumed internally for downstream NdFeB alloy/magnet production.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    We expect to receive letters of intent from a number of phosphor
    producers, which will easily consume our europium production. At
    this time, we are the only producer outside of China for this
    element, which enables energy efficient, compact fluorescent
    lights and straight tube T-8 lamps.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    This represents the estimated NdPr metal contained in the letter
    of intent volume for NdFeB alloy and magnets.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    IMCOA predicts that there will be a surplus of samarium metal.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Integrate
    downstream to profitably capture the full value
    chain.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to utilize vertical integration through further
    downstream processing of our REOs into rare earth metals, alloys
    and finished magnets. We have entered into a letter of intent to
    acquire a third-party producer of rare earth metals and alloys
    in the United States. This acquisition would provide us with a
    license to technology related to the production of rare earth
    metals and alloys. Additionally, we are currently working to
    secure a collaborative joint venture agreement with a
    third-party manufacturer to produce NdFeB magnets in the United
    States. This
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy will make us the first fully integrated supplier of
    NdFeB magnets in the world and the only producer of NdFeB
    magnets in the United States. In addition, we are working to
    identify and develop new downstream opportunities for the REOs,
    rare earth metals and alloys and rare earth products we will
    manufacture.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Develop
    new higher margin products.</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to develop new higher margin products and processes
    for REEs that historically have had lower demand. For example,
    cerium is used primarily for glass polishing and has typically
    sold at prices lower than those for other REEs. However, we have
    developed
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>

    is protected by over 100 issued and pending U.S.&#160;and
    foreign patents and patent applications. This product, which we
    have proven to be effective in removing arsenic and other
    contaminants from water, is applicable to a broad range of
    applications with higher margins. We have entered into a
    non-binding letter of intent with a water filtration company to
    jointly develop water treatment products. We will continue to
    focus on establishing proprietary markets for low-demand REEs to
    provide us with an opportunity to sell these REEs as higher
    margin products.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    60
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Our
    Corporate History and Structure</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp Minerals, LLC, a Delaware limited liability company
    formerly known as Rare Earth Acquisitions LLC, was formed on
    June&#160;12, 2008 to purchase the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc., a subsidiary of Chevron Corporation. Prior to the
    acquisition, the Mountain Pass facility was owned by Chevron
    Mining Inc. and, before 2005, by Unocal Corporation. Molycorp,
    LLC, the parent of Molycorp Minerals, LLC, is a Delaware limited
    liability company that was formed on September&#160;9, 2009.
    Molycorp, Inc. was formed on March&#160;4, 2010 as a new
    Delaware corporation that is not, to date, conducting any
    activities other than those incident to its formation and the
    preparation of this registration statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The members of Molycorp, LLC have contributed either
    (a)&#160;all of their member interests in Molycorp, LLC or
    (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class&#160;A common stock. Additionally, all of
    the holders of profits interests in Molycorp Minerals, LLC,
    which were represented by incentive shares, have contributed all
    of their incentive shares to Molycorp, Inc. in exchange for
    shares of Molycorp, Inc. Class&#160;B common stock. Accordingly,
    Molycorp, LLC and Molycorp Minerals, LLC have become
    subsidiaries of Molycorp, Inc. All of the shares of Class&#160;A
    common stock and Class&#160;B common stock will convert into
    shares of common stock immediately prior to the consummation of
    this offering.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The
    Mountain Pass Facility</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the Mountain Pass facility, we own an open-pit mine
    containing the world&#146;s most fully developed rare earth
    deposit outside of China. In addition to the mine, the Mountain
    Pass facility includes associated crushing, milling, flotation
    and separation facilities. These facilities are not currently in
    operation, and will need to be modernized or refurbished before
    we can recommence mining operations. The Mountain Pass facility
    is located approximately 60&#160;miles southwest of Las Vegas,
    Nevada near Mountain Pass, San&#160;Bernardino County,
    California, straddles Interstate 15 and may be accessed by
    existing hard-surface roads.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046912.gif" alt="(MAP)">
</DIV>
<!-- XBRL Pagebreak Begin -->

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    <BR>
    61
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Mountain Pass facility represents the only developed
    commercial source of rare earth material in the Western
    hemisphere. Molybdenum Corporation of America began REO mining
    operations at the Mountain Pass facility in 1952. REO production
    at the Mountain Pass facility, as well as milling and separation
    processes, continued under Unocal Corporation, which purchased
    Molybdenum Corporation of America in 1977, until 1998 when all
    chemical processing operations were suspended. Mining and
    milling operations continued until 2002 when those operations
    were also placed on standby due to softening prices for REOs and
    a lack of additional tailings disposal capacity. Unocal
    Corporation thereafter sold or otherwise disposed of
    substantially all of the mining equipment at the Mountain Pass
    facility (e.g., shovels, haul trucks, etc.) prior to being
    acquired by Chevron Corporation in 2005. Operations at the
    Mountain Pass facility remained suspended until September 2007
    when Chevron Mining Inc., a wholly-owned subsidiary of Chevron
    Corporation, commenced a NFL pilot processing campaign. Under
    the NFL campaign, lanthanum, which was produced prior to
    suspending activities in 1998 and held in lanthanum pond
    stockpiles at the Mountain Pass facility, was processed in order
    to recover the related neodymium and praseodymium. The NFL
    campaign did not constitute the restart of fully integrated
    operations at the Mountain Pass facility and was used as an
    opportunity to improve processing technologies and generate very
    modest revenue. On September&#160;30, 2008, we acquired the
    Mountain Pass, California rare earth deposit and associated
    assets from Chevron Mining Inc. through Rare Earth Acquisitions
    LLC (which was later renamed Molycorp Minerals, LLC). The
    acquisition by us excluded certain assets and liabilities,
    including certain liabilities related to environmental and
    employment matters, that were retained by Chevron Corporation.
    As part of the acquisition, we also acquired the services of
    approximately 100&#160;employees from Chevron Mining, including
    43 non-union employees and 57 union employees. Under the terms
    of the asset purchase agreement, we agreed to maintain all
    acquired employees&#146; salaries at their previous levels for a
    period of 12&#160;months, provide comparable 401(k) and health
    benefits and to honor all vacation days accrued prior to the
    asset purchase.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently hold a
    <FONT style="white-space: nowrap">30-year</FONT> mine
    plan permit and associated environmental impact report, which
    were issued in 2004. Since our acquisition of the Mountain Pass
    facility in 2008, we have been processing stockpiled lanthanum
    in an effort to significantly improve our solvent extraction
    technologies and capabilities. This effort has been successful
    and we are now achieving greater than 98% recovery in our
    solvent extraction units at commercial scale, which we believe
    is one of the highest recovery rates in the world.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with modernization of our
    processing capabilities in order to efficiently produce 19,090
    mt of REO per year by the end of 2012. In 2010, we plan to
    process bastnasite concentrate from our stockpiles in an effort
    to optimize our processing technologies to further improve
    recovery rates. This new technology is expected to be scaled up
    to commercial levels through 2011. We are also positioning our
    company to move further downstream into metals, alloy and magnet
    production through our
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy. In addition, we are exploring new downstream markets
    for rare earths and rare earth products.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Mountain Pass facility consists of approximately
    2,222&#160;acres of fee land, of which approximately
    770&#160;acres are currently in use (e.g., existing buildings,
    infrastructure or active disturbance). The lands surrounding the
    Mountain Pass facility are mostly public lands managed by the
    Bureau of Land Management and the National Park Service. In
    addition to the ground that we hold in fee in and around the
    Mountain Pass facility, we also hold 55 patented claims and 489
    unpatented mining claims and mill sites under The Mining Law of
    1872. These mining claims and mill sites provide land for
    mining, ancillary facilities and expansion capacity around the
    Mountain Pass facility.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Mountain Pass facility includes an open-pit mine, overburden
    stockpiles, a crusher and mill/flotation plant, a separation
    plant, a mineral recovery plant and
    <FONT style="white-space: nowrap">on-site</FONT>
    evaporation ponds, as well as laboratory facilities to support
    research and development activities, offices, warehouses and
    support buildings. The majority of the physical plant and
    equipment at the Mountain Pass facility is over 20 years old,
    substantially all of which will be replaced or refurbished as
    part of our modernization effort. We expect to expand the
    open-pit mine both laterally to the west, southwest and north as
    well as deepening vertically. In addition to the existing
    overburden stockpile located west of the pit, which will serve
    as the initial overburden stockpile when mining recommences, we
    will need to construct additional overburden stockpiles to the
    north or east of the pit
</DIV>
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    62
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    to provide additional storage capacity sufficient to accommodate
    the remaining overburden material for the existing permitted
    life of the mine.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with our modernization and expansion efforts at
    the Mountain Pass facility, we expect to build new facilities,
    including the construction of a control lab, additional
    warehousing and raw material storage facilities. We had
    initially planned to add facilities and equipment for metal
    conversion and alloy production, but we have entered into a
    letter of intent to acquire a producer of rare earth metals and
    alloys located off-site, which would obviate the need for such
    facilities and equipment at the Mountain Pass facility. We also
    expect to build a new paste tailings operation and new roads at
    the Mountain Pass facility. Although the operating cost of the
    paste tailings operation is expected to be greater than it would
    be for a tailings pond, which is the method prior owners used at
    the Mountain Pass facility, we expect that the increased water
    recycling and reduced environmental risks associated with the
    paste tailings facility will ultimately mitigate that additional
    cost.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, we intend to produce hydrochloric acid and sodium
    hydroxide at our own chlor-alkali plant at the Mountain Pass
    facility, thereby reducing our reliance on external sources of
    reagents. While the production of our own hydrochloric acid and
    sodium hydroxide will utilize proven technologies, these
    technologies have not yet been implemented in the rare earth
    industry. Not only would the chlor-alkali plant reduce our need
    for external sources of reagents, but it would also reduce our
    production of waste salt water. Previous owners of the Mountain
    Pass facility disposed of waste salt water in evaporation ponds
    on the Ivanpah dry lake bed, which is no longer an available
    option for the Mountain Pass facility. Accordingly, waste water
    must be dealt with in a different manner. We intend to utilize
    our chlor-alkali plant to convert waste salt water to
    hydrochloric acid and sodium hydroxide, which will be recycled
    into the process. Through this process, approximately
    913&#160;million pounds of water and 101&#160;million pounds of
    salt would be recycled back to the chlor-alkali plant per year.
    This process would avoid the need for disposal of waste salt
    water in evaporation ponds. Additionally, because the water is
    internally recycled, the need for fresh water to run the
    Mountain Pass processing facilities would be dramatically
    reduced.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following the completion of our modernization and expansion
    efforts, we expect to have the ability to mine, crush, mill and
    separate 2,000 tons of rare earth ore per day to produce
    individual REOs that meet or exceed industry standards for
    purity. However, we will only need to process 1,100 to 1,500
    tons of rare earth ore per day to meet our production goals. In
    addition, as part of our
    <FONT style="white-space: nowrap">&#147;mine-to-magnets&#148;</FONT>
    strategy, we have entered into a letter of intent to acquire a
    third-party producer of rare earth metals and alloys in NdFeB
    magnet the United States, which acquisition would provide us
    with a license to the technology required to process and
    manufacture rare earth metals, compositions containing rare
    earth metals and rare earth alloys, including the rare earth
    alloys used in NdFeB and samarium cobalt magnet production. We
    also expect to build a magnet production and finishing facility
    as part of a joint venture with an existing magnet producer to
    produce finished NdFeB magnets in the United States and plan to
    begin producing finished NdFeB magnets by the end of 2012. We
    are working to identify and develop new downstream opportunities
    for the REOs and rare earth alloys we produce.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our facilities currently rely on electricity provided by
    Southern California Edison. Due to its position on the regional
    electric grid, the Mountain Pass facility can experience power
    shortages during peak periods. Instability in electrical supply
    in past years has caused sporadic outages and brownouts. Such
    outages and brownouts have had a negative impact on our
    production. In connection with our modernization and expansion
    efforts at the Mountain Pass facility, we expect to build a new
    22 megawatt co-generation power plant that will use natural gas
    to provide reliable electricity and steam to our facilities. The
    completion of the co-generation power plant is dependent on
    several factors, including obtaining the permits required to
    build and operate the co-generation power plant. Following the
    completion of the co-generation power plant, we expect it to
    provide 100% percent of our production power requirements and
    95% of our overall power requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Numerous other governmental permits and approvals are required
    in order for us to proceed with our modernization and expansion
    efforts. These include a conditional use permit and reclamation
    plan approval, air permits, water usage permits, an agreement
    and permit to alter the streambeds affected by our new plant
    site or a natural gas pipeline, various building permits and
    permits related to the use and storage of radioactive
</DIV>
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    <BR>
    63
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    or hazardous materials. See &#147;&#151;&#160;Environmental,
    Health and Safety Matters&#148; for a detailed discussion of
    certain of the permits, licenses and approvals we will be
    required to obtain or maintain.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="d70469d7046913.gif" alt="(MAP)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The bastnasite ore body at the Mountain Pass facility has been
    mined as a principal source of REEs for over 50&#160;years. The
    currently defined zone of REE mineralization exhibits a strike
    length of approximately 2,750&#160;feet in a north-northwest
    direction and extends for approximately 7,000&#160;feet down dip
    from surface. The true thickness of the greater than 3.0% REO
    zone ranges from 15&#160;feet to 250&#160;feet. The percentage
    of each rare earth material contained in the Mountain Pass
    facility bastnasite ore is estimated to be as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="87%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Estimated<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Percentage of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Element</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Bastnasite Ore</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cerium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    48.8
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Lanthanum
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Neodymium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11.7
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Praseodymium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4.2
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Samarium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.79
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gadolinium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.21
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Europium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.13
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dysprosium
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.05
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other REE (including Terbium)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.12
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rare
    Earth Reserves and Non-Reserve Deposits</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of February&#160;6, 2010, SRK Consulting, an independent
    consulting firm that we have retained to assess our reserves,
    estimates total proven and probable reserves based on historic
    and estimated recoveries of 2.21&#160;billion pounds of REO,
    with an average ore grade of 8.24%, using a cut-off grade of
    5.0%.
</DIV>
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    <BR>
    64
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">SEC
    Guidelines</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The SEC has established guidelines contained in Industry Guide
    No.&#160;7 to assist registered companies as they estimate ore
    reserves. These guidelines set forth technical, legal and
    economic criteria for determining whether our ore reserves can
    be classified as proven and probable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    &#147;Reserves&#148; are defined by the SEC Industry Guide 7 as
    that part of a mineral deposit that could be economically and
    legally extracted or produced at the time of the reserve
    determination. SEC Industry Guide 7 divides reserves between
    &#147;proven reserves&#148; and &#147;probable reserves,&#148;
    which are defined as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    &#147;Proven reserves&#148; are reserves for which:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    quantity is computed from dimensions revealed in outcrops,
    trenches, workings or drill holes; grade
    <FONT style="white-space: nowrap">and/or</FONT>
    quality are computed from the results of detailed
    sampling;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the sites for inspection sampling and measurement are spaced so
    closely and the geologic character is so well defined that size,
    shape, depth and mineral content of reserves are
    well-established.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    &#147;Probable reserves&#148; are reserves for which quantity
    and grade
    <FONT style="white-space: nowrap">and/or</FONT>
    quality are computed from information similar to that used for
    proven reserves, but the sites for inspection, sampling, and
    measurement are farther apart or are otherwise less adequately
    spaced. The degree of assurance, although lower than that for
    proven reserves, is high enough to assume continuity between
    points of observation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Methodology</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently rely on the interpretations made during prior
    mining campaigns at our Mountain Pass facility, the
    U.S.&#160;Geological Survey and various consulting companies,
    including SRK Consulting, to identify the regional and mine area
    geology and hydrogeology, regional and local structure, deposit
    geology, current pit slope stability conditions and REE
    recoveries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Proven Reserves.</I>&#160;&#160;SRK Consulting compiled a
    drillhole database from prior drilling at the Mountain Pass site
    that includes a total of 137 drillholes with a cumulative length
    of 79,453.3&#160;feet. Individual drillholes range in length
    from 56&#160;feet to 2,012&#160;feet, and averaged
    580&#160;feet. The majority of core samples in the deposit area
    analyzed by SRK Consulting range from 50&#160;feet to
    250&#160;feet along strike of the ore body and 150&#160;feet to
    350&#160;feet down dip. The sample data for proven ore reserves
    consists of survey data, lithologic data and assay results.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based on the review of historic sample preparation and
    analytical procedures, SRK Consulting initiated a sample check
    assay program of 1% of the assay database. The material
    remaining from previous drilling programs consisted of split
    core stored at the Mountain Pass facility. SRK Consulting
    examined the existing split core using third-party preparation
    and analytical laboratories. SRK Consulting determined that the
    overall results of the sample check assay program indicated that
    our historic data was acceptable for use in preparing their
    report. SRK Consulting based the mining cut-off calculation on a
    grade of 5.0% REO given historical performance at the Mountain
    Pass mine and a determination that a cut-off grade below 5.0%
    was relatively sensitive to economic variables.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Probable Reserves.</I>&#160;&#160;Probable ore reserves are
    based on longer projections and the maximum distance between
    drill holes is 200 meters. Statistical modeling and the
    established continuity of the bastnasite ore body as determined
    from results of over 50&#160;years of mining activity to date
    support our technical confidence in estimates of tonnage and
    grade over this projection distance. Where appropriate,
    projections for the probable ore reserve determination are
    constrained by any known or anticipated restrictive geologic
    features. SRK generated a resource estimate based on composites
    derived from drillhole sample assay results. Grade interpolation
    was based on the geology, drillhole spacing and geo-statistical
    analysis of the data. The resources were classified by their
    proximity to the sample locations and number of drillholes. SRK
    considers the resource model and resource classification to be
    consistent with Canadian Institute of Mining and Metallurgy
    guidelines.
</DIV>
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    <BR>
    65
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The proven and probable ore reserves are then modeled as a
    long-term mine plan and additional factors including recoveries,
    metal prices, mine operating costs and capital estimates are
    applied to determine the overall economics of the ore reserves.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Results</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Proven and probable reserves at the Mountain Pass facility as of
    February&#160;6, 2010 are estimated to be approximately
    2.21&#160;billion pounds of REO, with an average ore grade of
    8.24%, using a cut-off grade of 5.0%. We base our REO reserve
    estimates and non-reserve REO deposit information on
    engineering, economic and geological data assembled and analyzed
    by SRK Consulting, which includes various engineers and
    geologists. The Mountain Pass facility has been subject to
    extensive drilling since the beginning of mining operations in
    1952, including drilling data for 152 holes totaling
    83,216&#160;feet. We also maintain detailed geologic logs,
    <FONT style="white-space: nowrap">on-site</FONT>
    assay records and databases and geologic cross-sections. Our
    estimates of REO reserves and non-reserve REO deposits as to
    both quantity and quality will be regularly updated to reflect
    new drilling or other data received.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table provides information as of February&#160;6,
    2010 on the amount of our proven and probable REO reserves.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Average Ore<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Recoverable REO<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Category of Reserves</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Grade&#160;(%)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(Pounds)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Proven
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.38
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    88,000,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Probable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.20
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,122,000,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    <B>Proven and Probable</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>8.24</B>
</TD>
<TD nowrap align="left" valign="bottom">
    <B>%</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>2,210,000,000 </B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In making the estimate above, SRK Consulting:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumed full mining recovery;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumed that mine reserves are not diluted and assume
    selectivity in mining;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumed a historic cut-off grade of 5.0% REO within the pit
    design;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumed an average REO mill recovery estimated at 63%;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    used the 1997 surface topography for volume control of reserves;
    and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    rounded values to the nearest significant number.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There are numerous uncertainties inherent in estimating
    quantities and qualities of REO reserves and
    <FONT style="white-space: nowrap">non-reserve</FONT>
    REO deposits and costs to mine recoverable reserves, including
    many factors beyond our control. We will regularly evaluate our
    REO reserve and non-reserve REO estimates. This will typically
    be done in conjunction with expanded, phased drilling programs.
    Cores are analyzed by geologists to determine mineral types and
    to identify geological anomalies. Samples along the length of
    the core are logged and analyzed for total rare earth content,
    rare earth distribution and mineralogy. This data is entered
    into a master database and statistically analyzed. The resulting
    information is used to enhance the mine plan. We also gain
    information from blast hole cuttings. The estimates of REO
    reserves and non-reserve REO deposits as to both quantity and
    quality will also be updated to reflect new drilling or other
    data received. Estimates of economically recoverable REO
    reserves, however, necessarily depend upon a number of variable
    factors and assumptions, all of which may vary considerably from
    actual results, such as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    geological and mining conditions and/or effects from prior
    mining that may not be fully identified by available data or
    that may differ from experience;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumptions concerning future prices of rare earth products,
    operating costs, mining technology improvements, development
    costs and reclamation costs;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assumptions concerning future effects of regulation, including
    the issuance of required permits and taxes by governmental
    agencies.
</TD>
</TR>

</TABLE>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although SRK Consulting assumed pricing levels consistent with
    those estimated by Roskill, a 38% decrease in average REE prices
    from such levels, holding all other variables constant, would
    not materially reduce reserve estimates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Actual REO tonnage recovered from identified REO reserve and
    non-reserve REO deposit areas and revenues and expenditures with
    respect to the same may vary materially from estimates. These
    estimates may not accurately reflect our actual REO reserves or
    non-reserve REO deposits. Any inaccuracy in our estimates
    related to our REO reserves and non-reserve REO deposits could
    result in lower than expected revenues and higher than expected
    costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Additionally, we have recently expanded our
    <FONT style="white-space: nowrap">on-site</FONT>
    exploratory drilling program to confirm the existence and extent
    of bastnasite, monazite and other rare earth phosphate mineral
    occurrences in unexplored areas of the Mountain Pass facility.
    This program will also help to establish that our measured,
    indicated and inferred resources can become proven or probable
    reserves.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Customers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    and other planned downstream products at the Mountain Pass
    facility, we expect to produce 19,090&#160;mt of REO per year.
    As of April&#160;1, 2010, we had 19&#160;letters of intent to
    sell our rare earth products, representing approximately 138% of
    our anticipated production for 2013. Over the next two years, we
    intend to enter into short- and long-term sales contracts with
    existing and new customers. For certain REEs where the market
    demand is high, such as europium, we do not expect to enter into
    letters of intent or contracts, given that these REEs can be
    easily sold. None of our existing customer relationships are
    from contracts we assumed from Chevron Mining Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There is a limited market for our lanthanum and our two largest
    customers comprised 82% (55% of the total corresponds to our
    largest customer and 27% of the total corresponds to our second
    largest customer) and 72% (57% of the total corresponds to our
    largest customer and 15% of the total corresponds to our second
    largest customer) of our total product revenue for the year
    ended December&#160;31, 2009 and the period ended
    December&#160;31, 2008, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Additionally, we have developed
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    a patented, proprietary product, and process, primarily
    consisting of cerium, to remove arsenic and other heavy metals
    from industrial processing streams that will allow our customers
    to more safely sequester arsenic and increase their production
    of metal products. We are in discussions with multiple large,
    globally diversified mining companies for the sale of
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>.

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We anticipate that the location of the Mountain Pass facility,
    just off the Interstate&#160;15 and along the train route
    leading to the Los Angeles port, will be an advantage in the
    transportation and delivery of our rare earth products to our
    customers as compared to other rare earth mining and development
    projects.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Suppliers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We use significant amounts of hydrochloric acid and sodium
    hydroxide as reagents to process REOs. We ultimately intend to
    produce and recycle our own hydrochloric acid and sodium
    hydroxide at the Mountain Pass facility, however, the technology
    we are developing to internally produce these reagents to
    significantly reduce our dependence on external supplies has not
    yet been implemented. Accordingly, we currently purchase
    hydrochloric acid and sodium hydroxide in the open market
    through multiple suppliers and, as a result, could be subject to
    significant volatility in the cost or availability of these
    reagents, although they are currently in ample supply. We may
    not be able to pass increased prices for these reagents through
    to our customers in the form of price increases. A significant
    increase in the price of these reagents, or limited availability
    of such materials, could materially increase our operating costs
    and adversely affect our profit margins from quarter to quarter.
</DIV>
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    <BR>
    67
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Patents,
    Trademarks and Licenses</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We rely on a combination of trade secret protection,
    nondisclosure and licensing agreements, patents and trademarks
    to establish and protect our proprietary intellectual property
    rights. We utilize trade secret protection and nondisclosure
    agreements to protect our proprietary rare earth technology. We
    also have a proven technology and product development group and
    as of April&#160;1, 2010, held 18 issued and pending
    U.S.&#160;patents and patent applications, and 146 issued and
    pending foreign patents and patent applications. We intend to
    rely on patented products, such as
    XSORBX<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,

    and related licensing agreements to establish proprietary
    markets for low demand REEs. These intellectual property rights
    may be challenged or infringed upon by third parties or we may
    be unable to maintain, renew or enter into new license
    agreements with
    <FONT style="white-space: nowrap">third-party</FONT>
    owners of intellectual property on reasonable terms. In
    addition, our intellectual property will be subject to
    infringement or other unauthorized use outside of the United
    States. In such case, our ability to protect our intellectual
    property rights by legal recourse or otherwise may be limited,
    particularly in countries where laws or enforcement practices
    are undeveloped or do not recognize or protect intellectual
    property rights to the same extent as the United States.
    Unauthorized use of our intellectual property rights or
    inability to preserve existing intellectual property rights
    could adversely impact our competitive position and results of
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Competition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2008, global production of rare earth products was estimated
    at 124,000 mt of REO. China accounted for approximately 97% of
    this total. The majority of the remaining production in 2009 was
    from Mountain Pass and Russia. Although exploration programs for
    REEs exist outside of China, Russia, Mountain Pass and
    Australia, none of the deposits that are the subject of these
    programs is currently in production and, according to IMCOA, it
    may take ten years or more following the discovery of additional
    REE deposits before such deposits are brought into production.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Once we reach full planned production rates for REOs and other
    planned downstream products, the increased competition may lead
    our competitors to engage in predatory pricing behavior. Any
    increase in the amount of rare earth products exported from
    other nations, and increased competition, whether legal or
    illegal, may result in price reductions, reduced margins and
    loss of potential market share, any of which could materially
    adversely affect our profitability. As a result of these
    factors, we may not be able to compete effectively against
    current and future competitors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Research
    and Development</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have invested significant resources to improve the efficiency
    of our REO processing operations and the development of new
    applications for individual REEs. As of December&#160;31, 2009,
    our product development group consisted of 17 scientists and
    engineers. In addition, we spent $1.5&#160;million for the year
    ended December&#160;31, 2009 and $0.4&#160;million for the
    period ended December&#160;31, 2008 on research and development.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Environmental,
    Health and Safety Matters</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are subject to numerous and detailed, federal, state and
    local laws, regulations and permits affecting the mining and
    mineral processing industry, including those pertaining to
    employee health and safety, environmental permitting and
    licensing, air quality standards, GHG emissions, water
    pollution, waste management, plant and wildlife protection,
    handling and disposal of radioactive substances, remediation of
    soil and groundwater contamination, land use, reclamation and
    restoration of properties, the discharge of materials into the
    environment and groundwater quality and availability. These
    laws, regulations and permits have had, and will continue to
    have, a significant effect on our results of operations and
    competitive position and have tended to become increasingly
    stringent over time. Future laws, regulations or permits, as
    well as the interpretation or enforcement of existing
    requirements, may require substantial increases in capital or
    operating costs or otherwise delay, limit or prohibit our
    current or future operations. Our management team and employees
    have a significant amount of experience working with various
    federal, state and local authorities to
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    address compliance with such laws, regulations and permits.
    However, we cannot assure you that we have been or will be at
    all times in compliance with such requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect to incur approximately $3&#160;million per year in
    2010 and 2011 for ongoing operating environmental expenditures,
    including salaries, monitoring, compliance, reporting and
    permits. In addition, we plan to invest significant capital in
    certain infrastructure, including iron and lead removal
    equipment in our processing facilities, a chlor-alkali plant, a
    co-generation power plant and a paste tailings plant and related
    storage facility. Our planned chlor-alkali plant is expected to
    reduce the amount of waste salt water that otherwise would be
    produced by our processing facilities and eliminate the need for
    evaporation ponds to dispose of this waste water. Our planned
    co-generation power plant is expected to increase the energy
    efficiency of our Mountain Pass facility by generating steam
    with waste heat from the power generation process. Our planned
    paste tailings plant and related storage facility are expected
    to increase the extent of our water recycling and present lower
    environmental risks than storing tailings in ponds. We expect to
    invest approximately $187&#160;million in these capital projects
    from 2010 to 2012, in addition to the costs of air emissions
    offset credits, which may become necessary.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Permits
    and Approvals</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Numerous governmental permits and approvals are required for our
    current and future operations. We hold a 30&#160;year mine plan
    permit and an associated environmental impact report, both of
    which were issued in 2004 in connection with our conditional use
    permit from San&#160;Bernardino County. We hold numerous other
    permits and approvals, including permits to operate from the
    Lahontan Regional Water Quality Control Board and orders for
    wastewater treatment and other facilities. Our ability to build
    <FONT style="white-space: nowrap">state-of-the-art</FONT>
    processing facilities at Mountain Pass depends upon obtaining
    the necessary installation and operation permits from a variety
    of governmental entities. In connection with our planned
    expansion, we will be required to obtain permit modifications
    and additional permits for new and replacement processing
    facilities and utilities, including a chlor-alkali plant and
    co-generation power plant, and also may be required to prepare a
    risk management plan in connection with the storage of ammonia
    for use at the planned co-generation power plant. To obtain,
    maintain and renew these and other environmental permits, we may
    be required to conduct environmental studies and collect and
    present to governmental authorities data pertaining to the
    potential impact that our current or future operations may have
    upon the environment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We may be unable to obtain permits unless we are able to avoid
    or mitigate those impacts, particularly impacts to desert flora
    and fauna. The permitting processes and development of
    supporting materials, including any environmental impact
    statements, may be costly and time consuming. Any failure to
    obtain, maintain or renew required permits, or other permitting
    delays or conditions, may delay, limit or prohibit current or
    future operations. Consequently, the expansion and modernization
    of the Mountain Pass facility may be delayed, curtailed or
    prevented, particularly in the event any environmental impact
    statement is required in connection therewith. These permit
    processes and requirements, and the interpretation and
    enforcement thereof, change frequently, and any such future
    changes could materially adversely affect our mining operations
    and results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Mine
    Health and Safety Laws</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Federal Mine Safety and Health Act of 1977, as amended by
    the Mine Improvement and New Emergency Response Act of 2006, and
    the regulations adopted by the California Occupational Safety
    and Health Administration, impose stringent health and safety
    standards on numerous aspects of mining operations, including
    training of mine personnel, mining procedures, blasting, the
    equipment used in mining operations and other matters. As a
    result of increasing scrutiny surrounding mine safety, federal
    and state legislatures and other regulatory authorities have
    imposed more stringent regulatory requirements on mining
    operations. In 2006, the MSHA promulgated new emergency rules on
    mine safety that address mine safety equipment, training and
    emergency reporting requirements. The U.S.&#160;Congress enacted
    the Mine Improvement and New Emergency Response Act of 2006,
    which significantly amended the Federal Mine Safety and Health
    Act of 1977, requiring improvements in mine safety practices,
    increasing criminal penalties and establishing a maximum civil
    penalty for non-compliance, and expanding the scope of federal
    oversight, inspection and
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    enforcement activities. The MSHA published final rules
    implementing the Mine Improvement and New Emergency Response Act
    to revise both the emergency rules and the MSHA&#146;s existing
    civil penalty assessment regulations, which resulted in an
    <FONT style="white-space: nowrap">across-the-board</FONT>
    increase in penalties from the existing regulations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Since July 2005, the Mountain Pass facility has not had a
    lost-time accident and has received the coveted &#147;Sentinels
    of Safety&#148; award from the MSHA for three of the last four
    years. Lost-time incidence rate is an industry standard used to
    describe occupational injuries that result in loss of one or
    more days from an employee&#146;s scheduled work. Our lost-time
    incidence rate for all operations for the year ended
    December&#160;31, 2009 was zero as compared to the national
    average of 1.78 for the same period, as reported by the MSHA.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Workers&#146;
    Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although, as of April&#160;1, 2010, the Mountain Pass Facility
    has not experienced a lost-time workplace injury since
    July&#160;11, 2005, we are required to compensate employees for
    work-related injuries. The states in which we operate consider
    changes in workers&#146; compensation laws from time to time. We
    are insured under various state workers&#146; compensation
    programs for our operations at the Mountain Pass facility, our
    offices in Greenwood Village, Colorado and the State of
    Washington.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Surface
    Mining Control and Reclamation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our San&#160;Bernardino County conditional use permit, approved
    mining plan and state laws and regulations establish
    operational, reclamation and closure standards for all aspects
    of our surface mining operations. Comprehensive environmental
    protection and reclamation standards must be met during the
    course of and upon completion of mining activities, and our
    failure to meet such standards may subject us to fines,
    penalties or other sanctions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Although we expect the Mountain Pass facility to remain open for
    significantly longer than 30&#160;years, our
    <FONT style="white-space: nowrap">30-year</FONT> mine
    plan requires that we restore the surface area upon completion
    of mining. Financial assurances are generally required to secure
    the performance of these reclamation obligations. To satisfy
    these financial assurance requirements, we typically obtain
    surety bonds, which are renewable on a yearly basis. Although we
    expect to continue to obtain and renew such bonds, it has become
    increasingly difficult for mining companies to secure new or
    renew existing surety bonds without the posting of partial or
    full collateral. In addition, surety bond costs have increased
    while the market terms of surety bonds have generally become
    less favorable. It is possible that surety bond issuers may
    refuse to provide or renew bonds or may demand additional
    collateral upon those issuances or renewals. Our inability to
    obtain or failure to maintain or renew these bonds could have a
    material adverse effect on our business and results of
    operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, there was approximately
    $27&#160;million in surety bonds to secure the performance of
    our reclamation obligations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Water
    Usage and Pollution Control</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The federal Clean Water Act and similar state and local laws and
    regulations affect surface mining and processing operations by
    imposing restrictions on the discharge of pollutants, including
    tailings and other material, into waters of the United States.
    These requirements are complex and subject to amendments, legal
    challenges and changes in implementation. Recent court
    decisions, regulatory actions and proposed legislation have
    created uncertainty over the jurisdiction and permitting
    requirements of the federal Clean Water Act. Individual or
    general permits under Section&#160;404 of the Clean Water Act
    are required if we discharge dredged or fill materials into
    jurisdictional waters of the United States. In addition, our
    Lahontan Regional Water Quality Control Board permit establishes
    treatment standards for wastewater discharges to evaporation
    ponds. Regular monitoring by the Lahontan Regional Water Quality
    Control Board, as well as compliance with reporting requirements
    and performance standards, are preconditions for the issuance
    and renewal of our permits.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations require significant quantities of water to
    process REOs. As part of the modernization and expansion of the
    Mountain Pass facility, we expect to significantly reduce our
    need for fresh water by
</DIV>
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    recycling available water resources. Current design
    specifications for our modernization project indicate an
    approximately 90% reduction of fresh water consumption as
    compared to water consumption in the
    <FONT style="white-space: nowrap">mid-1990&#146;s,</FONT>
    when the mine was producing 20,000&#160;mt of REO per year.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Air
    Pollution Control</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The federal Clean Air Act and similar state and local laws and
    regulations affect our surface mining and processing operations
    both directly and indirectly. We currently operate and maintain
    numerous air pollution control devices under permits from the
    California Mojave Desert Air Quality Management District. We
    generally must obtain permits before we install new sources of
    air pollution, which may require us to do air quality studies
    and obtain emission offset credits, which can be costly and time
    consuming to procure. We expect that our new and expanded
    facilities will require us to obtain emission credits or offsets
    for nitrogen oxides, particulate matter (10 microns), sulfur
    oxide and volatile organic compounds. The increased emissions
    from these facilities may trigger permitting under Title&#160;V
    of the Clean Air Act. In addition, the regulations of the
    California Air Resources Board will require us to retrofit or
    replace off-road, on-road and forklift vehicles to achieve
    emission standards for nitrogen oxides and particulate matter
    (10 microns).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our operations also emit GHGs. Pursuant to existing GHG
    requirements, we expect that following the expansion of the
    Mountain Pass facility we will be required to report annual GHG
    emissions from our operations. Additional GHG emission related
    requirements are in various stages of development. For example,
    the U.S.&#160;Congress is considering various legislative
    proposals to address climate change, including a nationwide
    limit on GHGs. In addition, the EPA has issued vehicle emissions
    regulations that would subject GHG emissions from stationary
    sources to the Prevention of Significant Deterioration and
    Title&#160;V provisions of the federal Clean Air Act. California
    also may establish GHG emission regulations pursuant to its
    Global Warming Solutions Act. If made effective, any such
    regulations could require us to modify existing permits or
    obtain new permits, implement additional pollution control
    technology, curtail operations or increase significantly our
    operating costs. Any regulation of GHG emissions, including
    through a
    <FONT style="white-space: nowrap">cap-and-trade</FONT>
    system, technology mandate, emissions tax, reporting requirement
    or other program, could adversely affect our business, financial
    condition, reputation, operating performance and product demand.
    However, such regulations might also present opportunities for
    our industry to the extent they increase the demand for rare
    earth products used in clean-technology applications, such as
    hybrid and electric vehicles and wind power turbines.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Mountain Pass facility consumes significant amounts of
    energy and, accordingly, is subject to fluctuations in energy
    costs. These costs may increase significantly in part as an
    indirect result of GHG and other air emission regulations
    applicable to third-party power suppliers.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Hazardous
    and Radioactive Substances and Wastes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    CERCLA and analogous state laws impose liability, without regard
    to fault or the legality of the original conduct, on certain
    classes of persons that are considered to have contributed to
    the actual or threatened release of a &#147;hazardous
    substance&#148; into the environment. Persons who are or were
    responsible for such releases of hazardous substances under
    CERCLA, which can include waste generators, site owners, lessees
    and others, may be subject to joint and several liability for
    the costs of remediating such hazardous substances and for
    damages to natural resources. Accordingly, we may be subject to
    liability under CERCLA and similar state laws for properties
    that we currently own, lease or operate or that we or our
    predecessors have previously owned, leased or operated, and
    sites to which we or our predecessors sent waste materials.
    Pursuant to a 1998 clean up and abatement order issued by the
    Lahontan Regional Water Quality Control Board, we have conducted
    and are continuing to conduct various investigatory, monitoring
    and remedial activities related to contamination at and around
    the Mountain Pass facility. These activities include the
    operation of groundwater monitoring and recovery wells, water
    treatment systems and evaporation ponds. Although Chevron Mining
    Inc. is obligated to indemnify us for certain potential
    environmental losses associated with activities that occurred
    prior to our purchase of the Mountain Pass facility, the amount
    of such indemnity is limited and may not be sufficient to cover
    such losses.
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In 2009, the EPA announced that it is developing financial
    responsibility requirements under CERCLA for certain facilities
    within the hardrock mining industry. If applicable to our
    current or future operations, these requirements could impose on
    us significant additional costs or obligations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    REOs contain naturally occurring radioactive substances, such as
    thorium and uranium. The mining and processing of REOs involves
    the handling and disposal of such substances, and accordingly we
    are subject to extensive safety, health and environmental laws,
    regulations and permits regarding radioactive substances.
    Significant costs, obligations or liabilities may be incurred
    with respect to such requirements, and any future changes in
    such requirements (or the interpretation or enforcement thereof)
    may have a material adverse effect on our business or results of
    operations. One such permit pursuant to which we currently
    operate is a Radioactive Materials License issued and
    administered by the California Department of Health Services
    Radiologic Health Branch. The license applies to the use of
    sealed radioactive sources used for gauging volumes of
    materials, as well as certain other activities. A failure to
    maintain or renew this license could materially adversely affect
    our business or results of operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We generate, manage and dispose of solid and hazardous waste.
    Demolition of structures in connection with facility expansion
    and modernization generates waste in addition to that associated
    with processing and remediation activities. In connection with
    our modernization and expansion effort at the Mountain Pass
    facility, we will incur additional costs to handle, store and
    dispose of such wastes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Endangered
    Species Act</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The federal Endangered Species Act and counterpart state
    legislation protect species threatened with possible extinction.
    Such laws and related regulations may have the effect of
    prohibiting or delaying us from obtaining mining permits and may
    impose restrictions on pipeline or road building and other
    mining or construction activities in areas containing the
    affected species or their habitats. Several species indigenous
    to Mountain Pass, California, including the desert tortoise, are
    protected under the Endangered Species Act and California
    Endangered Species Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Use of
    Explosives</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with our surface mining activities, we use
    explosives, which are subject to regulation, including under the
    federal Safe Explosives Act. Violation of these regulatory
    requirements may result in fines, imprisonment, revocation of
    permits
    <FONT style="white-space: nowrap">and/or</FONT>
    seizure or forfeiture of explosive materials.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Other
    Environmental Laws</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are required to comply with numerous other federal, state and
    local environmental laws and regulations in addition to those
    previously discussed. These additional laws include, for
    example, the California Environmental Quality Act, the National
    Environmental Policy Act, the Emergency Planning and Community
    <FONT style="white-space: nowrap">Right-to-Know</FONT>
    Act and the California Accidental Release Prevention Program.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Facilities
    and Employees</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We own the Mountain Pass facility. We also lease our executive
    office space at 5619 Denver Tech Center Parkway,
    Suite&#160;1000, Greenwood Village, Colorado, which lease
    expires November 2011, subject to a renewal option.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, we had 116&#160;employees. In
    connection with our ongoing modernization and expansion efforts
    at the Mountain Pass facility, we expect to hire additional
    employees by the end of 2012. As of December&#160;31, 2009, 60
    of our employees were represented by the United Steelworkers of
    America. Our contract with the United Steelworkers of America
    expires in 2012. We have not experienced any work stoppages and
    consider our employee relations to be good.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Legal
    Proceedings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From time to time, we may become subject to various legal
    proceedings that are incidental to the ordinary conduct of our
    business. We are not currently party to any legal proceedings.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    72
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='113'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MANAGEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Executive
    Officers and Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth certain information regarding the
    individuals who are expected to be our executive officers and
    directors as of the consummation of this offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="43%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="52%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Age</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Position</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    51
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    President, Chief Executive Officer and Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    James S. Allen
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    43
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Chief Financial Officer
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John L. Burba, PhD
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    58
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Executive Vice President and Chief Technology Officer
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John F. Ashburn, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    55
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Executive Vice President and General Counsel
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    28
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Corporate Controller
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Russell D. Ball
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    41
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Ross R. Bhappu
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    50
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Chairman of the Board
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Brian T. Dolan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    69
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Charles R. Henry
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    72
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark S. Kristoff
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    48
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Alec Machiels
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    37
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Jack E. Thompson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    60
</TD>
<TD>&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Director
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Executive
    Officers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mark A. Smith </I>has been our Chief Executive Officer and
    has served as a Director since October 2008 and our President
    since March 2010. From April 2006 until October 2008,
    Mr.&#160;Smith was president and chief executive officer of
    Chevron Mining Inc., a wholly-owned subsidiary of Chevron
    Corporation, and from August 2005 until April 2006 he was vice
    president of Chevron Mining Inc. In his positions at Chevron
    Mining Inc., Mr.&#160;Smith was responsible for
    1,500&#160;employees, approximately $500&#160;million in
    revenue, three coal mines, one molybdenum mine and the Mountain
    Pass rare earth mine. From June 2000 until August 2005,
    Mr.&#160;Smith was a vice president for Unocal Corporation, an
    oil and gas exploration and production company, that previously
    owned the Mountain Pass facility, where he was responsible for
    managing all real estate, remediation, mining and carbon groups.
    Mr.&#160;Smith has served on the board of directors of Avanti
    Mining Inc., a molybdenum mining company, since November 2009.
    Mr.&#160;Smith received his B.S. degree in agricultural
    engineering from Colorado State University in 1981 and his J.D.,
    cum laude, from Western State University School of Law in 1990.
    Mr.&#160;Smith&#146;s broad experience in the rare earths mining
    industry and deep understanding of the operations at our
    Mountain Pass facility make him a valuable member of our
    management and board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>James S. Allen </I>has been our Chief Financial Officer since
    December 2009. From October 2005 until April 2009,
    Mr.&#160;Allen was an audit partner at KPMG LLP, a public
    accounting firm, and from June 2002 until September 2005,
    Mr.&#160;Allen was an audit senior manager at KPMG. During his
    time at KPMG, Mr.&#160;Allen was responsible for the
    professional development of managers and staff, the execution of
    audit engagements and other projects in accordance with firm and
    professional standards, as well as various other business
    development and administrative matters including maintenance of
    client relationships. A Certified Public Accountant,
    Mr.&#160;Allen received his B.S. degree in business
    administration&#160;&#151; accounting from Colorado State
    University in 1989.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>John L. Burba, PhD </I>has been our Chief Technology Officer
    since October 2008, and was promoted to the position of
    Executive Vice President and Chief Technology Officer in
    September of 2009. From August 2005 until October 2008,
    Mr.&#160;Burba was vice president of technology at Chevron
    Mining Inc., where he was involved in identifying and developing
    technologies for Chevron Mining&#146;s businesses, including
    coal, molybdenum and rare earths. From July 2002 until August
    2005, Mr.&#160;Burba was vice president of technology
</DIV>
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    <BR>
    73
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    at Molycorp Inc., a subsidiary of Unocal Corp. Mr.&#160;Burba
    received his B.S. degree in chemistry in 1974, his M.S. in
    physical chemistry in 1976 and his PhD in physical chemistry
    from Baylor University in 1979.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>John F. Ashburn,&#160;Jr.</I> has been General Counsel,
    Secretary and Executive Vice President since December 2008. From
    August 2005 until November 2008, Mr.&#160;Ashburn was senior
    counsel of Chevron Mining Inc. From April 1990 until August
    2005, Mr.&#160;Ashburn was senior counsel of Unocal Corporation,
    an oil and gas exploration and production company.
    Mr.&#160;Ashburn received his B.S. degree in psychology from
    Northern Illinois University in 1976 and his J.D. from Northern
    Illinois University School of Law in 1980.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Ksenia A. Adams </I>has been our Corporate Controller since
    July 2009. From May 2007 until July 2009, Ms.&#160;Adams was an
    audit manager with KPMG LLP. From October 2002 until May 2007,
    Ms.&#160;Adams was a senior member of the audit staff of KPMG.
    Ms.&#160;Adams is a certified public accountant and received her
    B.S. degree in accounting from Colorado State University in 2002.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Russell D. Ball </I>has been a Director since March
    2010.&#160;&#160;Since July 2007, Mr.&#160;Ball has been the
    Chief Financial Officer and since October&#160;2008, he has been
    the Executive Vice President of Newmont Mining Corporation, a
    gold mining and production company. Before becoming Chief
    Financial Officer, Mr.&#160;Ball held a variety of senior
    positions with the Newmont Mining Corporation, including Vice
    President and Controller from 2004 until 2007. Mr.&#160;Ball is
    both a chartered accountant in South Africa and a Certified
    Public Accountant in the United States. Mr.&#160;Ball brings a
    unique and important understanding of finance and accounting in
    the international mining industry to our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Ross R. Bhappu </I>has been our Chairman of the Board since
    September 2008. Since 2005, Mr.&#160;Bhappu has been a partner
    with Resource Capital Funds, a series of private equity funds
    investing exclusively in the mining and minerals industry, and
    from 2001 until 2005 Mr.&#160;Bhappu was vice
    president/principal of Resource Capital Funds. Mr.&#160;Bhappu
    has served on the board directors of EMED Mining Public Ltd., a
    copper mining company, since October 2008, and he has been a
    director of Traxys S.A., a metal trading and distribution
    company, since January 2007. Previously, Mr.&#160;Bhappu served
    on the board of directors of Constellation Copper Corporation, a
    copper mining company, from July 2002 until November 2007 and
    Anglo Asian Mining, a gold mining company, from November 2005
    until September 2006. Mr.&#160;Bhappu has prior experience
    constructing and operating complex mining and processing
    operations as well as mining related merger and acquisition
    activities. He was previously employed by Newmont Mining
    Corporation, GTN Copper Corporation and Cyprus Minerals Company.
    With his comprehensive knowledge of the mining industry and his
    extensive board experience, Mr.&#160;Bhappu is a key member of
    our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Brian T. Dolan </I>has been a Director since September 2008.
    Mr.&#160;Dolan has been a partner of RCF Management, L.L.C., a
    company that provides management services to the several
    Resource Capital Funds, since January 2002. Mr.&#160;Dolan is
    currently serving as a member of the board of directors of the
    following companies: Fund&#160;Three Inc.; Fund&#160;Four Inc.;
    Fund&#160;Five Inc.; American Tripoli, Inc.; CDU Drilling Pty
    Ltd.; Connors Drilling LLC; Dampier International; Dampier
    Master Fund; NYCO Mexico; NYCO Minerals LLC; RCF IV Speedwagon
    Inc.; Resource Capital Funds Foundation; Rolling Rock Minerals,
    Inc.; and Sanderson Drilling Pty. Mr.&#160;Dolan is also
    currently serving in the following executive officer positions:
    assistant secretary of American Tripoli, Inc.; secretary of HR
    Lincoln Holdings, Inc.; vice president and assistant secretary
    of NYCO Minerals LLC; vice president and secretary of RCF IV
    Speedwagon, Inc.; vice president of Resource Capital Funds
    Foundation; vice president and secretary of Rolling Rock
    Minerals, Inc.; vice president and secretary of Tarn Drilling
    LLC; and vice president and secretary of Tecate Minerals LLC.
    Mr.&#160;Dolan&#146;s extensive and ongoing experience as
    director of a wide spectrum of companies makes him a vital part
    of our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Charles R. Henry </I>has been a Director since August 2009.
    Mr.&#160;Henry is currently the president of CRH, Inc., a
    consulting firm specializing in defense acquisition issues, and
    has been associated with CRH since its formation in 1993. From
    2005 to 2007, Mr.&#160;Henry was the chief operating officer of
    CEG Company, a leading producer of wiring harnesses for military
    vehicles. He has served on the board of directors of Gaming
    Partners International, a gaming products company, since June
    2006. Mr.&#160;Henry is a retired two-star general who
</DIV>
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    <BR>
    74
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    served 32&#160;years in the U.S.&#160;Army. With his strong
    background in management, Mr.&#160;Henry brings significant
    organizational acumen to our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Mark S. Kristoff </I>has been a Director since September
    2008. Since April 2005, Mr.&#160;Kristoff has been the chief
    executive officer of Traxys North America, a metal trading and
    distribution company. Before becoming chief executive officer,
    Mr.&#160;Kristoff was chief operating officer of Traxys North
    America from January 2003 until April 2005. Mr.&#160;Kristoff
    has served as the chief executive officer of Traxys S.A., a
    metal trading and distribution company, since 2005 and as the
    manager of MP Rare, a REE trading and distribution company,
    since 2008. Mr.&#160;Kristoff&#146;s experience in the trade and
    distribution of metals and REEs provides valuable insight to our
    board of directors regarding existing and potential
    opportunities in the rare earths market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Alec Machiels </I>has been a Director since September 2008.
    Mr.&#160;Machiels has served as a partner at Pegasus Capital
    Advisors, L.P., a private equity fund manager, since May 2006.
    Prior to becoming a partner at Pegasus, Mr.&#160;Machiels was as
    vice president from June 2004 until May 2006 and an associate
    from August 2002 until June 2004. Mr.&#160;Machiels served as a
    member of the board of directors of Coffeyville Resources, LLC,
    an oil refinery and ammonia plant in Coffeyville, KS, from 2003
    until 2005 as well as a member of the board of directors of
    Merisant Company, a manufacturer and distributor of sugar
    substitute sweeteners, from 2005 until 2008. He has served on
    the board of directors of Traxys S.A., a global metal trading
    and distribution company, since January 2006. He started his
    career as a financial analyst in the Financial Services Group at
    Goldman Sachs International in London and in the Private Equity
    Group at Goldman, Sachs&#160;&#038; Co. in New York from July
    1996 until June 1999. From July 2001 to July 2002,
    Mr.&#160;Machiels served as chief executive officer and chairman
    of Potentia Pharmaceuticals, Inc. Mr.&#160;Machiels attended
    Harvard Business School from August 1999 to June 2001 and
    received an MBA. Mr.&#160;Machiels also received a masters in
    law from KU Leuven Law School in Belgium and a masters in
    international economics from Konstanz University in Germany. His
    strong background in financial management and investment in
    <FONT style="white-space: nowrap">commodity-related</FONT>
    businesses provides our board of directors with a valuable
    perspective on strategic, financial and capital raising matters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Jack E. Thompson </I>has been a Director since August 2009.
    From December 2001 until April 2005 he was the vice chairman of
    Barrick Gold Corporation, a gold mining company.
    Mr.&#160;Thompson has served as a member of the boards of
    directors of Tidewater, Inc., an offshore oil services company,
    and Century Aluminum Co., an aluminum smelting company, since
    February 2005. He has also served as a member of the board of
    directors of Centerra Gold, Inc., a gold mining company, since
    May 2009 and as a member of the board of directors of Anglo
    American, a mining company, since November 2009. Previously,
    Mr.&#160;Thompson served as a member of the board of directors
    of: Stillwater Mining Co., a palladium and platinum mining
    company, from March 2003 until July 2007; Rinker Group Limited,
    a sand and gravel company, from May 2006 until April 2007; and
    Phelps Dodge Corporation, a copper mining company, from January
    2003 until March 2007. Mr.&#160;Thompson brings extensive
    knowledge of the mining industry and broad management experience
    to our board of directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Board
    Composition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation will provide that our board of
    directors will consist of no less
    than&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    or more
    than&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    persons. The exact number of members on our board of directors
    will be determined from time to time by resolution of a majority
    of our full board of directors. Upon consummation of this
    offering, our board will be divided into three classes, with
    each director serving a
    <FONT style="white-space: nowrap">three-year</FONT>
    term and one class being elected at each year&#146;s annual
    meeting of stockholders. <BR>
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;will
    serve initially as Class&#160;I directors (with a term expiring
    in 2010).<BR>
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;will
    serve initially as Class&#160;II directors (with a term expiring
    in 2011).<BR>
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;will
    serve initially as Class&#160;III directors (with a term
    expiring in 2012).
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Committees
    of Our Board of Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Audit
    and Ethics Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Audit and Ethics Committee is expected to consist of Russell
    Ball, Jack E. Thompson, Alec Machiels and Charles R. Henry as of
    the consummation of this offering. The Audit and Ethics
    Committee,
</DIV>
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    <BR>
    75
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    among other things, will oversee our accounting practices and
    processes, system of internal controls, independent auditor
    relationships, financial statement audits and audit and
    financial reporting processes. All of the members of our Audit
    and Ethics Committee are expected to be independent under
    <FONT style="white-space: nowrap">Rule&#160;10A-3</FONT>
    under the Securities Exchange Act. Each of the committee members
    is financially literate within the requirements of the NYSE and
    Mr.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;is
    an audit committee financial expert within the applicable rules
    of the SEC and the NYSE.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Compensation Committee is expected to consist of Jack E.
    Thompson, Mark S. Kristoff and Brian&#160;T.&#160;Dolan as of
    the consummation of this offering. The Compensation Committee
    will establish and administer our policies, programs and
    procedures for compensating our executive officers and
    directors. The Compensation Committee&#146;s duties will
    include, among other things, reviewing and approving executive
    officer compensation and recommending incentive compensation
    plans and equity-based plans. All of the members of our
    Compensation Committee are expected to be independent under the
    rules of the NYSE.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Nominating
    and Corporate Governance Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Nominating and Corporate Governance Committee is expected to
    consist of Mark S. Kristoff, Ross R. Bhappu and Alec Machiels as
    of the consummation of this offering. The Nominating and
    Corporate Governance Committee will identify individuals
    qualified to become board members, recommend director nominees,
    recommend board members for committee membership, develop and
    recommend corporate governance principles and practices, oversee
    the evaluation of our board of directors and its committees and
    formulate a description of the skills and attributes of
    desirable board members. All of the members of our Nominating
    and Corporate Governance Committee are expected to be
    independent under the rules of the NYSE.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Health,
    Safety and Environment Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Health, Safety and Environment Committee is expected to
    consist of Charles R. Henry, Brian T. Dolan and Mark A. Smith as
    of the consummation of this offering. The Health, Safety and
    Environment Committee will establish and oversee administration
    of our policies, programs and procedures for ensuring that we
    continue to provide a safe working environment for our
    employees. The Health, Safety and Environment Committee will
    also establish and oversee administration of our policies,
    programs and procedures for ensuring our continued commitment to
    protecting the environment.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Executive
    Committee</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors is expected to establish an Executive
    Committee that will act, when necessary, in place of our full
    board of directors during periods in which our board of
    directors is not in session. The Executive Committee will be
    authorized and empowered to act as if it were the full board of
    directors in overseeing our business and affairs, except that it
    will not be authorized or empowered to take actions that have
    been specifically delegated to other board committees or to take
    actions with respect to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the declaration of distributions on our capital stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a merger or consolidation of our company with or into another
    entity;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a sale, lease or exchange of all or substantially all of our
    assets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a liquidation or dissolution of our company;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any action that must be submitted to a vote of our
    stockholders;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any action that may not be delegated to a board committee under
    our certificate of incorporation or the General Corporation Law
    of the State of Delaware.
</TD>
</TR>

</TABLE>
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    <BR>
    76
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect that the Executive Committee will consist of Ross R.
    Bhappu, Mark S. Kristoff and Mark&#160;A.&#160;Smith.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Committee Interlocks and Insider Participation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Compensation Committee is expected to consist of Jack E.
    Thompson, Mark S. Kristoff and Brian&#160;T.&#160;Dolan as of
    the consummation of this offering. None of these individuals has
    ever been an officer or employee of Molycorp or any of our
    subsidiaries. None of our executive officers serves or have
    served as a member of the compensation committee or other board
    committee performing equivalent functions of any entity that has
    one or more executive officers serving as one of our directors
    or on our Compensation Committee.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Code of
    Ethics</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the consummation of this offering, we will adopt a Code
    of Business Conduct and Ethics applicable to all officers, other
    employees and directors that will become effective upon
    completion of this offering. We intend to post the full text of
    our Code of Business Conduct and Ethics on our website at
    www.molycorp.com promptly following the completion of this
    offering. We intend to disclose future amendments to certain
    provisions of our Code of Business Conduct and Ethics or waivers
    of such provisions applicable to any director, principal
    executive officer, principal financial officer, principal
    accounting officer or controller, or persons performing similar
    functions, on our website identified above. The information on
    or accessible through our website is not a part of this
    prospectus.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Corporate
    Governance Guidelines</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the consummation of this offering, we will adopt
    Corporate Governance Guidelines to assist us with the proper
    management and governance of the activities of our board of
    directors. A complete copy of the Corporate Governance
    Guidelines will be available prior to the consummation of this
    offering on our website at www.molycorp.com. Our Corporate
    Governance Guidelines cover, among other topics:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    director independence;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    board structure and composition;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    board member nomination and eligibility requirements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    board leadership and executive sessions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    limitations on other board and committee service;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    committees of the board;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    director responsibilities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    board and committee resources, including access to officers and
    employees;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    director compensation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    director orientation and ongoing education;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    succession planning;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    board and committee self evaluations.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Review
    and Approval of Related-Party Transactions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following the consummation of this offering, our Audit and
    Ethics Committee will be responsible for the review and approval
    of all related-party transactions required to be disclosed to
    the public under SEC rules. This procedure will be contained in
    the written charter of our Audit and Ethics Committee. In
    addition, we will maintain a written Code of Ethics that will
    require all employees, including our officers, to disclose to
    the Audit and Ethics Committee any material relationship or
    transaction that could reasonably be expected to give
</DIV>
<!-- XBRL Paragraph Pagebreak -->
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    77
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    rise to a personal conflict of interest. Related-party
    transactions will be reviewed and approved by the Audit and
    Ethics Committee on a
    <FONT style="white-space: nowrap">case-by-case</FONT>
    basis.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Compensation
    Discussion and Analysis</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Executive
    Summary</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As further discussed in this section, our compensation and
    benefit programs help us attract, retain and motivate
    individuals who will maximize our business results by working to
    meet or exceed established company or individual objectives.
    This section focuses on our compensation programs for executive
    officers, including the following officers whom we refer to as
    our named executive officers:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="48%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Title</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    President and Chief Executive Officer
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    James S. Allen
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Chief Financial Officer
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Corporate Controller
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John F. Ashburn
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Executive Vice President and General Counsel
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John L. Burba
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Executive Vice President and Chief Technology Officer
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Between the time when Molycorp Minerals, LLC acquired the
    Mountain Pass California rare earth deposit and associated
    assets from Chevron Mining Inc. in September 2008 and the
    formation of Molycorp, LLC in September 2009, the board of
    directors of Molycorp Minerals, LLC, our subsidiary,
    historically had the overall responsibility for monitoring and
    approving our executive compensation programs and making
    decisions regarding compensation to be paid or awarded to our
    executive officers. Since September 2009, our board of directors
    has had responsibility for monitoring executive compensation.
    Going forward, our Compensation Committee will administer our
    compensation plans, policies and programs for the named
    executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following discussion and analysis of our compensation and
    benefit programs should be read together with the compensation
    tables and related disclosures that follow this section. This
    discussion includes forward-looking statements based on our
    current plans, considerations, expectations and determinations
    about our compensation program. Actual compensation decisions
    that we may make for 2010 and beyond may differ materially from
    those made in our recent past.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Overview,
    Philosophy and Objectives</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our compensation and benefit program seeks to attract and retain
    talented and qualified individuals to manage and lead our
    company and to motivate them to pursue our long-term business
    objectives. In 2009, our compensation program consisted of a mix
    of cash and equity-based components. This mix provided an
    attractive total compensation package that rewarded individual
    and company performance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We compete with a variety of companies and organizations to hire
    and retain individual talent. As a result, the primary goal of
    our compensation program is to help us attract, motivate and
    retain the best people possible. We implement this philosophy by:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    encouraging, recognizing and rewarding outstanding performance;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recognizing and rewarding individuals for their experience,
    expertise, level of responsibility, leadership, individual
    accomplishment and other contributions to Molycorp;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recognizing and rewarding individuals for work that helps
    increase the value of Molycorp;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    providing compensation packages that are competitive with those
    offered by companies with whom we compete in hiring and
    retaining talented individuals.
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    78
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Executive compensation is a management tool that we use to
    provide reasonable financial security for our executive officers
    in exchange for their service. We also use executive
    compensation to align our executive officers&#146; behavior with
    our mission, business strategy, values and culture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not engaged third-party consultants to assist in the
    formation of our compensation packages. However, going forward,
    our Compensation Committee may retain third-party executive
    compensation specialists in connection with determining cash and
    equity-based compensation and related compensation policies in
    the future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This Compensation Discussion and Analysis provides you with a
    description of the material factors underpinning our
    compensation policies and decisions for our named executive
    officers. We refer to these policies and decisions as our
    compensation program.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Allocation
    of Compensation Components</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our compensation program consists of the following components:
    base salary, annual cash bonus,
    <FONT style="white-space: nowrap">equity-based</FONT>
    awards, health and welfare benefits and retirement benefits.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Administration and Consulting</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Role of the Board of Directors of Molycorp Minerals, LLC
    Prior to This Offering.</I>&#160;&#160;Until September&#160;10,
    2009, the board of directors of Molycorp Minerals, LLC
    historically had the overall responsibility for monitoring and
    approving our compensation program. After September&#160;10,
    2009, our board of directors has responsibility for monitoring
    executive compensation. The compensation we paid our named
    executive officers for fiscal year 2009 is disclosed in detail
    in the tables and narratives that follow under the heading
    &#147;&#151;&#160;Executive Compensation.&#148; We describe and
    discuss the particular compensation decisions made by the board
    of directors of Molycorp Minerals, LLC regarding the 2009
    compensation of our named executive officers below under
    &#147;&#151;&#160;Primary Components of Executive
    Compensation.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Role of Compensation Consultant.</I>&#160;&#160;Neither the
    board of Molycorp Minerals, LLC nor our board of directors
    employed a compensation consultant in 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Role of Executive Officers.</I>&#160;&#160;Since the
    acquisition by Molycorp Minerals, LLC from Chevron Mining Inc.
    in September 2008, our President and Chief Executive Officer has
    taken the lead in providing our board of directors, and before
    that, the board of directors of Molycorp Minerals, LLC, with
    recommendations regarding our compensation program and the
    compensation of our named executive officers other than himself.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Role of Compensation Committee after Completion of This
    Offering.</I>&#160;&#160;In connection with this offering, we
    will to form a Compensation Committee that will oversee our
    compensation program for the named executive officers. Under the
    rules of the NYSE, our Compensation Committee will be required
    to be composed entirely of independent directors. In addition,
    all members of the Compensation Committee will be
    (i)&#160;&#147;non-employee directors&#148; within the meaning
    of
    <FONT style="white-space: nowrap">Rule&#160;16b-3</FONT>
    promulgated under the Exchange Act and (ii)&#160;&#147;outside
    directors&#148; within the meaning of Section&#160;162(m) of the
    Internal Revenue Code of 1986, as amended, or the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After completion of this offering, the Compensation Committee
    will have the primary responsibility under its charter for:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    determining, or recommending to our board of directors, our
    President and Chief Executive Officer&#146;s compensation and
    compensation for our other executive officers;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    administering the equity and incentive compensation plans in
    which our executive officers and other employees participate.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our Compensation Committee will also generally be responsible
    for evaluating and administering our compensation program to
    ensure that it properly motivates our executive officers and
    appropriately drives our operational and financial performance.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    79
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each year, our Compensation Committee will review base salaries,
    determine and make annual cash incentive awards, approve payout
    amounts earned for the past year&#146;s annual cash incentive
    awards, and determine and make equity incentive awards under the
    Molycorp, Inc. 2010 Equity and Performance Incentive Plan. In
    fulfilling its duties and responsibilities, the Compensation
    Committee will receive input in the form of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reports and updates from our executive officers on company and
    individual executive performance that will be measured against
    quantitative and qualitative performance goals established to
    help determine individual performance and business
    success;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    recommendations from our President and Chief Executive Officer
    regarding the compensation for our executive officers.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Compensation Committee will not be bound by the input it
    receives from our President and Chief Executive Officer or any
    other executive officer. Instead, the Compensation Committee
    will exercise independent discretion when making executive
    compensation decisions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Compensation
    Program Overview</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We believe our compensation program, when judged on a
    <FONT style="white-space: nowrap">component-by-component</FONT>
    basis and in total, effectively achieves our compensation
    philosophy and objectives described above. The following chart
    summarizes the primary components of our compensation program
    for 2009:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="35%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="63%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Component</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Primary Purpose</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Base Salary
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Base salary rewards an individual for his or her position&#146;s
    responsibilities, skills, experience and performance.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Base salaries are intended to provide a level of compensation
    sufficient to attract and retain an effective management team,
    when considered in combination with the other components of our
    compensation program. The relative levels of base salary for our
    named executive officers are designed to reflect each executive
    officer&#146;s scope of responsibility and accountability with
    us.
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Annual Cash Bonuses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Annual cash bonuses are used to reward named executive officers
    for our achievement of superior operating performance.
    Participants in the annual cash bonus plan can achieve bonuses
    equal to a percentage of their salaries in the discretion of our
    board.
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Long-Term Equity-Based Awards
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Equity-based awards motivate individuals to help achieve an
    increase in stockholder value and promote retention.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Amount realized by the individual depends on appreciation in our
    value.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Awarded based on individual responsibilities and the
    position&#146;s organizational value to us.
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Health and Welfare Benefits
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Health and welfare benefits provide for basic health, life and
    income security needs.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Retirement Benefits
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Our 401(k) plan encourages and rewards long-term service by
    providing market-based benefits upon retirement. All employees
    are eligible to participate in our 401(k) plan.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Our nonqualified deferred compensation plan provides a
    tax-efficient vehicle to accumulate retirement savings.
    Participation in our nonqualified deferred compensation plan is
    limited to a select group of other highly compensated
    individuals, including our executive officers
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    80
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Primary
    Components of Executive Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>2009 Base Salaries.</I>&#160;&#160;For 2009, none of our
    executive officers received an increase in base salary compared
    to 2008. The salaries for Mr. Allen and Ms. Adams, who were
    hired in 2009, were determined by our board of directors based
    on the recommendation of our President and Chief Executive
    Officer. These salaries were set at levels designed to attract
    Mr. Allen and Ms. Adams to Molycorp.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Annual Cash Bonuses.</I>&#160;&#160;We maintain a Management
    Incentive Plan for our key employees, including our named
    executive officers, pursuant to which we award annual cash
    bonuses based on company performance. Additionally, participants
    can defer a portion of their salaries pursuant to the Management
    Incentive Plan. Bonuses under the Management Incentive Plan are
    purely at the discretion of our board of directors. For 2009,
    our board of directors determined that participants were
    entitled to bonuses equal to 2% of their respective salaries
    based on our performance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Long-Term Equity-Based Awards.</I>&#160;&#160;In September
    2009, the board of directors of Molycorp Minerals, LLC made
    discretionary grants to each of Messrs.&#160;Smith, Ashburn and
    Burba of profits interests in Molycorp Minerals, LLC, which we
    refer to as incentive shares, pursuant to Molycorp Minerals,
    LLC&#146;s Second Amended and Restated Operating Agreement that
    were designed to provide an opportunity for compensation after
    our initial investors receive their annually compounded return
    and their initial capital contribution. These incentive shares
    represented an indirect ownership interest in Molycorp Minerals,
    LLC, providing the holder with a specified percentage of cash
    distributions from of Molycorp Minerals, LLC from the date of
    grant. The incentive shares were structured as one-time grants
    that we believe immediately aligned the interests of the
    recipients, including Messrs.&#160;Smith, Ashburn and Burba,
    with the investors in Molycorp Minerals, LLC and with each
    other. The number of incentive shares awarded to each executive
    officer was determined by the board of directors of Molycorp
    Minerals, LLC commensurate with the executive officer&#146;s
    position and responsibilities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The incentive shares provide the named executive officers who
    received them rights that were parallel to those of other
    indirect owners with respect to future profits of Molycorp
    Minerals, LLC, thereby motivating and rewarding those named
    executive officers for our profitability. In addition, these
    awards provided a retention tool because they were scheduled to
    vest ratably over a three-year period, subject to the applicable
    named executive officer&#146;s continued employment on each
    annual vesting date. See the &#147;2009 Grants of Plan-Based
    Awards&#148; table below for more information regarding the
    vesting schedule of the incentive shares held by certain of our
    named executive officers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All outstanding incentive shares were converted into restricted
    shares of Class B common stock of Molycorp, Inc. in the
    corporate reorganization.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to his employment agreement, Mark A. Smith, our
    President and Chief Executive Officer, was granted an option to
    purchase 3,798 of our shares, which was immediately exercisable.
    In granting Mr.&#160;Smith the option, we believe that we were
    aligning his interests with those of our other investors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with this offering, we intend to adopt the
    Molycorp, Inc. 2010 Equity and Performance Incentive Plan so
    that we can continue to provide our named executive officers and
    other employees with equity-based compensation. For details on
    the 2010 Equity and Performance Incentive Plan, see &#147;&#151;
    Molycorp, Inc. 2010 Equity and Performance Incentive Plan.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Health and Welfare Benefits.</I>&#160;&#160;Each of our named
    executive officers is entitled to participate in our employee
    benefit plans (including medical, dental, and life insurance
    benefits) on the same basis as other employees.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Retirement Benefits.</I>&#160;&#160;We have established a
    401(k) plan for our employees that encourages and rewards
    long-term service by providing market-based benefits upon
    retirement. Each of our named executive officers is entitled to
    participate in our 401(k) plan on the same basis as other
    employees. For more information on our 401(k) plan, please see
    &#147;&#151;&#160;Executive Compensation&#160;&#151; Retirement
    Plans.&#148;
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    81
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our nonqualified deferred compensation plan provides a
    tax-efficient vehicle to accumulate retirement savings. For more
    information on our nonqualified deferred compensation plan,
    please see &#147;&#151;&#160;Executive Compensation&#160;&#151;
    Nonqualified Deferred Compensation.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Executive
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth compensation information
    regarding our President and Chief Executive Officer, Chief
    Financial Officer and each of our three other most highly
    compensated executive officers serving as of December&#160;31,
    2009.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">2009
    SUMMARY COMPENSATION TABLE</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 9pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="44%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=09 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=09 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=09 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=09 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Non-Equity<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Incentive Plan<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>All Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Salary<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Bonus<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Compensation<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name and Principal Position</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Year</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)(3)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Mark A. Smith,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    400,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    241,000
</TD>
<TD nowrap align="left" valign="bottom">
    (5)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    30,245
</TD>
<TD nowrap align="left" valign="bottom">
    (6)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    679,245
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 9pt">
    President and Chief Executive Officer
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    James S. Allen,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,179
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,256
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 9pt">
    Chief Financial Officer(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    52,308
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53,254
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 9pt">
    Corporate Controller(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    John F. Ashburn,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    215,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34,900
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,800
</TD>
<TD nowrap align="left" valign="bottom">
    (7)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    259,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 9pt">
    Executive Vice President and General Counsel
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -9pt; margin-left: 9pt">
    John L. Burba,
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2009
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    213,701
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,274
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,644
</TD>
<TD nowrap align="left" valign="bottom">
    (8)
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    243,619
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 9pt">
    Executive Vice President and chief Technology Officer
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Mr.&#160;Allen was hired on December&#160;9, 2009.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Ms.&#160;Adams was hired on July&#160;27, 2009.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents cash bonuses awarded under our Management Incentive
    Plan, other than $30,000 paid to Mr. Ashburn, which consisted of
    the remaining portion of his signing bonus that was contingent
    upon his employment continuing in 2009.</TD>
</TR>

<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    On September&#160;10, 2009, our board of directors awarded
    incentive shares of Molycorp Minerals, LLC to certain employees,
    including 2,310,000&#160;shares to Mr.&#160;Smith,
    700,000&#160;shares to Mr.&#160;Ashburn and 875,000&#160;shares
    to Mr.&#160;Burba. Additional information regarding the
    incentive shares, which are intended to constitute &#147;profits
    interests&#148; under IRS Revenue Procedures
    <FONT style="white-space: nowrap">93-27</FONT> and
    <FONT style="white-space: nowrap">2001-43,</FONT> is
    included in note&#160;7 to the consolidated financial statements
    included elsewhere in this prospectus.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    The value of this option award represents the amount of
    compensation recognized for financial statement purposes.
    Additional information regarding the determination of the grant
    date fair value of this award and the underlying assumption is
    included in Note&#160;8 to the consolidated financial statements
    included elsewhere in this prospectus.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes $29,400 for employer contributions to our 401(k) plan
    on behalf of Mr.&#160;Smith for 2009, and $845 in 2009 for the
    premiums paid on a term life insurance policy for the benefit of
    Mr.&#160;Smith.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents employer contributions to our 401(k) plan on behalf
    of Mr.&#160;Ashburn for 2009.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD align="right" valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents employer contributions to our 401(k) plan on behalf
    of Mr.&#160;Burba for 2009.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Employment
    Agreements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have not entered into employment agreements or severance
    agreements with any of our named executive officers, except for
    Mr.&#160;Smith. In connection with the consummation of this
    offering, we anticipate that we will enter into employment
    agreements with certain other of our named executive officers.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    82
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Mark A.
    Smith Employment Agreement</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We entered into an executive employment agreement with
    Mr.&#160;Smith, our President and Chief Executive Officer, on
    November&#160;1, 2009. The agreement terminates under its own
    term on October&#160;8, 2011, but it can be renewed upon our
    mutual agreement with Mr.&#160;Smith. Mr.&#160;Smith&#146;s
    employment agreement provides for, among other things:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an annual base salary of $400,000, subject to increases at our
    discretion;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    eligibility to participate in our employee benefit plans;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    eligibility to participate in our annual bonus plan for officers
    and directors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    eligibility to participate in our executive nonqualified
    deferred compensation plan;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a term life insurance policy in the amount of $1,000,000 for the
    benefit of Mr.&#160;Smith.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we terminate Mr.&#160;Smith&#146;s employment without cause,
    Mr.&#160;Smith would be entitled to receive any accrued salary
    and vacation pay up to and including the date or termination and
    severance payments in an amount equal to either two years of his
    base salary, if the termination occurs prior to November&#160;1,
    2010, or one year of his base salary, if the termination after
    November&#160;1, 2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under his employment agreement, Mr.&#160;Smith is subject to a
    three-year prohibition on &#147;competitive conduct,&#148; as
    defined in his agreement, anywhere in the world following the
    termination of his employment for any reason.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth information with respect to
    non-equity and equity incentive plan awards granted to our named
    executive officers during 2009. The Summary Compensation Table
    above provides information regarding the actual dollar amounts
    earned under our incentive plans.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">2009
    GRANTS OF PLAN-BASED AWARDS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="32%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="11%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Other<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Stock Awards:<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Price of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Grant Date<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Grant<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Incentive Share<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Option Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Fair Value<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Grant Type</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Date</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Stock Options</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Awards(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($/Sh)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>of Awards($)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    option
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4/10/09
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,798
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    92.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    240,843
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    incentive shares
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9/10/09
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,310,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    James S. Allen
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John F. Ashburn
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    incentive shares
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9/10/09
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    700,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John L. Burba
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    incentive shares
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9/10/09
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    875,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    In connection with the corporate reorganization, all of the
    incentive shares were converted into restricted shares of
    Class&#160;B common stock, each of which will convert
    into&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    shares of common stock (based upon an assumed offering price of
    $&#160;&#160;&#160;&#160;&#160;per share) immediately prior to
    this offering.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">OUTSTANDING
    EQUITY AWARDS AT DECEMBER 31, 2009</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table provides information about the incentive
    shares held by each of our named executive officers as of
    December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="57%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Securities<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Underlying<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Unexercised<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Option<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Options<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Expiration<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(#) Exercisable</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>(#) Unexercisable</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Date</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,255(1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    92.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2/1/12
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Options for member interest in Molycorp Minerals, LLC, which
    were assumed by Molycorp, LLC were immediately vested&#160;and
    exercisable on the grant date.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    83
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table provides information about the incentive
    shares held by each of our named executive officers as of
    December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="15%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Market Value of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Number of Shares or<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares or Units of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Units of Stock That<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Stock That Have Not<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Have Not Vested<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Vested<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>(#)(1)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    1,540,000
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    James S. Allen
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    &#151;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John F. Ashburn
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    466,666.66
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John L. Burba
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    583,333.33
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    In connection with the corporate reorganization, all of the
    incentive shares were converted into restricted shares of
    Class&#160;B common stock, each of which will convert
    into&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    shares of common stock (based upon an assumed offering price of
    $&#160;&#160;&#160;&#160;&#160;per share) immediately prior to
    this offering.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">2009
    OPTION EXERCISES AND STOCK VESTED</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="67%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Option Awards</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Shares Acquired on<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Value Realized on<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Exercise&#160;(#)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Exercise&#160;($)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    543
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,432
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Retirement
    Plans</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our named executive officers are eligible to participate in our
    tax-qualified Molycorp Minerals, LLC 401(k) Plan on the same
    basis as other employees under the plan. We make safe harbor
    contributions to this plan equal to 100% of each
    participant&#146;s own elective deferrals of up to 3% of each
    participant&#146;s salary and 50% of each participant&#146;s own
    elective deferrals of the next 2% of the participant&#146;s
    salary. We also have the discretion to make annual profit
    sharing contributions that are allocated among all eligible
    participants in proportion to their respective compensation. The
    Summary Compensation Table above reflects the actual dollar
    amounts contributed to our 401(k) plan on each named executive
    officer&#146;s behalf.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Nonqualified
    Deferred Compensation</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table reflects the amounts credited under our
    Management Incentive Plan on behalf of our named executive
    officers. We do not maintain any other nonqualified deferred
    compensation plans.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">2009
    NONQUALIFIED DEFERRED COMPENSATION</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="31%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="5%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Executive<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Registrant<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Contributions<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Contributions<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Earnings<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Balance at<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>in Last<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>in Last<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>in Last<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Withdrawals/<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Last<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fiscal Year<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fiscal Year<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fiscal Year<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Distributions<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fiscal Year End<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,667
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    James S. Allen
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    77
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    946
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John F. Ashburn
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,900
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    John L. Burba
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,274
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The amounts reported are fully reported as part of the
    &#147;Salary&#148; and &#147;Bonus&#148; columns of the Summary
    Compensation Table.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    84
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;1, 2009, we established the Management Incentive
    Plan, which is a nonqualified deferred compensation plan for the
    purpose of providing deferred compensation benefits for a select
    group of management or highly compensated employees. Under the
    Management Incentive Plan, participants can defer their base
    salary and any bonus, commission or other extraordinary
    compensation that is supplemental to the participant&#146;s base
    salary and is dependent upon achievement of individual or
    company performance goals. It is intended that the Management
    Incentive Plan constitute an unfunded plan for purposes of the
    Employee Retirement Income Security Act of 1974, as amended.
    Pursuant to the Management Incentive Plan, a deferred
    compensation account is established for each participant, as
    determined by the plan&#146;s administrative committee. The
    amounts of compensation or awards deferred with respect to each
    deferred compensation account are credited to such account and
    are deemed invested in a hypothetical investment as of the date
    of deferral.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Potential
    Payments upon Termination or Change in Control</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We currently do not have any termination or change of control
    agreements with any of our named executive officers, except for
    Mr.&#160;Smith as described under &#147;&#151;&#160;Employment
    Agreements&#148; above.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Director
    Compensation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="78%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Fees Paid<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Stock<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>in Cash<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Awards<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>($)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Jack E. Thompson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;(1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Charles R. Henry
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;(1
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    On September&#160;10, 2009, our board of directors awarded
    350,000 incentive shares of Molycorp Minerals, LLC to each of
    Mr.&#160;Thompson and Mr.&#160;Henry. Additional information
    regarding the incentive shares, which are intended to constitute
    &#147;profits interests&#148; under IRS Revenue Procedures
    <FONT style="white-space: nowrap">93-27</FONT> and
    <FONT style="white-space: nowrap">2001-43,</FONT> is
    included in note&#160;7 to the consolidated financial statements
    included elsewhere in the prospectus.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our non-employee directors receive an annual cash retainer in
    the amount of $25,000. We anticipate that after the consummation
    of this offering, non-employee directors will also receive an
    annual cash retainer of $5,000 for each committee on which the
    director serves, other than the chairman of the Audit and Ethics
    Committee, who will receive an additional cash retainer of
    $10,000.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Molycorp,
    Inc. 2010 Equity and Performance Incentive Plan</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We expect our board of directors to adopt the Molycorp, Inc.
    2010 Equity and Performance Incentive Plan, which we refer to as
    the Plan, prior to the consummation of this offering and subject
    to the approval of our stockholders. The Plan is expected to
    provide for the grant of incentive stock options and
    nonqualified stock options, the grant or sale of restricted
    shares of common stock and restricted stock units, the grant of
    appreciation rights and the grant of performance shares and
    performance units to our non-employee directors, officers and
    other employees. Under the Plan, our board of directors is
    expected to be able to provide for the payment of dividend
    equivalents on a current, deferred or contingent basis, on
    restricted stock units or performance shares granted or sold
    under the Plan. Our board of directors may condition the grant
    of any award under the Plan on a participant&#146;s surrender or
    deferral of his or her right to receive a cash bonus or other
    compensation payable by us, so long as such surrender or
    deferral would not result in negative tax consequences under
    Section&#160;409A of the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Options.</I>&#160;&#160;Incentive and nonqualified stock
    options have an exercise price of 100% or more of the market
    value of our common stock on the date of grant. No stock option
    will be exercisable more than ten years from its date of grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Appreciation Rights.</I>&#160;&#160;Participants who are
    awarded stock options may also be granted tandem appreciation
    rights, which may be used as an alternative to exercising the
    stock option. Participants may also be granted free-standing
    appreciation rights, which will entitle them to payments equal
    to a percentage, not to
</DIV>
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    <BR>
    85
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    exceed 100%, of the difference of the market value per share on
    the exercise date minus the base price, which base price will to
    be equal to or greater than the market value per share on the
    date of grant.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Restricted Stock.</I>&#160;&#160;Restricted stock may be
    granted or sold to participants in consideration of the
    performance of services or payments by a participant that may be
    less than the market value of our common stock on the date of
    grant. Each grant or sale is expected to constitute an immediate
    transfer of the ownership of common stock to the participants.
    The restricted shares were subject to a substantial risk of
    forfeiture for a period to be determined by our board of
    directors at the time of grant and such other terms and
    restrictions as provided for by our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Restricted Stock Units.</I>&#160;&#160;Restricted stock units
    granted or sold to a participant are expected to constitute an
    agreement between the participant and us that we will deliver
    shares of common stock or cash to the participant in the future
    in consideration of the performance of services by the
    participant. The restricted stock units will be subject to the
    fulfillment of the conditions that the board of directors sets
    forth in its grant of the award.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Performance Shares and Performance
    Units.</I>&#160;&#160;Performance shares and performance units
    granted to a participant are expected to set forth certain
    management objectives to be achieved during a specified
    performance period. A performance share is a bookkeeping entry
    that represents the equivalent of one share of common stock. A
    performance unit is a bookkeeping entry that represents the
    equivalent of $1.00 or other such value as determined by the
    board of directors. The participant will receive full payment
    upon satisfaction of the management objectives or, short of
    meeting the management objectives, partial payment upon reaching
    a minimum acceptable level of performance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Shares&#160;Reserved; Plan Limits.</I>&#160;&#160;We expect
    to
    reserve&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    common shares of our common stock for issuance under the Plan,
    subject to adjustment to prevent dilution or enlargement of the
    rights of participants. The aggregate number of shares that may
    be issued upon the exercise of incentive stock options is not
    expected to
    exceed&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    common shares. The number of shares that may be issued as
    full-value awards is not expected to
    exceed&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    common shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Eligibility.</I>&#160;&#160;Officers, employees and
    non-employee directors of us and any of our subsidiaries may be
    selected by the board of directors to receive benefits under the
    Plan. Non-employee directors are expected to be subject to
    additional terms and conditions regarding equity awards under
    the Plan. Our board of directors may provide for special terms
    for awards to participants who are foreign nationals or who are
    employed by us outside the United States as our board of
    directors may deem necessary or appropriate to accommodate
    differences in local law, tax policy or custom.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Administration.</I>&#160;&#160;Our board of directors is
    expected to administer the Plan and may delegate its authority
    to our Compensation Committee. Our board of directors or the
    Compensation Committee may delegate certain administrative
    powers to one or more of our officers, agents or advisors.
    Delegated officers who are authorized to administer the plan may
    designate employees to be recipients of awards and determine the
    size of the awards so long as this responsibility is not
    delegated for awards granted to &#147;officers,&#148; as defined
    by
    <FONT style="white-space: nowrap">Rule&#160;16a-1(f)</FONT>
    of the Exchange Act. Such delegation will also be contingent
    upon an authorizing resolution that sets forth the number of
    shares that such officers may grant and periodic reporting by
    such officers to our board of directors regarding the nature and
    scope of the awards granted pursuant to the authority delegated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Adjustments.</I>&#160;&#160;The number and kind of shares
    covered by outstanding awards, certain other provisions
    contained in outstanding awards, the number of shares reserved
    for issuance under the Plan and the other share limits contained
    in the Plan will be subject to adjustment in certain
    transactions or events as provided in the Plan. Moreover, in the
    event of any such transaction or event or in the event of a
    change of control, our board of directors may provide in
    substitution for any or all outstanding awards under the Plan
    such alternative consideration (including cash), if any, as it
    may determine to be equitable in the circumstances. Our board of
    directors may require in connection with such substitution the
    surrender of all awards that are replaced in a manner that
    complies with Section&#160;409A of the Code. In addition, for
    each stock option or stock appreciation right with an option
    price or base price greater than the consideration offered in
    connection with any such
</DIV>
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    <BR>
    86
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    transaction or event or change of control, our board of
    directors may elect to cancel such stock option or stock
    appreciation right without any payment to the person holding
    such stock option or stock appreciation right.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Amendments.</I>&#160;&#160;Our board of directors may at any
    time amend the Plan in whole or in part. However, an amendment
    to the Plan will be subject to stockholder approval if such
    amendment:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    would materially increase the benefits accruing to participants
    under the Plan;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    would materially increase the number of securities which may be
    issued under the Plan;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    would materially modify the requirements for participation in
    the Plan;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    must otherwise be approved by our stockholders in order to
    comply with applicable law or the rules of the NYSE or, if our
    common shares are not traded on the NYSE, the principal national
    securities exchange upon which our common shares are traded or
    quoted.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Except in connection with a corporate transaction or event
    described in the Plan, the terms of outstanding awards may not
    be amended to reduce the exercise price of outstanding stock
    options or the base price of outstanding stock appreciation
    rights, or cancel outstanding stock options or stock
    appreciation rights in exchange for cash, other awards or stock
    options or stock appreciation rights with an exercise price or
    base price, as applicable, that is less than the exercise price
    of the original stock options or base price of the original
    stock appreciation rights, as applicable, without stockholder
    approval.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If permitted by Section&#160;409A of the Code, in the case of a
    change of control or in case of termination of employment by
    reason of death, disability or normal or early retirement, in
    the case of unforeseeable emergency or other special
    circumstances of a participant who holds an unvested or
    unexercisable award, our board of directors may accelerate the
    time at which:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    such award may be exercised;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the substantial risk of forfeiture or prohibition or restriction
    on transfer of such award will lapse;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the restriction period of such award will end;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    such award will be deemed to have been fully earned;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    such award&#146;s transfer restriction will terminate.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Likewise, our board of directors may waive any other limitation
    or requirement under any such unvested or unexercisable award.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our board of directors may amend the terms of any award granted
    under the Plan prospectively or retroactively. No such amendment
    may impair the rights of any participant without his or her
    consent. Our board of directors may terminate the Plan at any
    time. Termination of the Plan will not affect the rights of
    participants or their successors under any awards outstanding
    under the Plan and not exercised in full on the date of
    termination.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Effective Date; Termination.</I>&#160;&#160;We intend for the
    Plan to become effective on the date on which the Plan is
    adopted by our board of directors. The Plan will be submitted to
    our current stockholders for approval. Unless the Plan is
    approved by our current stockholders within twelve months after
    the date on which the Plan is adopted by our board of directors,
    the Plan and all awards made under it will be void and of no
    force and effect. No grant is expected to be made under the Plan
    after the ten-year anniversary of the effective date of the Plan
    but all grants made on or prior to such date are expected to
    continue in effect subject to the terms of their award
    agreements and the terms of the Plan.
</DIV>
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    <BR>
    87
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='114'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CERTAIN
    RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Inventory
    Financing and Resale Agreement</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp, LLC entered into an inventory financing and resale
    agreement with Traxys North America, LLC, dated as of
    May&#160;15, 2009. Pursuant to this agreement, Traxys has agreed
    to purchase, and Molycorp, LLC agreed to sell, approximately one
    million pounds of didymium oxide and up to 18&#160;million
    pounds of bastnasite at fixed prices. The purchase price paid by
    Traxys is treated as an advance, on which Molycorp, LLC pays
    finance charges, until the products are ultimately sold by
    Traxys to third-party purchasers. The net revenue from sales to
    such third-party purchasers is then allocated between Traxys and
    Molycorp, LLC according to a fixed schedule. Pursuant to this
    agreement, Molycorp, LLC is obligated to repurchase from Traxys
    any unsold didymium oxide and any unsold bastnasite at
    May&#160;15, 2010 and May&#160;15, 2011, respectively. At
    certain periods during the term of the agreement, Traxys also
    has the right to convert any amounts owed by us into member
    interests in Molycorp, LLC in the form of shares at a fixed
    price. On November&#160;15, 2009, Traxys converted outstanding
    advances and finance charges totaling $6.8&#160;million into
    59,311&#160;shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;16, 2010, Molycorp Minerals, LLC executed an
    agreement under which an affiliate of Traxys agreed to purchase
    up to $5&#160;million of product from us through
    December&#160;31, 2010. Purchases under the agreement would
    occur at our request at a price per pound based on published
    index pricing. Upon the resale of any acquired product, we are
    entitled to receive 50% of the sales price that exceeds a
    specified level.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Contribution
    Agreement</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each of Resource Capital Fund&#160;IV L.P., Resource Capital
    Fund&#160;V L.P., PP IV Mountain Pass II, LLC, PP IV MP AIV 1,
    LLC PP IV MP AIV 2, LLC, PP IV MP AIV 3, LLC, TNA Moly Group
    LLC, MP Rare Company LLC and KMSMITH LLC were members of
    Molycorp, LLC. In connection with our corporate reorganization
    and pursuant to a contribution agreement, these parties
    contributed either (a)&#160;all of their member interests in
    Molycorp, LLC or (b)&#160;all of their equity interests in
    entities that hold member interests in Molycorp, LLC (and no
    other assets or liabilities) to Molycorp, Inc. in exchange for
    shares of Class&#160;A common stock of Molycorp, Inc. See
    &#147;Principal and Selling Stockholders.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Registration
    Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Resource Capital Fund&#160;IV L.P., Resource Capital Fund&#160;V
    LP, PP IV MP AIV 1, LLC, PP IV MP AIV 2, LLC, PP IV MP AIV 3,
    LLC, TNA Moly Group LLC, PP IV MP AIV 1, LLC, PP IV MP AIV 2,
    LLC, PP IV MP AIV 3, LLC, TNA Moly Group LLC, MP Rare Company
    LLC and KMSMITH LLC have registration rights beginning six
    months after completion of this offering with respect to the
    shares of capital stock that they will hold after giving effect
    to the corporate reorganization. For a description of these
    registration rights, see &#147;Description of Capital
    Stock&#160;&#151; Registration Rights.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Letters
    of Credit</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In February 2009, the members of Molycorp Minerals, LLC incurred
    certain costs in providing letters of credit
    <FONT style="white-space: nowrap">and/or</FONT> cash
    collateral to secure surety bonds issued for the benefit of
    certain regulatory agencies relating to our Mountain Pass
    facility closure and reclamation obligations. The total amount
    of collateral provided by these members at December&#160;31,
    2009 was $18.2&#160;million. We have agreed to pay each member a
    five percent annual return on the amount of collateral provided.
    Under the terms of the agreement, the members may receive
    quarterly payments, delayed payments or
    <FONT style="white-space: nowrap">payments-in-kind.</FONT>
    After the completion of this offering, we intend to terminate
    this agreement with these members.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Mountain
    Pass Acquisition</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with our acquisition of the Mountain Pass,
    California rare earth deposit and associated land, facilities,
    rare earth processing facilities and intellectual property from
    Chevron Mining Inc., a subsidiary of Chevron Corporation,
    certain members of Molycorp Minerals, LLC incurred acquisition
    costs that were
</DIV>
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    <BR>
    88
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    subsequently reimbursed by Molycorp Minerals, LLC. At
    December&#160;31, 2008, accrued expenses included approximately
    $0.2&#160;million related to this reimbursement obligation.
</DIV>
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    <BR>
    89
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='115'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PRINCIPAL
    AND SELLING STOCKHOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table sets forth certain information regarding the
    beneficial ownership of shares of common stock as
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    as adjusted to reflect the corporate reorganization and the sale
    of common stock offered by us and the selling stockholders in
    this offering, for:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each person who we know beneficially owns more than 5% of our
    common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of the individuals whom we expect to be our directors as of
    the consummation of this offering;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of our named executive officers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all of the individuals whom we expect to be our directors and
    our executive officers as a group;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all selling stockholders.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have determined beneficial ownership in accordance with the
    rules of the SEC. Except as indicated by the footnotes below, we
    believe, based on the information furnished to us, that the
    persons and entities named in the table below have sole voting
    and investment power with respect to all shares of common stock
    that they beneficially own, subject to applicable community
    property laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The percentage ownership information shown in the table is based
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    shares of common stock outstanding
    at&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    (after giving effect to the corporate reorganization). In
    computing the number of shares of common stock beneficially
    owned by a person and the percentage ownership of that person,
    we deemed to be outstanding all shares of common stock subject
    to options or warrants held by that person that are currently
    exercisable or exercisable within 60&#160;days
    of&#160;&#160;&#160;&#160;&#160;. We did not deem these shares
    outstanding, however, for the purpose of computing the
    percentage ownership of any other person. Beneficial ownership
    representing less than 1% is denoted with an asterisk
    &#147;*&#148;.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Unless otherwise noted below, the address of the persons and
    entities listed on the table is
    <FONT style="white-space: nowrap">c/o&#160;Molycorp,</FONT>
    Inc., 5619 Denver Tech Center Parkway, Suite&#160;1000,
    Greenwood Village, Colorado 80111.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>
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    <BR>
    90
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 8pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="38%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=07 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=07 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=07 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=07 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=08 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=08 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=08 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=08 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Shares Beneficially<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Owned<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>After This Offering<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Number<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>(assuming the<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Shares Beneficially<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>of Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Shares Beneficially<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>underwriters exercise<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Owned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Being<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>Owned<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom">
    <B>their over-allotment<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Prior to This Offering</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Offered</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>After This Offering</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="7" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>option in full)</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
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    <B>Name and Address of Beneficial Owner</B>
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<DIV style="text-indent: -8pt; margin-left: 8pt">
    Resource Capital Funds
</DIV>
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<DIV style="text-indent: 0pt; margin-left: 8pt">
    1400 Sixteenth Street, Suite&#160;200<BR>
    Denver, Colorado 80202
</DIV>
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<DIV style="text-indent: -8pt; margin-left: 8pt">
    Pegasus Capital Advisors, LP
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<DIV style="text-indent: 0pt; margin-left: 8pt">
    505 Park Avenue,
    22<SUP style="font-size: 85%; vertical-align: top">nd</SUP>

    Floor<BR>
    New York, New York 10022
</DIV>
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<DIV style="text-indent: -8pt; margin-left: 8pt">
    Traxys North America LLC
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<DIV style="text-indent: 0pt; margin-left: 8pt">
    825 Third Avenue<BR>
    New York, New York 10022
</DIV>
</TD>
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<DIV style="text-indent: -8pt; margin-left: 8pt">
    MP Rare Company LLC
</DIV>
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<DIV style="text-indent: 0pt; margin-left: 8pt">
    825 Third Avenue<BR>
    New York, New York 10022
</DIV>
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<DIV style="text-indent: -8pt; margin-left: 8pt">
    KMSMITH LLC
</DIV>
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<TD align="left" valign="top">
<DIV style="text-indent: 0pt; margin-left: 8pt">
    418&#160;E.&#160;Fairchild Drive<BR>
    Highlands Ranch, Colorado 80126
</DIV>
</TD>
<TD>
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</TR>
<TR valign="bottom">
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<DIV style="text-indent: -8pt; margin-left: 8pt">
    Russell D. Ball
</DIV>
</TD>
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<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Ross R. Bhappu
</DIV>
</TD>
<TD>
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<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Brian T. Dolan
</DIV>
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="left" valign="bottom">
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</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Charles R. Henry
</DIV>
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Mark Kristoff
</DIV>
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="left" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="left" valign="bottom">
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<TD>
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<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
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<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Alec Machiels
</DIV>
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
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&nbsp;
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="left" valign="bottom">
&nbsp;
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<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Mark A. Smith
</DIV>
</TD>
<TD>
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</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
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<TD>
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<TD nowrap align="right" valign="bottom">
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<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
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</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Jack E. Thompson
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
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</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    James S. Allen
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    Ksenia A. Adams
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John F. Ashburn
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    John L. Burba
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    All selling stockholders as a group
    (&#160;&#160;&#160;&#160;&#160;&#160;entities)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -8pt; margin-left: 8pt">
    All executive officers and directors as a group
    (&#160;&#160;&#160;&#160;&#160;&#160;individuals)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
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</TD>
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</TD>
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</TD>
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&nbsp;
</TD>
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&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
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<TD nowrap align="right" valign="bottom">
&nbsp;
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&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
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<TD nowrap align="right" valign="bottom">
&nbsp;
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&nbsp;
</TD>
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&nbsp;
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&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
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    91
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='116'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF CAPITAL STOCK</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of the rights of our capital stock,
    certain provisions of our certificate of incorporation and our
    bylaws that will be effective upon the completion of this
    offering, and certain provisions of applicable law. For more
    detailed information, please see the form of our certificate of
    incorporation and bylaws, which are filed as exhibits to the
    registration statement of which this prospectus is a part.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Authorized
    Capitalization</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Immediately following the completion of this offering, our
    authorized capital stock will consist of shares, with a par
    value of $0.001 per share, of which:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares will be designated as common stock;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    shares will be designated as preferred stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Following the completion of this offering, each outstanding
    share of common stock will be entitled to one vote on all
    matters submitted to a vote of stockholders. Pursuant to our
    certificate of incorporation, holders of our common stock will
    not have the right to cumulate votes in elections of directors.
    Subject to preferences that may be applicable to any outstanding
    shares of preferred stock, holders of our common stock will be
    entitled to receive ratably such dividends as may be declared
    from time to time by our board of directors out of legally
    available funds. For additional information, see &#147;Dividend
    Policy.&#148; In the event of our liquidation, dissolution or
    winding up, holders of common stock will be entitled to share
    ratably in all assets remaining after payment of liabilities and
    any amounts due to the holders of preferred stock. Holders of
    our common stock will have no preemptive, conversion or
    subscription rights. No redemption or sinking fund provisions
    will apply to our common stock. All shares of common stock to be
    outstanding upon completion of this offering will be fully paid
    and non-assessable.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Preferred
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation authorizes our board of
    directors, without stockholder approval, to designate and issue
    up
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of preferred stock in one or more series and to fix the rights,
    preferences, privileges and restrictions granted to or imposed
    upon each such series of preferred stock, including voting
    rights, dividend rights, conversion rights, terms of redemption,
    liquidation preference, sinking fund terms, subscription rights
    and the number of shares constituting any series or the
    designation of a series. Our board of directors can issue,
    without stockholder approval, preferred stock with voting and
    conversion rights that could adversely affect the voting power
    of the holders of common stock and reduce the likelihood that
    such holders will receive dividend payments or payments upon
    liquidation. Such issuance could have the effect of decreasing
    the market price of the common stock. The issuance of preferred
    stock or even the ability to issue preferred stock could also
    have the effect of delaying, deterring or preventing a change of
    control or other corporate action. Immediately after the
    completion of this offering, no shares of preferred stock will
    be outstanding, and we currently have no plans to issue any
    shares of preferred stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Registration
    Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After giving effect to the corporate reorganization, the holders
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of our common stock are entitled to rights with respect to the
    registration under the Securities Act of such shares of common
    stock. These registration rights are contained in the
    Registration Rights Agreement and are described below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    Demand Registration Rights</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At any time following six months after the completion of this
    offering, the holders of shares of our common stock having
    demand registration rights under the Registration Rights
    Agreement have the right to
</DIV>
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    <BR>
    92
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    require that we register their shares of common stock on
    <FONT style="white-space: nowrap">Form&#160;S-1,</FONT>
    provided such holders hold least 10% or 5% (depending on the
    stockholder) of the shares of our common stock outstanding
    immediately after giving effect to the corporate reorganization
    and the aggregate offering price to the public exceeds
    $10,000,000. In the event that such demand registration rights
    are exercised, stockholders party to the Registration Rights
    Agreement have the right to participate in offering. We are only
    obligated to effect one registration on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    for each holder of our common stock possessing such demand
    registration rights. We may postpone the filing of a
    registration statement for up to 90&#160;days once in any
    <FONT style="white-space: nowrap">12-month</FONT>
    period if our board of directors determines in good faith that
    the filing would be materially detrimental to our stockholders
    or us. In an underwritten offering, the holders of shares of our
    common stock having demand registration rights or the right to
    participate in such offering will have priority over us in
    including such shares in a registration statement filed in
    response to the exercise of these demand registration rights. We
    must pay all expenses, except for underwriters&#146; discounts,
    selling commissions and the fees and expenses of each selling
    stockholder&#146;s own counsel, incurred in connection with the
    exercise of these demand registration rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    Demand Registration Rights</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we are eligible to file a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-3,</FONT>
    the stockholders with
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    registration rights under the Registration Rights Agreement can
    request that we register their shares, provided that the total
    price of the shares of common stock offered to the public
    exceeds $5,000,000. In the event that such demand registration
    rights are exercised, stockholders party to the Registration
    Rights Agreement have the right to participate in offering.
    These
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    registration rights are wholly distinct from the
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    demand registration rights and piggyback registration rights
    described in this section. We are obligated to effect an
    unlimited number of registrations on
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    for each holder of our common stock possessing such demand
    registration rights. A holder of
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    registration rights may not require us to file a registration
    statement on
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    if we have already effected two registrations on
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    at the request of such holder in the last
    <FONT style="white-space: nowrap">12-month</FONT>
    period. We may postpone the filing of a
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    registration statement for up to 90&#160;days once in any
    <FONT style="white-space: nowrap">12-month</FONT>
    period if our board of directors determines in good faith that
    the filing would be materially detrimental to our stockholders
    or us. In an underwritten offering, the holders of shares of our
    common stock having demand registration rights or the right to
    participate in such offering will have priority over us in
    including such shares in a registration statement filed in
    response to the exercise of these demand registration rights. We
    must pay all expenses, except for underwriters&#146; discounts,
    selling commissions and the fees and expenses of each selling
    stockholder&#146;s own counsel, incurred in connection with the
    exercise of these demand registration rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Piggyback
    Registration Rights</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If we register any securities for public sale, other than a
    registration statement filed on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    or
    <FONT style="white-space: nowrap">Form&#160;S-3</FONT>
    pursuant to the stockholder demand registration rights described
    above, the stockholders with piggyback registration rights under
    the Registration Rights Agreement have the right to include
    their shares in the registration, subject to specified
    exceptions. In an underwritten offering, certain holders of
    shares of our common stock having piggyback registration rights
    will have priority over us in including such shares in the
    applicable registration statement. We must pay all expenses,
    except for underwriters&#146; discounts, selling commissions and
    the fees and expenses of each selling stockholder&#146;s own
    counsel, incurred in connection with the exercise of these
    piggyback registration rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Anti-Takeover
    Effects of Delaware Law and Our Certificate of Incorporation and
    Bylaw Provisions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws contain several
    provisions that may make it more difficult to acquire us by
    means of a tender offer, open market purchase, proxy fight or
    otherwise. These provisions and certain provisions of Delaware
    law are expected to discourage coercive takeover practices and
    inadequate takeover bids.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    These provisions of our certificate of incorporation and bylaws
    are designed to encourage persons seeking to acquire control of
    us to negotiate with our board of directors. We believe that, as
    a general rule, our interests and the interests of our
    stockholders would be served best if any change in control
    results from
</DIV>
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    <BR>
    93
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    negotiations with our board of directors based upon careful
    consideration of the proposed terms, such as the price to be
    paid to stockholders, the form of consideration to be paid and
    the anticipated tax effects of the transaction.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws provisions could,
    however, have the effect of delaying, deferring or discouraging
    a prospective acquiror from making a tender offer for our shares
    or otherwise attempting to obtain control of us. To the extent
    that these provisions discourage takeover attempts, they could
    deprive stockholders of opportunities to realize takeover
    premiums for their shares. Moreover, these provisions could
    discourage accumulations of large blocks of common stock, thus
    depriving stockholders of any advantages which large
    accumulations of stock might provide.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Set forth below is a summary of the relevant provisions of our
    certificate of incorporation and bylaws and certain applicable
    sections of the General Corporation Law of the State of
    Delaware. For additional information we refer you to the
    provisions of our certificate of incorporation, our bylaws and
    the sections of the General Corporation Law of the State of
    Delaware.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Delaware
    Anti-Takeover Statute</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are subject to the provisions of Section&#160;203 of the
    General Corporation Law of the State of Delaware regulating
    corporate takeovers. In general, Section&#160;203, subject to
    certain exceptions, prohibits a publicly-held Delaware
    corporation from engaging in any business combination with any
    interested stockholder for a period of three years following the
    date that such person or entity became an interested
    stockholder, unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prior to such date, the board of directors of the corporation
    approved either the business combination or the transaction
    which resulted in the stockholder becoming an interested
    stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    upon consummation of the transaction that resulted in the
    stockholder becoming an interested stockholder, the interested
    stockholder owned at least 85% of the voting stock of the
    corporation outstanding at the time the transaction commenced,
    excluding specified shares;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at or subsequent to such date of the transaction that resulted
    in a person or entity becoming an interested stockholder, the
    business combination is approved by the board of directors and
    authorized at an annual or special meeting of stockholders, and
    not by written consent, by the affirmative vote of at least
    66<FONT style="vertical-align: text-top; font-size: 70%;">2</FONT>/<FONT style="font-size: 70%;">3</FONT>%
    of the outstanding voting stock that is not owned by the
    interested stockholder.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The application of Section&#160;203 may limit the ability of
    stockholders to approve a transaction that they may deem to be
    in their best interests. In addition, Section&#160;203 makes it
    more difficult for an interested stockholder to effect various
    business combinations with a corporation for a three-year
    period, although the stockholders may, by adopting an amendment
    to our certificate of incorporation or bylaws, elect not to be
    governed by this section, effective 12&#160;months after
    adoption.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, Section&#160;203 defines &#147;business
    combination&#148; as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any merger or consolidation involving the corporation and the
    interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any sale, lease, exchange, mortgage, pledge, transfer or other
    disposition of 10% or more of the assets of the corporation to
    or with the interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    subject to certain exceptions, any transaction which results in
    the issuance or transfer by the corporation of any stock of the
    corporation to the interested stockholder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transaction involving the corporation that has the effect of
    increasing the proportionate share of the stock of any class or
    series of the corporation beneficially owned by the interested
    stockholder;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the receipt by the interested stockholder of the benefit of any
    loans, advances, guarantees, pledges or other financial benefits
    provided by or through the corporation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, Section&#160;203 defines an &#147;interested
    stockholder&#148; as any person that is:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the owner of 15% or more of the outstanding voting stock of the
    corporation;
</TD>
</TR>

</TABLE>
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    <BR>
    94
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an affiliate or associate of the corporation and was the owner
    of 15% or more of the outstanding voting stock of the
    corporation at any time within three years immediately prior to
    the relevant date;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an affiliate or associate of the above.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws do not exclude us
    from the restrictions imposed under Section&#160;203. We
    anticipate that the provisions of Section&#160;203 may encourage
    companies interested in acquiring us to negotiate in advance
    with our board of directors because the stockholder approval
    requirement would be avoided if a majority of the directors then
    in office approve either the business combination or the
    transaction that resulted in the stockholder becoming an
    interested stockholder.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Classified
    Board of Directors</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation provides for our board of
    directors to be divided into three classes of directors, as
    nearly equal in number as possible, serving staggered terms.
    Approximately one-third of our board of directors will be
    elected each year. Under Section&#160;141 of the General
    Corporation Law of the State of Delaware, unless the certificate
    of incorporation provides otherwise, directors serving on a
    classified board can only be removed for cause. Accordingly, our
    directors may only be removed for cause. The provision for our
    classified board of directors may be amended, altered or
    repealed only upon the affirmative vote of the holders of
    66<FONT style="vertical-align: text-top; font-size: 70%;">2</FONT>/<FONT style="font-size: 70%;">3</FONT>%
    of our outstanding voting stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The provision for a classified board of directors could prevent
    a party that acquires control of a majority of the outstanding
    voting stock from obtaining control of our board of directors
    until the second annual stockholders meeting following the date
    the acquiror obtains the controlling stock interest. The
    classified board of directors provision could have the effect of
    discouraging a potential acquiror from making a tender offer for
    shares of common stock or otherwise attempting to obtain control
    of us and could increase the likelihood that our incumbent
    directors will retain their positions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We believe that a classified board of directors will help to
    assure the continuity and stability of our board and our
    business strategies and policies as determined by our board of
    directors because a majority of the directors at any given time
    will have prior experience on our board. The classified board of
    directors provision should also help to ensure that our board of
    directors, if confronted with an unsolicited proposal from a
    third party that has acquired a block of our voting stock, will
    have sufficient time to review the proposal and appropriate
    alternatives and to seek the best available result for all
    stockholders.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Number of
    Directors; Removal; Vacancies</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation and bylaws provide that the
    number of directors shall be fixed by the affirmative vote of
    our board of directors or by the affirmative vote of holders of
    at least
    66<FONT style="vertical-align: text-top; font-size: 70%;">2</FONT>/<FONT style="font-size: 70%;">3</FONT>%
    of our outstanding voting stock. Upon consummation of this
    offering, the size of our board of directors will be fixed
    at&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to our certificate of incorporation, each director will
    serve until his or her successor is duly elected and qualified,
    unless he or she resigns, dies, becomes disqualified or is
    removed. Our certificate of incorporation also provides that,
    subject to the rights of the holders of any series of preferred
    stock, directors may be removed, but only for cause.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation further provides that
    generally, vacancies or newly created directorships in our board
    may only be filled by a resolution approved by a majority of our
    board of directors and any director so chosen will hold office
    until the next election of the class for which such director was
    chosen.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stockholder
    Action; Special Meetings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation provides that stockholder
    action can be taken only at an annual or special meeting of
    stockholders and cannot be taken by written consent in lieu of a
    meeting. Our certificate of incorporation and bylaws provide
    that, except as otherwise required by law, special meetings of
    the stockholders can only be called by the Chairman of our board
    of directors, our Chief Executive Officer or our
</DIV>
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    <BR>
    95
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Secretary at the written request of a majority of the number of
    directors that we would have if there were no vacancies on our
    board of directors. Stockholders are not permitted to call a
    special meeting or to require our board of directors to call a
    special meeting. Stockholders also may not bring business before
    the special meeting of stockholders.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stockholder
    Proposals and Nominations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our bylaws provide that stockholders seeking to bring business
    before an annual meeting of stockholders or to nominate
    candidates for election as directors at an annual meeting of
    stockholders must provide timely notice of such proposed
    business in writing. To be timely, a stockholder&#146;s notice
    generally must be delivered to or mailed and received at our
    principal executive office not less than 90&#160;days or more
    than 120&#160;days prior to the first anniversary of the
    preceding year&#146;s annual meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our bylaws also provide certain requirements as to the form and
    content of a stockholder&#146;s notice. These provisions may
    preclude stockholders from bringing matters before an annual
    meeting of stockholders or from making nominations for directors
    at an annual meeting of stockholders. A stockholder&#146;s
    notice must set forth, among other things, as to each business
    matter or nomination the stockholder proposes to bring before
    the meeting:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the name and address of the stockholder and the beneficial
    owner, if any, on whose behalf the proposal or nomination is
    made;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the class and number of shares that are owned of record and
    beneficially by the stockholder proposing the business or
    nominating the nominee;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a representation that the stockholder giving the notice is a
    holder of record of shares of our voting stock entitled to vote
    at such annual meeting and intends to appear in person or by
    proxy at the annual meeting to propose the business or nominate
    the person or persons specified in the notice, as
    applicable;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether such stockholder or beneficial owner intends to deliver
    a proxy statement and forms of proxy to holders of at least the
    percentage of shares of our voting stock required to approve
    such proposal or nominate such nominee or nominees.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the stockholder is nominating a candidate for director, the
    stockholder&#146;s notice must also include the name, age,
    business address, residence address and occupancy of the nominee
    proposed by the stockholder and the signed consent of the
    nominee to serve as a director on our board of directors if so
    elected.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, a stockholder must also comply with all applicable
    requirements of the Exchange Act and the rules and regulations
    under the Exchange Act with respect to matters relating to
    nomination of candidates for directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Amendment
    of Certificate of Incorporation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Except as otherwise provided by law or our certificate of
    incorporation, our certificate of incorporation may be amended,
    altered or repealed at a meeting of the stockholders provided
    that such amendment has been described or referred to in the
    notice of such meeting or a meeting of our board of directors.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Amendment
    of Bylaws</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Except as otherwise provided by law, our certificate of
    incorporation or our bylaws, our bylaws may be amended, altered
    or repealed at a meeting of the stockholders provided that such
    amendment has been described or referred to in the notice of
    such meeting or a meeting of our board of directors, provided
    that no amendment adopted by the board of directors may vary or
    conflict with any amendment adopted by the stockholders in
    accordance with our certificate of incorporation or bylaws.
</DIV>
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    <BR>
    96
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Transfer
    Agent and Registrar</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have
    appointed&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    as the transfer agent and registrar for our common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Listing</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to apply to list our common stock on the NYSE under
    the symbol &#147;MCP.&#148;
</DIV>
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    <BR>
    97
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='117'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SHARES&#160;ELIGIBLE
    FOR FUTURE SALE</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for our
    common stock. Future sales of substantial amounts of our common
    stock in the public market, or the perception that substantial
    sales may occur, could adversely affect the prevailing market
    price of our common stock or impair our ability to raise equity
    capital in the future. Upon the completion of this offering,
    there will
    be&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock outstanding. Of these shares,
    the&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    sold in this offering by us and the selling stockholders, plus
    any shares sold upon exercise of the underwriters&#146;
    over-allotment option, will be freely tradable in the public
    market without restriction or further registration under the
    Securities Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The
    remaining&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock will be &#147;restricted securities,&#148; as
    that term is defined in Rule&#160;144 under the Securities Act.
    These restricted securities are eligible for public sale only if
    they are registered under the Securities Act or if they qualify
    for an exemption from registration under Rules&#160;144 or 701
    under the Securities Act, which are summarized below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements described below and the provisions of Rules&#160;144
    and 701 under the Securities Act, these restricted securities
    will be available for sale in the public market as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="90%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="8%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Date</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    On the date of this prospectus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Between 90 and 180&#160;days after the date of this prospectus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    At various times beginning more than 180&#160;days after the
    date of this prospectus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rule&#160;144</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, under Rule&#160;144 as in effect on the date of this
    prospectus, a person who is not one of our affiliates at any
    time during the three months preceding a sale, and who has
    beneficially owned shares of our common stock for at least six
    months, would be entitled to sell an unlimited number of shares
    of our common stock provided that current public information
    about us is available and, after owning such shares for at least
    one year, would be entitled to sell an unlimited number of
    shares of our common stock without restriction. Our affiliates
    who have beneficially owned restricted shares of common stock
    for at least six months are entitled to sell within any
    three-month period a number of restricted shares that does not
    exceed the greater of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    1.0% of the number of shares of common stock then
    outstanding;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the average weekly trading volume of our common stock on the
    NYSE during the four calendar weeks preceding the filing of a
    notice on Form&#160;144 with respect to the sale.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sales of restricted stock under Rule&#160;144 by our affiliates
    are also subject to manner of sale provisions, notice
    requirements and the availability of current public information
    about us.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Rule&#160;701</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In general, under Rule&#160;701 of the Securities Act, any of
    our directors, officers, employees, consultants or advisors who
    purchase shares of common stock from us in connection with a
    compensatory stock plan or other written agreement before the
    effective date of this offering, to the extent not subject to a
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreement, is eligible to resell those shares 90&#160;days after
    the effective date of this offering in reliance on
    Rule&#160;144, but without compliance with some of the
    restrictions, including the holding period, contained in
    Rule&#160;144.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Lock-Up</FONT>
    Agreements</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We, all of our executive officers and directors and all of our
    stockholders have agreed that, without the prior written consent
    of J.P. Morgan Securities Inc. and Morgan Stanley Incorporated
    on behalf of the
</DIV>
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    <BR>
    98
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    underwriters, we and they will not, directly or indirectly,
    during the period ending 180&#160;days after the date of this
    prospectus:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    offer, pledge, sell, contract to sell, sell any option or
    contract to purchase, purchase any option or contract to sell,
    grant any option, right or warrant for the sale of, or otherwise
    dispose of or transfer any shares of the our common stock or any
    securities convertible into or exchangeable or exercisable for
    our common stock, whether now owned or hereafter
    acquired;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any swap or any other agreement or any transaction
    that transfers, in whole or in part, directly or indirectly, the
    economic consequence of ownership of our common stock, whether
    any such swap or transaction is to be settled by delivery of
    shares of our common stock or other securities, in cash or
    otherwise.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This agreement is subject to certain exceptions, and is also
    subject to extension for up to an additional 34&#160;days, as
    set forth in &#147;Underwriting.&#148; In addition,
    substantially all of the holders of our member interests and
    holders of securities exercisable for or convertible into our
    member interests, or, after the consummation of this offering,
    shares of common stock, are subject to contractual
    <FONT style="white-space: nowrap">lock-up</FONT>
    restrictions with us for a period of 180&#160;days following the
    date of this prospectus.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stock
    Options and Other Equity Awards</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon the completion of this offering, we intend to file a
    registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    under the Securities Act covering the shares of common stock to
    be issued pursuant to options and other equity awards granted
    under our equity compensation plan. Based on the number of
    shares reserved for issuance under our equity compensation plan,
    the registration statement would cover
    approximately&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares.
    The registration statement will become effective upon filing.
    Accordingly, shares registered under the registration statement
    on
    <FONT style="white-space: nowrap">Form&#160;S-8</FONT>
    will be available for sale in the open market immediately
    thereafter, after complying with Rule&#160;144 volume
    limitations applicable to affiliates and with applicable 180-day
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Registration
    Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The holders
    of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock or their transferees will be entitled to various
    rights with respect to the registration of these shares under
    the Securities Act, including the shares offered by the selling
    stockholders in this offering. Registration of these shares
    under the Securities Act would result in these shares becoming
    fully tradable without restriction under the Securities Act
    immediately upon the effectiveness of the registration, except
    for shares purchased by affiliates. See &#147;Description of
    Capital Stock&#160;&#151; Registration Rights&#148; for
    additional information. Shares covered by a registration
    statement will be eligible for sale in the public market upon
    the expiration or release from the terms of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    agreement.
</DIV>
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    <BR>
    99
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='118'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MATERIAL
    U.S. FEDERAL INCOME TAX CONSEQUENCES<BR>
    TO <FONT style="white-space: nowrap">NON-U.S.</FONT>
    HOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a discussion of the material U.S.&#160;federal
    income tax consequences of the acquisition, ownership, and
    disposition of our common stock by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    as defined below, that acquires our common stock pursuant to
    this offering. This discussion assumes that a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    will hold our common stock issued pursuant to this offering as a
    capital asset within the meaning of Section&#160;1221 of the
    Code. This discussion does not address all aspects of
    U.S.&#160;federal income taxation that may be relevant to a
    particular investor in light of the investor&#146;s individual
    circumstances. In addition, this discussion does not address
    (i)&#160;U.S.&#160;federal non-income tax laws, such as gift or
    estate tax laws, (ii)&#160;state, local or
    <FONT style="white-space: nowrap">non-U.S.&#160;tax</FONT>
    consequences, (iii)&#160;the special tax rules that may apply to
    certain investors, including, without limitation, banks,
    insurance companies, financial institutions, controlled foreign
    corporations, passive foreign investment companies,
    broker-dealers, grantor trusts, personal holding companies,
    taxpayers who have elected
    <FONT style="white-space: nowrap">mark-to-market</FONT>
    accounting, tax-exempt entities, regulated investment companies,
    real estate investment trusts, a partnership or other entity or
    arrangement classified as a partnership for United States
    federal income tax purposes or other pass-through entities, or
    an investor in such entities or arrangements, or
    U.S.&#160;expatriates or former long-term residents of the
    United States, (iv)&#160;the special tax rules that may apply to
    an investor that acquires, holds, or disposes of our common
    stock as part of a straddle, hedge, constructive sale,
    conversion or other integrated transaction, or (v)&#160;the
    impact, if any, of the alternative minimum tax.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This discussion is based on current provisions of the Code,
    applicable U.S.&#160;Treasury Regulations promulgated
    thereunder, judicial opinions, and published rulings of the
    Internal Revenue Service, or the IRS, all as in effect on the
    date of this prospectus and all of which are subject to
    differing interpretations or change, possibly with retroactive
    effect. We have not sought, and will not seek, any ruling from
    the IRS or any opinion of counsel with respect to the tax
    consequences discussed herein, and there can be no assurance
    that the IRS will not take a position contrary to the tax
    consequences discussed below or that any position taken by the
    IRS would not be sustained.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As used in this discussion, the term
    &#147;U.S.&#160;person&#148; means a person that is, for
    U.S.&#160;federal income tax purposes, (i)&#160;a citizen or
    individual resident of the United States, (ii)&#160;a
    corporation (or other entity taxed as a corporation) created or
    organized (or treated as created or organized) in the United
    States or under the laws of the United States or any state
    thereof or the District of Columbia, (iii)&#160;an estate the
    income of which is subject to U.S.&#160;federal income taxation
    regardless of its source, or (iv)&#160;a trust if (A)&#160;a
    court within the United States is able to exercise primary
    supervision over the administration of the trust and one or more
    U.S.&#160;persons have the authority to control all substantial
    decisions of the trust, or (B)&#160;it has in effect a valid
    election under applicable U.S.&#160;Treasury Regulations to be
    treated as a U.S.&#160;person. As used in this discussion, the
    term
    <FONT style="white-space: nowrap">&#147;non-U.S.&#160;holder&#148;</FONT>
    means a beneficial owner of our common stock (other than a
    partnership or other entity treated as a partnership or as a
    disregarded entity for U.S.&#160;federal income tax purposes)
    that is not a U.S.&#160;person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The tax treatment of a partnership and each partner thereof will
    generally depend upon the status and activities of the
    partnership and such partner. A holder that is treated as a
    partnership for U.S.&#160;federal income tax purposes or a
    partner in such partnership should consult its own tax advisor
    regarding the U.S.&#160;federal income tax consequences
    applicable to it and its partners of the acquisition, ownership
    and disposition of our common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    THIS DISCUSSION IS ONLY A SUMMARY OF MATERIAL U.S.&#160;FEDERAL
    INCOME TAX CONSEQUENCES TO
    <FONT style="white-space: nowrap">NON-U.S.&#160;HOLDERS</FONT>
    OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR COMMON
    STOCK. IT IS NOT TAX ADVICE. EACH PROSPECTIVE INVESTOR SHOULD
    CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE PARTICULAR TAX
    CONSEQUENCES OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF
    OUR COMMON STOCK, INCLUDING THE APPLICABILITY AND EFFECT OF ANY
    STATE, LOCAL, AND
    <FONT style="white-space: nowrap">NON-U.S.&#160;TAX</FONT>
    LAWS, AS WELL AS U.S.&#160;FEDERAL ESTATE AND GIFT TAX LAWS, AND
    ANY APPLICABLE TAX TREATY.
</DIV>
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    <BR>
    100
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Income
    Tax Consequences of an Investment in Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Distributions
    on Common Stock</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As discussed under &#147;Dividend Policy,&#148; we do not
    anticipate paying dividends. If we pay cash or distribute
    property to holders of shares of common stock, such
    distributions generally will constitute dividends for
    U.S.&#160;federal income tax purposes to the extent paid from
    our current or accumulated earnings and profits, as determined
    under U.S.&#160;federal income tax principles. Distributions in
    excess of current and accumulated earnings and profits will
    constitute a return of capital that will be applied against and
    reduce (but not below zero) the holder&#146;s adjusted tax basis
    in our common stock. Any remaining excess will be treated as
    gain from the sale or exchange of the common stock and will be
    treated as described under &#147;&#151;&#160;Gain or Loss on
    Sale, Exchange or Other Taxable Disposition of Common
    Stock&#148; below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Dividends paid to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that are not effectively connected with the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    conduct of a trade or business in the United States generally
    will be subject to withholding of U.S.&#160;federal income tax
    at a rate of 30% or such lower rate as may be specified by an
    applicable income tax treaty. A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that wishes to claim the benefit of an applicable tax treaty
    withholding rate generally will be required to (i)&#160;complete
    IRS
    <FONT style="white-space: nowrap">Form&#160;W-8BEN</FONT>
    (or other applicable form) and certify under penalties of
    perjury that such holder is not a U.S.&#160;person and is
    eligible for the benefits of the applicable tax treaty or
    (ii)&#160;if our common stock is held through certain foreign
    intermediaries, satisfy the relevant certification requirements
    of applicable U.S.&#160;Treasury Regulations. These forms may
    need to be periodically updated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    eligible for a reduced rate of withholding of U.S.&#160;federal
    income tax pursuant to an income tax treaty may obtain a refund
    of any excess amounts withheld by timely filing an appropriate
    claim for refund with the IRS.
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    should consult their own tax advisors regarding their
    entitlement to benefits under an applicable income tax treaty
    and the manner of claiming the benefits of such treaty
    (including, without limitation, the need to obtain a
    U.S.&#160;taxpayer identification number).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Dividends that are effectively connected with a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    conduct of a trade or business in the United States, and, if
    required by an applicable income tax treaty, attributable to a
    permanent establishment or fixed base maintained by the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    in the United States, are subject to U.S.&#160;federal income
    tax on a net income basis at the U.S.&#160;federal income tax
    rates generally applicable to a U.S.&#160;holder and are not
    subject to withholding of U.S.&#160;federal income tax, provided
    that the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    establishes an exemption from such withholding by complying with
    certain certification and disclosure requirements. Any such
    effectively connected dividends (and, if required, dividends
    attributable to a U.S.&#160;permanent establishment or fixed
    base) received by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is treated as a foreign corporation for U.S.&#160;federal
    income tax purposes may be subject to an additional branch
    profits tax at a 30% rate, or such lower rate as may be
    specified by an applicable income tax treaty.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Gain
    or Loss on Sale, Exchange or Other Taxable Disposition of Common
    Stock</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any gain recognized by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    on a sale or other taxable disposition of our common stock
    generally will not be subject to U.S.&#160;federal income tax,
    unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;the gain is effectively connected with a trade or
    business of the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    in the United States (and, if required by an applicable income
    tax treaty, is attributable to a U.S.&#160;permanent
    establishment or fixed base of the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder),</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (ii)&#160;the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is an individual who is present in the United States for
    183&#160;days or more in the taxable year of that disposition,
    and certain other conditions are met,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (iii)&#160;we are or have been a United States real property
    holding corporation, or a USRPHC, for U.S.&#160;federal income
    tax purposes at any time during the shorter of the five-year
    period ending on the date of disposition or the period that the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    held the common stock, and, in the case where the shares of our
    common stock are regularly traded on an established securities
    market, the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    holds or held (at any time during the shorter of the five-year
    period ending on the date of disposition or the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    holding period) more than five percent of our common stock. A
    corporation
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    101
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    generally is a USRPHC if the fair market value of its
    U.S.&#160;real property interests equals or exceeds 50% of the
    sum of the fair market value of its worldwide real property
    interests plus its other assets used or held for use in a trade
    or business. We believe that we currently are a USRPHC, and we
    expect to remain a USRPHC.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any gain recognized by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is described in clause&#160;(i) or (iii)&#160;of the
    preceding paragraph generally will be subject to tax at the
    U.S.&#160;federal income tax rates generally applicable to a
    U.S.&#160;person and be required to file a U.S.&#160;tax return.
    Such
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    are urged to consult their tax advisors regarding the possible
    application of these rules. Any gain of a corporate
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is described in clause&#160;(i) above may also be subject
    to an additional branch profits tax at a 30% rate, or such lower
    rate as may be specified by an applicable income tax treaty. An
    individual
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is described in clause&#160;(ii) of such paragraph
    generally will be subject to a flat 30% tax (or a lower
    applicable tax treaty rate) on the U.S.&#160;source capital gain
    derived from the disposition, which may be offset by
    U.S.&#160;source capital losses during the taxable year of the
    disposition.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Information
    Reporting and Backup Withholding</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We generally must report annually to the IRS and to each
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    of our common stock the amount of dividends paid to such holder
    on our common stock and the tax, if any, withheld with respect
    to those dividends. Copies of the information returns reporting
    those dividends and withholding may also be made available to
    the tax authorities in the country in which the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is a resident under the provisions of an applicable income tax
    treaty or agreement. Information reporting also is generally
    required with respect to the proceeds from sales and other
    dispositions of our common stock to or through the
    U.S.&#160;office (and in certain cases, the foreign office) of a
    broker.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under some circumstances, U.S.&#160;Treasury Regulations require
    backup withholding of U.S.&#160;federal income tax, currently at
    a rate of 28%, on reportable payments with respect to our common
    stock. A
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally may eliminate the requirement for information
    reporting (other than in respect to dividends, as described
    above) and backup withholding by providing certification of its
    foreign status, under penalties of perjury, on a duly executed
    applicable IRS
    <FONT style="white-space: nowrap">Form&#160;W-8</FONT>
    or by otherwise establishing an exemption. Notwithstanding the
    foregoing, backup withholding and information reporting may
    apply if either we or our paying agent has actual knowledge, or
    reason to know, that a holder is a U.S.&#160;person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Backup withholding is not a tax. Rather, the amount of any
    backup withholding will be allowed as a credit against a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    U.S.&#160;federal income tax liability, if any, and may entitle
    such
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    to a refund, provided that certain required information is
    timely furnished to the IRS.
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    should consult their own tax advisors regarding the application
    of backup withholding and the availability of and procedure for
    obtaining an exemption from backup withholding in their
    particular circumstances.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    102
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='119'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">UNDERWRITING</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms and subject to the conditions in an underwriting
    agreement dated the date of this prospectus, the underwriters
    named below, for whom J.P.&#160;Morgan Securities Inc. and
    Morgan Stanley&#160;&#038; Co. Incorporated are acting as
    representatives, have severally agreed to purchase, and we and
    the selling stockholders have agreed to sell to them, severally,
    the number of shares indicated below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="90%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="8%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    J.P.&#160;Morgan Securities Inc.
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Morgan Stanley&#160;&#038; Co. Incorporated
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters and the representatives are collectively
    referred to as the &#147;underwriters&#148; and the
    &#147;representatives,&#148; respectively. The underwriters are
    offering the shares of common stock subject to their acceptance
    of the shares from us and subject to prior sale. The
    underwriting agreement provides that the obligations of the
    several underwriters to pay for and accept delivery of the
    shares of common stock offered by this prospectus are subject to
    the approval of certain legal matters by their counsel and to
    certain other conditions. The underwriters are obligated to take
    and pay for all of the shares of common stock offered by this
    prospectus if any such shares are taken. However, the
    underwriters are not required to take or pay for the shares
    covered by the underwriters&#146; over-allotment option
    described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters initially propose to offer part of the shares
    of common stock directly to the public at the offering price
    listed on the cover page of this prospectus and part to certain
    dealers. After the initial offering of the shares of common
    stock, the offering price and other selling terms may from time
    to time be varied by the representatives.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have granted to the underwriters an option, exercisable for
    30&#160;days from the date of this prospectus, to purchase up
    to&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    additional shares of common stock at the public offering price
    listed on the cover page of this prospectus, less underwriting
    discounts and commissions. The underwriters may exercise this
    option solely for the purpose of covering over-allotments, if
    any, made in connection with the offering of the shares of
    common stock offered by this prospectus. To the extent the
    option is exercised, each underwriter will become obligated,
    subject to certain conditions, to purchase about the same
    percentage of the additional shares of common stock as the
    number listed next to the underwriter&#146;s name in the
    preceding table bears to the total number of shares of common
    stock listed next to the names of all underwriters in the
    preceding table.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows the per share and total public
    offering price, underwriting discounts and commissions, and
    proceeds before expenses to us and the selling stockholders.
    These amounts are shown assuming both no exercise and full
    exercise of the underwriters&#146; option to purchase up to an
    additional&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;shares
    of common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="63%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="6%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total per Share</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>No Exercise</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Full Exercise</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Public offering price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Underwriting discounts and commissions to be paid by:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Us
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    The selling stockholders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to us:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds, before expenses, to selling stockholders
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The estimated offering expenses payable by us, exclusive of the
    underwriting discounts and commissions, are approximately
    $&#160;&#160;&#160;&#160;&#160; .
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The underwriters have informed us that they do not intend sales
    to discretionary accounts to exceed 5% of the total number of
    shares of common stock offered by them.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We intend to apply to list our common stock on the NYSE under
    the symbol &#147;MCP.&#148;
</DIV>
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    <BR>
    103
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We and all directors and officers and the holders of all of our
    outstanding stock have agreed that, without the prior written
    consent of J.P.&#160;Morgan Securities Inc. and Morgan
    Stanley&#160;&#038; Co. Incorporated on behalf of the
    underwriters, we and they will not, during the period ending
    180&#160;days after the date of this prospectus (the
    &#147;restricted period&#148;):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    offer, pledge, sell, contract to sell, sell any option or
    contract to purchase, purchase any option or contract to sell,
    grant any option, right or warrant to purchase lend or otherwise
    transfer or dispose of, directly or indirectly, any shares of
    common stock or any securities convertible into or exercisable
    or exchangeable for shares of common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    file any registration statement with the SEC relating to the
    offering of any shares of common stock or any securities
    convertible into or exercisable or exchangeable for common
    stock;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any swap or other arrangement that transfers to
    another, in whole or in part, any of the economic consequences
    of ownership of the common stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    whether any such transaction described above is to be settled by
    delivery of common stock or such other securities, in cash or
    otherwise. In addition, we and each such person agrees that,
    without the prior written consent of J.P.&#160;Morgan Securities
    Inc. and Morgan Stanley&#160;&#038; Co. Incorporated on behalf
    of the underwriters, we or such person will not, during the
    period ending 180&#160;days after the date of this prospectus,
    make any demand for, or exercise any right with respect to, the
    registration of any shares of common stock or any security
    convertible into or exercisable or exchangeable for common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The restrictions described in the immediately preceding
    paragraph do not apply to the sale of shares to the underwriters.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    With respect to our directors and officers, the restrictions
    described above do not apply to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the exercise of a warrant or an option to purchase, or other
    equity award for, shares of our common stock (provided that any
    shares of common stock received pursuant to such exercise are
    subject to the same restrictions as those described above);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in the case of an option expiring during the restricted period,
    the sale or transfer of shares of our common stock to satisfy
    any payment or withholding obligations in connection with the
    exercise of an option to purchase, or other equity award for,
    shares of our common stock, or in connection with any cashless
    exercise of a warrant to purchase shares of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the conversion of any preferred stock, Class&#160;A common
    stock, Class B common stock or other equity interest of Molycorp
    into shares of our common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transactions relating to shares of our common stock or other
    securities acquired in open market transactions after the
    completion of this offering (provided that no filing under
    Section&#160;16(a) of the Exchange Act shall be required or
    shall be voluntarily made in connection with subsequent sales of
    common stock or other securities acquired in such open market
    transactions);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transfers of shares of our common stock or any security
    convertible into our common stock (a)&#160;as a bona fide gift,
    (b)&#160;to any trust for the direct or indirect benefit of the
    director or officer or an immediate family member of the
    director or officer or (c)&#160;to any immediate family member
    of the director or officer;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transfers of shares of our common stock or any security
    convertible into our common stock pursuant to the laws of
    descent or distribution;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the establishment of a trading plan pursuant to
    <FONT style="white-space: nowrap">Rule&#160;10b5-1</FONT>
    under the Exchange Act for the transfer of shares of our common
    stock (provided that such plan does not provide for the transfer
    of shares of our common stock during the restricted period and
    no public announcement or filing under the Exchange Act
    regarding the establishment of such plan shall be required of or
    voluntarily made by or on behalf of the director of officer or
    us during the restricted period);
</TD>
</TR>

</TABLE>
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    <BR>
    104
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    provided that, in the case of any transfer or distribution
    pursuant to the fifth or sixth bullet above, (x)&#160;each
    transferee shall sign and deliver a
    <FONT style="white-space: nowrap">lock-up</FONT>
    letter substantially in the form of the
    <FONT style="white-space: nowrap">lock-up</FONT>
    letter signed by the director or officer and (y)&#160;no filing
    under Section&#160;16(a) of the Exchange Act, reporting a
    reduction in beneficial ownership of shares of our common stock,
    shall be required or shall be voluntarily made during the
    restricted period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The restricted period described in the preceding paragraph will
    be extended if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    during the last 17&#160;days of the restricted period we issue
    an earnings release or material news event relating to us
    occurs,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prior to the expiration of the restricted period, we announce
    that we will release earnings results during the 16-day period
    beginning on the last day of the restricted period,
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    in which case the restrictions described in the preceding
    paragraph will continue to apply until the expiration of the
    18-day period beginning on the issuance of the earnings release
    or the occurrence of the material news or material event.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In order to facilitate the offering of the common stock, the
    underwriters may engage in transactions that stabilize, maintain
    or otherwise affect the price of the common stock. Specifically,
    the underwriters may sell more shares than they are obligated to
    purchase under the underwriting agreement, creating a short
    position. A short sale is covered if the short position is no
    greater than the number of shares available for purchase by the
    underwriters under the over-allotment option. The underwriters
    can close out a covered short sale by exercising the
    over-allotment option or purchasing shares in the open market.
    In determining the source of shares to close out a covered short
    sale, the underwriters will consider, among other things, the
    open market price of shares compared to the price available
    under the over-allotment option. The underwriters may also sell
    shares in excess of the over-allotment option, creating a naked
    short position. The underwriters must close out any naked short
    position by purchasing shares in the open market. A naked short
    position is more likely to be created if the underwriters are
    concerned that there may be downward pressure on the price of
    the common stock in the open market after pricing that could
    adversely affect investors who purchase in this offering. As an
    additional means of facilitating this offering, the underwriters
    may bid for, and purchase, shares of common stock in the open
    market to stabilize the price of the common stock. These
    activities may raise or maintain the market price of the common
    stock above independent market levels or prevent or retard a
    decline in the market price of the common stock. The
    underwriters are not required to engage in these activities and
    may end any of these activities at any time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We, the selling stockholders and the underwriters have agreed to
    indemnify each other against certain liabilities, including
    liabilities under the Securities Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A prospectus in electronic format may be made available on
    websites maintained by one or more underwriters, or selling
    group members, if any, participating in this offering. The
    representatives may agree to allocate a number of shares of
    common stock to underwriters for sale to their online brokerage
    account holders. Internet distributions will be allocated by the
    representatives to underwriters that may make Internet
    distributions on the same basis as other allocations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Pricing
    of the Offering</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to this offering, there has been no public market for our
    common stock. The initial public offering price was determined
    by negotiations between us and the representatives. Among the
    factors considered in determining the initial public offering
    price were our future prospects and those of our industry in
    general, our sales, earnings and certain other financial and
    operating information in recent periods, and the price-earnings
    ratios, price-sales ratios, market prices of securities, and
    certain financial and operating information of companies engaged
    in activities similar to ours.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">European
    Economic Area</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In relation to each Member State of the European Economic Area
    which has implemented the Prospectus Directive, each underwriter
    has represented and agreed that with effect from and including
    the date on which
</DIV>
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    <BR>
    105
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    the Prospectus Directive is implemented in that Member State it
    has not made and will not make an offer of Shares to the public
    in that Member State, except that it may, with effect from and
    including such date, make an offer of Shares to the public in
    that Member State:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;at any time to legal entities which are authorized or
    regulated to operate in the financial markets or, if not so
    authorized or regulated, whose corporate purpose is solely to
    invest in securities;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;at any time to any legal entity which has two or more
    of (1)&#160;an average of at least 250&#160;employees during the
    last financial year; (2)&#160;a total balance sheet of more than
    &#128;43,000,000 and (3)&#160;an annual net turnover of more
    than &#128;50,000,000, as shown in its last annual or
    consolidated accounts;&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;at any time in any other circumstances which do not
    require the publication by us of a prospectus pursuant to
    Article&#160;3 of the Prospectus Directive.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the purposes of the above, the expression an &#147;offer of
    Shares to the public&#148; in relation to any Shares in any
    Member State means the communication in any form and by any
    means of sufficient information on the terms of the offer and
    the Shares to be offered so as to enable an investor to decide
    to purchase or subscribe the Shares, as the same may be varied
    in that Member State by any measure implementing the Prospectus
    Directive in that Member State and the expression Prospectus
    Directive means Directive
    <FONT style="white-space: nowrap">2003/71/EC</FONT>
    and includes any relevant implementing measure in that Member
    State.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">United
    Kingdom</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each underwriter has represented and agreed that it has only
    communicated or caused to be communicated and will only
    communicate or cause to be communicated an invitation or
    inducement to engage in investment activity (within the meaning
    of Section&#160;21 of the Financial Services and Markets Act
    2000)&#160;in connection with the issue or sale of the shares of
    our common stock in circumstances in which Section&#160;21(1) of
    such Act does not apply to us and it has complied and will
    comply with all applicable provisions of such Act with respect
    to anything done by it in relation to any Shares in, from or
    otherwise involving the United Kingdom.
</DIV>
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    <BR>
    106
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='120'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">CHANGE IN
    ACCOUNTANTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On January&#160;14, 2010, the board of directors of Molycorp,
    LLC dismissed KPMG LLP as its independent registered public
    accounting firm.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The report of KPMG LLP on Molycorp Minerals, LLC&#146;s
    financial statements as of December&#160;31, 2008 and for the
    period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2008 (not included in this prospectus) did not
    contain an adverse opinion or a disclaimer of opinion, and was
    not qualified or modified as to uncertainty, audit scope or
    accounting principles.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the period from June&#160;12, 2008 (Inception) through
    January&#160;14, 2010, there were: (i)&#160;no disagreements (as
    that term is defined in Item&#160;304(a)(1)(iv) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K</FONT>
    and the related instructions to Item&#160;304 of
    <FONT style="white-space: nowrap">Regulation&#160;S-K)</FONT>
    with KPMG LLP on any matter of accounting principles or
    practices, financial statement disclosure, or auditing scope or
    procedure, which disagreements, if not resolved to the
    satisfaction of KPMG LLP, would have caused KPMG LLP to make
    reference to the subject matter of the disagreements in its
    reports on the consolidated financial statements for such years;
    or (ii)&#160;reportable events.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We provided KPMG LLP with a copy of the above disclosures, and
    requested that KPMG LLP furnish us with a letter addressed to
    the SEC stating that KPMG LLP agrees with the above statements.
    A copy of KPMG LLP&#146;s letter is filed as an exhibit to this
    registration statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On January&#160;14, 2010, Molycorp, LLC&#146;s board of
    directors approved the appointment of PricewaterhouseCoopers LLP
    as our independent registered public accounting firm for the
    period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2008 and for the year ended December&#160;31,
    2009. Prior to their engagement on January&#160;14, 2010,
    neither we nor anyone on our behalf consulted with
    PricewaterhouseCoopers LLP regarding: (i)&#160;the application
    of accounting principles to a specified transaction, either
    completed or proposed, or the type of audit opinion that might
    be rendered on our financial statements, and neither a written
    report was provided to us nor oral advice was provided that
    PricewaterhouseCoopers LLP concluded was an important factor
    considered by us in reaching a decision as to any accounting,
    auditing or financial reporting issue; or (ii)&#160;any matter
    that was either the subject of a disagreement (as that term is
    defined in Item&#160;304(a)(1)(iv) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K</FONT>
    and the related instructions to Item&#160;304 of
    <FONT style="white-space: nowrap">Regulation&#160;S-K)</FONT>
    or a reportable event (as that term is defined in
    Item&#160;304(a)(1)(v) of
    <FONT style="white-space: nowrap">Regulation&#160;S-K).</FONT>
</DIV>
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    <BR>
    107
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='121'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">LEGAL
    MATTERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The validity of the issuance of the shares of common stock
    offered by this prospectus will be passed upon for us by Jones
    Day. Certain legal matters relating to this offering will be
    passed on for the underwriters by Davis Polk&#160;&#038;
    Wardwell LLP, New York, New York.
</DIV>

<A name='122'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXPERTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The consolidated financial statements as of December&#160;31,
    2009 and 2008, and for the year ended December&#160;31, 2009,
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2008, and cumulatively for the period from
    June&#160;12, 2008 (Inception) through December&#160;31, 2009
    included in this prospectus, have been so included in reliance
    on the report of PricewaterhouseCoopers LLP, an independent
    registered public accounting firm, given on the authority of
    such firm as experts in auditing and accounting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The information appearing in this prospectus concerning
    estimates of our proven and probable REO reserves and
    non-reserve REO deposits for the Mountain Pass facility was
    derived from the report of SRK Consulting, independent mining
    consultants, and has been included herein upon the authority of
    SRK Consulting as experts with respect to the matters covered by
    such report and in giving such report.
</DIV>

<A name='123'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">WHERE YOU
    CAN FIND MORE INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have filed with the SEC a registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    under the Securities Act to register our common stock being
    offered in this prospectus. This prospectus, which constitutes a
    part of the registration statement, does not contain all the
    information set forth in the registration statement or the
    exhibits and schedules filed thereto. For further information
    about us and the common stock offered by this prospectus, we
    refer you to the registration statement and the exhibits and
    schedules filed with the registration statement. Any statement
    contained in this prospectus regarding the contents of any
    contract or any other document that is filed as an exhibit to
    the registration statement is not necessarily complete and each
    such statement is qualified in all respects by reference to the
    full text of such contract or other document filed as an exhibit
    to the registration statement. A copy of the registration
    statement and the exhibits and schedules to the registration
    statement may be inspected without charge at the SEC&#146;s
    Public Reference Room, 100&#160;F&#160;Street, N.E.,
    Room&#160;1580, Washington,&#160;D.C. 20549. You may obtain
    information on the operation of the Public Reference Room by
    calling the SEC at
    <FONT style="white-space: nowrap">1-800-SEC-0330.</FONT>
    The SEC also maintains an Internet site at www.sec.gov that
    contains reports, proxy and information statement and other
    information regarding issuers who file electronically with the
    SEC. You may also inspect our SEC reports and other information
    at our website at www.molycorp.com. Information on or accessible
    through our website is not a part of this prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Upon completion of this offering, we will be subject to the
    information reporting requirements of the Exchange Act and we
    intend to file reports, proxy statements and other information
    with the SEC.
</DIV>
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    <BR>
    108
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<A name='124'>
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">GLOSSARY
    OF SELECTED MINING TERMS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a glossary of selected mining terms used in
    this prospectus that may be technical in nature:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    Assay </TD>
    <TD></TD>
    <TD valign="bottom">
    The analysis of the proportions of metals in ore, or the testing
    of an ore or mineral for composition, purity, weight, or other
    properties of commercial interest.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Bastnasite </TD>
    <TD></TD>
    <TD valign="bottom">
    Bastnasite is a mixed Lanthanide fluoro-carbonate mineral
    (Ln&#160;F&#160;CO3) that currently provides the bulk of the
    world&#146;s supply of the light REEs. Bastnasite and monazite
    are the two most common sources of cerium and other REEs.
    Bastnasite is found in carbonatites, igneous carbonate rocks
    that melt at unusually low temperatures.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Cerium </TD>
    <TD></TD>
    <TD valign="bottom">
    Cerium (Ce) is a soft, silvery, ductile metal which easily
    oxidizes in air. Cerium is the most abundant of the REEs, and is
    found in a number of minerals, including monazite and bastnasite.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Concentrate </TD>
    <TD></TD>
    <TD valign="bottom">
    A mineral processing product that generally describes the
    material that is produced after crushing and grinding ore
    effecting significant separation of gangue (waste) minerals from
    the metal and/or metal minerals, and discarding the waste and
    minor amounts of metal and/or metal minerals. The resulting
    &#147;concentrate&#148; of minerals typically has an order of
    magnitude higher content of minerals than the beginning ore
    material.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Cut-off grade </TD>
    <TD></TD>
    <TD valign="bottom">
    The lowest grade of mineralized material that qualifies as ore
    in a given deposit. The grade above which minerals are
    considered economically mineable considering the following
    parameters: estimates over the relevant period of mining costs,
    ore treatment costs, general and administrative costs, refining
    costs, royalty expenses, by-product credits, process and
    refining recovery rates and price.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Dysprosium </TD>
    <TD></TD>
    <TD valign="bottom">
    Dysprosium (Dy) is used in high power neodymium iron boron
    magnets to enhance thermal stability.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Europium </TD>
    <TD></TD>
    <TD valign="bottom">
    Europium (Eu) is desirable due to its photon emission.
    Excitation of the europium atom, by absorption of electrons or
    by UV radiation, results in changes in energy levels that create
    a visible emission. Almost all practical uses of europium
    utilize this luminescent behavior.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Gadolinium </TD>
    <TD></TD>
    <TD valign="bottom">
    Gadolinium (Gd) is a silvery-white, malleable and ductile
    rare-earth metal. Gadolinium has exceptionally high absorption
    of neutrons and therefore is used for shielding in neutron
    radiography and in nuclear reactors. Because of its paramagnetic
    properties, solutions of organic gadolinium complexes and
    gadolinium compounds are the most popular intravenous medical
    magnetic resonance imaging contrast agents in MRI.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Grade </TD>
    <TD></TD>
    <TD valign="bottom">
    The average REE content, as determined by assay of a ton of ore.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Lanthanum </TD>
    <TD></TD>
    <TD valign="bottom">
    Lanthanum (La) is the first member of the Lanthanide series.
    Lanthanum is a strategically important rare earth element due to
    its use in fluid bed cracking catalysts, FCCs, which are used in
    the production of transportation and aircraft fuel. Lanthanum is
    also used in fuel cells and batteries.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Mill </TD>
    <TD></TD>
    <TD valign="bottom">
    A processing plant that produces a concentrate of the valuable
    minerals contained in an ore.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Mineralization </TD>
    <TD></TD>
    <TD valign="bottom">
    The concentration of metals and their compounds in rocks, and
    the processes involved therein.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    G-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    Monazite </TD>
    <TD></TD>
    <TD valign="bottom">
    Monazite is a reddish-brown phosphate mineral. Monazite minerals
    are typically accompanied by concentrations of uranium and
    thorium. Because of this, there is no significant rare earth
    production from monazite today. Monazite is becoming more
    attractive because it typically has elevated concentrations of
    heavy rare earths.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Neodymium </TD>
    <TD></TD>
    <TD valign="bottom">
    Neodymium (Nd) is used in the production of NdFeB permanent
    magnets. These permanent magnets, which maximize the power/cost
    ratio, are used in a large variety of motors and mechanical
    systems. Cellular phones, vehicle systems and certain lasers
    contain both neodymium magnets and capacitors, which produce
    powerful electronic generation and boost the power of these
    devices.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Ore </TD>
    <TD></TD>
    <TD valign="bottom">
    That part of a mineral deposit which could be economically and
    legally extracted or produced at the time of reserve
    determination.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Overburden </TD>
    <TD></TD>
    <TD valign="bottom">
    In surface mining, overburden is the material that overlays an
    ore deposit. Overburden is removed prior to mining.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Praseodymium </TD>
    <TD></TD>
    <TD valign="bottom">
    Praseodymium (Pr) comprising about 4% of the lanthanide content
    of bastnasite, is a common coloring pigment. Along with
    neodymium, praseodymium is used to filter certain wavelengths of
    light. Praseodymium is used in photographic filters, airport
    signal lenses, and welder&#146;s glasses. As part of an alloy,
    praseodymium is used in permanent magnet systems designed to
    make smaller and lighter motors. Praseodymium is also used in
    automobile and other internal combustion engine pollution
    control catalysts.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Probable reserves </TD>
    <TD></TD>
    <TD valign="bottom">
    Reserves for which quantity and grade and/or quality are
    computed from information similar to that used for proven
    reserves, but the sites for inspection, sampling, and
    measurement are farther apart or are otherwise less adequately
    spaced. The degree of assurance, although lower than that for
    proven reserves, is high enough to assume continuity between
    points of observation.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Proven reserves </TD>
    <TD></TD>
    <TD valign="bottom">
    Reserves for which (a) quantity is computed from dimensions
    revealed in outcrops, trenches, workings or drill holes; grade
    and/or quality are computed from the results of detailed
    sampling; and (b) the sites for inspection, sampling and
    measurement are spaced so closely and the geologic character is
    so well defined that size, shape, depth and mineral content of
    reserves are well established.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Recovery </TD>
    <TD></TD>
    <TD valign="bottom">
    The percentage of contained metal actually extracted from ore in
    the course of processing such ore.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Reserves </TD>
    <TD></TD>
    <TD valign="bottom">
    That part of a mineral deposit which could be economically and
    legally extracted or produced at the time of the reserve
    determination.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    REO cut-off </TD>
    <TD></TD>
    <TD valign="bottom">
    Cut-off grade is the percentage of REO that defines the minimum
    economically recoverable concentration in an ore body.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Samarium </TD>
    <TD></TD>
    <TD valign="bottom">
    Samarium (Sm) is a silvery-white metallic element that is
    predominantly used to produce high temperature, high power
    samarium cobalt.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Strike </TD>
    <TD></TD>
    <TD valign="bottom">
    The direction of the line of intersection of a REE deposit with
    the horizontal plane of the ground. The strike of a deposit is
    the direction of a straight line that connects two points of
    equal elevation on the deposit.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Tailings </TD>
    <TD></TD>
    <TD valign="bottom">
    That portion of the mined material that remains after the
    valuable minerals have been extracted.</TD>
</TR>

</TABLE>
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    <BR>
    G-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    Terbium </TD>
    <TD></TD>
    <TD valign="bottom">
    Terbium (Tb) is a soft, malleable, silvery-grey element of the
    lanthanide series, used in x-ray and color television tubes.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Tolling </TD>
    <TD></TD>
    <TD valign="bottom">
    Processing of material owned by others for a fee without taking
    title to the material.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    Yttrium </TD>
    <TD></TD>
    <TD valign="bottom">
    Yttrium (Y) is predominantly utilized in auto-catalysts. Other
    uses include resonators, microwave communication devices and
    other electronic devices.</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    G-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='125'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">INDEX TO
    FINANCIAL STATEMENTS</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="95%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#301'>Report of Independent Registered Public
    Accounting Firm</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    F-2
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#302'>Consolidated Balance Sheets as of
    December&#160;31, 2009 and December&#160;31, 2008</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    F-3
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#303'>Consolidated Statements of Operations for the
    year ended December&#160;31, 2009, for the period from
    June&#160;12, 2008 (Inception) through December&#160;31, 2008
    and for the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    F-4
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#304'>Consolidated Statements of Members&#146; Equity
    for the year ended December&#160;31, 2009 and for the period
    from June&#160;12, 2008 (Inception) through December&#160;31,
    2008</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    F-5
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#305'>Consolidated Statements of Cash Flows for the
    year ended December&#160;31, 2009, for the period from
    June&#160;12, 2008 (Inception) through December&#160;31, 2008
    and for the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    F-6
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#306'>Notes to Consolidated Financial Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    F-7
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='301'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Report of
    Independent Registered Public Accounting Firm</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    To the Members of Molycorp, LLC:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our opinion, the accompanying consolidated balance sheets and
    the related consolidated statements of operations, of
    members&#146; equity and of cash flows present fairly, in all
    material respects, the financial position of Molycorp, LLC and
    its wholly-owned subsidiary (a development stage company) at
    December&#160;31, 2009 and 2008, and the results of their
    operations and their cash flows for the year ended
    December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008, and cumulatively for
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009, in conformity with accounting principles
    generally accepted in the United States of America. These
    financial statements are the responsibility of the
    Company&#146;s management. Our responsibility is to express an
    opinion on these financial statements based on our audits. We
    conducted our audits of these statements in accordance with the
    standards of the Public Company Accounting Oversight Board
    (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the financial statements are free of material misstatement. An
    audit includes examining, on a test basis, evidence supporting
    the amounts and disclosures in the financial statements,
    assessing the accounting principles used and significant
    estimates made by management, and evaluating the overall
    financial statement presentation. We believe that our audits
    provide a reasonable basis for our opinion.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    PricewaterhouseCoopers LLP
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Phoenix, Arizona<BR>
    April&#160;16, 2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='302'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,BS -->Consolidated Balance Sheets</FONT></B></A>
</DIV>

<!-- XBRL,BODY -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>(In thousands)</B>
</DIV>
</A>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD colspan="9" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>ASSETS</B>
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current assets:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,189
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Trade accounts receivable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,221
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,346
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,545
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,990
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Prepaid expenses and other
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,825
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,185
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,520
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,710
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Non-current assets:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Property, plant&#160;and equipment, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    66,352
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    63,053
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,090
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,122
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Investment in joint venture
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Intangible asset, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    704
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    770
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total non-current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    79,146
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    86,645
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <B>Total assets</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    97,666
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    95,355
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="9">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD colspan="9" align="center" valign="bottom">
    <B>LIABILITIES AND MEMBERS&#146; EQUITY</B>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Trade accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,886
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,963
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,446
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Current portion of asset retirement obligation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    693
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    387
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total current liabilities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,542
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,083
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Non-current liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Asset retirement obligation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,509
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,196
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <B>Total liabilities</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,051
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,279
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Members&#146; equity:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Paid-in capital
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    117,276
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Deficit accumulated during the development stage
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (42,661
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total members&#146; equity
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    74,615
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    78,076
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <B>Total liabilities and members&#146; equity</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    97,666
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    95,355
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,bs -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='303'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,op -->Consolidated Statements of
    Operations</FONT></B></A>
</DIV>

<!-- XBRL,body -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    </A><B>(In thousands, except share and per share data)</B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net sales
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    7,093
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,137
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    9,230
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Operating costs and expenses:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Cost of goods sold
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (21,785
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,027
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (34,812
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Selling, general, and administrative
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (12,685
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (2,979
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (15,664
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Depreciation&#160;and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (191
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (19
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (210
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Accretion expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,006
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (250
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,256
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Operating loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (28,574
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,138
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (42,712
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other income (expense):
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Other income
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    181
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    54
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    235
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Interest income (expense)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (194
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (184
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42,661
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Weighted average shares outstanding
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,017,959
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,000,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,011,561
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Loss per share:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Basic
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28.08
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14.07
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42.17
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Diluted
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28.08
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14.07
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42.17
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,op -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='304'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,se -->Consolidated Statements of Members&#146;
    Equity</FONT></B></A>
</DIV>

<!-- XBRL,body -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    </A><B>(In thousands, except share amounts)</B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="56%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Deficit<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Accumulated<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Common Stock</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>During the<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Total<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Common<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Paid-in<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Development<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Members&#146;<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Capital</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Stage</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Equity</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance at June&#160;12, 2008 (Inception)</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>&#151;</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>&#151;</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>&#151;</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Issuance of common shares
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    998,276
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Employee compensation agreement
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,724
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance at December&#160;31, 2008</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>1,000,000</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>92,150</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>(14,074</B>
</TD>
<TD nowrap align="left" valign="bottom">
    <B>)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>78,076</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Issuance of shares
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    99,019
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Conversion of short-term borrowings from member plus related
    accrued interest into common shares
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    59,312
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,831
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,831
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exercise of employee options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    543
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Employee compensation agreement
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    241
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    241
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Balance at December&#160;31, 2009</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>1,158,874</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>117,276</B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>(42,661</B>
</TD>
<TD nowrap align="left" valign="bottom">
    <B>)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>$</B>
</TD>
<TD nowrap align="right" valign="bottom">
    <B>74,615 </B>
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,se -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <A name='305'><B><FONT style="font-family: 'Times New Roman', Times">
    <!-- XBRL,cf -->Consolidated Statements of Cash
    Flows</FONT></B></A>
</DIV>

<!-- XBRL,body -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    </A><B>(In thousands)</B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="50%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="12%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>June&#160;12, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(Inception)<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash flows from operating activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Net loss
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (28,587
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (14,074
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    (42,661
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    Adjustments to reconcile net loss to net cash used in operating
    activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Depreciation and amortization
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,896
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    936
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,832
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Accretion of asset retirement obligation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,256
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Non-cash inventory write-downs
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,035
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,509
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,544
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Non-cash stock compensation expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    241
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    391
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Loss on sale of assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Changes in operating assets and liabilities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Accounts receivable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    125
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,897
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,772
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Other current assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    345
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    345
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Inventory
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (13,557
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (3,440
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (16,997
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Prepaid expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,634
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (1,619
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Accounts payable
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (254
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    642
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    388
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Asset retirement obligation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (387
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (387
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5,749
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,218
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7,967
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net cash used in operating activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (22,371
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,340
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (29,711
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash flows from investing activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Acquisition of the Mountain Pass facility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (82,150
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (82,150
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Proceeds from sale of investment in joint venture
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Capital expenditures
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,285
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (321
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (7,606
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Proceeds from sale of assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net cash provided by (used in) investing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,420
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (82,471
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (80,051
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash flows provided by financing activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Capital contributions from members
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    110,004
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Proceeds from exercise of options
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Short-term borrowings from member
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,637
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,637
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net cash provided by financing activities
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    116,691
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 40pt">
    Net increase in cash and cash equivalents
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4,740
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,189
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents at beginning of the year
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,189
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Cash and cash equivalents at end of year
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,189
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,929
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Supplemental disclosure of non-cash activities:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Conversion of short-term borrowings from member plus accrued
    interest, into common shares
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    6,831
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- /XBRL,cf -->
<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    See accompanying notes to consolidated financial statements.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
<!-- XBRL,ns -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">


    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    <BR>
    (A Company in the Development Stage)<BR>
    <A name='306'>Notes to Consolidated Financial Statements<BR>
    December&#160;31, 2009 and 2008</FONT></B>
</DIV>
</A>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(1)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Company
    Background</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,BODY -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp, LLC (the &#147;Company&#148; or &#147;Molycorp&#148;)
    was formed on September&#160;9, 2009, as a Delaware limited
    liability company. Upon such formation, the members of Molycorp
    Minerals, LLC (&#147;Molycorp Minerals&#148;) exchanged their
    ownership interests for ownership interests in Molycorp. These
    transactions were accounted for as a reorganization of entities
    under common control at historical cost. Accordingly, the
    accompanying financial information for periods prior to
    Molycorp&#146;s formation is the historical financial
    information of Molycorp Minerals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp Minerals, previously known as Rare Earth Acquisition
    LLC (which was formed on June&#160;12, 2008), acquired the
    Mountain Pass, California rare earth deposit and associated
    assets (the &#147;Mountain Pass facility&#148;) and assumed
    certain liabilities from Chevron Mining, Inc.
    (&#147;Chevron&#148;) on September&#160;30, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Mountain Pass facility is located in San&#160;Bernardino
    County, California and is the only significant developed rare
    earth resource in the western world. Rare earth elements
    (&#147;REEs&#148;) are a group of specialty elements with unique
    properties that make them critical to many existing and emerging
    applications including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Clean-energy technologies such as hybrid and electric vehicles,
    wind turbines and compact florescent lighting;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    High-technology applications including cell phones, personal
    digital assistant devices, digital music players, hard disk
    drives used in computers, computing devices, &#147;ear bud&#148;
    speakers and microphones, as well as fiber optics, lasers and
    optical temperature sensors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Critical defense applications such as guidance and control
    systems, communications, global positioning systems, radar and
    sonar;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Advanced water treatment applications including those for
    industrial, military, homeland security, domestic and foreign
    aid use.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The REE group includes 17 elements, namely the
    15&#160;lanthanide elements, which are lanthanum, cerium,
    praseodymium, promethium (which does not occur naturally),
    neodymium, samarium, europium, gadolinium, terbium, dysprosium,
    holmium, erbium, thulium, ytterbium, and lutetium, and two
    elements that have similar chemical properties to the lanthanide
    elements&#160;&#151; yttrium and scandium. The oxides produced
    from processing REEs are collectively referred to as rare earth
    oxides (&#147;REOs&#148;). Bastnasite is a mineral that contains
    REEs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Operations at the Mountain Pass facility began in 1952 under
    Molybdenum Corporation of America (&#147;MCA&#148;). MCA was
    purchased by Union Oil of California (&#147;Unocal&#148;) in
    1997. In 2002, mining operations were suspended at the Mountain
    Pass facility primarily due to softening prices for REOs and a
    lack of additional tailings disposal capacity. Chevron
    Corporation purchased Unocal in 2005.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the acquisition, operations at the Mountain Pass
    facility had been suspended with the exception of a pilot
    processing project to recover neodymium from lanthanum
    stockpiles produced prior to Chevron&#146;s ownership of the
    Mountain Pass facility. The neodymium from lanthanum
    (&#147;NFL&#148;) pilot processing project was undertaken to
    improve the facility&#146;s REE processing techniques. For the
    year ended December&#160;31, 2009 and the period from
    June&#160;12, 2008 (Inception) through December&#160;31, 2008,
    revenue was generated primarily from the sale of products
    associated with the NFL pilot processing project.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(2)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Basis of
    Presentation</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s acquisition of the Mountain Pass facility has
    been accounted for as an acquisition of net assets and not a
    business combination. As described below, the Company&#146;s
    current business plan includes investing substantial capital to
    restart mining operations, construct and refurbish processing
    facilities and other
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-7
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    infrastructure, and to expand into metal and alloy production.
    Molycorp will continue as a development stage company until
    these activities have been completed which is currently expected
    by the end of 2012.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying consolidated financial statements include the
    accounts of the Company and its
    <FONT style="white-space: nowrap">wholly-owned</FONT>
    subsidiary. All intercompany balances and transactions have been
    eliminated in consolidation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company has evaluated subsequent events through
    April&#160;16, 2010, which is the date the accompanying
    financial statements were available to be issued.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(3)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Liquidity
    and Capital Requirements</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Most of the facilities and equipment acquired with the Mountain
    Pass facility are at least 20&#160;years old and must be
    modernized or replaced. Under its current business plan, the
    Company intends to spend approximately $511&#160;million through
    2012 to restart mining operations, construct and refurbish
    processing facilities and other infrastructure at the Mountain
    Pass facility and expand into metal and alloy production.
    Capital expenditures under this plan total approximately
    $53&#160;million in 2010. The Company expects to finance these
    expenditures, as well as its working capital requirements, with
    proceeds from planned public
    <FONT style="white-space: nowrap">and/or</FONT>
    private offerings of its securities or project financing. There
    can be no assurance that the Company will be successful in the
    anticipated offerings or that it will be successful in raising
    additional capital in the future on terms acceptable to the
    Company, or at all.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the Company is unable to raise sufficient capital through the
    planned securities offerings, additional capital contributions
    from existing members or other alternative sources of financing,
    management will implement a short-term business plan in 2010.
    Under this plan, capital expenditures will be curtailed at
    <FONT style="white-space: nowrap">mid-year</FONT> and
    limited operations at the Mountain Pass facility will continue
    through December&#160;31, 2010. The Company believes that it
    will be able to fund the short-term business plan with existing
    cash and cash equivalents, which totaled $6.9&#160;million at
    December&#160;31, 2009, and funding commitments from its members
    totaling $20.0&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The accompanying financial statements have been prepared on a
    going concern basis under which the Company is expected to be
    able to realize its assets and satisfy its liabilities in the
    normal course of business. To continue as a going concern beyond
    2010 and in order to continue the restart of mining operations
    and modernization of the Mountain Pass facility, the Company
    will need to complete the planned securities offerings or obtain
    alternative sources of financing. Absent additional financing,
    the Company will not have the resources to execute its current
    business plan.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(4)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Summary
    of Significant Accounting Policies</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(a)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Use of
    Estimates</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The preparation of the financial statements, in accordance with
    generally accepted accounting principles in the United States of
    America, requires management to make estimates and assumptions
    that affect the reported amounts of assets and liabilities, the
    disclosure of contingent assets and liabilities at the date of
    the financial statements and the reported amounts of revenues
    and expenses during the reporting period. Management bases its
    estimates on the Company&#146;s historical experience and on
    various other assumptions that are believed to be reasonable
    under the circumstances. Actual results may differ significantly
    from these estimates under different assumptions and conditions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Significant estimates made by management in the accompanying
    financial statements include the allocation of the purchase
    price for the Mountain Pass facility to the assets acquired and
    liabilities assumed, the collectability of accounts receivable,
    the recoverability of inventory, the useful lives and
    recoverability of long-lived assets such as property, plant and
    equipment and intangible asset, and the adequacy of the
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-8
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Company&#146;s asset retirement obligations. The current
    economic environment has increased the degree of uncertainty
    inherent in these estimates and the underlying assumptions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(b)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Revenue
    and Cost of Goods Sold</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Revenue is recognized when persuasive evidence of an arrangement
    exists, the risks and rewards of ownership have been transferred
    to the customer, which is generally when title passes, the
    selling price is fixed or determinable, and collection is
    reasonably assured. Title generally passes upon shipment of
    product from the Mountain Pass facility. Prices are generally
    set at the time of, or prior to, shipment. Transportation and
    distribution costs are incurred only on sales for which the
    Company is responsible for delivering the product. Our reported
    revenues are presented net of freight and shipping costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Cost of goods sold includes the cost of production as well as
    inventory write-downs caused by market price declines. Primary
    production costs include labor, supplies, maintenance costs,
    depreciation, and plant overhead.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(c)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Cash</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company considers cash and all highly liquid investments
    with an original maturity of three months or less to be cash
    equivalents.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(d)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Trade
    Accounts Receivable</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Trade accounts receivable are recorded at the invoiced amount
    and do not bear interest. The Company reviews its allowance for
    doubtful accounts on a quarterly basis. As of December&#160;31,
    2009 and 2008, an allowance for doubtful accounts was not
    required.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(e)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Inventories</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Inventories consist of
    <FONT style="white-space: nowrap">work-in-process,</FONT>
    finished goods, stockpiles of bastnasite and lanthanum
    concentrate, and materials and supplies. Inventory cost is
    determined using the lower of weighted average cost or estimated
    net realizable value. Inventory expected to be sold in the next
    12&#160;months is classified as a current asset in the
    consolidated balance sheet.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Write-downs to estimated net realizable value are charged to
    cost of goods sold. Many factors influence the market prices for
    REOs and, in the absence of established prices contained in
    customer contracts, management uses an independent pricing
    source to evaluate market prices for REOs at the end of each
    quarter. For the year ended December&#160;31, 2009, the period
    from June&#160;12, 2008 (Inception) through December&#160;31,
    2008, and cumulatively for the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2009, the Company
    recognized write-downs of $9.0&#160;million, $9.5&#160;million
    and $18.5&#160;million, respectively, as a result of declines in
    REO market prices.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company evaluates the carrying value of materials and supply
    inventories each quarter giving consideration to slow-moving
    items, obsolescence, excessive levels, and other factors and
    recognizes related write-downs as necessary.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-9
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At December&#160;31, 2009 and 2008, inventory consisted of the
    following (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Work in process
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,797
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    52
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Finished goods
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,685
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,635
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Materials and supplies
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,063
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,303
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total current
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    8,545
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,990
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Long term:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Concentrate stockpiles
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,844
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    11,862
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Work in process
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    681
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Finished goods
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    246
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    579
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total long term
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    12,090
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,122
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(f)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Property,
    Plant and Equipment, net</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Property, plant and equipment associated with the acquisition of
    the Mountain Pass facility is stated at estimated fair value as
    of the acquisition date. Expenditures for new property, plant
    and equipment and improvements that extend the useful life or
    functionality of the asset are capitalized. The Company incurred
    $7.1&#160;million in plant modernization costs in 2009, and
    anticipates incurring approximately $474&#160;million in plant
    modernization costs from 2010 through 2012. Depreciation on
    plant and equipment is calculated using the straight-line method
    over the estimated useful lives of the assets. Depreciation
    expense for the year ended December&#160;31, 2009, the period
    from June&#160;12, 2008 (Inception) through December&#160;31,
    2008, and cumulatively for the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2009, was
    $3.9&#160;million, $0.9&#160;million and $4.8&#160;million,
    respectively. Maintenance and repair costs are expensed as
    incurred.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mineral properties at December&#160;31, 2009 and 2008, represent
    the estimated fair value of the mineral resources associated
    with the Mountain Pass facility. The Company will begin to
    amortize such mineral properties using the units of production
    method over estimated proven and probable reserves once mining
    operations resume, which is currently expected to occur in late
    2010.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At December&#160;31, 2009 and 2008, property, plant and
    equipment consisted of the following (in thousands):
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Land
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    800
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    800
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Land improvements (15&#160;years)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,954
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17,923
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Buildings and improvements (4 to 27&#160;years)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,458
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,335
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Plant and equipment (2 to 12&#160;years)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12,065
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11,692
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Vehicles (7&#160;years)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,023
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,031
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Computer software (5&#160;years)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,116
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    164
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Furniture and fixtures (5&#160;years)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Construction in progress
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6,506
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    851
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mineral properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,138
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,138
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Property, plant and equipment at cost
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    71,101
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63,973
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Less accumulated depreciation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (4,749
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (920
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Property, plant and equipment, net
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    66,352
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    63,053
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-10
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In accordance with ASC&#160;360, <I>Property Plant and
    Equipment</I>, long-lived assets such as property, plant, and
    equipment, mineral properties and purchased intangible assets
    subject to amortization, are reviewed for impairment whenever
    events or changes in circumstances indicate that the carrying
    amount of an asset may not be recoverable. The Company did not
    recognize any impairment for the year ended December&#160;31,
    2009 or the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2008.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(g)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Intangible
    Asset</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company acquired its trade name in connection with the
    Mountain Pass facility acquisition. Amortization is provided
    using the straight-line method based on an estimated useful life
    of 12&#160;years. Amortization expense for the year ended
    December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008, and cumulatively for
    the period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2009 was $65,000, $17,000, and $82,000,
    respectively. Amortization expense is estimated to be $65,000
    annually for the following five years.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(h)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Investment
    in Joint Venture</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with the Mountain Pass facility acquisition, the
    Company acquired a one third interest in a joint venture with
    Sumitomo Metals Industries, Ltd. of Japan (Sumitomo) called
    Sumikin Molycorp (SMO). The Company sold its interest in the
    joint venture to Sumitomo on July&#160;9, 2009 for
    $9.7&#160;million for no gain.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(i)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Accrued
    Expenses</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Accrued expenses as of December&#160;31, 2009 and 2008 consisted
    of the following: (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>December&#160;31,<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Waste disposal accrual
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Completion bonus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,445
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    650
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Defined contribution plan
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    988
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    192
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Other accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,030
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    604
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total accrued expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    5,963
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,446
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(j)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Asset
    Retirement Obligation</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company accounts for reclamation costs, along with other
    costs related to the closure of the Mountain Pass facility, in
    accordance with
    <FONT style="white-space: nowrap">ASC&#160;410-20</FONT>
    <I>Asset Retirement Obligations</I>. This standard requires the
    Company to recognize asset retirement obligations at estimated
    fair value in the period in which the obligation is incurred.
    The Company recognized an asset retirement obligation and
    corresponding asset retirement cost of $13.3&#160;million in
    connection with the Mountain Pass facility acquisition. The
    liability was initially measured at fair value and is
    subsequently adjusted for accretion expense and changes in the
    amount or timing of the estimated cash flows. The asset
    retirement cost was capitalized as part of the carrying amount
    of the related long-lived assets and is being depreciated over
    the assets&#146; remaining useful lives. Depreciation expense
    associated with the asset retirement cost was $1.2&#160;million,
    $0.3&#160;million and $1.5&#160;million for the year ended
    December&#160;31, 2009, the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2008, and
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-11
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    cumulatively for the period from June&#160;12, 2008 (Inception)
    through December&#160;31, 2009, respectively. The following
    table presents the activity in our asset retirement obligation
    (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="64%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="13%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="14%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>September&#160;30, 2008<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Year Ended<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Through<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>December&#160;31, 2008</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Balance at beginning of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,583
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,333
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Obligations settled
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    (387
</TD>
<TD nowrap align="left" valign="bottom">
    )
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accretion expense
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,006
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    250
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Balance at end of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    14,202
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    13,583
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company is required to provide the applicable governmental
    agencies with financial assurances relating to its closure and
    reclamation obligations. As of December&#160;31, 2008, the
    Company had financial assurance requirements of
    $26.3&#160;million which were satisfied by instruments obtained
    by Chevron. In March 2009, the Company replaced these
    instruments with surety bonds secured by letters of credit or
    cash collateral provided by the individual members. As of
    December&#160;31, 2009, the Company had financial assurance
    requirements of $27.4&#160;million.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(k)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Income
    Taxes</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As a limited liability company, the Company does not incur or
    pay federal or state income taxes. Rather, taxable income and
    losses of the Company are reported on the income tax returns of
    the Company&#146;s members. As a result, a provision for incomes
    taxes has not been included in the consolidated statements of
    operations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(l)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Members&#146;
    Equity</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Members&#146; interests are represented by 1,158,874 and
    1,000,000&#160;shares of the Company&#146;s common stock at
    December&#160;31, 2009 and 2008, respectively. Paid-in capital
    in the consolidated balance sheets represents amounts paid by
    members or interests earned under certain stock compensation
    agreements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(m)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Earnings
    (loss) per Share</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Basic income (loss) per share is computed by dividing the
    Company&#146;s net income (loss) by the weighted average number
    of common shares outstanding during the year. Diluted income
    (loss) per share reflects the dilution of potential common
    shares in the weighted average number of common shares
    outstanding during the year, if dilutive. For this purpose, the
    &#147;treasury stock method&#148; and &#147;if converted
    method,&#148; as applicable, are used for the assumed proceeds
    upon the exercise of common share equivalents at the average
    selling prices of the shares during the year. For the year ended
    December&#160;31, 2009, potential shares associated with 3,255
    outstanding stock options were excluded from the calculation of
    diluted earnings per share as their effect would have been
    anti-dilutive due to the Company&#146;s net loss for the year.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(n)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Comprehensive
    income (loss)</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company does not have any items entering into the
    determination of comprehensive income (loss) other than net
    income (loss) for the period.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>


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    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(5)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Acquisition
    of Mountain Pass Facility</FONT></B>
</TD>
</TR>

</TABLE>
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On September&#160;30, 2008, Molycorp completed the acquisition
    of the Mountain Pass facility for approximately
    $82.1&#160;million, consisting of $80.0&#160;million in cash
    paid to Chevron and $2.1&#160;million in related
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-12
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    transaction costs. The acquisition has been accounted as an
    acquisition of net assets. The following table summarizes the
    allocation of the purchase price to the assets acquired and
    liabilities assumed (in thousands):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
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    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
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</TR>
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<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Acquired assets:
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory&#160;&#151; concentrate stockpiles
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    19,201
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory&#160;&#151; finished goods
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,506
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory&#160;&#151; work in process
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    572
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Inventory&#160;&#151; material and supply
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    902
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Mineral properties
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23,138
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Land and land improvements
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    18,723
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Property, plant, and equipment
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21,354
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Trade name
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    786
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Investment in joint venture
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,700
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Total assets
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    95,882
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Asset retirement obligation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,333
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Completion bonus
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    399
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    Net purchase price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    82,150
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD style="border-top: 3px double #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As part of the purchase agreement, the Company also retained the
    services of approximately 100&#160;employees from Chevron,
    including 43 non-union employees and 57 union employees. Under
    the terms of the purchase agreement, the Company agreed to
    continue to provide all retained employees&#146; salaries at
    their previous levels for a period of 12&#160;months; provide
    comparable 401(k) and health benefits, and to honor all vacation
    days accrued prior to the purchase.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>


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    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(6)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Employee
    Benefit Plans</FONT></B>
</TD>
</TR>

</TABLE>
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company maintains a defined contribution plan for all
    employees who meet the related eligibility requirements. All
    former Chevron employees became eligible to participate in the
    plan on the date of the acquisition while all new employees
    become eligible to participate after 90&#160;days of service.
    The Company currently makes a non-elective contribution equal to
    4% of compensation for each employee who performed at least
    1,000&#160;hours of service and is employed on the last day of
    the year. In addition, the Company currently matches 100% of the
    first 3% contributed and 50% of the next 2% contributed by each
    eligible employee. Employees vest in Company contributions after
    three years of service. Expense related to this plan totaled
    $1.0&#160;million, $0.2&#160;million and $1.2&#160;million for
    the year ended December&#160;31, 2009, the period from
    June&#160;12, 2008 (Inception) through December&#160;31, 2008,
    and cumulatively for the period from June&#160;12, 2008
    (Inception) through December&#160;31, 2009, respectively.
    Additionally, accrued expenses at December&#160;31, 2009 and
    2008, included $1.0&#160;million and $0.2&#160;million related
    to this plan, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;1, 2009, the Company established the Management
    Incentive Plan (&#147;MIP&#148;), which is a nonqualified
    deferred compensation plan for the purpose of providing deferred
    compensation benefits for certain members of management. Under
    the MIP, participants can defer their base salary and other
    compensation that is supplemental to his or her base salary and
    is dependent upon achievement of individual or Company
    performance goals. It is intended that the MIP constitute an
    unfunded plan for purposes of the Employee Retirement Income
    Security Act of 1974, as amended. The amounts of compensation or
    awards deferred are deemed to be invested in a hypothetical
    investment as of the date of deferral. For the year ended
    December&#160;31, 2009, the Company elected to make
    discretionary contributions to the MIP totaling
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-13
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    approximately $47,000. In addition, participants in the MIP
    program elected to defer approximately $19,000 of their
    compensation, which is included in other accrued expenses at
    December&#160;31, 2009.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(7)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Commitments
    and Contingencies</FONT></B>
</TD>
</TR>

</TABLE>
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(a)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Self
    Insurance</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company is self-insured for employee healthcare costs,
    subject to a related stop-loss agreement with an insurance
    company. The Company recorded a liability of $0.1&#160;million
    associated with this obligation as of December&#160;31, 2009.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(b)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Future
    Operating Lease Commitments</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company has certain operating leases for office space, land,
    and certain equipment. Remaining annual minimum payments under
    these leases at December&#160;31, 2009 were $0.2&#160;million in
    2010 and $0.1&#160;million in 2011.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(c)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Completion
    Bonus</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with the Mountain Pass facility acquisition, the
    Company assumed a $0.4&#160;million obligation related to a
    completion bonus payable to union employees who worked on the
    NFL pilot processing development project. Under the terms of the
    related labor agreement, eligible employees were entitled to a
    bonus of 40&#160;hours of pay at the employee&#146;s base rate
    for every month spent on the project, regardless of the number
    of hours worked. The Company recognized the related costs
    associated with this bonus as employees worked on the project.
    As of December&#160;31, 2009 and 2008, the accrued completion
    bonus was $1.4&#160;million and $0.7&#160;million, respectively.
    The completion bonus was paid in March 2010.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(d)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Labor
    Contract</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Certain Mountain Pass facility employees are covered by a
    collective bargaining agreement with the United Steelworkers of
    America which expires on March&#160;15, 2012. At
    December&#160;31, 2009, 60&#160;employees, or approximately 50%
    of the Company&#146;s workforce, were covered by this collective
    bargaining agreement.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(e)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Reclamation
    Surety Bonds</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, Molycorp had placed
    $27.4&#160;million of surety bonds with California state and
    regional agencies to secure its Mountain Pass facility closure
    and reclamation obligations.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(f)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Insurance
    Premium Financing Agreement</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As of December&#160;31, 2009, Molycorp was a party to a
    short-term premium financing agreement related to its property
    insurance policies. The unpaid principal balance of
    $0.4&#160;million is included in accrued expenses in the
    consolidated balance sheet. The agreement requires monthly
    principal and interest payments of $41,592 through November 2010.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(g)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Licenses
    and Permits</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company is subject to numerous and detailed federal, state
    and local environmental laws, regulations and permits including
    health and safety, environmental, and air quality. The Company
    must obtain a number of additional permits in order to complete
    the plant modernization and expansion. The Company is subject to
    strict conditions, requirements and obligations relating to
    various environmental and health and safety matters in
    connection with the current permits, and the Company anticipates
    additional conditions, requirements and
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-14
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    obligations associated with the additional permits required for
    future operations, including the modernization and expansion of
    the Mountain Pass facility. Certain conditions could be imposed
    in order to obtain the required permits including requirements
    to conduct additional environmental studies and collect and
    present data to government authorities pertaining to the
    potential impact of current and future operations upon the
    environment. Accordingly, the required permits may not be
    issued, maintained or renewed in a timely fashion if at all, or
    may be issued or renewed upon conditions that restrict the
    Company&#146;s ability to conduct its operations economically.
    Any failure, significant delay or significant change in
    conditions that is required to obtain, maintain or renew
    permits, could have a material adverse effect on the
    Company&#146;s business, results of operations and financial
    condition.
</DIV>
<!-- XBRL,n -->
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(8)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Stock
    Based Compensation</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s Chief Executive Officer received a signing
    bonus, of which $350,000 was paid in cash and $150,000 was paid
    through the issuance of 1,724&#160;shares of common stock. The
    per share value of the common stock at the date of issuance
    approximates the per share amount contributed by other members.
    These shares vested immediately and the related expense was
    recognized during the period from June&#160;12, 2008 (Inception)
    through December&#160;31, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company issued an option to its Chief Executive Officer for
    the purchase of 3,798&#160;shares of Company stock on
    April&#160;10, 2009. The option vested on the date of grant and
    had a stated exercise price of $92.15 per share. The fair value
    of the stock at the time of issuance was estimated to be $115.17
    per share based on the share price established in a related
    party financing agreement executed shortly prior to the issuance
    of the option. In measuring compensation expense, the Company
    estimated the fair value of the award on the grant date using
    the Black-Scholes-Merton option valuation model. Option
    valuation models require the input of highly subjective
    assumptions, including the expected volatility of the price of
    the underlying stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following assumptions were used to compute the fair value of
    the option grant:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="89%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Risk free interest rate
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    0.60
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Dividend yield
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Estimated volatility
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    146
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Expected option life
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10&#160;months
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s computation of the estimated volatility was
    based on the historical volatility of a group of peer
    companies&#146; common stock over the expected option life. The
    peer information was used because Molycorp is not publicly
    traded and therefore does not have the market trading history
    required to calculate a meaningful volatility factor. The
    computation of expected option life was determined based on a
    reasonable expectation of the option life prior to being
    exercised or forfeited. The risk-free interest rate assumption
    was based on the U.S.&#160;Treasury constant maturity yield at
    the date of grant over the expected life of the option.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For the year ended December&#160;31, 2009, the Company
    recognized stock-based compensation related to this option grant
    of $241,000.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-15
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A summary of Molycorp&#146;s stock option activity for the year
    ended December&#160;31, 2009, is as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="61%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="4%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Estimated<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Exercise<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Grant-Date<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Remaining<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Price</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Fair Value</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Life</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Outstanding options at beginning of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Granted&#160;and vested
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,798
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63.41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10&#160;months
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Exercised
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    543
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63.41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Forfeited
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Vested options outstanding end of period
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,255
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    92.15
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63.41
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2&#160;months
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Effective November&#160;1, 2009, the Company issued 5,880,000
    incentive shares of Molycorp Minerals to certain employees and
    independent directors. Pursuant to the terms of Molycorp
    Minerals&#146; Second Amendment and Restated Operating Agreement
    dated September&#160;10, 2009, the incentive shares have no
    voting rights and are intended to constitute a &#147;profits
    interests&#148; as defined under Internal Revenue Service
    regulations. Holders of incentive shares have no capital
    accounts, but are entitled to receive cash distributions from
    the Company in amounts ranging from 3.2% to 7.0% of excess
    distributions after common shareholders have received an
    annually compounded 10% return of their capital contributions.
    The distribution percentage applied is based on the cumulative
    return on investment received by the common shareholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The incentive shares vest at a rate of one-third per year on the
    anniversary date of the award, subject to acceleration at the
    Company&#146;s discretion or six months after a change in
    control or a public offering of equity interest in the Company.
    Upon termination, unvested shares are forfeited and vested
    shares may be repurchased by the Company&#146;s at its
    discretion. The purchase price of vested shares is based upon an
    assumed liquidation of the Company&#146;s assets at book value
    and is subject to the same distribution terms as the cash
    distribution described above. Due to the Company&#146;s option
    to repurchase vested shares of terminated participants at a
    price other than fair value, the incentive shares are classified
    as liabilities measured using the intrinsic value method. These
    liabilities will be remeasured at each reporting date until the
    shares are forfeited or repurchased. As of December&#160;31,
    2009, the intrinsic value of the incentive shares was zero.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(9)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Concentrations</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(a)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Limited
    Number of Products</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Company&#146;s current operations are limited to the
    production and sale of REOs from stockpiled concentrates and it
    does not have the capability to significantly alter its product
    mix prior to completing the modernization and expansion of the
    Mountain Pass facility and the restart of mining operations.
    Sales of lanthanum concentrate accounted for 82% and 72% of our
    sales for the year ended December&#160;31, 2009 and for the
    period from June&#160;12, 2008 (Inception) through
    December&#160;31, 2008, respectively.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(b)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Limited
    Number of Customers</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    There is a limited market for the Company&#146;s lanthanum
    concentrate and its two largest customers comprised 82% (55% of
    the total corresponds to the Company&#146;s largest customer and
    27% of the total corresponds to the Company&#146;s second
    largest customer) and 72% (57% of the total corresponds to the
    Company&#146;s largest customer and 15% of the total corresponds
    to the Company&#146;s second largest customer) of the
    Company&#146;s total product revenue for the year ended
    December&#160;31, 2009 and for the period from June&#160;12,
    2008 (Inception) through December&#160;31, 2008, respectively.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    F-16
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL -->
<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">(c)&#160;&#160;</FONT></I></B>
</TD>
    <TD>
    <B><I><FONT style="font-family: 'Times New Roman', Times">Single
    Geographic Location</FONT></I></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Currently, the Company&#146;s only mining and production
    facility is the Mountain Pass facility and the Company&#146;s
    viability is based on the successful modernization and expansion
    of its operations. The deterioration or destruction of any part
    of the Mountain Pass facility, or legal restrictions related to
    current or anticipated operations at the Mountain Pass facility,
    may significantly hinder the Company&#146;s ability to reach or
    maintain full planned production rates within the expected time
    frame, if at all.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(10)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Related
    Party Transactions</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with the Mountain Pass facility acquisition,
    certain members incurred acquisition costs that were
    subsequently reimbursed by Molycorp. At December&#160;31, 2008,
    accrued expenses included approximately $0.2&#160;million
    related to this reimbursement obligation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In February 2009, the Company&#146;s members incurred certain
    costs in providing letters of credit
    <FONT style="white-space: nowrap">and/or</FONT> cash
    collateral to secure the surety bonds issued for the benefit of
    certain regulatory agencies relating to the Company&#146;s
    Mountain Pass facility closure and reclamation obligations. The
    total amount of collateral provided by the members at
    December&#160;31, 2009 was $18.2&#160;million. The Company has
    agreed to pay each member a 5% annual return on the amount of
    collateral provided. Under the terms of the agreement, the
    members may receive quarterly payments, delayed payments, or
    <FONT style="white-space: nowrap">payments-in-kind.</FONT>
    During the year ended December&#160;31, 2009, the Company
    recognized approximately $0.8&#160;million in compensation to
    the members under this agreement which is included in selling,
    general and administrative expense in the consolidated statement
    of operations. At December&#160;31, 2009, accrued expenses in
    the consolidated balance sheet included $0.6&#160;million
    payable to members.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In May and July 2009, Molycorp entered into transactions with a
    member under which it borrowed an aggregate $6.6&#160;million,
    secured by certain product inventories. Borrowings under this
    agreement required interest at a variable rate of LIBOR plus one
    percent. On November&#160;15, 2009, the member converted
    outstanding advances plus accrued interest totaling
    $6.8&#160;million into 59,312&#160;shares of Molycorp common
    stock in settlement of the obligation.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(11)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Recently
    Issued Accounting Pronouncements</FONT></B>
</TD>
</TR>

</TABLE>
<!-- XBRL,body -->
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Variable
    Interest Entities</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In June 2009, the ASC guidance for consolidation accounting was
    updated to require an entity to perform a qualitative analysis
    to determine whether the enterprise&#146;s variable interest
    gives it a controlling financial interest in the variable
    interest entity (&#147;VIE&#148;). This analysis identifies a
    primary beneficiary of a VIE as the entity that has both of the
    following characteristics: (i)&#160;the power to direct the
    activities of a VIE that most significantly impact the
    entity&#146;s economic performance and (ii)&#160;the obligation
    to absorb losses or receive benefits from the entity that could
    potentially be significant to the VIE. The updated guidance also
    requires ongoing reassessments of the primary beneficiary of a
    VIE. The updated guidance is effective for the Company&#146;s
    fiscal year beginning January&#160;1, 2010. The Company is
    evaluating the potential impact of adopting this guidance on the
    Company&#146;s consolidated financial position, results of
    operations and cash flows.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <I><FONT style="font-family: 'Times New Roman', Times">Fair
    Value Accounting</FONT></I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In January 2010, the ASC guidance for fair value measurements
    and disclosure was updated to require additional disclosures
    related to: i)&#160;transfers in and out of level 1 and 2 fair
    value measurements and ii)&#160;enhanced detail in the level 3
    reconciliation. The guidance was amended to provide clarity
    about: i)&#160;the level of disaggregation required for assets
    and liabilities and ii)&#160;the disclosures required for inputs
    and valuation techniques used to measure fair value for both
    recurring and nonrecurring measurements that fall in
</DIV>
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    <BR>
    F-17
</DIV><!-- END PAGE WIDTH -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MOLYCORP,
    LLC<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">(A
    Company in the Development Stage)<BR>
    </FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes to
    Consolidated Financial
    Statements&#160;&#151;&#160;(Continued)</FONT></B>
</DIV>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    either level 2 or level 3. The updated guidance is effective for
    the Company&#146;s fiscal year beginning January&#160;1, 2010,
    with the exception of the level 3 disaggregation which is
    effective for the Company&#146;s fiscal year beginning
    January&#160;1, 2011. The Company is evaluating the potential
    impact of adopting this guidance on the Company&#146;s
    consolidated financial position, results of operations and cash
    flows.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">(12)&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Subsequent
    Events</FONT></B>
</TD>
</TR>

</TABLE>
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Molycorp, Inc. was formed on March&#160;4, 2010, and on
    April&#160;15, 2010, the members of Molycorp, LLC contributed
    either (a)&#160;all of their member interests in Molycorp, LLC
    or (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class&#160;A common stock. Additionally, all
    holders of profits interests in Molycorp Minerals, LLC, which
    were represented by incentive shares, contributed all of their
    incentive shares to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class&#160;B common stock. Accordingly, Molycorp,
    LLC and Molycorp Minerals, LLC became subsidiaries of Molycorp,
    Inc. All of the shares of Class&#160;A common stock and
    Class&#160;B common stock will convert into shares of common
    stock immediately prior to the consummation of an initial public
    offering of Molycorp, Inc. common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;16, 2010, Molycorp Minerals, LLC executed an
    agreement under which an affiliate of one of Molycorp,
    Inc.&#146;s stockholders agreed to purchase up to
    $5&#160;million of product from Molycorp, Inc. through
    December&#160;31, 2010. Purchases under the agreement would
    occur at Molycorp, Inc.&#146;s request at a price per pound
    based on published index pricing. Upon the resale of any
    acquired product, Molycorp, Inc. is entitled to receive 50% of
    the sales price that exceeds a specified level.
</DIV>
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    <BR>
    F-18
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 14pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Shares<BR>
    <BR>
    <IMG src="d70469d7046914.gif" alt="(MOLYCORP, INC. LOGO)"> </FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 24pt">Molycorp, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 14pt">Common Stock</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 14%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt">PROSPECTUS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 14%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Dealer
    Prospectus Delivery Obligation</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Until&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2010 (the 25th&#160;day after the date of this prospectus), all
    dealers that effect transactions in these securities, whether or
    not participating in this offering, may be required to deliver a
    prospectus. This is in addition to the dealer&#146;s obligation
    to deliver a prospectus when acting as an underwriter and with
    respect to unsold allotments or subscriptions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 1pt solid #000000"></CENTER>

<CENTER style="font-size: 1pt; width: 100%; border-bottom: 2pt solid #000000"></CENTER>
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</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PART&#160;II<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">INFORMATION
    NOT REQUIRED IN THE PROSPECTUS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;13.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Other
    Expenses of Issuance and Distribution.</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows the costs and expenses, other than
    underwriting discounts and commissions, to be paid by the
    registrant in connection with this offering. All amounts shown
    except the SEC registration fee, the FINRA fee and the New York
    Stock Exchange Listing Fee are estimates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="87%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="9%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Amount</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>(In thousands)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    SEC Registration Fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    24,955
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    NYSE Listing Fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    FINRA Filing Fee
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    35,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Accounting Fees and Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Legal Fees and Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Printing and Engraving Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Blue Sky Fees and Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Transfer Agent and Registrar Fees and Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Miscellaneous Expenses
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    To be provided by amendment.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;14.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Indemnification
    of Officers and Directors.</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;102(b)(7) of the General Corporation Law of the
    State of Delaware allows a corporation to include in its
    certificate of incorporation a provision that limits or
    eliminates the personal liability of directors of a corporation
    or its stockholders for monetary damages for a breach of a
    fiduciary duty as a director, except where the director breached
    his duty of loyalty, failed to act in good faith, engaged in
    intentional misconduct or knowingly violated a law, authorized
    the payment of a dividend or approved a stock repurchase or
    redemption in violation of Delaware corporate law or obtained an
    improper personal benefit.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;145 of the General Corporation Law of the State of
    Delaware allows a corporation to indemnify any person who was or
    is a party or is threatened to be made a party to any
    threatened, pending or completed action, suit or proceeding,
    whether civil, criminal, administrative or investigative (other
    than an action by or in the right of such corporation) by reason
    of the fact that such person is or was a director, officer,
    employee or agent of such corporation, or is or was serving at
    the request of such corporation as a director, officer, employee
    or agent of another corporation, partnership, joint venture,
    trust or other enterprise. The indemnity may include expenses
    (including attorneys&#146; fees), judgments, fines and amounts
    paid in settlement actually and reasonably incurred by such
    person in connection with such action, suit or proceeding,
    provided that such person acted in good faith and in a manner
    such person reasonably believed to be in or not opposed to the
    best interests of the corporation and, with respect to any
    criminal action or proceeding, had no reasonable cause to
    believe such person&#146;s conduct was unlawful. A Delaware
    corporation may indemnify directors, officers, employees and
    other agents of such corporation in an action by or in the right
    of a corporation to procure a judgment in its favor under the
    same conditions against expenses (including attorneys&#146;
    fees) actually and reasonably incurred by the person in
    connection with the defense or settlement of such action or
    suit, except that no indemnification is permitted without
    judicial approval if the person to be indemnified has been
    adjudged to be liable to the corporation with respect to such
    claim, issue or matter. Where a present or former director or
    officer of the corporation is successful on the merits or
    otherwise in the defense of any action, suit or proceeding
    referred to above or in defense of any claim, issue or matter
    therein, the corporation must indemnify such person against the
    expenses (including attorneys&#146; fees) which he or she
    actually and reasonably incurred in connection therewith.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Section&#160;174 of the General Corporation Law of the State of
    Delaware provides, among other things, that a director who
    willfully or negligently approves of an unlawful payment of
    dividends or an unlawful stock purchase or redemption, may be
    held liable for such actions. A director who was either absent
    when the unlawful actions were approved or dissented at the
    time, may avoid liability by causing his or her dissent to such
    actions to be entered into the books containing the minutes of
    the meetings of the board of directors at the time such action
    occurred or immediately after such absent director receives
    notice of the unlawful acts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our certificate of incorporation contains a provision that
    provides that each person who was or is a party or is threatened
    to be made a party to or is otherwise involved in any
    threatened, pending or completed action, suit or proceeding,
    whether civil, criminal, administrative or investigative, or a
    proceeding, by reason of the fact that the person is or was a
    director or an officer of our company, or is or was serving at
    our request as a director, officer, employee or agent of another
    corporation, partnership, joint venture, trust or other
    enterprise, including service with respect to an employee
    benefit plan, or an indemnitee, whether the basis of such
    proceeding is alleged action in an official capacity as a
    director, officer, employee or agent or in any other capacity
    while serving as a director, officer, employee or agent, shall
    be indemnified and held harmless by us to the fullest extent
    permitted or required by the General Corporation Law of the
    State of Delaware, as the same exists or may hereafter be
    amended (but, in the case of any such amendment, only to the
    extent that such amendment permits us to provide broader
    indemnification rights than such law permitted us to provide
    prior to such amendment), against all expense, liability and
    loss (including attorneys&#146; fees, judgments, fines, the
    Employment Retirement Income Security Act of 1974 excise taxes
    or penalties and amounts paid in settlement) reasonably incurred
    or suffered by such indemnitee in connection therewith;
    provided, however, that, with limited exceptions relating to
    rights to indemnification, we shall indemnify any such
    indemnitee in connection with a proceeding (or part thereof)
    initiated by such indemnitee only if such proceeding (or part
    thereof) was authorized by our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our policy is to enter into separate indemnification agreements
    with each of our directors and officers that provide the maximum
    indemnity allowed to directors and executive officers by
    Section&#160;145 of the General Corporation Law of the State of
    Delaware and also provides for certain additional procedural
    protections.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, our certificate of incorporation states that we may
    maintain insurance to protect ourselves and any person who is or
    was a director, officer, employee or agent of our company, or is
    or was serving at our request as a director, officer, employee
    or agent of another corporation, partnership, joint venture,
    trust or other enterprise against any liability asserted against
    such person and incurred by such person in any such capacity, or
    arising out of such person&#146;s status as such, whether or not
    we would have the power to indemnify such person against such
    liability under the General Corporation Law of the State of
    Delaware. We have and intend to maintain director and officer
    liability insurance, if available on reasonable terms.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;15.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Recent
    Sales of Unregistered Securities.</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the past two years, Molycorp, Inc.&#146;s predecessors,
    Molycorp, LLC and Molycorp Minerals, LLC, issued unregistered
    securities to funds affiliated with Resource Capital Funds,
    Pegasus Capital Advisors, LP, GS Power Holdings LLC, Traxys
    North America LLC, MP Rare Company LLC and KMSMITH LLC in
    connection with capital contributions. Prior to February&#160;4,
    2009, no additional securities were issued to members; rather,
    the percentage ownership of each member, and such member&#146;s
    capital account, was adjusted accordingly. Molycorp, LLC also
    granted an option to its Chief Executive Officer to purchase
    member interests, and Molycorp Minerals, LLC awarded profits
    interests to certain employee and non-employee directors of
    Molycorp, LLC. None of these transactions involved any
    underwriters or any public offerings, and we believe that each
    of these transactions was exempt from the registration
    requirements pursuant to Section&#160;4(2) of the Securities Act
    of 1933. The recipients of the securities in these transactions
    represented their intention to acquire the securities for
    investment only and not with a view to or for sale in connection
    with any distribution thereof. The information presented below
    does not give effect to our corporate reorganization as
    described in the prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From July&#160;30, 2008 through February&#160;4, 2009 the
    members of Molycorp Minerals, LLC contributed an aggregate of
    $94,991,246 to Molycorp Minerals, LLC.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From February&#160;5, 2009 through September&#160;8, 2009, the
    members of Molycorp Minerals, LLC contributed an aggregate of
    $50,000 to Molycorp Minerals, LLC in exchange for
    542.59&#160;shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On September&#160;9, 2009, the members of Molycorp Minerals, LLC
    exchanged all of their member interests in Molycorp Minerals,
    LLC in exchange for all of the member interests of Molycorp,
    LLC. On September&#160;10, 2009, Molycorp Minerals, LLC granted
    profits interests represented by an aggregate of 5,880,000
    incentive shares to certain employees and non-employee directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From September&#160;10, 2009 through April&#160;14, 2010, the
    members of Molycorp, LLC contributed an aggregate of $27,130,946
    to Molycorp, LLC in exchange for 260,606.66&#160;shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;15, 2010, the members of Molycorp, LLC exchanged
    either (a)&#160;all of their member interests in Molycorp, LLC
    or (b)&#160;all of their equity interests in entities that hold
    member interests in Molycorp, LLC to Molycorp, LLC in exchange
    for 1,261,149.24&#160;shares of Class&#160;A common stock of
    Molycorp, Inc. Additionally on April&#160;15, 2010, all of the
    holders of profits interests in Molycorp Minerals, LLC
    contributed all of their profits interests to Molycorp, Inc. in
    exchange for 78,788.33&#160;shares of Class&#160;B common stock
    of Molycorp, Inc.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;16.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Exhibits
    and Financial Statement Schedules.</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=01 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=01 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=01 type=align1 -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="92%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Underwriting Agreement
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Certificate of Incorporation of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .2*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Certificate of Incorporation of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Bylaws of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .4*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Bylaws of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Certificate of Molycorp, Inc. Common Stock
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    5
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Opinion of Jones Day
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Sales/Buy-Back Agreement, dated May&#160;15, 2009, between
    Molycorp Minerals, LLC and Traxys North America LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .2*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Letter Agreement, dated April&#160;16, 2010, between Molycorp
    Minerals, LLC and Traxys North America LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement, dated November&#160;1, 2009, between
    Molycorp, LLC and Mark A. Smith
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    16
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Letter from KPMG LLP to the Securities and Exchange Commission
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    21
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    List of Subsidiaries
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of PricewaterhouseCoopers LLP
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of SRK Consulting (U.S.), Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .3*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of Jones Day (included in Exhibit&#160;5.1)
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    24
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Power of Attorney
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    To be filed by amendment.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Item&#160;17.&#160;&#160;</FONT></B>
</TD>
    <TD>
    <B><FONT style="font-family: 'Times New Roman', Times">Undertakings.</FONT></B>
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The undersigned registrant hereby undertakes to provide to the
    underwriter at the closing specified in the underwriting
    agreement, certificates in such denominations and registered in
    such names as required by the underwriter to permit prompt
    delivery to each purchaser.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Insofar as indemnification for liabilities arising under the
    Securities Act of 1933&#160;may be permitted to directors,
    officers and controlling persons of the registrant pursuant to
    the foregoing provisions, or otherwise, the registrant has been
    advised that in the opinion of the Securities and Exchange
    Commission such indemnification is against public policy as
    expressed in the Securities Act and is, therefore,
    unenforceable. In the event that a claim for indemnification
    against such liabilities (other than the payment by the
    registrant of expenses incurred or paid by a director, officer
    or controlling person of the registrant in the successful
    defense of any action, suit or proceeding) is asserted by such
    director, officer or controlling person in connection with the
    securities being registered, the registrant will, unless in the
    opinion of its counsel the matter has been settled by
    controlling precedent, submit to a court of appropriate
    jurisdiction the question whether such
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    indemnification by it is against public policy as expressed in
    the Securities Act and will be governed by the final
    adjudication of such issue.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The undersigned registrant hereby undertakes that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;For the purposes of determining any liability under the
    Securities Act of 1933, the information omitted from the form of
    prospectus filed as a part of this registration statement in
    reliance upon Rule&#160;430A and contained in a form of
    prospectus filed by the registrant pursuant to
    Rule&#160;424(b)(1) or (4)&#160;or 497(h) under the Securities
    Act shall be deemed to be part of this registration statement as
    of the time it was declared effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;For the purpose of determining any liability under the
    Securities Act of 1933, each post-effective amendment that
    contains a form of prospectus shall be deemed to be a new
    registration statement relating to the securities offered
    therein, and this offering of such securities at that time shall
    be deemed to be the initial <I>bona fide </I>offering thereof.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SIGNATURES</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act of 1933, the
    registrant has duly caused this registration statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized, in the city of Greenwood Village, Colorado, on the
    16<SUP style="font-size: 85%; vertical-align: top">th</SUP> day

    of April 2010.
</DIV>

<DIV style="margin-top: 22pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-variant: SMALL-CAPS">Molycorp,
    Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;<FONT style="font-variant: SMALL-CAPS">Mark
    A. Smith</FONT></DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Mark A. Smith
</DIV>

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    President and Chief Executive Officer
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the requirements of the Securities Act of 1933, this
    registration statement has been signed by the following persons
    in the capacities and on the dates indicated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="2%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="39%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="39%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="13%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD colspan="3" nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Signature</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Title</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Date</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 10pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;<FONT style="font-variant: SMALL-CAPS">Mark
    A. Smith</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Mark
    A. Smith
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    President and Chief Executive Officer and Director (Principal
    Executive Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>James
    S. Allen
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Chief Financial Officer (Principal Financial Officer and
    Principal Accounting Officer)
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Russell
    D. Ball
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Ross
    R. Bhappu
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    Chairman of the Board
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Brian
    T. Dolan
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Charles
    R. Henry
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Mark
    S. Kristoff
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Alec
    Machiels
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
<TR valign="bottom" style="line-height: 11pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
    <DIV style="display:inline; text-align:center; width:90%"><FONT style="font-variant: SMALL-CAPS">*</FONT></DIV><BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV>Jack
    E. Thompson
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="top">
    Director
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="top">
    April 16, 2010
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="1%"></TD>
    <TD width="1%"></TD>
    <TD width="98%"></TD>
</TR>

<TR>
    <TD valign="top">
    * </TD>
    <TD></TD>
    <TD valign="bottom">
    The undersigned by signing his name hereto does sign and execute
    this registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-1</FONT>
    pursuant to the Power of Attorney executed by the above-named
    directors and officers of the registrant, which is being filed
    herewith on behalf of such directors and officers.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>    By&#160;</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;<FONT style="font-variant: SMALL-CAPS">Mark
    A. Smith</FONT></DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 3%; width: 36%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="white-space: nowrap">Attorney-in-Fact</FONT>
</DIV>

<DIV style="margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    April&#160;16, 2010
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    II-5
</DIV><!-- END PAGE WIDTH -->
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    <B><FONT style="font-family: 'Times New Roman', Times">EXHIBIT&#160;INDEX</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

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<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Underwriting Agreement
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Certificate of Incorporation of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .2*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Certificate of Incorporation of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Bylaws of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    3
</TD>
<TD nowrap align="left" valign="top">
    .4*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Bylaws of Molycorp, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    4
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Certificate of Molycorp, Inc. Common Stock
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    5
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Form of Opinion of Jones Day
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .1*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Sales/Buy-Back Agreement, dated May&#160;15, 2009, between
    Molycorp Minerals, LLC and Traxys North America LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .2*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Letter Agreement, dated April&#160;16, 2010, between Molycorp
    Minerals, LLC and Traxys North America LLC
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD nowrap align="left" valign="top">
    .3
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Employment Agreement, dated November&#160;1, 2009, between
    Molycorp, LLC and Mark A. Smith
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    16
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Letter from KPMG LLP to the Securities and Exchange Commission
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    21
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    List of Subsidiaries
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of PricewaterhouseCoopers LLP
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .2
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of SRK Consulting (U.S.), Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD nowrap align="left" valign="top">
    .3*
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Consent of Jones Day (included in Exhibit&#160;5.1)
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="right" valign="top">
&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    24
</TD>
<TD nowrap align="left" valign="top">
    .1
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Power of Attorney
</TD>
</TR>
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    To be filed by amendment.</TD>
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[{"type": "S-1", "sequence": "1", "filename": "d70469sv1.htm", "description": "FORM S-1", "secsgml_size_bytes": 1418665}]
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sv1
Table of Contents
As filed with the Securities and Exchange Commission on
    April 16, 2010
Registration
    No. 333-
UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
Washington, D.C.
    20549
Form S-1
REGISTRATION
    STATEMENT
UNDER
THE SECURITIES ACT OF
    1933
Molycorp, Inc.
(Exact name of registrant as
    specified in its charter)
Delaware
3390
27-2301797
(State or other jurisdiction
    of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification Number)
5619 Denver Tech Center
    Parkway
Suite 1000
Greenwood Village, Colorado
    80111
(303) 843-8040
(Address, including zip code,
    and telephone number, including area code, of registrant's
    principal executive offices)
Mark A. Smith
President and Chief Executive
    Officer
5619 Denver Tech Center
    Parkway
Suite 1000
Greenwood Village, Colorado
    80111
(303) 843-8040
(Name, address, including zip
    code, and telephone number, including area code, of agent for
    service)
Copies to:
John F. Ashburn, Jr., Esq.
Executive Vice President and General
Counsel
5619 Denver Tech Center Parkway
Suite 1000
Greenwood Village, Colorado 80111
Tel:
(303) 843-8040
Fax:
(303) 843-8082
Christopher M. Kelly, Esq.
Michael J. Solecki, Esq.
Jones Day
North Point
901 Lakeside Avenue
Cleveland, Ohio 44114
Tel: (216) 586-3939
Fax: (216) 579-0212
Michael Kaplan, Esq.
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017
Tel: (212) 450-4000
Fax: (212) 701-5800
Approximate date of commencement of proposed sale to the
    public
:  As soon as practicable after this
    Registration Statement becomes effective.
If any of the securities being registered on this Form are to be
    offered on a delayed or continuous basis pursuant to
    Rule 415 under the Securities Act of 1933, check the
    following
    box.
o
If this Form is filed to register additional securities for an
    offering pursuant to Rule 462(b) under the Securities Act,
    check the following box and list the Securities Act registration
    statement number of the earlier effective registration statement
    for the same
    offering.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(c) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.
o
If this Form is a post-effective amendment filed pursuant to
    Rule 462(d) under the Securities Act, check the following
    box and list the Securities Act registration statement number of
    the earlier effective registration statement for the same
    offering.
o
Indicate by check mark whether the registrant is a large
    accelerated filer, an accelerated filer, a non-accelerated
    filer, or a smaller reporting company. See the definitions of
    "large accelerated filer," "accelerated
    filer" and "smaller reporting company" in Rule
12b-2
of the
    Exchange Act. (Check one):
Large
    accelerated
    filer
o
Accelerated
    filer
o
Non-accelerated
filer
o
Smaller reporting
    company
þ
(Do not check if a smaller
    reporting company)
CALCULATION
    OF REGISTRATION FEE
Proposed Maximum
Amount of
Title of Each Class of
Aggregate
Registration
Securities to be Registered
Offering Price(1)(2)
Fee(3)
Common Stock, par value $0.001 per share
$350,000,000
$24,955
(1)
Includes shares of common stock
    that the underwriters have an option to purchase.
(2)
This amount represents the proposed
    maximum aggregate offering price of the securities registered
    hereunder to be sold by the registrant and the selling
    stockholders. These figures are estimated solely for the purpose
    of calculating the registration fee pursuant to Rule 457(o)
    under the Securities Act of 1933.
(3)
Calculated pursuant to
    Rule 457(o) under the Securities Act of 1933 based on an
    estimate of the proposed maximum offering price.
The registrant hereby amends this Registration Statement on
    such date or dates as may be necessary to delay its effective
    date until the registrant shall file a further amendment which
    specifically states that this Registration Statement shall
    thereafter become effective in accordance with Section 8(a)
    of the Securities Act of 1933 or until the Registration
    Statement shall become effective on such date as the Securities
    and Exchange Commission, acting pursuant to said
    Section 8(a), may determine.
Table of Contents
The
information in this prospectus is not complete and may be
changed. We may not sell securities under this registration
statement until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus
is not an offer to sell any securities and it is not soliciting
an offer to buy these securities in any state where the offer or
sale is not permitted.
SUBJECT TO COMPLETION
Prospectus Dated April 16, 2010
PROSPECTUS
Shares
Molycorp, Inc.
Common Stock
This is the initial public offering of shares of our common
    stock. We are
    offering          shares
    of common stock.
Currently, no public market exists for our common stock. We
    expect the public offering price to be between
    $      and
    $      per share. We intend to apply to
    list our common stock on The New York Stock Exchange under the
    symbol "MCP."
Investing in our common stock involves risk. Please read
    carefully the section entitled "Risk Factors"
    beginning on page 14 of this prospectus.
Per Share
Total
Public offering price
$
$
Underwriting discount
$
$
Proceeds, before expenses, to Molycorp, Inc.
$
$
The underwriters may also purchase up to an
    additional           shares
    from us and up to an
    additional           shares
    from the selling stockholders, at the public offering price,
    less the underwriting discount, within 30 days from the
    date of this prospectus to cover over-allotments.
Neither the Securities and Exchange Commission nor any state
    securities commission has approved or disapproved of these
    securities or determined if this prospectus is truthful or
    complete. Any representation to the contrary is a criminal
    offense.
The underwriters expect to deliver the shares of common stock
    against payment on or
    about          ,
    2010.
J.P.
    Morgan
Morgan Stanley
Prospectus
    dated          ,
    2010.
TABLE OF
    CONTENTS
Page
Prospectus Summary
1
Risk Factors
14
Special Note Regarding Forward-Looking
    Statements
28
Use of Proceeds
29
Capitalization
30
Dividend Policy
31
Dilution
32
Corporate Reorganization
33
Selected Consolidated Financial Data
34
Management's Discussion and Analysis of
    Financial Condition and Results of Operations
36
Rare Earth Industry Overview
49
Business
55
Management
73
Certain Relationships and Related-Party
    Transactions
88
Principal and Selling Stockholders
90
Description of Capital Stock
92
Shares Eligible for Future Sale
98
Material U.S. Federal Income Tax Consequences to
Non-U.S.
Holders
100
Underwriting
103
Change in Accountants
107
Legal Matters
108
Experts
108
Where You Can Find More Information
108
Glossary of Selected Mining Terms
G-1
Index to Financial Statements
F-1
EX-3.1
EX-3.3
EX-10.3
EX-16.1
EX-21.1
EX-23.1
EX-23.2
EX-24.1
You should rely only on the information contained in this
    prospectus or in any free writing prospectus that we provide to
    you. We have not, and the underwriters have not, authorized any
    other person to provide you with different information. If
    anyone provides you with different or inconsistent information,
    you should not rely on it. We are not, and the underwriters are
    not, making an offer to sell these securities in any
    jurisdiction where the offer or sale is not permitted. You
    should assume that the information appearing in this prospectus
    is accurate only as of the date on the front cover of this
    prospectus. Our business, financial condition, operating results
    and prospects may have changed since that date.
i
Table of Contents
PROSPECTUS
    SUMMARY
This summary highlights information contained elsewhere in
    this prospectus and does not contain all of the information that
    you should consider before investing in our common stock. You
    should read this entire prospectus carefully, including the
    sections entitled "Risk Factors" and
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations," and our historical
    consolidated financial statements and related notes included
    elsewhere in this prospectus. In this prospectus, unless the
    context requires otherwise, references to "Molycorp,"
    "we," "our" or "us" refer to
    Molycorp, LLC and its consolidated subsidiaries prior to the
    corporate reorganization (as described below) and Molycorp, Inc.
    and its consolidated subsidiaries after the corporate
    reorganization. As used in this prospectus, the term
    "ton" means a ton (equal to 2,000 pounds), the term
    "mt" means a metric tonne (equal to 2,205 pounds), the
    term "Roskill" means Roskill Consulting Group Limited,
    a rare-earth market consultant, the term "IMCOA" means
    the Industrial Minerals Company of Australia Pty Ltd, a
    rare-earth market consultant, and the terms "ROW" and
    "Rest of World" mean the entire world except China.
    For definitions of certain rare earth-related and mining terms,
    see "Glossary of Selected Mining Terms."
Our
    Business
We are the only rare earth oxide, or REO, producer in the
    Western hemisphere and own the world's largest, most fully
    developed rare earth project outside of China. Furthermore,
    following the execution of our "mine-to-magnets"
    strategy and completion of our modernization and expansion
    efforts, we expect to be one of the world's most integrated
    producers of rare earth products, including oxides, metals,
    alloys and magnets. Our rare earths are critical inputs in
    existing and emerging applications including: clean energy
    technologies, such as hybrid and electric vehicles and wind
    power turbines; multiple high-tech uses, including fiber optics,
    lasers and hard disk drives; numerous defense applications, such
    as guidance and control systems and global positioning systems;
    and advanced water treatment technology for use in industrial,
    military and outdoor recreation applications. Global demand for
    rare earth elements, or REEs, is projected to steadily increase
    both due to continuing growth in existing applications and
    increased innovation and development of new end uses. We have
    made significant investments, and expect to continue to invest,
    in developing technologically advanced applications for
    individual REEs.
For the year ended December 31, 2009, we generated
    approximately $7.1 million of revenue from sales of
    products manufactured from stockpiled feedstocks, although this
    level of revenue is not representative of our planned level of
    operations after we restart mining operations. Following the
    finalization of our financing plan in connection with, and
    including, this offering, we expect to be fully funded through
    our modernization and expansion efforts, which we expect will
    continue through 2012.
Mine-to-Oxides
We and SRK Consulting (U.S.), Inc., or SRK Consulting, estimate
    total proven and probable reserves of 2.21 billion pounds
    of REO, with an average ore grade of 8.24%, using a cut-off
    grade of 5.0%, at our Mountain Pass mine. Based on these
    estimated reserves and an expected annual production rate of
    19,090 mt of REO, our expected mine life is in excess of
    30 years. According to Roskill, global REO production in
    2008 was approximately 124,000 mt, of which only approximately
    4,300 mt originated from outside of China, with Molycorp
    producing approximately 1,700 mt from its stockpiles and Russian
    producers producing approximately 2,500 mt. This contrasts with
    total demand outside of China in 2008 of approximately 50,000
    mt, according to Roskill, with rapid growth expected by industry
    analysts. Upon completion of our modernization and expansion
    efforts, we will have the ability to produce 19,090 mt of REO
    per year to supply this non-Chinese demand and expect to have
    the capability to increase production to 40,000 mt of REO per
    year, if warranted by market conditions.
At our Mountain Pass facility, we have the ability to mine,
    crush, mill and separate rare earth ore to produce individual
    REEs. We hold a
30-year
mine
    plan permit and an associated environmental impact report, both
    of which were issued in 2004. Since our acquisition of the
    Mountain Pass facility, we have been producing and selling REOs
    from stockpiled feedstocks to significantly improve our solvent
    extraction
1
Table of Contents
technologies and capabilities. We are now achieving greater than
    98% recovery in our solvent extraction units at commercial
    scale, which we believe is one of the highest recovery rates in
    the world. We have developed the expertise to produce the
    following REEs in many usable forms: bastnasite concentrate;
    cerium; lanthanum; neodymium; praseodymium; europium; samarium;
    gadolinium; dysprosium; and terbium.
Processing at our Mountain Pass facility entails mining the
    bastnasite ore followed by crushing and milling it to a fine
    powder. Milled bastnasite ore is then processed by flotation
    whereby the bastnasite, which is a mineral containing light and
    heavy rare earth elements, floats to the surface and is
    separated from the waste material, which sinks in a series of
    flotation cells. The resultant bastnasite concentrate is then
    processed by leaching with strong acid solutions followed by a
    series of solvent-extraction separation steps that produce
    various individual REO minerals, generally in a high purity
    (greater than 99%) oxide form. Beginning in the second quarter
    of 2010, we plan to begin processing bastnasite concentrate from
    our stockpiles in an effort to commercially demonstrate our new
    cracking technology while at the same time continue to further
    optimize our processing technologies and improve recovery rates
    compared to historical operations at the Mountain Pass facility.
We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with modernization of our
    processing capabilities to efficiently produce at a rate of
    19,090 mt of REO per year by the end of 2012. The
    U.S. Government Accountability Office, or U.S. GAO,
    April 2010 briefing titled "Rare Earth Minerals in the
    Defense Supply Chain," which was prepared in accordance
    with the National Defense Reauthorization Act for Fiscal Year
    2010 (Pub. L.
No. 111-84),
stated that, for a typical exploration-stage mine, once a
    company has secured the necessary capital to start a mine,
    government and industry officials said it can take from seven to
    15 years to bring a property fully online, largely due to
    the time it takes to comply with multiple state and federal
    regulations. Since Molycorp's Mountain Pass facility is not
    an early stage rare earth project, we believe it has significant
    timeline advantages as it has a well-defined ore body, an
    existing open pit with over 50 years of production history,
    an existing mine and reclamation plan, proven reserves,
    substantial permitting, and all necessary technology to
    successfully process and separate the rare earth elements at a
    commercial scale.
Oxides-To-Metals/Alloys
We expect to sell and transport a portion of the REOs we produce
    to customers for use in their particular applications. The
    remainder of the REOs will be processed into rare earth metals.
    A portion of these metals will be sold to end users and we
    expect to process the rest into rare earth alloys. These rare
    earth alloys can be used in a variety of applications, including
    but not limited to: electrodes for nickel metal hydride, or
    NiMH, battery production; samarium cobalt magnet production; and
    neodymium iron boron, or NdFeB, magnet production.
Initially, our modernization and expansion plans envisioned
    adding facilities and equipment for metal conversion and alloy
    production at the Mountain Pass facility. However, we have
    entered into a letter of intent to acquire a third-party
    producer of rare earth metals and alloys in the United States.
    If we complete the acquisition instead of adding such facilities
    and equipment at Mountain Pass, we plan to transport cerium,
    lanthanum, neodymium/praseodymium (didymium) and samarium oxide
    products from our Mountain Pass facility to our new off-site
    location that already possesses the technological capability to
    produce rare earth metals and alloys.
2
Table of Contents
Magnet
    Production
We are currently evaluating joint venture opportunities to
    integrate downstream into NdFeB magnet manufacturing in the
    United States. NdFeB magnets, which are critical components in
    "green" technologies and the miniaturization of
    electronics, are primarily manufactured in China (approximately
    80%) and Japan (approximately 20%). We are currently working to
    secure a collaborative joint venture agreement with a
third-party
manufacturer of NdFeB magnets. This joint venture will provide
    us with access to the intellectual property, technology, people
    and facilities to convert our rare earth materials into the
    high-performance permanent magnets required for production of
    hybrid and electric vehicles, wind power turbines, high-tech
    applications and numerous advanced defense systems on which the
    U.S. economy and national security depend. The consummation
    of such a joint venture, in conjunction with our current
    modernization plans and the potential acquisition of a
    third-party rare earth metals and alloys producer, is expected
    to provide us with the capability to mine, process, separate and
    alloy individual REEs before manufacturing them into NdFeB
    magnets. This downstream integration would make us the only
    fully integrated producer of NdFeB magnets outside of China,
    helping to secure rare earth supply for the Rest of World.
Rare
    earth "mine-to-magnets" production supply
    chain
Industry
    Overview
The REE group includes 17 elements, namely the
    15 lanthanide elements, which are cerium, lanthanum,
    neodymium, praseodymium, promethium (which does not occur
    naturally), samarium, europium, gadolinium, terbium, dysprosium,
    holmium, erbium, thulium, ytterbium and lutetium, and two
    elements that have similar chemical properties to the lanthanide
    elements — yttrium and scandium. The oxides produced
    from processing REEs are collectively referred to as REOs. Light
    and heavy REEs are contained in all rare earth deposits. Cerium,
    lanthanum, neodymium, praseodymium and samarium are considered
    "light REEs" that are more predominant in bastnasite,
    while europium, gadolinium, terbium, dysprosium, holmium,
    erbium, thulium, ytterbium and lutetium are considered
    "heavy REEs" that are more predominant in monazite.
    Our reserves are bastnasite, but there are also known monazite
    occurrences on our property that we are currently examining.
REEs have unique properties that make them critical materials to
    many existing applications upon which society has become
    dependent as well as emerging applications. Examples include:
•
Clean-Energy Technologies:
hybrid and electric
    vehicles, wind power turbines and compact fluorescent lighting;
•
High-Technology Applications:
miniaturization of
    cell phones, personal digital assistant devices, digital music
    players, hard disk drives used in computers, computing devices,
    "ear bud" speakers and microphones, as well as fiber
    optics, lasers and optical temperature sensors;
•
Critical Defense Applications:
guidance and control
    systems, communications, global positioning systems, radar and
    sonar; and
•
Advanced Water Treatment:
industrial, military,
    homeland security and domestic and foreign aid applications.
Global consumption of REEs is projected to steadily increase due
    to continuing growth in existing applications and increased
    innovation and development of new end uses. For example, the
    integration of rare earth permanent magnet drives into wind
    power turbines has substantially reduced the need for gearboxes,
    which increases overall efficiency and reliability. According to
    IMCOA and Roskill, total demand for rare earths outside of China
    is expected to increase at a compound annual growth rate, or
    CAGR, of approximately 4% to
3
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5% between 2008 and 2014. In addition, according to Roskill,
    global demand for the more important magnetic rare earths,
    neodymium, praseodymium and dysprosium, is expected to grow at
    CAGRs of approximately 8%, 6% and 6%, respectively, over the
    same period. Both IMCOA and Roskill estimate that total global
    demand for rare earths is expected to increase at a CAGR of
    approximately 6% from 2008 through 2014, from approximately
    124,000 mt to approximately 180,000 mt per annum.
China has dominated the global supply of REOs for the last ten
    years and, according to Roskill, accounted for approximately 97%
    of global REO production in 2008. Even with our planned
    production, global supply is expected by analysts to remain
    tight due to the combined effects of growing demand and actions
    taken by the Chinese government to restrict exports. The Chinese
    government heightened international supply concerns in August
    2009 when China's Interior Ministry signaled that it would
    further restrict exports of Chinese rare earth resources. Citing
    the importance of REE availability to internal industries and
    the desire to conserve resources, the Chinese government has
    announced export quotas, increased export tariffs and introduced
    a "mining quotas policy." China's internal
    consumption of rare earths is expected to continue to grow,
    leaving the Rest of World with a supply gap within the next two
    years, during a period of projected increasing global demand.
    China also dominates the manufacture of rare earth metals,
    producing substantially all of the world's supply, and the
    manufacture of NdFeB magnets, producing approximately 80% of the
    world's supply. Neither capability currently exists in the
    United States, as confirmed by the April 2010 U.S. GAO
    briefing.
China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S. Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
According to the April 2010 briefing prepared by the
    U.S. GAO:
•
the Mountain Pass mine is the largest non-Chinese rare earth
    deposit in the world;
•
other U.S. rare earth deposits exist, but these deposits
    are still in early exploratory stages of development;
•
officials emphasized the significance of the widespread use of
    commercial-off-the-shelf products in defense systems that
    include rare earth materials, such as computer hard drives;
•
government and industry officials told the U.S. GAO that
    where rare earth materials are used in defense systems, the
    materials are responsible for the functionality of the component
    and would be difficult to replace without losing performance;
•
a 2009 National Defense Stockpile configuration report
    identified lanthanum, cerium, europium and gadolinium as having
    already caused some kind of weapon system production delay and
    recommended further study to determine the severity of the
    delays; and
•
defense systems will likely continue to depend on rare earth
    materials, based on their life cycles and lack of effective
    substitutes.
Current estimates indicate that global demand for REEs will
    exceed global supply by 2011. This shortage will continue unless
    Mountain Pass and other rare earths projects achieve projected
    production capacities. IMCOA and Roskill expect that this
    anticipated excess demand will underpin strong pricing.
4
Table of Contents
Global
    Supply and Demand of Rare Earths
(2000-2015)
(mt)
Source: Roskill
Roskill has assumed that our Mountain Pass facility will provide
    a significant portion of the increased supply after 2011.
ROW
    Supply and Demand of Rare Earths
(2000-2015)
(mt)
Source: Roskill
5
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As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. According to Metal Pages, since the
    beginning of the fourth quarter of 2009, prices have risen by
    approximately 60% and continue to rise.
Rare
    Earth Product Prices(1)
Rare Earth Product
2010
2014
2020
2030
Lanthanum Oxide
$
7.50
$
6.00
$
7.00
$
10.00
Cerium Oxide
4.00
2.50
2.50
3.00
Praseodymium Oxide
22.50
30.00
40.00
60.00
Neodymium Oxide
22.50
30.00
40.00
60.00
Samarium Oxide
4.50
4.50
5.00
8.00
Europium Oxide
475.00
600.00
750.00
1,000.00
Gadolinium Oxide
7.00
8.00
10.00
15.00
Terbium Oxide
500.00
650.00
850.00
1,200.00
Dysprosium Oxide
120.00
155.00
200.00
250.00
Yttrium Oxide
20.00
27.50
35.00
50.00
(1)
Rare earth product prices in US$/kg,
free-on-board
China (+/− 20%)
Source: IMCOA. Although IMCOA and Roskill predict strong growth,
    their projections with respect to certain years are slightly
    different.
Our
    Strengths
We believe that we possess a number of competitive strengths
    that position the Mountain Pass facility to regain its role as
    one of the leading global suppliers of REOs.
We
    have a proven source of REOs with high-grade ore and long
    reserve life.
Prior to the end of the last mining campaign at the Mountain
    Pass facility in 2002, the mine had been in continuous operation
    for over 50 years. Since our acquisition of the Mountain
    Pass facility, we have been processing stockpiled feedstocks as
    part of our ongoing effort to significantly improve our solvent
    extraction technologies and other processing capabilities.
    Today, based on estimated reserves of 2.21 billion pounds
    of REO with an average ore grade of 8.24%, using a cut-off grade
    of 5.0%, the Mountain Pass mine has a life in excess of
    30 years at an annual production rate of 19,090 mt of REO.
    Our leadership team is committed to the continuous and
    sustainable manufacture of rare earth products at the Mountain
    Pass facility using advanced milling and processing technologies
    that will significantly increase the life of the known ore body
    at the Mountain Pass facility. Additionally, we have recently
    expanded our
on-site
exploratory drilling program to confirm the existence and extent
    of bastnasite, monazite and other rare earth phosphate mineral
    occurrences in unexplored areas of the Mountain Pass facility.
    This program will also help to establish that our measured,
    indicated and inferred resources can become proven or probable
    reserves.
We
    expect to be well-positioned to capitalize on the tightening
    balance of global supply and demand of rare earth
    products.
As worldwide demand for rare earth products increases, the
    supply of REOs is limited by available production capacity,
    which is currently concentrated in China. According to Roskill,
    China accounted for approximately 97% of global REO production
    in 2008. China also dominates the manufacture of metals and
    NdFeB magnets from rare earths, capabilities that are not
    currently found in the United States.
Chinese government policies will also impact the supply and
    demand of REOs and rare earth products. We believe that the
    Chinese government intends to increase wind generated power to
    100 gigawatts with an investment expected to be above $150
    billion and has also proposed a package of over $29 billion
    to fund hybrid and electric vehicle production, placing
    additional strain on the REE supply chain. Citing the importance
    of REE availability to internal industries and the desire to
    conserve resources, the Chinese government has also announced
    export quotas, increased export tariffs and introduced a
    "mining quotas policy."
6
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Given China's estimated consumption levels and the
    limitations its government has put on exports, Roskill projects
    a global deficit beginning in 2011 without the advent of
    production from new projects, such as Mountain Pass. Limits on
    rare earth exports from China and the lack of available
    substitutes make the development of new sources of REEs
    essential to meet the growing demand for existing and emerging
    technologies, such as hybrid and electric vehicles, wind power
    turbines, compact fluorescent light bulbs, hard disk drives and
    dual use electronics.
China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S. Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
U.S. federal government investments and policies may
    materially increase end-market demand for our rare earth
    products. For example, the U.S. federal government recently
    approved $45 billion in grant funding and loan guarantees
    directed toward wind power generation projects and hybrid and
    electric vehicles. Pending energy legislation may also increase
    demand for clean technology applications, which use rare earth
    products.
Upon reaching full planned production rates for REOs in 2012, we
    expect to be in a position to supply a substantial portion of
    the U.S. demand and also sell to export markets.
We
    have a highly experienced and qualified management
    team.
Our President and Chief Executive Officer has 29 years of
    experience, 24 of which are associated with the Mountain Pass
    facility. In addition, our Chief Technology Officer, General
    Counsel and Chief Financial Officer have over 75 years of
    combined technical, operational, legal, financial and management
    experience. Many of our key employees have worked with the
    Mountain Pass facility for over 20 years each. We also have
    a proven technology and product development group and as of
    April 1, 2010, held 18 issued and pending U.S. patents
    and patent applications, and 146 issued and pending foreign
    patents and patent applications. Management has also created a
    work environment that prioritizes safety. Since July 2005, the
    Mountain Pass facility has not had a lost-time accident and has
    received the coveted "Sentinels of Safety" award from
    the Mine Safety and Health Administration, or MSHA, for three of
    the last four years.
Our
    Business Strategy
Our business strategy is to:
Build
    the largest, most advanced and efficient fully integrated REO
    processing facility in the world.
We intend to refurbish or replace existing equipment at the
    Mountain Pass facility in connection with our modernization and
    expansion efforts. We also intend to build the largest, most
    advanced and efficient fully integrated REO processing facility
    in the world to support our anticipated production requirements.
    Following the refurbishment of existing equipment and the
    purchase, delivery, installation, and
start-up
of
    new equipment, our fully integrated facility will allow us to
    reach full production, utilizing our newly optimized and
    commercially proven REO processing operations. Additionally, we
    expect that our proprietary production technology and our
    planned new paste tailings operation will reduce our
    environmental footprint and set the standard in the industry for
    environmental stewardship.
Successfully
    complete modernization and expansion efforts and reach full
    planned production rates for REOs at the Mountain Pass facility
    by the end of 2012.
After reaching full planned production rates for REOs at the
    Mountain Pass facility, we expect to produce 19,090 mt of REO
    per year. We operate the Mountain Pass facility pursuant to a
30-year
mining permit issued in 2004 that allows us to feed ore to the
    mill at a rate of 2,400 tons per day. While the Mountain Pass
    facility historically required 2,000 tons of mill feed per day
    to manufacture 19,090 mt of REO per year, we expect that new
    proprietary technologies we developed will allow us to extract
    the same 19,090 mt of REO per year
7
Table of Contents
while only using approximately 1,100 to 1,500 tons of mill feed
    per day, thus allowing for potential increases in annual REO
    production beyond the planned 19,090 mt per year without any
    change in the permit limit.
Improve
    our operating efficiencies with technically advanced
    manufacturing techniques.
We intend to continue to improve the efficiency of our
    operations through the creation and use of technically advanced
    manufacturing processes for production of rare earth products,
    which will allow us to deliver high-quality rare earth products
    at globally competitive prices. We have already invested
    significant resources towards perfecting our REO processing
    operations and developing new and proprietary applications for
    individual REEs. We expect that by advancing all of these
    technologies, we will continue to lower our operating costs.
Manage
    our costs to be cost competitive.
The success of our business will depend on our ability to manage
    our costs. We will manage these costs through the use of new
    production technologies that have been developed by our research
    and development group, which will use less energy and raw
    materials and will result in a reduced environmental footprint.
    These production technologies will substantially reduce the
    amount of water consumption and waste water generation. We plan
    to use our proprietary technology to maximize our process
    recoveries and maximize REO concentrate production per unit of
    extracted ore. We plan to install a natural gas powered
    co-generation power plant as part of our modernization and
    expansion of the Mountain Pass facility to reduce energy
    consumption and costs as well as minimize or eliminate our
    reliance on the regional electric power grid. We intend to
    produce our own hydrochloric acid and sodium hydroxide at the
    Mountain Pass facility and recycle our acid and base, thereby
    reducing our reliance on external sources of reagents. After
    completion of our modernization and expansion efforts, we
    anticipate our most significant cash operating costs will
    consist of natural gas and labor.
Secure
    customer commitments to provide a stable revenue
    stream.
We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    at the Mountain Pass facility, we expect to produce
    approximately 19,090 mt of REO per year. As of April 1,
    2010, we had 19 letters of intent to sell our rare earth
    products, representing approximately 138% of our anticipated
    production for 2013. We are continuing to seek additional
    letters of intent and, prior to commencing full production, we
    intend to enter into short- and long-term sales contracts with
    existing and new customers. In addition, we are in discussions
    with multiple large, globally diversified mining companies
    regarding the sale of
    XSORBX
®
.

    XSORBX
®
is a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX
®
is protected by over 100 issued and pending U.S. and
    foreign patents and patent applications.
The following table compares the volume under our letters of
    intent to our anticipated production for 2013 (in mt):
8
Table of Contents
Volume Under
Percent of
Letters of
Uncommitted
2013
Projected 2013
Product Type
Intent (1)(2)
Volume
Production(1)(2)
Production
Lanthanum non-metal
11,427
—
3,104
368
%
Lanthanum metal
436
(3)
2,071
2,507
17
%
Cerium non-metal
6,914
(4)
2,770
9,684
71
%
Cerium metal
200
(3)
—
—
—
Neodymium non-metal
50
—
—
—
Neodymium metal
3,318
(5)
—
313
1,060
%
Praseodymium metal
1,091
(5)
—
116
941
%
Europium oxide
—
(6)
19
19
—
Samarium metal(8)
—
191
191
—
NdPr metal in NdFeB alloy
1,000
(7)
964
1,964
51
%
NdPr metal in NdFeB magnets
291
(7)
—
—
—
TOTAL
24,727
6,015
17,898
138
%
(1)
Alloy and magnet production and letter of intent volume are
    reported on a rare earth metal basis.
(2)
There is a 14.2% loss of mass when REOs are converted to rare
    earth metal due to oxygen evolution.
(3)
Contained within mischmetal, a combination of lanthanum, cerium
    and iron, for battery alloy producers.
(4)
Volume shown is used in traditional glass or catalyst market
    segments and represents only a very small fraction of cerium
    buyers. Although IMCOA predicts that there will be a surplus of
    cerium in the future, we anticipate most of our production will
    serve the new, proprietary
    XSORBX
®
market segment. This segment alone is expected to consume many
    times more cerium units than we can produce. We believe the new
    segment negates the need for additional letters of intent at
    this time.
(5)
We have received letters of intent for 9,700,000 pounds of Nd
    and/or NdPr metal (otherwise known as didymium metal). To
    demonstrate the Nd and Pr breakdown, we have split the didymium
    requirement to the generally accepted ratio of 75/25 Nd to Pr in
    the didymium metal. Some of our metal production will be
    consumed internally for downstream NdFeB alloy/magnet production.
(6)
We expect to receive letters of intent from a number of phosphor
    producers, which will easily consume our europium production. At
    this time, we are the only producer outside of China for this
    element, which enables energy efficient, compact fluorescent
    lights and straight tube T-8 lamps.
(7)
This represents the estimated NdPr metal contained in the letter
    of intent volume for NdFeB alloy and magnets.
(8)
IMCOA predicts that there will be a surplus of samarium metal.
Integrate
    downstream to profitably capture the full value
    chain.
We intend to utilize vertical integration through further
    downstream processing of our REOs into rare earth metals, alloys
    and finished magnets. We have entered into a letter of intent to
    acquire a third-party producer of rare earth metals and alloys
    in the United States. This acquisition would provide us with a
    license to technology related to the production of rare earth
    metals and alloys. Additionally, we are currently working to
    secure a collaborative joint venture agreement with a
    third-party manufacturer to produce NdFeB magnets in the United
    States. This
"mine-to-magnets"
strategy will make us the first fully integrated supplier of
    NdFeB magnets in the world and the only producer of NdFeB
    magnets in the United States. In addition, we are working to
    identify and develop new downstream opportunities for the REOs,
    rare earth metals and alloys and rare earth products we will
    manufacture.
Develop
    new higher margin products.
We intend to develop new higher margin products and processes
    for REEs that historically have had lower demand. For example,
    cerium is used primarily for glass polishing and has typically
    sold at prices lower than those for other REEs. However, we have
    developed
    XSORBX
®
,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams
9
Table of Contents
and will allow our customers to more safely sequester arsenic
    and increase their production.
    XSORBX
®
is protected by over 100 issued and pending U.S. and
    foreign patents and patent applications. This product, which we
    have proven to be effective in removing arsenic and other
    contaminants from water, is applicable to a broad range of
    applications with higher margins. We have entered into a
    non-binding letter of intent with a water filtration company to
    jointly develop water treatment products. We will continue to
    focus on establishing proprietary markets for low-demand REEs to
    provide us with an opportunity to sell these REEs as higher
    margin products.
Our
    Corporate History and Structure
Molycorp Minerals, LLC, a Delaware limited liability company
    formerly known as Rare Earth Acquisitions LLC, was formed on
    June 12, 2008 to purchase the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc., a subsidiary of Chevron Corporation. Prior to the
    acquisition, the Mountain Pass facility was owned by Chevron
    Mining Inc. and, before 2005, by Unocal Corporation. Molycorp,
    LLC, the parent of Molycorp Minerals, LLC, is a Delaware limited
    liability company that was formed on September 9, 2009.
    Molycorp, Inc. was formed on March 4, 2010 as a new
    Delaware corporation that is not, to date, conducting any
    activities other than those incident to its formation and the
    preparation of this registration statement.
The members of Molycorp, LLC have contributed either
    (a) all of their member interests in Molycorp, LLC or
    (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class A common stock. Additionally, all of
    the holders of profits interests in Molycorp Minerals, LLC,
    which were represented by incentive shares, have contributed all
    of their incentive shares to Molycorp, Inc. in exchange for
    shares of Molycorp, Inc. Class B common stock. Accordingly,
    Molycorp, LLC and Molycorp Minerals, LLC have become
    subsidiaries of Molycorp, Inc. We refer to this process as the
    "corporate reorganization" throughout this prospectus.
    All of the shares of Class A common stock and Class B
    common stock will convert into shares of common stock
    immediately prior to the consummation of this offering. See
    "Corporate Reorganization" for further information.
Company
    Information
Our principal executive offices are located at 5619 Denver Tech
    Center Parkway, Suite 1000, Greenwood Village, Colorado
    80111, and our telephone number is
(303) 843-8040.
Our website address is www.molycorp.com. Information on or
    accessible through our website is not a part of this prospectus.
10
Table of Contents
The
    Offering
Common stock offered by us
shares
Common stock offered by the selling stockholders if the
    underwriters exercise their option to purchase additional shares
    of common stock in this offering
shares
Common stock outstanding after this offering
shares
Use of proceeds
We estimate that the net proceeds to us from this offering,
    after deducting underwriting discounts and commissions and
    estimated offering expenses that we must pay, will be
    approximately $      million,
    based on an assumed initial public offering price of
    $      per share, which is the midpoint
    of the estimated price range set forth on the cover page of this
    prospectus. If the underwriters exercise their over-allotment
    option in full, we estimate that our net proceeds will be
    approximately $     .
We intend to use our net proceeds from this offering primarily
    to fund our modernization and expansion of the Mountain Pass
    facility as well as for general corporate purposes, including,
    without limitation, to fund our working capital requirements and
    to develop new products, processes and technologies, both
    through acquisitions and capital programs.
We will not receive any proceeds from the sale of shares of
    common stock offered by the selling stockholders if the
    underwriters exercise their over-allotment option to purchase
    shares of common stock from the selling stockholders in this
    offering. See "Use of Proceeds."
Risk factors
See "Risk Factors" beginning on page 14 and other
    information included in this prospectus for a discussion of
    factors you should carefully consider before deciding whether to
    invest in our common stock.
Proposed NYSE symbol
We intend to apply to list our common stock on The New York
    Stock Exchange, or NYSE, under the symbol "MCP."
Unless otherwise indicated, this prospectus reflects and assumes:
•
no exercise by the underwriters of their option to
    purchase          
    additional shares of common stock;
•
an initial public offering price of
    $      per share, the midpoint of the
    estimated price range set forth on the cover page of this
    prospectus; and
•
the conversion of all of our Class A common stock and
    Class B common stock into an aggregate
    of           shares
    of common stock immediately prior to the consummation of this
    offering as described under "Corporate Reorganization."
The number of shares of common stock to be outstanding
    immediately after this offering does not reflect shares of
    common stock authorized and reserved for future issuance under
    our new stock incentive plan. See "Management —
    Compensation Discussion and Analysis — Molycorp, Inc.
    2010 Equity and Performance Incentive Plan."
11
Table of Contents
Summary
    Consolidated Financial Data
Upon the formation of Molycorp, LLC on September 9, 2009,
    all members of Molycorp Minerals, LLC contributed their member
    interests to Molycorp, LLC in exchange for member interests in
    Molycorp, LLC. That exchange was treated as a reorganization of
    entities under common control and Molycorp Minerals, LLC is the
    predecessor to Molycorp, LLC. Accordingly, all financial
    information of Molycorp, LLC for periods prior to its formation
    is the historical financial information of Molycorp Minerals,
    LLC. Molycorp Minerals, LLC acquired the Mountain Pass,
    California rare earth deposit and associated assets from Chevron
    Mining Inc., a subsidiary of Chevron Corporation, on
    September 30, 2008. The summary consolidated financial data
    as of December 31, 2009 and 2008, for the year ended
    December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008, and cumulatively for
    the period from June 12, 2008 (Inception) through
    December 31, 2009 has been derived from Molycorp,
    LLC's audited consolidated financial statements and the
    related notes included elsewhere in this prospectus.
On April 15, 2010, the members of Molycorp, LLC contributed
    either (a) all of their member interests in Molycorp, LLC
    or (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc., and, as a result, Molycorp, LLC and Molycorp
    Minerals, LLC became wholly owned subsidiaries of Molycorp, Inc.
    The unaudited pro forma balance sheet data as of
    December 31, 2009 has been prepared to give effect to the
    corporate reorganization as if it had occurred on
    December 31, 2009. The unaudited pro forma balance sheet
    data is for informational purposes only and does not purport to
    indicate balance sheet information as of any future date.
As a limited liability company, the taxable income and losses of
    Molycorp, LLC were reported on the income tax returns of its
    members. Molycorp, Inc. is subject to federal and state income
    taxes and will file consolidated income tax returns. If the
    corporate reorganization had been effective as of
    January 1, 2009, our net loss of $28.6 million would
    have generated a pro forma deferred income tax benefit of
    $11.3 million, assuming a combined federal and state
    statutory income tax rate. However, as realization of such tax
    benefit would not have been assured, we would have also
    established a valuation allowance to eliminate such pro forma
    tax benefit.
The unaudited pro forma per share data has been computed based
    upon the number of shares of common stock outstanding
    immediately after the corporate reorganization applied to our
    historical net loss amounts and gives retroactive effect to the
    corporate reorganization as if it had occurred on June 12,
    2008.
The summary consolidated financial data set forth below should
    be read in conjunction with "Selected Consolidated
    Financial Data," "Management's Discussion and
    Analysis of Financial Condition and Results of Operations"
    and the financial statements and the notes thereto included
    elsewhere in this prospectus.
June 12, 2008
June 12, 2008
(Inception)
(Inception)
Year Ended
Through
Through
Statement of Operations Data
December 31, 2009
December 31, 2008
December 31, 2009
(In thousands, except share and per share data)
Net sales
$
7,093
$
2,137
$
9,230
Cost of goods sold(1)
(21,785
)
(13,027
)
(34,812
)
Selling, general and administrative expense
(12,685
)
(2,979
)
(15,664
)
Accretion expense
(1,006
)
(250
)
(1,256
)
Depreciation and amortization expense
(191
)
(19
)
(210
)
Operating loss
(28,574
)
(14,138
)
(42,712
)
Net loss
$
(28,587
)
$
(14,074
)
$
(42,661
)
Loss per share:
Weighted average shares outstanding
1,017,959
1,000,000
1,011,561
Basic
$
(28.08
)
$
(14.07
)
$
(42.17
)
Diluted
$
(28.08
)
$
(14.07
)
$
(42.17
)
Pro forma loss per share:
Weighted average shares outstanding:
Basic
Diluted
12
Table of Contents
Pro Forma
Balance Sheet Data
December 31, 2009
December 31, 2009
December 31, 2008
(In thousands)
Cash and cash equivalents
$
$
6,929
$
2,189
Total current assets
18,520
8,710
Total assets
97,666
95,355
Total non-current liabilities
13,509
13,196
Total liabilities
23,051
17,279
Members' equity
74,615
78,076
June 12, 2008
June 12, 2008
(Inception)
Year Ended
(Inception) Through
Through
Other Financial Data
December 31, 2009
December 31, 2008
December 31, 2009
(In thousands)
Capital expenditures
$
7,285
$
321
$
7,606
(1)
Cost of goods sold includes write-downs of inventory to
    estimated net realizable value of $9.0 million,
    $9.5 million and $18.5 million for the year ended
    December 31, 2009 and for the period from June 12,
    2008 (Inception) through December 31, 2008, and
    cumulatively for the period from June 12, 2008 (Inception)
    through December 31, 2009, respectively.
13
Table of Contents
RISK
    FACTORS
An investment in our common stock involves a high degree of
    risk. Accordingly, you should carefully consider the following
    risk factors, together with all of the other information
    contained in this prospectus, including our consolidated
    financial statements and related notes, before making an
    investment in our common stock. If any of the following risks
    actually occurs, we may not be able to conduct our business as
    currently planned, and our business, operating results and
    financial condition could be harmed. In that case, the market
    price of our common stock could decline, and you could lose all
    or a part of your investment.
Risks
    Related to Our Business
The
    production of rare earth products is a capital-intensive
    business and our ongoing modernization and expansion efforts at
    the Mountain Pass facility to reach full planned production
    rates by 2012 will require the commitment of substantial
    resources. Any unanticipated costs or delays associated with our
    ongoing modernization and expansion efforts at the Mountain Pass
    facility could have a material adverse effect on our financial
    condition or results of operations.
Our ongoing modernization and expansion efforts at the Mountain
    Pass facility to reach full planned production rates by 2012
    require the commitment of substantial resources for operating
    expenses and capital expenditures. We expect to incur
    approximately $511 million in capital costs prior to the
    end of 2012. Our estimated expenses may increase in subsequent
    years as consultants, personnel and equipment associated with
    advancing development and commercial production are added. The
    progress of our modernization and expansion efforts at the
    Mountain Pass facility and the amounts and timing of
    expenditures will depend in part on the following:
•
the refurbishment or replacement of a significant portion of the
    existing process, plant and equipment that consists of aging or
    outdated facilities and equipment, retooling and development and
    the preparation of the mine pit for renewed production of ore;
•
obtaining and maintaining required federal, state and local
    permits;
•
the results of consultants' analysis and recommendations;
•
negotiating contracts for equipment, earthwork, construction,
    equipment installation, labor and completing infrastructure and
    construction work;
•
negotiating sales and offtake contracts for our planned
    production;
•
the execution of any joint venture agreements or similar
    arrangements with strategic partners; and
•
other factors, many of which are beyond our control.
Most of these activities require significant lead times and must
    be advanced concurrently. Any unanticipated costs or delays
    associated with our ongoing modernization and expansion efforts
    at the Mountain Pass facility could have a material adverse
    effect on our financial condition or results of operations and
    could require us to seek additional capital, which may not be
    available on commercially acceptable terms or at all.
The
    actual amount of capital required for the expansion and
    modernization of the Mountain Pass facility may vary materially
    from our current estimates, in which case we would need to raise
    additional funds, which may delay completion and have a material
    adverse effect on our business and financial
    condition.
The anticipated funding required to complete the expansion and
    modernization of the Mountain Pass facility is based on certain
    estimates and assumptions we have made about the additional
    facilities, equipment, labor, permits and other factors required
    to complete the project. If any of these estimates or
    assumptions change, the actual timing and amount of capital
    required to complete the expansion and modernization of the
    Mountain Pass facility may vary materially from what we
    anticipate. Additional funds may be required in the event of
    significant departures from our current expansion and
    modernization plan, unforeseen delays, cost overruns,
    engineering design changes or other unanticipated expenses.
    There can be no assurance that
14
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additional financing will be available to us, or, if available,
    that it can be obtained on a timely basis and on commercially
    acceptable terms.
Our
    growth depends on the modernization and expansion of our
    Mountain Pass facility, which is our only rare earth mining,
    manufacturing and processing facility.
Our only rare earth mining, manufacturing and processing
    facility at this time is the Mountain Pass facility. Our
    continued viability is based on successfully implementing our
    strategy, including our modernization and expansion plans at the
    Mountain Pass facility, successfully commencing mining
    operations at the Mountain Pass facility and reaching full
    planned production rates in accordance with our expected
    timeframe. The deterioration or destruction of any part of the
    Mountain Pass facility may significantly hinder our ability to
    reach or maintain full planned production rates within the
    expected time frame or at all. If we are unsuccessful in
    reaching and maintaining full planned production rates for REOs
    at the Mountain Pass facility, within expected time frames or at
    all, we may not be able to build a sustainable or profitable
    business.
We may
    not successfully establish or maintain collaborative, joint
    venture and licensing arrangements, or establish new ones, which
    could adversely affect our ability to develop and commercialize
    our rare earth products.
A key element of our business strategy is to utilize vertical
    integration through further downstream processing of our REOs
    into rare earth metal alloys and finished magnets for
    clean-energy, high-technology and defense applications. To
    implement this
"mine-to-magnets"
vertical integration successfully, we will need to license
    certain intellectual property related to these downstream
    processes and form a joint venture with an existing magnet
    producer for the final production of finished rare earth
    magnets. While we have signed a letter of intent to acquire a
    producer of rare earth metals and alloys that will provide us
    with a license for certain technology related to the production
    of rare earth metals and alloys, we may not be able to finalize
    a definitive agreement and successfully consummate the
    acquisition. In addition, other licenses that may be necessary
    for some of these downstream processing steps have not yet been
    obtained, and we are currently only in negotiations with respect
    to a joint venture for the production of finished magnets. Any
    failure to establish or maintain collaborative, joint venture or
    licensing arrangements for the production of downstream products
    on favorable terms could adversely affect our business
    prospects, financial condition or ability to develop and
    commercialize downstream rare earth products.
We may
    not be able to convert existing letters of intent with customers
    for the sale of REO products into binding contracts, which may
    have a material adverse effect on our financial position and
    results of operations.
We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    and other planned downstream products at the Mountain Pass
    facility, we expect to produce 19,090 mt of REO per year. As of
    April 1, 2010, we had 19 letters of intent to sell certain
    of our rare earth products, representing approximately 138% of
    our total anticipated production for 2013. Prior to reaching
    full planned production rates for REOs and other planned
    downstream products at the Mountain Pass facility, we intend to
    enter into short- and long-term sales contracts with existing
    and new customers. However, there can be no assurance that these
    customers will enter into binding sales contracts for the same
    amount of REO products as in the letters of intent, or at all.
    The failure to enter into such binding contracts may have a
    material adverse effect on our financial position and results of
    operations.
We
    have limited commercial production and revenues and there can be
    no assurance that we will successfully reach full planned
    production rates for REOs and other planned downstream products
    at the Mountain Pass facility or other facilities and obtain
    profitability.
We currently have limited commercial production and revenues
    from the Mountain Pass facility and have carried on our business
    at a loss since inception. We expect to continue to incur losses
    unless and until we achieve full planned production rates and
    generate sufficient revenues to fund our continuing operations.
    We
15
Table of Contents
expect to incur substantial losses for the foreseeable future
    related to operating expenses, modernization and expansion
    activities and other capital expenditures, which may increase in
    subsequent years as needed consultants, personnel and equipment
    are retained as we continue to implement our business plan. The
    amounts and timing of expenditures will depend on the progress
    of our ongoing modernization and expansion efforts, the results
    of consultants' analysis and recommendations, the rate at
    which operating losses are incurred, the execution of any joint
    venture agreements with strategic partners and other factors,
    many of which are beyond our control. As a result, we may not
    ever achieve profitability.
We may
    be adversely affected by fluctuations in demand for, and prices
    of, rare earth products.
Because our sole source of revenue is the sale of rare earth
    minerals and products, changes in demand for, and the market
    price of, rare earth minerals and products could significantly
    affect our profitability. The value and price of our common
    stock and our financial results may be significantly adversely
    affected by declines in the prices of rare earth minerals and
    products. Rare earth minerals and product prices may fluctuate
    and are affected by numerous factors beyond our control such as
    interest rates, exchange rates, inflation or deflation,
    fluctuation in the relative value of the U.S. dollar
    against foreign currencies on the world market, global and
    regional supply and demand for rare earth minerals and products,
    and the political and economic conditions of countries that
    produce rare earth minerals and products.
As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. A prolonged or significant economic
    contraction in the United States or worldwide could put further
    downward pressure on market prices of rare earth minerals and
    products. Protracted periods of low prices for rare earth
    minerals and products could significantly reduce revenues and
    the availability of required development funds in the future.
    This could cause substantial reductions to, or a suspension of,
    REO production operations, impair asset values and reduce our
    proven and probable rare earth ore reserves.
Demand for our products may be impacted by demand for downstream
    products incorporating rare earths, including hybrid and
    electric vehicles, wind power equipment and other clean
    technology products, as well as demand in the general automotive
    and electronic industries. Lack of growth in these markets may
    adversely affect the demand for our products.
In contrast, extended periods of high commodity prices may
    create economic dislocations that may be destabilizing to rare
    earth minerals supply and demand and ultimately to the broader
    markets. Periods of high rare earth mineral market prices
    generally are beneficial to our financial performance. However,
    strong rare earth mineral prices also create economic pressure
    to identify or create alternate technologies that ultimately
    could depress future long-term demand for rare earth minerals
    and products, and at the same time may incentivize development
    of otherwise marginal mining properties.
Our
    business will be adversely affected if we do not successfully
    implement new processing technologies and
    capabilities.
Our processing technologies and capabilities are key components
    of our competitive strengths and are expected to contribute to
    low operating costs and increasing the life of the ore body at
    the Mountain Pass facility. Beginning in the second quarter of
    2010, we expect to process bastnasite concentrate from our
    stockpiles in an effort to significantly improve these
    technologies and capabilities and optimize recovery rates.
    Although this effort has been successful at pilot-scale level
    with over 95% recovery, we may not be able to scale the new
    technology and recovery rates to commercial levels, or may not
    be able to do so by 2011, as planned. We are also working to
    optimize other steps in our production process. Any failure may
    affect our ability to achieve the expected benefits of the new
    technologies and may have a material adverse effect on our
    financial condition or results of operations.
We
    operate in a highly competitive industry.
The rare earths mining and processing markets are capital
    intensive and competitive. Our Chinese competitors may have
    greater financial resources, as well as other strategic
    advantages to maintain, improve
16
Table of Contents
and possibly expand their facilities. Additionally, the Chinese
    producers have historically been able to produce at relatively
    low costs due to domestic economic factors. Even upon successful
    implementation of the new processing technologies and
    capabilities at the Mountain Pass facility, if we are not able
    to achieve anticipated costs of production, then any strategic
    advantages that our competitors may have over us, such as lower
    labor costs, could have a material adverse effect on our
    business.
The
    success of our business will depend, in part, on the
    establishment of new uses and markets for rare earth
    products.
The success of our business will depend, in part, on the
    establishment of new markets by us or third parties for certain
    rare earth products that may be in low demand. For example,
    cerium is, and is expected to remain, in global surplus.
    Although we have developed
    XSORBX
®
,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production,
    XSORBX
®
has not yet been sold and has yet to be fully commercialized. In
    addition, although we are developing rare earth products for use
    in NdFeB magnets, which are used in critical existing and
    emerging technologies, such as hybrid and electric vehicles,
    wind power turbines and compact fluorescent lighting, the
    success of our business depends on creating new markets and
    successfully commercializing rare earth products in existing and
    emerging markets. Any unexpected costs or delays in the
    commercialization of any of the foregoing products and
    applications could have a material adverse effect on our
    financial condition or results of operations.
An
    increase in the global supply of rare earth products, dumping
    and predatory pricing by our competitors may materially
    adversely affect our profitability.
The pricing and demand for our products is affected by a number
    of factors beyond our control, including growth of economic
    development and the global supply and demand for REO products.
    According to Roskill, China accounted for approximately 97% of
    global REO production in 2008. China also dominates the
    manufacture of metals and NdFeB magnets from rare earths, a
    capacity that is not currently found in the United States. Once
    we reach full planned production rates for REOs and other
    planned downstream products, the increased competition may lead
    our competitors to engage in predatory pricing behavior. Any
    increase in the amount of rare earth products exported from
    other nations and increased competition may result in price
    reductions, reduced margins and loss of potential market share,
    any of which could materially adversely affect our
    profitability. As a result of these factors, we may not be able
    to compete effectively against current and future competitors.
We may
    not be able to adequately protect our intellectual property
    rights. If we fail to adequately enforce or defend our
    intellectual property rights, our business may be
    harmed.
Much of the technology used in the markets in which we compete
    is protected by patents and trade secrets, and our commercial
    success will depend in significant part on our ability to obtain
    and maintain patent and trade secret protection for our products
    and methods. To compete in these markets, we rely on a
    combination of trade secret protection, nondisclosure and
    licensing agreements, patents and trademarks to establish and
    protect our proprietary intellectual property rights, including
    our proprietary rare earth production processes that are not
    patented. We also have a proven technology and product
    development group and as of April 1, 2010, held 18 issued
    and pending U.S. patents and patent applications, and 146
    issued and pending foreign patents and patent applications. We
    intend to rely on patented products, such as
    XSORBX
®
,

    and related licensing agreements to establish proprietary
    markets for low demand REEs. These intellectual property rights
    may be challenged or infringed upon by third parties or we may
    be unable to maintain, renew or enter into new license
    agreements with third-party owners of intellectual property on
    reasonable terms. In addition, our intellectual property may be
    subject to infringement or other unauthorized use outside of the
    United States. In such case, our ability to protect our
    intellectual property rights by legal recourse or otherwise may
    be limited, particularly in countries where laws or enforcement
    practices are undeveloped or do not recognize or protect
    intellectual property rights to the same extent as the United
    States. Unauthorized use of our intellectual property rights or
    our inability to preserve existing intellectual property rights
    could adversely impact our competitive position and results of
    operations. The loss of our patents could reduce the value of
    the
17
Table of Contents
related products. In addition, the cost to litigate
    infringements of our patents, or the cost to defend ourselves
    against patent infringement actions by others, could be
    substantial.
Proprietary trade secrets and unpatented know-how are also very
    important to our business. We rely on trade secrets to protect
    certain aspects of our technology, especially where we do not
    believe that patent protection is appropriate or obtainable.
    However, trade secrets are difficult to protect. Our employees,
    consultants, contractors, outside scientific collaborators and
    other advisors may unintentionally or willfully disclose our
    confidential information to competitors, and confidentiality
    agreements may not provide an adequate remedy in the event of
    unauthorized disclosure of confidential or proprietary
    information. Enforcing a claim that a third party illegally
    obtained and is using our trade secrets is expensive and time
    consuming, and the outcome is unpredictable. Moreover, our
    competitors may independently develop equivalent knowledge,
    methods and know-how. Failure to obtain or maintain trade secret
    protection could adversely affect our competitive business
    position.
We may
    not be able to obtain additional patents and the legal
    protection afforded by any additional patents may not adequately
    protect our rights or permit us to gain or keep any competitive
    advantage.
Our ability to obtain additional patents is uncertain and the
    legal protection afforded by these patents is limited and may
    not adequately protect our rights or permit us to gain or keep
    any competitive advantage. In addition, the specific content
    required of patents and patent applications that are necessary
    to support and interpret patent claims is highly uncertain due
    to the complex nature of the relevant legal, scientific and
    factual issues. Changes in either patent laws or interpretations
    of patent laws in the United States or elsewhere may diminish
    the value of our intellectual property or narrow the scope of
    our patent protection. Even if patents are issued regarding our
    products and processes, our competitors may challenge the
    validity of those patents. Patents also will not protect our
    products and processes if competitors devise ways of making
    products without infringing our patents.
If we
    infringe, or are accused of infringing, the intellectual
    property rights of third parties, it may increase our costs or
    prevent us from being able to sell our existing products or
    commercialize new products.
There is a risk that we may infringe, or may be accused of
    infringing, the proprietary rights of third parties under
    patents and pending patent applications belonging to third
    parties that may exist in the United States and elsewhere in the
    world that relate to our rare earth products and processes.
    Because the patent application process can take several years to
    complete, there may be currently pending applications that may
    later result in issued patents that cover our products and
    processes. In addition, our products and processes may infringe
    existing patents.
Defending ourselves against third-party claims, including
    litigation in particular, would be costly and time consuming and
    would divert management's attention from our business,
    which could lead to delays in our expansion and modernization
    efforts. If third parties are successful in their claims, we
    might have to pay substantial damages or take other actions that
    are adverse to our business. As a result of intellectual
    property infringement claims, or to avoid potential claims, we
    might:
•
be prohibited from, or delayed in, selling or licensing some of
    our products or using some of our processes unless the patent
    holder licenses the patent to us, which it is not required to do;
•
be required to pay substantial royalties or grant a cross
    license to our patents to another patent holder; or
•
be required to redesign a product or process so it does not
    infringe a third party's patent, which may not be possible
    or could require substantial funds and time.
In addition, we could be subject to claims that our employees,
    or we, have inadvertently or otherwise used or disclosed trade
    secrets or other proprietary information of third parties.
18
Table of Contents
If we are unable to resolve claims that may be brought against
    us by third parties related to their intellectual property
    rights on terms acceptable to us, we may be precluded from
    offering some of our products or using some of our processes.
Power
    shortages at the Mountain Pass facility may temporarily delay
    mining and processing operations and increase costs, which may
    materially adversely impact our business.
Due to its position on the regional electric grid, the Mountain
    Pass facility faces occasional power shortages during peak
    periods. Instability in electrical supply in past years has
    caused sporadic outages and brownouts and higher costs. Such
    outages and brownouts have had a negative impact on production.
    We plan to install a natural gas powered co-generation power
    plant as part of our modernization and expansion of the Mountain
    Pass facility to reduce energy costs at the Mountain Pass
    facility as well as minimize or eliminate our reliance on the
    regional electric power grid. If the co-generation power plant
    is not installed, or is significantly delayed, we will remain
    subject to the effects of occasional power outages and brownouts
    and could experience temporary interruptions of mining and
    processing operations. We then may be unable to fill customer
    orders in a timely manner and may be subject to higher power
    costs at the Mountain Pass facility. As a result, our revenue
    could be adversely impacted and our relationships with our
    customers could suffer, adversely impacting our ability to
    generate future revenue. In addition, if power to the Mountain
    Pass facility is disrupted during certain phases of our REO
    extraction process, we may incur significant expenses that may
    adversely affect our business.
Increasing
    costs or limited access to raw materials may adversely affect
    our profitability.
We use significant amounts of hydrochloric acid and sodium
    hydroxide as reagents to process REOs. We ultimately intend to
    produce our own hydrochloric acid and sodium hydroxide at the
    Mountain Pass facility. While the technology used to produce
    hydrochloric acid and sodium hydroxide is well developed, this
    technology has not yet been implemented at the Mountain Pass
    facility. Accordingly, we currently purchase hydrochloric acid
    and sodium hydroxide in the open market and, as a result, could
    be subject to significant volatility in the cost or availability
    of these reagents. We may not be able to pass increased prices
    for these reagents through to our customers in the form of price
    increases. A significant increase in the price, or decrease in
    the availability, of these reagents before we perfect our
    ability to produce them on site could materially increase our
    operating costs and adversely affect our profit margins from
    quarter to quarter.
Fluctuations
    in transportation costs or disruptions in transportation
    services could increase competition or impair our ability to
    supply rare earth minerals or products to our customers, which
    could adversely affect our results of operations.
Finding affordable and dependable transportation is important
    because it allows us to supply customers around the world. Labor
    disputes, derailments, adverse weather conditions or other
    environmental events and changes to rail or ocean freight
    systems could interrupt or limit available transport services,
    which could result in customer dissatisfaction and loss of sales
    potential and could materially adversely affect our results of
    operations.
We
    must process REOs to exacting specifications in order to provide
    customers with a consistently high quality product. An inability
    to perfect the mineral extraction process to meet individual
    customer specifications may have a material adverse effect on
    our financial condition or results of operations.
We process REOs to meet customer needs and specifications and to
    provide customers with a consistently high quality product and a
    purity higher than previously achieved in prior mining
    operations at the Mountain Pass facility. An inability to
    perfect the mineral extraction process to meet individual
    customer specifications may have a material adverse effect on
    our financial condition or results of operations. In addition,
    customer needs and specifications may change with time. Any
    delay or failure in developing processes to meet changing
    customer needs and specifications may have a material adverse
    effect on our financial condition or results of operations.
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Diminished
    access to water may adversely affect our
    operations.
Currently, processing of REOs requires significant amounts of
    water. The technology we are developing to significantly reduce
    our need for fresh water, including proprietary production of
    our own hydrochloric acid and sodium hydroxide from waste water
    at our own chlor-alkali plant, has not yet been proven at
    commercial scale and has not yet been implemented. Although we
    believe our existing water rights and water supply are
    sufficient to meet our projected water requirements, any
    decrease or disruption in our available water supply until this
    technology is successfully developed may have a material adverse
    effect on our operations and our financial condition or results
    of operations.
Inaccuracies
    in our estimates of REO reserves and resource deposits could
    result in lower than expected revenues and higher than expected
    costs.
We base our REO reserve and resource estimates on engineering,
    economic and geological data assembled and analyzed by outside
    firms, which are reviewed by our engineers and geologists. Ore
    reserve estimates, however, are necessarily imprecise and depend
    to some extent on statistical inferences drawn from available
    drilling data, which may prove unreliable. There are numerous
    uncertainties inherent in estimating quantities and qualities of
    REO reserves and non-reserve REO deposits and costs to mine
    recoverable reserves, including many factors beyond our control.
    Estimates of economically recoverable REO reserves necessarily
    depend upon a number of variable factors and assumptions, all of
    which may vary considerably from actual results, such as:
•
geological and mining conditions and/or effects from prior
    mining that may not be fully identified by available data or
    that may differ from experience;
•
assumptions concerning future prices of rare earth products,
    operating costs, mining technology improvements, development
    costs and reclamation costs; and
•
assumptions concerning future effects of regulation, including
    the issuance of required permits and taxes by governmental
    agencies.
Any inaccuracy in our estimates related to our REO reserves and
    non-reserve REO deposits could result in lower than expected
    revenues and higher than expected costs or a shortened estimated
    life for the mine at the Mountain Pass facility.
Period-to-period
conversion of probable rare earth ore reserves to proven ore
    reserves may result in increases or decreases to the total
    reported amount of ore reserves. Conversion, an indicator of the
    success in upgrading probable ore reserves to proven ore
    reserves, is evaluated annually. Conversion rates are affected
    by a number of factors, including geological variability,
    applicable mining methods and changes in safe mining practices,
    economic considerations and new regulatory requirements.
Work
    stoppages or similar difficulties could significantly disrupt
    our operations, reduce our revenues and materially adversely
    affect our results of operations.
As of December 31, 2009, approximately 60 employees at
    the Mountain Pass facility were covered by a collective
    bargaining agreement with the United Steelworkers of America
    that expires in March 2012. A work stoppage at the Mountain Pass
    facility could significantly disrupt our operations, reduce our
    revenues and materially adversely affect our results of
    operations.
A
    shortage of skilled technicians and engineers may further
    increase operating costs, which may materially adversely affect
    our results of operations.
Efficient production of rare earth products using modern
    techniques and equipment requires skilled technicians and
    engineers. In addition, our expansion efforts will significantly
    increase the number of skilled technicians and engineers
    required to successfully operate our business. In the event that
    we are unable to hire and train the necessary number of skilled
    technicians and engineers, there could be an adverse impact on
    our
20
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labor costs and our ability to reach full planned production
    levels in a timely manner, which could have a material adverse
    effect on our results of operations.
We
    depend on key personnel for the success of our
    business.
We depend on the services of our senior management team and
    other key personnel. We do not have an employment agreement with
    any of the members of our senior management team other than our
    President and Chief Executive Officer. The loss of the services
    of any member of senior management or a key employee could have
    an adverse effect on our business. We may not be able to locate,
    attract or employ on acceptable terms qualified replacements for
    senior management or other key employees if their services are
    no longer available.
Because
    of the inherent dangers involved in the mining of minerals and
    the manufacture of mineral products, there is a risk that we may
    incur liability or damages as we conduct our
    business.
The mining of minerals and the manufacture of mineral products
    involves numerous hazards, including:
•
unusual and unexpected rock formations affecting ore or wall
    rock characteristics;
•
ground or slope failures;
•
environmental hazards;
•
industrial accidents;
•
processing problems;
•
periodic interruptions due to inclement or hazardous weather
    conditions or other acts of God; and
•
mechanical equipment failure and facility performance problems.
Although we maintain insurance, we cannot be certain that our
    insurance will cover certain of the risks associated with our
    extraction and processing operations, nor that we will be able
    to maintain insurance to cover these risks at economically
    feasible premiums. We might also become subject to liability for
    environmental damage or other hazards that may be uninsurable or
    for which we may elect not to insure because of premium costs or
    commercial impracticality. The payment of such premiums, or the
    assumption of such liabilities, may have a material adverse
    effect on our financial position and results of operations.
Risks
    Related to Environmental Regulation
Our
    operations are subject to extensive and costly environmental
    requirements; and current and future laws, regulations and
    permits will impose significant costs, liabilities or
    obligations or could limit or prevent our ability to continue
    our current operations or to undertake new
    operations.
We are subject to numerous and detailed, federal, state and
    local environmental laws, regulations and permits, including
    those pertaining to employee health and safety, environmental
    permitting and licensing, air quality standards, greenhouse gas,
    or GHG, emissions, water usage and pollution, waste management,
    plant and wildlife protection, handling and disposal of
    radioactive substances, remediation of soil and groundwater
    contamination, land use, reclamation and restoration of
    properties, the discharge of materials into the environment and
    groundwater quality and availability. These requirements may
    result in significant costs, liabilities and obligations, impose
    conditions that are difficult to achieve or otherwise delay,
    limit or prohibit current or planned operations. Consequently,
    the modernization and expansion of the Mountain Pass facility
    may be delayed, limited or prevented and current operations may
    be curtailed. Failure to comply with these laws, regulations and
    permits may result in the assessment of administrative, civil
    and criminal penalties, the issuance of injunctions to limit or
    cease operations, the suspension or revocation of permits and
    other sanctions. Pursuant to such requirements, we may also be
    subject to third-party claims, including for damages to property
    or injury to persons arising from our operations. Moreover,
    these environmental requirements, and the interpretation and
    enforcement thereof, change frequently and have tended to become
    more stringent over time. For example, GHG emission regulation
    is becoming more rigorous. As a result of our planned
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expansion, we expect to be required to report annual GHG
    emissions from our operations, and additional GHG emission
    related requirements are in various stages of development. The
    U.S. Congress is considering various legislative proposals
    to address climate change, including a nationwide limit on GHGs.
    In addition, the U.S. Environmental Protection Agency, or
    EPA, has issued vehicle emission regulations that would subject
    GHG emissions from stationary sources to the Prevention of
    Significant Deterioration and Title V provisions of the
    federal Clean Air Act. California also may establish GHG
    emission regulations pursuant to its Global Warming Solutions
    Act. If made effective, any such regulations could require us to
    modify existing permits or obtain new permits, implement
    additional pollution control technology, curtail operations or
    increase significantly our operating costs. Any regulation of
    GHG emissions, including through a
cap-and-trade
system, technology mandate, emissions tax, reporting requirement
    or other program, could adversely affect our business, financial
    condition, reputation, operating performance and product demand.
Any future changes in these laws, regulations or permits (or the
    interpretation or enforcement thereof) or any sanctions,
    damages, costs, obligations or liabilities in respect of these
    matters could have a material adverse effect on our business,
    results of operations and financial condition.
We are
    subject to the Federal Mine Safety and Health Act of 1977 and
    the California Occupational Safety and Health Program, and
    regulations adopted pursuant thereto, which impose stringent
    health and safety standards on numerous aspects of our
    operations.
Our operations at the Mountain Pass facility are subject to the
    Federal Mine Safety and Health Act of 1977, as amended by the
    Mine Improvement and New Emergency Response Act of 2006, and the
    regulations adopted by the California Occupational Safety and
    Health Administration, which impose stringent health and safety
    standards on numerous aspects of mineral extraction and
    processing operations, including the training of personnel,
    operating procedures, operating equipment and other matters. Our
    failure to comply with such standards, or changes in such
    standards or the interpretation or enforcement thereof, could
    have a material adverse effect on our business, financial
    condition or otherwise impose significant restrictions on our
    ability to conduct mining operations.
Our
    operations may affect the environment or cause exposure to
    hazardous substances, any of which could result in material
    costs, obligations or liabilities.
Our operations currently use, and in the past have used,
    hazardous materials and generate, and in the past have
    generated, hazardous and naturally occurring radioactive wastes.
    The Mountain Pass facility has been used for mining and related
    purposes since 1952, and contamination is known to exist around
    the facility. We may be subject to claims under environmental
    laws, regulations and permits for toxic torts, natural resource
    damages and other liabilities, as well as for the investigation
    and remediation of soil, surface water, groundwater and other
    environmental media. The Mountain Pass facility is currently
    subject to an order issued by the Lahontan Regional Water
    Quality Control Board pursuant to which we have conducted
    various investigatory and remedial actions. We are still in the
    process of delineating the extent of groundwater contamination
    at and around the facility and cannot assure you that we will
    not incur material costs relating to the remediation of such
    contamination. In addition to claims arising out of our current
    or former properties, such claims may arise in connection with
    contaminated third-party sites at which we have disposed of
    waste. As a matter of law, and despite any contractual indemnity
    or allocation arrangements or acquisition agreements to the
    contrary, our liability for these claims may be joint and
    several, so that we may be held responsible for more than our
    share of any contamination, or even for the entire share. These
    and similar unforeseen impacts that our operations may have on
    the environment, as well as human exposure to hazardous or
    radioactive materials or wastes associated with our operations,
    could have a material adverse effect on our business,
    reputation, results of operation and financial condition. In
    addition, although Chevron Mining Inc. is obligated to indemnify
    us for certain potential environmental losses associated with
    activities that occurred prior to our purchase of the Mountain
    Pass facility, the amount of such indemnity is limited and may
    not be sufficient to cover such losses.
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We may
    be unable to obtain, maintain or renew permits necessary for the
    development or operation of the Mountain Pass facility, which
    could have a material adverse effect on our business, results of
    operations and financial condition.
We must obtain a number of permits that impose strict
    conditions, requirements and obligations relating to various
    environmental and health and safety matters in connection with
    our current and future operations, including the modernization
    and expansion of the Mountain Pass facility. To obtain certain
    permits, we may be required to conduct environmental studies and
    collect and present data to governmental authorities pertaining
    to the potential impact of our current and future operations
    upon the environment and to take steps to avoid or mitigate
    those impacts. The permitting rules, and interpretation thereof,
    are complex and have tended to become more stringent over time.
    In some cases, the public (including environmental interest
    groups) has rights to comment upon and submit objections to
    permit applications and environmental impact statements prepared
    in connection therewith, and otherwise participate in the
    permitting process, including challenging the issuance of
    permits, validity of environmental impact statements and
    determinations and performance of permitted activities.
    Accordingly, permits required for our operations, including the
    modernization and expansion of the Mountain Pass facility, may
    not be issued, maintained or renewed in a timely fashion or at
    all, or may be issued or renewed upon conditions that restrict
    our ability to conduct our operations economically. Any such
    failure to obtain, maintain or renew permits, or other
    permitting delays or conditions, including in connection with
    any environmental impact analyses, could have a material adverse
    effect on our business, results of operations and financial
    condition.
Our
    inability to acquire, maintain or renew financial assurances
    related to the reclamation and restoration of mining property
    could have a material adverse effect on our business and results
    of operations.
We are generally obligated to restore property after it has been
    mined in accordance with regulatory standards and our approved
    mining plan. We are required under federal, state and local laws
    to maintain financial assurances, such as surety bonds, to
    secure such obligations. The failure to acquire, maintain or
    renew such assurances, as required by federal, state and local
    laws, could subject us to fines and penalties as well as the
    revocation of our mining permits. Such failure could result from
    a variety of factors, including:
•
the lack of availability, higher expense or unreasonable terms
    of such financial assurances;
•
the ability of current and future financial assurance
    counterparties to increase required collateral; and
•
the exercise by third-party financial assurance counterparties
    of any rights to refuse to renew the financial assurance
    instruments.
Our inability to acquire or failure to maintain or renew such
    financial assurances could have a material adverse effect on our
    business, financial condition and results of operations.
If the
    assumptions underlying our reclamation plan and mine closure
    obligations are inaccurate, we could be required to expend
    materially greater amounts than anticipated to reclaim mined
    property, which could materially and adversely affect our
    business, results of operations and financial
    condition.
Federal, state and local laws and regulations establish
    reclamation and closure standards applicable to our surface
    mining and other operations as well. Estimates of our total
    reclamation and mine closing liabilities are based upon our
    reclamation plan, third-party expert reports, current applicable
    laws and regulations, certain permit terms and our engineering
    expertise related to these requirements. Any change in the
    underlying assumptions or other variation between the estimated
    liabilities and actual costs could materially and adversely
    affect our business, results of operations and financial
    condition.
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Risks
    Related to This Offering and Ownership of Our Common
    Stock
There
    is no existing market for our common stock, and a trading market
    that will provide our stockholders with adequate liquidity may
    not develop. The price of our common stock may fluctuate
    significantly, and stockholders could lose all or part of their
    investment.
Prior to the offering, there has been no public market for our
    common stock. An active trading market for our common stock may
    never develop or be sustained, which could depress the market
    price of our common stock and could affect your ability to sell
    your shares of common stock. In the event that the number of
    shares of our common stock to be sold in this offering is
    decreased, liquidity could be adversely affected even further.
    Stockholders may not be able to resell their shares at or above
    the initial public offering price. Additionally, the lack of
    liquidity may result in wide bid-ask spreads, contribute to
    significant fluctuations in the market price of our common stock
    and limit the number of investors who are able to buy our common
    stock.
The initial public offering price for our common stock will be
    determined by negotiations between us and the representative of
    the underwriters and may bear no relationship to the price at
    which our common stock will trade following the completion of
    this offering. The market price of our common stock may decline
    below the initial public offering price. The market price of our
    common stock following this offering is likely to be highly
    volatile and may be influenced by many factors, some of which
    are beyond our control, including:
•
our quarterly or annual earnings or those of other companies in
    our industry;
•
loss of a large customer;
•
changes in accounting standards, policies, guidance,
    interpretations or principles;
•
general economic conditions;
•
the failure of securities analysts to cover our stock after this
    offering or changes in financial estimates by analysts;
•
future sales of our common stock; and
•
other factors described in this "Risk Factors" section.
Reports
    published by securities or industry analysts, including
    projections in those reports that exceed our actual results,
    could adversely affect our stock price and trading
    volume.
We currently expect securities research analysts, including
    those affiliated with our underwriters, to establish and publish
    their own quarterly projections regarding our operating results.
    These projections may vary widely from one another and may not
    accurately predict the results we actually achieve. Our stock
    price may decline if we fail to meet securities research
    analysts' projections. Similarly, if one or more of the
    analysts who covers us downgrades our stock or publishes
    inaccurate or unfavorable research about our business, our stock
    price could decline. If one or more of these analysts ceases
    coverage of us or fails to publish reports on us regularly, our
    stock price or trading volume could decline. Additionally, while
    we expect securities research analyst coverage, if no securities
    or industry analysts commence coverage of us, the trading price
    of our stock and the trading volume could decline.
Future
    sales of shares of common stock by existing stockholders could
    depress the market price of our common stock.
If our existing stockholders sell, or indicate an intent to
    sell, substantial amounts of our common stock in the public
    market after the
180-day
contractual
lock-up
period and other legal restrictions on resale discussed in this
    prospectus lapse, the trading price of our common stock could
    decline significantly and could decline below the initial public
    offering price. Upon completion of this offering, we will have
    approximately           shares
    of common stock outstanding, assuming no exercise of the
    underwriters' over-allotment option. J.P. Morgan
    Securities Inc. and Morgan Stanley & Co. Incorporated
    may, in their sole discretion,
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permit our executive officers, directors, employees and current
    stockholders to sell shares prior to the expiration of the
lock-up
agreements.
After the
lock-up
agreements pertaining to this offering expire, an
    additional           shares
    will be eligible for sale in the public
    market,           of
    which are held by directors, executive officers and other
    affiliates and will be subject to volume limitations under
    Rule 144 under the Securities Act and various vesting
    agreements. In addition,
    the           shares
    subject to outstanding restricted stock awards that have not
    vested and
    the           shares
    reserved for future issuance under our equity compensation plans
    will become eligible for sale in the public market in the
    future, subject to certain legal and contractual limitations. If
    these additional shares are sold, or if it is perceived that
    they will be sold, in the public market, the trading price of
    our common stock could decline substantially.
The
    availability of shares of our common stock for sale in the
    future could reduce the market price of our common
    stock.
In the future, we may issue additional securities to raise
    capital. We may also acquire interests in other companies by
    using a combination of cash and our common stock or just our
    common stock. We may also issue securities convertible into our
    common stock. Any of these events may dilute your ownership
    interest in our company and have an adverse impact on the price
    of our common stock. In addition, sales of a substantial amount
    of our common stock in the public market, or the perception that
    these sales may occur, could reduce the market price of our
    common stock. This could also impair our ability to raise
    additional capital through the sale of our securities.
We do
    not intend to pay dividends in the foreseeable
    future.
For the foreseeable future, we intend to retain any earnings to
    finance the development of our business, and we do not
    anticipate paying any cash dividends on our common stock. Any
    future determination to pay dividends will be at the discretion
    of our board of directors and will be dependent upon
    then-existing conditions, including our operating results and
    financial condition, capital requirements, contractual
    restrictions, business prospects and other factors that our
    board of directors considers relevant. Accordingly, investors
    must rely on sales of their common stock after price
    appreciation, which may never occur, as the only way to realize
    a return on their investment.
Anti-takeover
    provisions contained in our certificate of incorporation and
    bylaws after the corporate reorganization, as well as provisions
    of Delaware law, could impair a takeover attempt.
Our certificate of incorporation and bylaws provisions may have
    the effect of delaying, deferring or discouraging a prospective
    acquiror from making a tender offer for our shares or otherwise
    attempting to obtain control of us. To the extent that these
    provisions discourage takeover attempts, they could deprive
    stockholders of opportunities to realize takeover premiums for
    their shares. Moreover, these provisions could discourage
    accumulations of large blocks of common stock, thus depriving
    stockholders of any advantages which large accumulations of
    stock might provide.
As a Delaware corporation, we will also be subject to provisions
    of Delaware law, including Section 203 of the General
    Corporation Law of the State of Delaware. Section 203
    prevents some stockholders holding more than 15% of our
    outstanding common stock from engaging in certain business
    combinations unless the business combination was approved in
    advance by our board of directors, results in the stockholder
    holding more than 85% of our outstanding common stock or is
    approved by the holders of at least
    66
2
/
3
%
    of our outstanding common stock not held by the stockholder
    engaging in the transaction.
Any provision of our certificate of incorporation or our bylaws
    or Delaware law that has the effect of delaying or deterring a
    change in control could limit the opportunity for our
    stockholders to receive a premium for their shares of our common
    stock and could also affect the price that some investors are
    willing to pay for our common stock.
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Our
    board of directors can issue, without stockholder approval,
    preferred stock with voting and conversion rights that could
    adversely affect the voting power of the holders of common
    stock.
Our board of directors can issue, without stockholder approval,
    preferred stock with voting and conversion rights that could
    adversely affect the voting power of the holders of common stock
    and reduce the likelihood that such holders will receive
    dividend payments or payments upon liquidation. Such issuance
    could have the effect of decreasing the market price of the
    common stock. The issuance of preferred stock or even the
    ability to issue preferred stock could also have the effect of
    delaying, deterring or preventing a change of control or other
    corporate action.
You
    will experience immediate and substantial
    dilution.
The initial public offering price will be substantially higher
    than the net tangible book value of each outstanding share of
    common stock immediately after this offering. If you purchase
    common stock in this offering, you will suffer immediate and
    substantial dilution. The dilution will be
    $      per share in the net tangible
    book value of the common stock from the expected initial public
    offering price. In addition, if outstanding options to purchase
    shares of our common stock are exercised, there could be further
    dilution.
Our
    board of directors and management will have broad discretion
    over the use of the proceeds we receive in this offering and
    might not apply the proceeds in ways that increase the value of
    your investment.
Our board of directors and management will have broad discretion
    to use the net proceeds from this offering, and you will be
    relying on their judgment regarding the application of these
    proceeds. Our board of directors and management might not apply
    the net proceeds of this offering in ways that increase the
    value of your investment. We expect to use the net proceeds from
    this offering for general corporate purposes, including, without
    limitation, to fund our capital expenditures and working capital
    requirements and to develop new products, processes and
    technologies, both through acquisitions and capital programs.
    Until we use the net proceeds from this offering, we plan to
    invest them, and these investments may not yield a favorable
    rate of return. If we do not invest or apply the net proceeds
    from this offering in ways that enhance stockholder value, we
    may fail to achieve expected financial results, which could
    cause our stock price to decline.
We
    identified a material weakness in our internal control over
    financial reporting which, if not satisfactorily remediated,
    could result in material misstatements in our consolidated
    financial statements in future periods.
During the preparation of our consolidated financial statements
    as of December 31, 2009 and 2008 and for the year ended
    December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008, and cumulatively for
    the period from June 12, 2008 (Inception) through
    December 31, 2009, we identified deficiencies in our
    internal control over financial reporting which, when considered
    in the aggregate, represent a material weakness. If not
    remediated, this material weakness could result in material
    misstatements in our consolidated financial statements in future
    periods. Specifically, we did not maintain a sufficient
    complement of personnel with an appropriate level of accounting
    and financial reporting knowledge, experience and training in
    the application of U.S. generally accepted accounting
    principles, or U.S. GAAP. We also did not maintain an
    adequate system of processes and internal controls sufficient to
    support our financial reporting requirements and to produce
    timely and accurate consolidated financial statements in
    accordance with U.S. GAAP.
A material weakness is a deficiency, or combination of
    deficiencies, in internal control over financial reporting, such
    that there is a reasonable possibility that a material
    misstatement of our financial statements will not be prevented
    or detected on a timely basis. A deficiency in internal control
    over financial reporting exists when the design or operation of
    a control does not allow management or employees, in the normal
    course of performing their assigned functions, to prevent or
    detect misstatements on a timely basis.
In late 2009, we commenced remediation actions which included
    hiring several individuals with significant accounting, auditing
    and financial reporting experience and devoting significant
    resources to improving our system of processes and internal
    controls. Specifically, we hired a chief financial officer, a
    corporate controller and a director of financial reporting, and
    in early 2010, we hired an accounting manager for the Mountain
    Pass facility, all of whom are certified public accountants. We
    also installed additional
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functionality and increased the integration of our information
    technology systems to increase automation and accuracy within
    our processes. If our actions are not effective in correcting
    the material weakness and we continue to experience material
    weaknesses, investors could lose confidence in our financial
    reporting, particularly if such weaknesses result in a
    restatement of our financial results, and our stock price could
    decline. See "Management's Discussion and Analysis of
    Financial Condition and Results of Operations —
    Internal Controls."
We
    will be required by Section 404 of the Sarbanes-Oxley Act to
    evaluate the effectiveness of our internal controls. If we are
    unable to achieve and maintain effective internal controls,
    particularly in a period of anticipated rapid growth, our
    operating results and financial condition could be
    harmed.
We will be required to comply with Section 404 of the
    Sarbanes-Oxley Act beginning with the year ending
    December 31, 2011. Section 404 requires that we evaluate
    our internal control over financial reporting to enable
    management to report on the effectiveness of those controls.
    Management is responsible for establishing and maintaining
    adequate internal control over financial reporting. Our internal
    control over financial reporting is a process designed to
    provide reasonable assurance regarding the reliability of
    financial reporting and the preparation of our consolidated
    financial statements in accordance with U.S. GAAP. While we
    have begun the comprehensive process of evaluating our internal
    controls, we are in the early phases of our review and will not
    complete our review until well after this offering is completed.
    We cannot predict the outcome of our review at this time. During
    the course of the review, we may identify additional control
    deficiencies of varying degrees of severity, in addition to the
    material weakness discussed above.
We have taken steps to improve our internal control over
    financial reporting, including identification of deficiencies in
    the knowledge and expertise of personnel required in the
    accounting and finance functions of a public company. We have
    incurred significant costs to remediate our material weakness
    and deficiencies and improve our internal controls, and will
    incur additional expense as we undertake the modernization and
    expansion of the Mountain Pass facility.  As we implement this
    modernization and expansion, the resulting growth in our
    business will require us to implement additional internal
    controls. To comply with
Sarbanes-Oxley
requirements, especially during this period of anticipated rapid
    growth, we will need to further upgrade our systems, including
    information technology, implement additional financial and
    management controls, reporting systems and procedures and hire
    additional accounting, finance and legal staff. If we are unable
    to upgrade our systems and procedures or hire the necessary
    additional personnel in a timely and effective fashion, we may
    not be able to comply with our financial reporting requirements
    and other rules that apply to public companies.
As a public company, we will be required to report internal
    control deficiencies that constitute material weaknesses in our
    internal control over financial reporting. See
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations — Internal
    Controls." We will also be required to obtain an audit
    report from our independent registered public accounting firm
    beginning in 2011 regarding the effectiveness of our internal
    controls over financial reporting. If we fail to implement the
    requirements of Section 404 in a timely manner, if we or our
    independent registered public accounting firm are unable to
    conclude that our internal control over financial reporting are
    effective, or if we fail to comply with our financial reporting
    requirements, investors may lose confidence in the accuracy and
    completeness of our financial reports.
We
    will incur increased costs as a result of being a publicly
    traded corporation.
We have no history operating as a publicly traded corporation.
    As a publicly traded corporation, we will incur additional
    legal, accounting and other expenses that we did not incur as a
    private company. This increase will be due to the increased
    accounting support services, filing annual and quarterly reports
    with the SEC, increased audit fees, investor relations,
    directors' fees, directors' and officers'
    insurance, legal fees, stock exchange listing fees and registrar
    and transfer agent fees, which we expect to incur after the
    completion of this offering. In addition, we expect that
    complying with the rules and regulations implemented by the SEC
    and NYSE will increase our legal and financial compliance costs
    and make activities more time-consuming and costly. For example,
    as a result of becoming a publicly traded corporation, we are
    required to have a board containing a majority of independent
    directors, create additional board committees and adopt policies
    regarding internal controls and disclosure controls and
    procedures, including the preparation of reports on internal
    control over financial reporting. In addition, we will incur
    additional costs associated with our publicly traded corporation
    reporting requirements.
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SPECIAL
    NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus, including the sections entitled
    "Prospectus Summary," "Risk Factors,"
    "Management's Discussion and Analysis of Financial
    Condition and Results of Operations," "Rare Earth
    Industry Overview" and "Business," contains
    forward-looking statements that represent our beliefs,
    projections and predictions about future events or our future
    performance. You can identify forward-looking statements by
    terminology such as "may," "will,"
    "would," "could," "should,"
    "expect," "intend," "plan,"
    "anticipate," "believe,"
    "estimate," "predict,"
    "potential," "continue" or the negative of
    these terms or other similar expressions or phrases. These
    forward-looking statements are necessarily subjective and
    involve known and unknown risks, uncertainties and other
    important factors that could cause our actual results,
    performance or achievements or industry results to differ
    materially from any future results, performance or achievement
    described in or implied by such statements.
Factors that may cause actual results to differ materially from
    expected results described in forward-looking statements
    include, but are not limited to:
•
our ability to secure sufficient capital to implement our
    business plans;
•
our ability to complete our modernization and expansion efforts
    and reach full planned production rates for REOs and other
    planned downstream products;
•
uncertainties associated with our reserve estimates and
    non-reserve deposit information;
•
uncertainties regarding global supply and demand for rare earth
    materials;
•
our ability to maintain appropriate relations with unions and
    employees;
•
our ability to successfully implement our
"mine-to-magnets"
strategy;
•
environmental laws, regulations and permits affecting our
    business, directly and indirectly, including, among others,
    those relating to mine reclamation and restoration, climate
    change, emissions to the air and water and human exposure to
    hazardous substances used, released or disposed of by
    us; and
•
uncertainties associated with unanticipated geological
    conditions related to mining.
See "Risk Factors" for a more complete discussion of
    these risks and uncertainties and for other risks and
    uncertainties. Any forward-looking statement you read in this
    prospectus reflects our current views with respect to future
    events and is subject to these and other risks, uncertainties
    and assumptions relating to our operations, operating results,
    growth strategy and liquidity. We assume no obligation to
    publicly update or revise these forward-looking statements for
    any reason, or to update the reasons actual results could differ
    materially from those anticipated in these forward-looking
    statements, even if new information becomes available in the
    future, except as otherwise required by applicable law.
This prospectus also contains statistical data and estimates we
    obtained from industry publications and reports generated by
    third parties. Although we believe that the publications and
    reports are reliable, we have not independently verified their
    data.
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USE OF
    PROCEEDS
We estimate that we will receive net proceeds of approximately
    $      million from the sale
    of           shares
    of our common stock in this offering, based on an assumed
    initial public offering price of $     
    per share, which is the midpoint of the estimated price range
    set forth on the cover page of this prospectus, and after
    deducting underwriting discounts and commissions and estimated
    offering expenses that we must pay. If the underwriters exercise
    their over-allotment option in full, we estimate that we will
    receive additional net proceeds of approximately
    $      million. We will not
    receive any proceeds from the sale of shares of common stock
    offered by the selling stockholders if the underwriters exercise
    their over-allotment option to purchase shares of common stock
    from the selling stockholders in this offering.
We intend to use the net proceeds from this offering primarily
    to fund our modernization and expansion of the Mountain Pass
    facility as well as for general corporate purposes, including,
    without limitation, to fund our working capital requirements and
    to develop new products, processes and technologies, both
    through acquisitions and capital programs.
Each $1.00 increase or decrease in the assumed initial public
    offering price of $      per share
    would increase or decrease, as applicable, the net proceeds to
    us from this offering, after deducting underwriting discounts
    and commissions and estimated offering expenses that we must pay
    and assuming that the number of shares offered by us, as set
    forth on the cover page of this prospectus, remains the same, by
    approximately $     , or approximately
    $      assuming full exercise of the
    underwriters' over-allotment option. In addition, an
    increase or decrease in the number of shares of our common stock
    sold by us in this offering by 10% would cause the net proceeds
    from this offering, after deducting underwriting discounts and
    commissions and estimated offering expenses, to increase or
    decrease by approximately $     , or
    approximately $      assuming full
    exercise of the underwriters' over-allotment option. Any
    additional net proceeds would be used for general corporate
    purposes, including, without limitation, to fund capital
    expenditures and working capital requirements and to develop new
    products, processes and technologies, both through acquisitions
    and capital programs. If the net proceeds are less than the
    estimated amount, the amount of net proceeds that we would use
    for general corporate purposes, including, without limitation,
    to fund capital expenditures and working capital requirements
    and to develop new products, processes and technologies, both
    through acquisitions and capital programs, would be reduced.
Pending our use of the net proceeds from this offering as
    described above, we plan to invest the proceeds in a variety of
    capital preservation investments, including short-term
    interest-bearing obligations, investment-grade instruments,
    certificates of deposit and direct guaranteed obligations of the
    United States.
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Table of Contents
CAPITALIZATION
The following table sets forth our consolidated cash and cash
    equivalents and our capitalization as of December 31, 2009:
•
on an actual basis reflecting the capitalization of Molycorp,
    LLC; and
•
on a pro forma as adjusted basis reflecting the capitalization
    of Molycorp, Inc. to give effect to the following:
•
the corporate reorganization as described in "Corporate
    Reorganization"; and
•
the issuance
    of           shares
    of common stock and the receipt of the net proceeds by us in
    this offering, after deducting underwriting discounts and
    commissions and estimated offering expenses that we must pay.
The information in this table should be read in conjunction with
    "Use of Proceeds," "Selected Historical
    Consolidated Financial Data," "Management's
    Discussion and Analysis of Financial Condition and Results of
    Operations" and the consolidated financial statements and
    the related notes included elsewhere in this prospectus.
December 31, 2009
Pro Forma
Actual
as Adjusted
(In thousands)
Cash and cash equivalents
$
$
Total debt
$
$
Members' equity
Stockholders' equity
Common stock, $0.001 par
    value;           shares
    authorized;           shares
    issued and outstanding
    actual;           shares
    issued and outstanding as adjusted
Additional paid-in capital
Deficit accumulated during the development stage
Total stockholders' equity (deficit)
Total capitalization
$
$
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DIVIDEND
    POLICY
For the foreseeable future, we intend to retain any earnings to
    finance the development of our business. We do not anticipate
    paying any cash dividends on our common stock. Any future
    determination to pay dividends will be at the discretion of our
    board of directors and will depend upon then-existing
    conditions, including our operating results and our financial
    condition, capital requirements, contractual restrictions,
    business prospects and other factors that our board of directors
    may deem relevant.
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Table of Contents
DILUTION
Dilution is the amount by which the portion of the offering
    price paid by the purchasers of the common stock to be sold in
    this offering exceeds the net tangible book value or deficiency
    per share of common stock after the offering. Net tangible book
    value or deficiency per share of our common stock is determined
    at any date by subtracting total liabilities from our total
    assets less our intangible assets and dividing the difference by
    the number of shares of common stock deemed to be outstanding at
    that date.
Our net tangible book value as of December 31, 2009 (after
    giving effect to the corporate reorganization) was approximately
    $      million, or
    $      per share of common stock. After
    giving effect to our receipt and intended use of approximately
    $      million of estimated net
    proceeds (after deducting underwriting discounts and commissions
    and estimated offering expenses that we must pay) from our sale
    of common stock in this offering based on an assumed initial
    public offering price of $      per
    share of common stock, which is the midpoint of the estimated
    range set forth on the cover page of this prospectus, our
    adjusted net tangible book value as of December 31, 2009
    would have been approximately
    $      million, or
    $      per share of common stock. This
    amount represents an immediate increase in net tangible book
    value of $      per share of common
    stock to existing stockholders and an immediate dilution of
    $      per share of common stock to new
    investors purchasing shares of common stock in this offering at
    the assumed initial public offering price.
The following table illustrates this dilution on a per share
    basis:
Assumed initial public offering price per share
$
Net tangible book value per share as of December 31, 2009
    (after giving effect to the corporate reorganization)
Increase per share attributable to cash payments made by
    investors in this offering
Adjusted net tangible book value per share after this offering
Dilution per share to new investors
$
If the underwriters exercise their over-allotment option in
    full, the adjusted tangible book value per share after giving
    effect to the offering would be $     
    per share. This represents an increase in adjusted net tangible
    book value of $      per share to
    existing stockholders and dilution in adjusted net tangible book
    value of $      per share to new
    investors.
A $1.00 increase or decrease in the assumed initial public
    offering of $      per share would
    increase or decrease, as applicable, our adjusted net tangible
    book value per share after this offering and dilution to new
    investors by $      , assuming the
    number of shares of common stock offered by us, as set forth on
    the cover page of this prospectus, remains the same and after
    deducting the underwriting discounts and commissions and
    estimated offering expenses that we must pay.
The following table summarizes, on an as adjusted basis as of
    December 31, 2009, the differences between the number of
    shares of common stock purchased from us, the total
    consideration paid to us and the average price per share paid by
    existing stockholders and by new investors in this offering. As
    the table shows, new investors purchasing shares of common stock
    in this offering will pay an average price per share
    substantially higher than our existing stockholders paid. The
    table below assumes an initial public offering price of
    $      per share for shares of common
    stock purchased in this offering and excludes underwriting
    discounts and commissions and estimated offering expenses that
    we must pay:
Shares Purchased
Total Consideration
Average Price
Number
Percent
Number
Percent
per Share
Existing investors
%
$
%
$
New investors
Total
%
$
%
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CORPORATE
    REORGANIZATION
Molycorp Minerals, LLC, a Delaware limited liability company
    formerly known as Rare Earth Acquisitions LLC, was formed on
    June 12, 2008 to purchase the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc., a subsidiary of Chevron Corporation. Prior to the
    acquisition, the Mountain Pass facility was owned by Chevron
    Mining Inc. and, before 2005, by Unocal Corporation. Molycorp,
    LLC, the parent of Molycorp Minerals, LLC, is a Delaware limited
    liability company that was formed on September 9, 2009.
    Molycorp, Inc. was formed on March 4, 2010 as a new
    Delaware corporation that is not, to date, conducted any
    activities other than those incident to its formation and the
    preparation of this registration statement.
The members of Molycorp, LLC have contributed either
    (a) all of their member interests in Molycorp, LLC or
    (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class A common stock. Additionally, all of
    the holders of profits interests in Molycorp Minerals, LLC,
    which were represented by incentive shares, have contributed all
    of their incentive shares to Molycorp, Inc. in exchange for
    shares of Molycorp, Inc. Class B common stock. Accordingly,
    Molycorp, LLC and Molycorp Minerals, LLC have become
    subsidiaries of Molycorp, Inc. We refer to this process as the
    "corporate reorganization" throughout this prospectus.
    All of the shares of Class A common stock and Class B
    common stock will convert into shares of common stock
    immediately prior to the consummation of this offering.
The incentive shares had been issued by Molycorp, LLC to some of
    its key employees, including certain of our executive officers,
    and non-employee directors. These incentive shares would have
    entitled the incentive shareholders to share in cash
    distributions with the initial investors, who received
    Class A common stock, in amounts ranging from 3.2% to 7.0%
    of the distributions once the initial investors had received an
    annually compounded 10% return and their initial capital
    contributions. The terms of the Class A common stock and
    Class B common stock generally replicate the economics of
    the original incentive shares in that the shares of Class A
    common stock and Class B common stock will convert into
    shares of common stock in connection with the corporate
    reorganization at a conversion ratio dependent on the return
    that the initial investors receive. This return will be
    determined on the value of the initial investors' shares
    based on the initial public offering price. Accordingly,
    although the aggregate number of shares of common stock into
    which the Class A common stock and Class B common
    stock will be fixed
    at           shares
    in the aggregate, the actual number of shares of common stock
    that the holders of Class A common stock and Class B
    common stock will receive will vary depending on the initial
    public offering price and the amount of the deemed return to the
    initial investors. Based on an assumed initial offering price
    of          
    per share, which is the midpoint of the estimated price range
    set forth on the cover of this prospectus, we estimate that,
    immediately prior to the consummation of this offering, the
    holders of Class A common stock will receive
    approximately           shares
    of common stock upon conversion and the holders of Class B
    common stock will receive
    approximately           shares
    of common stock upon conversion.
33
Table of Contents
SELECTED
    CONSOLIDATED FINANCIAL DATA
Upon the formation of Molycorp, LLC on September 9, 2009,
    all members of Molycorp Minerals, LLC contributed their member
    interests to Molycorp, LLC in exchange for member interests in
    Molycorp, LLC. That exchange was treated as a reorganization of
    entities under common control and Molycorp Minerals, LLC is the
    predecessor to Molycorp, LLC. Accordingly, all financial
    information of Molycorp, LLC for periods prior to its formation
    is the historical financial information of Molycorp Minerals,
    LLC. Molycorp Minerals, LLC acquired the Mountain Pass,
    California rare earth deposit and associated assets from Chevron
    Mining Inc., a subsidiary of Chevron Corporation, on
    September 30, 2008. The selected consolidated financial
    data as of December 31, 2009 and 2008, and for the year
    ended December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008 and cumulatively for
    the period from June 12, 2008 (Inception) through
    December 31, 2009 has been derived from Molycorp,
    LLC's audited consolidated financial statements and the
    related notes included elsewhere in this prospectus.
On April 15, 2010, the members of Molycorp, LLC contributed
    either (a) all of their member interests in Molycorp, LLC
    or (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc., and, as a result, Molycorp, LLC and Molycorp
    Minerals, LLC became wholly owned subsidiaries of Molycorp, Inc.
    The unaudited pro forma balance sheet data as of
    December 31, 2009 has been prepared to give effect to the
    corporate reorganization as if it had occurred on
    December 31, 2009. The unaudited pro forma balance sheet
    data is for informational purposes only and does not purport to
    indicate balance sheet information as of any future date.
As a limited liability company, the taxable income and losses of
    Molycorp, LLC were reported on the income tax returns of its
    members. Molycorp, Inc. is subject to federal and state income
    taxes and will file consolidated income tax returns. If the
    corporate reorganization had been effective as of
    January 1, 2009, our net loss of $28.6 million would
    have generated a pro forma deferred income tax benefit of
    $11.3 million, assuming a combined federal and state
    statutory income tax rate. However, as realization of such tax
    benefit would not have been assured, we would have also
    established a valuation allowance to eliminate such pro forma
    tax benefit.
The unaudited pro forma per share data has been computed based
    upon the number of shares of common stock outstanding
    immediately after the corporate reorganization applied to our
    historical net loss amounts and gives retroactive effect to the
    corporate reorganization as if it had occurred on June 12,
    2008.
The selected historical consolidated financial data set forth
    below should be read in conjunction with "Management's
    Discussion and Analysis of Financial Condition and Results of
    Operations" and the financial statements and the notes
    thereto included elsewhere in this prospectus.
June 12, 2008
June 12, 2008
(Inception)
(Inception)
Year Ended
Through
Through
Statement of Operations Data
December 31, 2009
December 31, 2008
December 31, 2009
(In thousands, except share and per share data)
Net sales
$
7,093
$
2,137
$
9,230
Cost of goods sold(1)
(21,785
)
(13,027
)
(34,812
)
Selling, general and administrative expense
(12,685
)
(2,979
)
(15,664
)
Accretion expense
(1,006
)
(250
)
(1,256
)
Depreciation and amortization expense
(191
)
(19
)
(210
)
Operating loss
(28,574
)
(14,138
)
(42,712
)
Net loss
$
(28,587
)
$
(14,074
)
$
(42,661
)
Loss per share:
Weighted average shares outstanding
1,017,959
1,000,000
1,011,561
Basic
$
(28.08
)
$
(14.07
)
$
(42.17
)
Diluted
$
(28.08
)
$
(14.07
)
$
(42.17
)
Pro forma loss per share:
Weighted average shares outstanding:
Basic
Diluted
34
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Pro Forma
Balance Sheet Data
December 31, 2009
December 31, 2009
December 31, 2008
(In thousands)
Cash and cash equivalents
$
$
6,929
$
2,189
Total current assets
18,520
8,710
Total assets
97,666
95,355
Total non-current liabilities
13,509
13,196
Total liabilities
23,051
17,279
Members' equity
74,615
78,076
June 12, 2008
June 12, 2008
Year Ended
(Inception) Through
(Inception) Through
Other Financial Data
December 31, 2009
December 31, 2008
December 31, 2009
(In thousands)
Capital expenditures
$
7,285
$
321
$
7,606
(1)
Cost of goods sold includes write-downs of inventory to
    estimated net realizable value of $9.0 million and
    $9.5 million for the year ended December 31, 2009 and
    for the period from June 12, 2008 (Inception) through
    December 31, 2008, respectively.
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Table of Contents
MANAGEMENT'S
    DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in
    conjunction with our consolidated financial statements and
    related notes included elsewhere in this prospectus. The
    following discussion and analysis contains forward-looking
    statements that reflect our plans, estimates and beliefs and
    involves risks and uncertainties. Our actual results could
    differ materially from those discussed in these forward-looking
    statements as a result of various factors, including those
    discussed below, under the headings "Risk Factors" and
    "Special Note Regarding Forward-Looking Statements"
    and in other parts of this prospectus
.
Overview
Our
    Business
We are the only REO producer in the Western hemisphere and own
    the world's largest, most fully developed rare earth
    project outside of China. Following the execution of our
    "mine-to-magnets" strategy and completion of our
    modernization and expansion efforts, we expect to be one of the
    world's most integrated producers of rare earth products,
    including oxides, metals, alloys and magnets. Our rare earths
    are critical inputs in existing and emerging applications
    including: clean energy technologies, such as hybrid and
    electric vehicles and wind power turbines; multiple high-tech
    uses, including fiber optics, lasers and hard disk drives;
    numerous defense applications, such as guidance and control
    systems and global positioning systems; and advanced water
    treatment technology for use in industrial, military and outdoor
    recreation applications. Global demand for REEs is projected to
    steadily increase both due to continuing growth in existing
    applications and increased innovation and development of new end
    uses.
Our goals are to:
•
develop innovative rare earth technologies and products vital to
    green energy, high-tech, defense and industrial applications;
•
be commercially sustainable, globally competitive, profitable
    and environmentally superior;
•
act as a responsible steward of our rare earth
    resources; and
•
use our technology to improve the daily lives of people
    throughout the world.
We have made significant investments, and expect to continue to
    invest, in developing technologically advanced and proprietary
    applications for individual REEs. We are in the process of
    modernizing and expanding our production capabilities at our
    Mountain Pass, California facility in order to integrate the
    rare earths supply chain: mining; oxide processing; production
    of metals and alloys; and, as part of our
"mine-to-magnets"
strategy, the production of rare earth-based magnets.
Our vision is to be the rare earth products and technology
    company recognized for its "ETHICS" —
    Excellence, Trust, Honesty, Integrity, Creativity and Safety.
    Since July 2005, the Mountain Pass facility has not had a
    lost-time accident and has received the coveted "Sentinels
    of Safety" award from the MSHA for three of the last four
    years.
Our
    Mine Process and Development Plans
We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with the modernization of our
    processing capabilities in order to efficiently produce at a
    rate of 19,090 mt of REO per year by the end of 2012, and we
    expect to have the capability to increase production to 40,000
    mt of REO per year, if warranted by market conditions. Prior to
    the expected completion of our modernization and expansion
    efforts by the end of 2012, we expect to produce approximately
    3,000 mt in the aggregate of cerium products, lanthanum
    concentrate, didymium oxide and heavy rare earth concentrates in
    each of 2010 and 2011 from stockpiled feedstock.
Initially, our modernization and expansion plans envisioned
    adding facilities and equipment for metal conversion and alloy
    production at the Mountain Pass facility. However, we have
    entered into a letter of intent
36
Table of Contents
to acquire a third-party producer of rare earth metals and
    alloys in the United States. If we complete the acquisition
    instead of adding such facilities and equipment at Mountain
    Pass, we plan to transport cerium, lanthanum,
    neodymium/praseodymium (didymium) and samarium oxide products
    from our Mountain Pass facility to our new off-site location
    that already possesses the technological capability to produce
    rare earth metals and alloys.
We anticipate the cost of restarting mining operations, the
    modernization and expansion of our Mountain Pass facility and
    the addition of rare earth metal, composite and alloy production
    capabilities to be approximately $511 million. We are
    finalizing our financing plans, including this offering, so that
    we will have sufficient capital to cover such costs upon
    completion of this offering and our financing plan.
We are currently working to secure a collaborative joint venture
    agreement with a third-party manufacturer of NdFeB magnets in
    the United States. This joint venture will provide us with
    access to the intellectual property, technology, people and
    facilities to convert our rare earth materials into the
    high-performance permanent magnets required for production of
    hybrid and electric vehicles, wind power turbines, high-tech
    applications and numerous advanced defense systems on which the
    U.S. economy and national security depend. The consummation
    of such a joint venture, in conjunction with our current
    modernization plans and the potential acquisition of a
    third-party rare earth metal and alloys producer, is expected to
    provide us with the capability to mine, process, separate and
    alloy individual REEs before manufacturing them into NdFeB
    magnets. This downstream integration would make us the only
    fully integrated producer of NdFeB magnets outside of China,
    helping to secure rare earth supply for the Rest of World.
Our
    Products and Markets
Since our acquisition of the Mountain Pass facility, we have
    been producing and selling small quantities of REOs from our
    pilot processes using stockpiled feedstocks. The purpose of this
    effort has been to significantly improve our solvent extraction
    technology and to develop other key technologies that will be
    utilized in the new process. We recently completed processing
    stockpiled lanthanum to recover neodymium and praseodymium and
    produce didymium oxide (a combination of neodymium and
    praseodymium). We are commencing a second pilot processing
    campaign in the second quarter of 2010 to recover cerium,
    lanthanum, neodymium, praseodymium and a
    samarium/europium/gadolinium concentrate from bastnasite
    concentrate stockpiles.
Key
    Industry Factors
Demand
    for Rare Earth Products
Global consumption of REEs is projected to steadily increase
    both due to continuing growth in existing applications and
    development of new end uses. For example, the integration of
    rare earth permanent magnet drives into wind power turbines has
    substantially reduced the need for gearboxes, which increases
    overall efficiency and reliability. According to IMCOA and
    Roskill, total demand for rare earths outside of China is
    expected to increase at a CAGR of approximately 4% to 5% between
    2008 and 2014. In addition, according to Roskill, global demand
    for the more important magnetic rare earths, neodymium,
    praseodymium and dysprosium is expected to grow at CAGRs of
    approximately 8%, 6% and 6%, respectively, over the same period.
    Both IMCOA and Roskill estimate that total global demand for
    rare earths is expected to increase at a CAGR of approximately
    6% from 2008 through 2014, from approximately 124,000 mt to
    approximately 180,000 mt per annum.
Current estimates indicate that global demand for REEs will
    exceed global supply by 2011. This shortage will continue unless
    Mountain Pass and other rare earths projects achieve projected
    production capacities. IMCOA and Roskill expect that this
    anticipated excess demand will underpin strong pricing.
As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. According to Metal Pages, since the
    beginning of the fourth quarter of 2009, prices have risen by
    approximately 60% and continue to rise.
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Table of Contents
Rare
    Earth Product Prices(1)
Rare Earth Product
2010
2014
2020
2030
Lanthanum Oxide
$
7.50
$
6.00
$
7.00
$
10.00
Cerium Oxide
4.00
2.50
2.50
3.00
Praseodymium Oxide
22.50
30.00
40.00
60.00
Neodymium Oxide
22.50
30.00
40.00
60.00
Samarium Oxide
4.50
4.50
5.00
8.00
Europium Oxide
475.00
600.00
750.00
1,000.00
Gadolinium Oxide
7.00
8.00
10.00
15.00
Terbium Oxide
500.00
650.00
850.00
1,200.00
Dysprosium Oxide
120.00
155.00
200.00
250.00
Yttrium Oxide
20.00
27.50
35.00
50.00
(1)
Rare earth product prices in US$/kg,
free-on-board
China (+/− 20%)
Source: IMCOA. Although IMCOA and Roskill predict strong growth,
    their projections with respect to certain years are slightly
    different.
Supply
    of Rare Earth Products
China has dominated the global supply of REOs for the last ten
    years and, according to Roskill, accounted for approximately 97%
    of global REO production in 2008. Even with our planned
    production, global supply is expected by analysts to remain
    tight due to the combined effects of growing demand and actions
    taken by the Chinese government to restrict exports. The Chinese
    government heightened international supply concerns in August
    2009 when China's Interior Ministry signaled that it would
    further restrict exports of Chinese rare earth resources. Citing
    the importance of REE availability to internal industries and
    the desire to conserve resources, the Chinese government has
    announced export quotas, increased export tariffs and introduced
    a "mining quotas policy." China's internal
    consumption of rare earths is expected to continue to grow,
    leaving the Rest of World with a supply gap within the next two
    years, during a period of increasing global demand. China also
    dominates the manufacture of rare earth metals, producing
    substantially all of the world's supply, and the
    manufacture of NdFeB magnets, producing approximately 80% of the
    world's supply. Neither capability currently exists in the
    United States.
China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S. Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the global projected REE deficit.
According to Metal Pages, the price of rare earths rose
    significantly in the three years before the recent financial
    turmoil due to constraints placed on mining, processing and
    exporting by the Chinese authorities. According to Metal Pages,
    since the beginning of the fourth quarter of 2009, prices for
    REOs have risen by approximately 60% on average.
As a result of the internal industrial development and economic,
    environmental and regulatory factors in China, there is
    uncertainty with respect to the availability of rare earth
    products from China. Although Chinese production of rare earth
    materials is increasing, export quotas imposed by the Chinese
    government are decreasing, thus reducing the amount of rare
    earth materials that China may export to the rest of the world.
    This reduction is occurring at a time when the demand for REEs
    is growing significantly.
Factors
    Affecting Our Results
We anticipate a dramatic change in our business and results of
    operations upon the completion of our planned modernization and
    expansion of our Mountain Pass facility that we acquired on
    September 30, 2008 from Chevron Mining Inc. As discussed
    under the heading "Business
—
Our
    Corporate History and Structure
—
The Mountain
    Pass Facility," Unocal Corporation had suspended most
    operations at the Mountain Pass
38
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facility by 2002 and, except for pilot processing activities,
    they remained suspended under Chevron Mining Inc.'s
    ownership. Additionally, significant reclamation work was
    completed at the Mountain Pass facility under Chevron Mining
    Inc.'s ownership.
We plan to utilize the assets we acquired from Chevron Mining
    Inc. as a foundation to build an integrated rare earth products
    and technology company, which requires considerable additional
    capital investment. We believe the application of improved
    technologies, along with the capital investment, will allow us
    to create a sustainable business by cost effectively producing
    high purity rare earth products. In addition to the
    modernization and expansion of the Mountain Pass facility, we
    expect to significantly broaden our operations through the
    addition of a number of downstream activities and products,
    including metal production, alloying and magnet production.
    Accordingly, we expect our products and customer base to change
    significantly upon full implementation of our
"mine-to-magnets"
strategy.
We processed lanthanum, which comprised 82% and 72% of our sales
    for the year ended December 31, 2009 and the period ended
    December 31, 2008, respectively, from the stockpiled
    lanthanum material held in ponds since suspension of processing
    operations by Unocal Corporation in 2002. As a result of this
    campaign, we were able to significantly improve our solvent
    extraction technologies and capabilities.
Upon completion of the modernized extraction and separations
    facilities, we will begin producing cerium oxide for the glass
    polish market and
    XSORBX
®
products for water treatment. We will also package a portion of
    the lanthanum oxide and all of the europium oxide products for
    direct sale to our customers. Upon completion of our proposed
    acquisition of a
U.S.-based
producer of rare earth metals and alloys, we plan to transport
    by truck cerium, lanthanum, neodymium/praseodymium (didymium)
    and samarium oxide products from our Mountain Pass facility to
    our off-site location that possesses the technological
    capability to produce rare earth metals and alloys.
Revenues
Our prices and product mix are determined by a combination of
    global and regional supply and demand factors. Our revenue is
    currently derived principally from the sale of lanthanum and is
    based on the price and quantities of lanthanum we sell. The
    percentage of our revenues from sales of lanthanum were 82% and
    72% for the year ended December 31, 2009 and the period
    ended December 31, 2008, respectively. These revenues are
    net of any transportation costs that we incur. The quantities we
    sell are determined by the production capabilities of the
    Mountain Pass facility and by demand for our product, which is
    also influenced by the level of purity and consistency we are
    able to achieve. Our revenue also consists of sales of finished
    products acquired as part of our acquisition of the Mountain
    Pass facility.
Prices for lanthanum we sold to our two largest customers were
    primarily based on fixed-price contracts. Our contract with one
    of these customers expired on December 31, 2009. Our
    contract with the other customer expires in April 2010. Product
    sales to those customers and other customers that are not
    subject to existing contracts are based on current prevailing
    prices for the applicable product. Although prices for REOs have
    generally increased since October 2009, this increase followed a
    period of generally lower prices corresponding with the global
    financial crisis beginning in 2008. Many factors influence the
    market prices for REOs and, in the absence of established
    pricing in customer contracts, our sales revenue will fluctuate
    based upon changes in the prevailing prices for REOs. We use
    various industry sources, including certain publications, in
    evaluating prevailing market prices and establishing prices for
    our products because there are no published indices for rare
    earth alloys or magnets. In order to mitigate against the risk
    of fluctuations in market prices, we will likely use fixed price
    contracts for short durations, or longer term contracts that
    include periodic opportunities to adjust prices.
Cost
    of Goods Sold
Our cost of goods sold reflects the cost allocated to our
    inventory acquired as part of our acquisition of the Mountain
    Pass facility and, with respect to our lanthanum sales, the
    subsequent processing costs incurred to produce the product.
    Because many of our costs are fixed costs as opposed to variable
    costs, as our production increases or decreases, our average
    cost per ton decreases or increases, respectively. Primary
39
Table of Contents
production costs include direct labor and benefits, maintenance,
    natural gas, electricity, operating supplies, chemicals,
    depreciation and amortization and other plant overhead expenses.
Currently, our most significant variable costs are chemicals and
    electricity. In the future, we intend to produce more of our
    chemicals at a plant on-site, which will reduce our variable
    chemical costs. We also intend to build a co-generation facility
    to provide power. Following such steps, natural gas will replace
    electricity and become our most significant variable cost.
We expect our labor and benefit costs to increase in 2010 due to
    the addition of personnel as we prepare to increase production
    to a rate of 19,090 mt of REO per year by the end of 2012. In
    addition to volume fluctuations, our variable costs, such as
    electricity, operating supplies and chemicals, are influenced by
    general economic conditions that are beyond our control. Other
    events outside our control, such as power outages, have in the
    past interrupted our operations and increased our total
    production costs, and we may experience similar events in the
    future.
Selling,
    General and Administrative Expenses
Our selling, general and administrative expenses consist
    primarily of: personnel and related costs; legal, accounting and
    other professional fees; occupancy costs; and information
    technology costs. We anticipate an increase in selling, general
    and administrative expenses as we expand our business and
    operate as a publicly traded company. These expenses will
    include additional legal, compliance and corporate governance
    expenses, additional accounting and audit expenses, stock
    exchange listing fees, transfer agent and other
    stockholder-related fees and increased premiums for certain
    insurance coverages, among others.
Income
    Taxes
Prior to the corporate reorganization completed in connection
    with this offering, we operated entirely within limited
    liability companies, which were not directly liable for the
    payment of federal or state income taxes and our taxable income
    or loss was included in the state and federal tax returns of
    Molycorp, LLC's members. The newly formed holding company,
    Molycorp, Inc., will be subject to U.S. federal and state
    income taxes.
Environmental
Our operations are subject to numerous and detailed federal,
    state and local environmental laws, regulations and permits,
    including those pertaining to employee health and safety,
    environmental permitting and licensing, air quality standards,
    GHG emissions, water usage and pollution, waste management,
    plant and wildlife protection, handling and disposal of
    radioactive substances, remediation of soil and groundwater
    contamination, land use, reclamation and restoration of
    properties, the discharge of materials into the environment and
    groundwater quality and availability.
We retain, both within Molycorp and outside Molycorp, the
    services of reclamation and environmental, health and safety, or
    EHS, professionals to review our operations and assist with
    environmental compliance, including with respect to product
    management, solid and hazardous waste management and disposal,
    water and air quality, asbestos abatement, drinking water
    quality, reclamation requirements, radiation control and other
    EHS issues.
We have spent, and anticipate that we will continue to spend,
    financial and managerial resources to comply with environmental
    requirements. The majority of these resources will be expended
    through our capital investment budget. We expect to spend
    approximately $187 million not including the costs of air
    emissions offset credits, which may become necessary and, if
    required, could cost up to $20 million, on
    environmentally-driven capital projects between 2010 and 2012.
    See "Business — Environmental, Health and Safety
    Matters." In addition, in 2009 we incurred operating
    expenses of approximately $3 million associated with
    environmental compliance requirements.
We cannot predict the impact of new or changed laws, regulations
    or permit requirements, including the matters discussed below,
    or changes in the way such laws, regulations or permit
    requirements are enforced,
40
Table of Contents
interpreted or administered. Environmental laws and regulations
    are complex, change frequently and have tended to become more
    stringent over time. It is possible that greater than
    anticipated environmental expenditures will be required in 2010
    or in the future. We expect continued government and public
    emphasis on environmental issues will result in increased future
    investment for environmental controls at our operations.
    Additionally, with increased attention paid to emissions of
    GHGs, including carbon dioxide, new regulations could go into
    effect that may affect our operations. We will continue to
    monitor developments in these various programs and assess their
    potential impacts on our operations.
Violations of environmental laws, regulations and permits can
    result in substantial penalties, court orders to install
    pollution-control equipment, civil and criminal sanctions,
    permit revocations, facility shutdowns and other sanctions. In
    addition, environmental laws and regulations may impose joint
    and several liability, without regard to fault, for costs
    relating to environmental contamination at our facility or from
    wastes disposed of at third-party waste facilities. The proposed
    expansion of our operations is also conditioned upon securing
    the necessary environmental and other permits and approvals. In
    certain cases, as a condition to procuring such permits and
    approvals, we are required to comply with financial assurance
    requirements. The purpose of these requirements is to assure the
    government that sufficient company funds will be available for
    the ultimate closure, post-closure care
and/or
reclamation at our facilities. We typically obtain bonds as
    financial assurance for these obligations and, as of
    December 31, 2009, we had placed $27.4 million of
    surety bonds with California state and regional municipalities.
    These bonds are currently collateralized by letters of credit or
    cash accounts provided by our initial investors, and we intend
    to replace such collateral arrangements with collateral provided
    directly by us. These bonds require annual payment and renewal.
    The EPA has announced its intention to establish a new financial
    assurance program for hardrock mining, extraction and processing
    facilities under the Federal Comprehensive Environmental
    Response Compensation and Liability Act, known as CERCLA, or the
    "Superfund" law, which may require us to establish
    additional bonds or other sureties. We cannot predict the effect
    of any such requirements on our operations at this time.
Impact
    of Inflation
The cost estimates associated with the modernization and
    expansion of the Mountain Pass facility described under the
    heading "— Liquidity and Capital
    Resources — Capital Expenditures" have not been
    adjusted for inflation. If there is a significant rate of
    inflation over the near term, the funds obtained from this
    offering may not be sufficient to execute our business plan over
    the next few years. This could delay or preclude our business
    expansion efforts, or require us to raise additional capital. In
    addition, historical inflation rates have been used to estimate
    the future liability associated with our future remediation and
    reclamation obligations as reflected in the asset retirement
    obligations in our consolidated financial statements included
    elsewhere in this prospectus. If inflation rates significantly
    exceed the historical inflation rates, our future obligations
    could significantly increase.
Foreign
    Currency Fluctuations
Substantially all of our product sales are denominated in
    U.S. dollars, so we have minimal exposure to fluctuations
    in foreign currency exchange rates. Our results are indirectly
    influenced by currency fluctuations, as the relative cost of our
    exports for a foreign buyer will increase as the
    U.S. dollar strengthens and decrease as the
    U.S. dollar softens in comparison to the applicable foreign
    currency.
Critical
    Accounting Policies and Estimates
Revenue
    and Costs of Goods Sold
Revenue is recognized when persuasive evidence of an arrangement
    exists, the risks and rewards of ownership have been transferred
    to the customer, which is generally when title passes, the
    selling price is fixed or determinable and collection is
    reasonably assured. Title generally passes upon shipment of
    product from our Mountain Pass facility. Prices are generally
    set at the time of or prior to shipment. Transportation and
    distribution costs are incurred only on sales for which we are
    responsible for delivering the product. Our reported revenues
    are presented net of freight and shipping costs.
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Table of Contents
Cost of goods sold includes the cost of production as well as
    inventory write-downs caused by market price declines. Primary
    production costs include labor, supplies, maintenance costs,
    depreciation, and plant overhead.
Reclamation
Our asset retirement obligations, or AROs, arise from our
    San Bernardino County conditional use permit, approved
    mining plan and state laws and regulations, which establish
    reclamation and closure standards for all aspects of our surface
    mining operation. Comprehensive environmental protection and
    reclamation standards require that we, upon closure of the
    Mountain Pass facility, restore the property in accordance with
    an approved reclamation plan issued in conjunction with our
    conditional use permit.
Our AROs are recorded initially at fair value, or the amount at
    which we estimate we could transfer our future reclamation
    obligations to informed and willing third parties. We use
    estimates of future third party costs to arrive at the AROs
    because the fair value of such costs generally reflects a profit
    component. It has been our practice, and we anticipate it will
    continue to be our practice, to perform a substantial portion of
    the reclamation work using internal resources. Hence, the
    estimated costs used in determining the carrying amount of our
    AROs may exceed the amounts that are eventually paid for
    reclamation costs if the reclamation work were performed using
    internal resources.
To determine our AROs, we calculate the present value of the
    estimated future reclamation cash flows based upon our permit
    requirements, which is based upon the approved mining plan,
    estimates of future reclamation costs and assumptions regarding
    the useful life of the asset to be remediated. These cash flow
    estimates are discounted on a credit-adjusted, risk-free
    interest rate based on U.S. Treasury bonds with a maturity
    similar to the expected life of the asset.
The amount initially recorded as an ARO for the Mountain Pass
    facility may change as a result of changes to the mine permit,
    and changes in the estimated costs or timing of reclamation
    activities. We periodically update estimates of cash
    expenditures associated with our ARO obligations in accordance
    with U.S. GAAP, which generally requires a measurement of
    the present value of any increase in estimated reclamation costs
    using the current credit-adjusted, risk-free interest rate.
    Adjustments to the ARO for decreases in the estimated amount of
    reclamation costs are measured using the credit-adjusted,
    risk-free interest rate as of the date of the initial
    recognition of the ARO.
As of December 31, 2009, our accrued ARO obligation was
    $14.2 million. Of this amount, approximately
    $4.4 million is associated with the demolition and removal
    of buildings and equipment, approximately $4.7 million is
    associated with groundwater remediation and $5.1 million is
    associated with the remediation of tailing ponds, removal of
    land improvements and revegetation.
Property,
    Plant and Equipment
Property, plant and equipment associated with the acquisition of
    the Mountain Pass facility is stated at estimated fair value as
    of the acquisition date. Expenditures for new property, plant
    and equipment and improvements that extend the useful life or
    functionality of the asset are capitalized. Depreciation on
    plant and equipment is calculated using the straight-line method
    over the estimated useful lives of the assets. Maintenance and
    repair costs are expensed as incurred.
Reserves,
    Mineral Properties and Development Costs
Mineral properties represent the estimated fair value of the
    mineral resources associated with the Mountain Pass facility. We
    will begin to amortize such mineral properties using the units
    of production basis over estimated proven and probable reserves
    once mining operations resume, which is currently expected to
    occur in late 2010 or in 2011.
Inventory
Inventories consist of
work-in-process,
finished goods, stockpiles of bastnasite and lanthanum
    concentrate and materials and supplies. Inventory cost is
    determined using the lower of weighted average cost or estimated
42
Table of Contents
net realizable value. Inventory expected to be sold in the next
    12 months is classified as a current asset in the
    consolidated balance sheet. Cash flows related to the sale of
    inventory are classified as operating activities in the
    consolidated statements of cash flows.
Write-downs to estimated net realizable value are charged to
    cost of goods sold. Many factors influence the market prices for
    REOs and, in the absence of established prices contained in
    customer contracts, management uses an independent pricing
    source to evaluate market prices for REOs at the end of each
    quarter.
We evaluate the carrying value of materials and supply
    inventories each quarter giving consideration to slow-moving
    items, obsolescence, excessive levels and other factors and
    recognize related write-downs as necessary.
Asset
    Impairments
We account for asset impairment in accordance with ASC 360,
Property Plant and Equipment
.
Long-lived
assets such as property, plant and equipment, mineral properties
    and purchased intangible assets subject to amortization are
    reviewed for impairment whenever events or changes in
    circumstances indicate that the carrying amount of an asset may
    not be recoverable. Impairment is considered to exist if the
    total estimated future cash flow on an undiscounted basis is
    less than the carrying amount of the related assets. An
    impairment loss is measured and recorded based on the discounted
    estimated future cash flows. Changes in significant assumptions
    underlying future cash flow estimates or fair values of assets
    may have a material effect on our financial position and results
    of operations.
Factors we generally consider important in our evaluation and
    that could trigger an impairment review of the carrying value of
    long-lived assets include the following:
•
significant underperformance relative to expected operating
    results;
•
significant changes in the way assets are used;
•
underutilization of our tangible assets;
•
discontinuance of certain products by us our by our customers;
•
a decrease in estimated mineral reserves; and
•
significant negative industry or economic trends.
Although we believe the carrying values of our long-lived assets
    were realizable as of the relevant balance sheet date, future
    events could cause us to conclude otherwise.
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Table of Contents
Results
    of Operations
Due to the timing of our formation on June 12, 2008 and
    completion of the acquisition of the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc. on September 30, 2008, the results of our operations
    for the year ended December 31, 2009 are not directly
    comparable to our results of operations for the period from our
    inception on June 12, 2008 to December 31, 2008, which
    we refer to as the period ended December 31, 2008. We did
    not have any revenue or cost of goods sold until the fourth
    quarter of 2008. Accordingly, the following discussion focuses
    on significant trends in our revenues, cost of sales and other
    operating expenses.
June 12, 2008
June 12, 2008
(Inception)
(Inception)
Year Ended
Through
Through
December 31,
December 31,
December 31,
(In thousands)
2009
2008
2009
Net sales
$
7,093
$
2,137
$
9,230
Cost of goods sold
(21,785
)
(13,027
)
(34,812
)
Selling, general and administrative expenses
(12,685
)
(2,979
)
(15,664
)
Depreciation and amortization expense
(191
)
(19
)
(210
)
Accretion expense
(1,006
)
(250
)
(1,256
)
Operating loss
(28,574
)
(14,138
)
(42,712
)
Other income (expense):
Interest (expense) income
(194
)
10
(184
)
Other income
181
54
235
Net loss
$
(28,587
)
$
(14,074
)
$
(42,661
)
Revenues
For the year ended December 31, 2009 and for the period
    ended December 31, 2008, our revenues were approximately
    $7.1 million and $2.1 million, respectively. Sales of
    lanthanum accounted for 82% and 72% of our sales for the year
    ended December 31, 2009 and the period ended
    December 31, 2008, respectively. There is a limited market
    for our lanthanum and two customers comprised 81.2% and 70.4% of
    our total product revenue for the year ended December 31,
    2009 and the period ended December 31, 2008, respectively.
    We anticipate lanthanum and didymium oxide to make up a
    significant percentage of our total sales until we complete the
    modernization and expansion of the Mountain Pass facility, at
    which time we will no longer manufacture those products. We sell
    100% of our lanthanum to customers in the United States.
We expect increased revenues in 2010, primarily attributable to
    sales of additional products to be produced during our second
    pilot processing campaign. Upon completion of the modernization
    and expansion of the Mountain Pass facility and the full
    implementation of our
"mine-to-magnets"
strategy, we expect to produce cerium, lanthanum, neodymium,
    praseodymium, samarium, dysprosium and terbium oxide and metal
    products, europium and gadolinium oxide products and NdFeB and
    samarium cobalt alloys. We intend to use some of the NdFeB alloy
    and dysprosium metal product in our magnet production plant. Our
    new products are expected to have significantly more
    applications than our current products, exposing us to a larger
    population of potential customers. In addition, we estimate that
    generally higher REE prices in 2010, as compared to early 2009,
    will contribute to our increased revenue in 2010.
Cost
    of Goods Sold
Our cost of goods sold for the year ended December 31, 2009
    and for the period ended December 31, 2008 totaled
    approximately $21.8 million and $13.0 million,
    respectively. Included in the cost of sales for the year ended
    December 31, 2009 and the period ended December 31,
    2008 are write-downs of inventory to estimated net realizable
    value of $9.0 million and $9.5 million, respectively.
    Our principal production costs include chemicals, direct labor
    and employee benefits, maintenance labor and materials, contract
    labor, operating supplies, depreciation, utilities and plant
    overhead expenses.
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Table of Contents
Total production costs charged to inventory were
    $23.4 million and $5.4 million for the year ended
    December 31, 2009 and the period ended December 31,
    2008, respectively. We produced 3.4 million pounds of
    lanthanum and 1.1 million pounds of didymium oxide in 2009
    and 0.8 million pounds of lanthanum and 0.1 million of
    didymium oxide in the period ended December 31, 2008.
    Inventory purchases were $0.2 million and $0.6 million
    for the respective periods. We primarily purchase lanthanum
    oxide, cerium oxide and praseodymium oxide that undergo further
    processing either at our facility or at an off-site location.
Our chemical costs were $6.7 million and $1.4 million
    for the year ended December 31, 2009 and for the period
    ended December 31, 2008, respectively. Unit chemical costs
    do not vary significantly based on production volumes and are
    primarily driven by market prices. In 2008, the most significant
    chemical cost related to caustic soda, representing
    approximately 67% of total reagent costs. We launched a program
    in 2009 that has allowed us to lower the quantity and costs
    associated with the use of caustic soda in our production
    process.
Labor costs, including related employee benefits, allocated to
    production were $9.2 million and $1.9 million for the
    year ended December 31, 2009 and the period ended
    December 31, 2008, respectively. Included in the labor
    costs is a bonus, which was granted to all union employees for
    working on our neodymium from lanthanum, or NFL, pilot
    processing project, of $0.8 million and $0.4 million
    for the year ended December 31, 2009 and the period ended
    December 31, 2008, respectively. The bonus was paid out in
    March 2010.
Maintenance costs, including maintenance labor and supplies,
    were $1.9 million and $0.5 million for the year ended
    December 31, 2009 and the period ended December 31,
    2008, respectively. Maintenance costs remained consistent
    throughout this time period.
Other costs allocated to production include depreciation charges
    of $3.2 million and $0.9 million for the year ended
    December 31, 2009 and the period ended December 31,
    2008, respectively. Depreciation allocated to products is
    primarily related to buildings, equipment and machinery used in
    the production process. We also accrued waste disposal charges
    of $1.5 million as of December 31, 2009 for disposal
    of by-products of production that are potentially hazardous.
Selling,
    General and Administrative Expenses
Our selling, general and administrative expenses for the year
    ended December 31, 2009 and for the period ended
    December 31, 2008 totaled approximately $12.6 million
    and $2.9 million, respectively. Legal and accounting fees
    were approximately $1.8 million and $0.6 million,
    respectively. Other consulting expenses, primarily related to
    engineering and technical consultants were $1.5 million and
    $0.5 million. These costs related primarily to engineering
    and resource studies as well as process development projects.
    Costs associated with research and development projects were
    $1.5 million and $0.4 million and primarily are
    attributed to labor costs and materials and supplies. Management
    salaries and related benefits not capitalizable in inventory
    were $2.5 million and $0.9 million for the respective
    periods.
Operating
    Losses
Since our inception and our acquisition of the Mountain Pass
    facility, we have incurred significant operating losses. Our
    operating losses for the year ended December 31, 2009 and
    for the period ended December 31, 2008 were
    $28.6 million and $14.1 million, respectively. We have
    funded our operating losses entirely with proceeds from equity
    contributions from our initial investors.
Liquidity
    and Capital Resources
Most of the facilities and equipment acquired with the Mountain
    Pass facility are at least 20 years old and must be
    modernized or replaced. Under our current business plan, we
    intend to spend approximately $511 million through 2012 to
    restart mining operations, construct and refurbish processing
    facilities and other infrastructure at the Mountain Pass
    facility and expand into metals and alloys production. Capital
    expenditures under this plan total approximately
    $53 million in 2010. We expect to finance these estimated
    total expenditures, as well as our working capital requirements,
    with proceeds from planned public and/or private
45
Table of Contents
offerings of our securities or project financing as part of a
    financing plan we will finalize in connection with, and
    including, this offering. If the assumptions on which we based
    our estimated capital expenditures of $511 million change
    or are inaccurate, we may require additional funding. There can
    be no assurance that we will be successful in the anticipated
    offering or that we will be successful in raising additional
    capital in the future on terms acceptable to us, or at all.
Our financial statements have been prepared on a going concern
    basis under which we are expected to be able to realize our
    assets and satisfy our liabilities in the normal course of
    business. To continue as a going concern beyond 2010 and in
    order to continue the restart of mining operations and
    modernization of the Mountain Pass facility, we will need to
    complete the planned securities offering and the remainder of
    our financing plan or obtain alternative sources of financing.
    Absent the additional financing, we will not have the resources
    to execute our current business plan.
Capital
    Expenditures
In 2009, we acquired equipment with a total cost of
    approximately $3.5 million in preparation for our second
    pilot processing campaign. Other capital expenditures totaled
    $3.8 million including: purchase of an accounting
    information system in the amount of $0.8 million;
    production equipment of $0.5 million; as well as other
    capital improvement projects at the facility.
We expect to make significant capital expenditures under our
    plan to modernize and expand our Mountain Pass facility, as well
    as consistent expenditures to replace assets necessary to
    sustain safe and reliable production. Most of the facilities and
    equipment acquired in connection with the acquisition of the
    Mountain Pass facility are at least 20 years old. We have
    developed an accelerated modernization plan that includes the
    refurbishment of the Mountain Pass mine and related processing
    facilities in 2010 through 2012 in order to increase REO
    production. We anticipate the cost of this project to be
    approximately $511 million, as shown in the table below (in
    millions):
2010
2011
2012
Total
Refurbishment of existing facility
$
5
$
13
$
—
$
18
Refurbishment and expansion of extraction plant
5
30
15
50
Refurbishment and expansion of separations plant
21
128
64
213
New heating and power facility
—
31
13
44
Expansion into metal and alloy production
10
23
—
33
Construction of plant infrastructure
12
69
35
116
Overburden removal
—
20
6
26
Mining and miscellaneous equipment
—
2
9
11
Annual Totals
$
53
$
316
$
142
$
511
We expect that the high levels of spending associated with the
    refurbishment process to improve and modernize equipment will
    decrease in the future as we complete our modernization and
    expansion plans.
Contractual
    Obligations
As of December 31, 2009, we had the following contractual
    obligations:
Payments Due by Period
Less Than
More Than
Contractual Obligations
Total
1 Year
1-3 Years
4-5 Years
5 Years
(In thousands)
Operating lease obligations(1)
$
281
$
153
$
128
$
—
$
—
Purchase obligations(2)
—
—
—
—
—
Employee bonus obligations(3)
1,400
1,400
—
—
—
Asset retirement obligations(4)
29,247
639
4,191
1,597
22,820
Total
$
30,928
$
2,192
$
4,319
$
1,597
$
22,820
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Table of Contents
(1)
Represents all operating lease payments for office space, land
    and office equipment.
(2)
Represents non-cancelable contractual commitments for the
    purchase of materials and services from vendors.
(3)
Represents payments due to employees as a result of our NFL
    pilot processing campaign.
(4)
Under applicable environmental laws and regulations, we are
    subject to reclamation and remediation obligations resulting
    from our operations. The amounts presented above represent our
    estimated future undiscounted cash flows required to satisfy the
    obligations currently known to us.
Off-Balance
    Sheet Arrangements
As of the date of this prospectus, our only off-balance sheet
    arrangement in addition to the operating leases included in
    "— Contractual Obligations" above, is our
    agreement to compensate our initial investors for providing
    collateral relating to our bonding obligations to various
    government agencies. This arrangement is described in the notes
    to consolidated financial statements included in this prospectus.
Quantitative
    and Qualitative Disclosures about Market Risk
Our operations may be impacted by commodity prices, geographic
    concentration, changes in interest rates and foreign currency
    exchange rates.
Commodity
    Price Risk
Our principal products, including cerium, lanthanum,
    praseodymium, neodymium, europium, samarium, gadolinium,
    dysprosium, and terbium, are commodities but are not traded on
    any commodity exchange. As such, direct hedging of the prices
    for future production cannot be undertaken. We do not currently
    have any long-term sales contracts with customers, so prices
    will vary with the transaction and individual bids received. Our
    products are primarily marketed to manufacturer as component
    materials. Prices will vary based on the demand for the end
    products being produced with the mineral resources we mine and
    process.
Our net sales and profitability are determined principally by
    the price of the rare earth products that we produce and, to a
    lesser extent by the price of natural gas and other supplies
    used in the production process. The prices of our rare earth
    products are influenced by the price and demand of the end
    products that our products support, including clean energy
    technologies. A significant decrease in the global demand for
    these products may have a material adverse effect on our
    business. We currently have no hedging contracts in place and
    intend to consider hedging strategies in future.
Our costs and capital investments are subject to market
    movements in other commodities such as natural gas and
    chemicals. We may enter into derivative contracts for a portion
    of the expected usage of these products, but we do not currently
    have any derivative contracts and we do not anticipate entering
    into derivative agreements before the end of 2010.
Interest
    Rate Risk
We do not currently have any debt obligations. As a result, we
    would not be directly impacted by variation in interest rates at
    this time. Our exposure to interest rate risk would increase if,
    for example, we obtain and utilize debt facilities in the future.
Internal
    Controls
As a public company, we will be required to comply with the
    record keeping, financial reporting, corporate governance and
    other rules and regulations of the SEC, including the
    requirements of the
Sarbanes-Oxley
Act, and other regulatory bodies. These entities generally
    require that financial information be reported in accordance
    with U.S. GAAP. As a private company, we were not required
    to have, and until late 2009 did not have, sufficient personnel
    with SEC and
Sarbanes-Oxley
experience. In addition, we were not required to comply with the
    internal control design, documentation and testing requirements
    imposed by
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Sarbanes-Oxley. In connection with this offering as a
    publicly-held company, we will become subject to these
    requirements.
Effective internal control over financial reporting is necessary
    for us to provide reliable annual and interim financial reports
    and to prevent fraud. If we cannot provide reliable financial
    reports or prevent fraud, our operating results and financial
    condition could be materially misstated and our reputation could
    be significantly harmed. A material weakness in internal control
    over financial reporting is defined as a deficiency, or a
    combination of deficiencies, such that there is a reasonable
    possibility that a material misstatement of the annual or
    interim financial statements will not be prevented or detected
    on a timely basis. A significant deficiency is a deficiency, or
    a combination of deficiencies, in internal control over
    financial reporting that is less severe than a material
    weakness, yet important enough to merit attention by those
    responsible for oversight of a company's financial
    reporting. A deficiency in internal control over financial
    reporting exists when the design or operation of a control does
    not allow management or employees, in the normal course of
    performing their assigned functions, to prevent or detect
    misstatements on a timely basis.
During the preparation of our consolidated financial statements
    as of December 31, 2009 and 2008 and for the year ended
    December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008, and cumulatively for
    the period from June 12, 2008 (Inception) through
    December 31, 2009, we identified deficiencies in our
    internal control over financial reporting which, when considered
    in the aggregate, represent a material weakness. If not
    remediated, this material weakness could result in material
    misstatements in our consolidated financial statements in future
    periods. Specifically, we did not maintain a sufficient
    complement of personnel with an appropriate level of accounting
    and financial reporting knowledge, experience and training in
    the application of U.S. GAAP. We also did not maintain an
    adequate system of processes and internal controls sufficient to
    support our financial reporting requirements and to produce
    timely and accurate consolidated financial statements in
    accordance with U.S. GAAP. If our efforts are not adequate
    to remediate this material weakness, we could experience
    material misstatements in our consolidated financial statements
    in future periods.
In late 2009, we hired a chief financial officer, a corporate
    controller and a director of financial reporting, and in early
    2010, we hired an accounting manager for the Mountain Pass
    facility as part of the actions being taken to remediate the
    material weakness. All of these individuals are certified public
    accountants possessing significant experience with accounting
    and financial reporting matters. We also continued the process
    of reviewing our existing processes and system of internal
    control in order to implement related improvements where needed.
    We installed additional functionality and increased the
    integration of our information technology systems to increase
    automation and accuracy within our processes.
Under current requirements, our independent registered public
    accounting firm will not be required to evaluate and assess our
    internal control over financial reporting until we file our
    annual report on
Form 10-K
for the year ended December 31, 2011. Consequently, we will
    not be evaluated independently in respect of our controls for a
    substantial period of time after this offering is completed. As
    a result, we may not become aware of other material weaknesses
    or significant deficiencies in our internal controls that may be
    later identified by our independent registered public accounting
    firm as part of the evaluation.
The actions we have taken to date, or any future measures or
    actions we will take, may not remediate the material weakness
    mentioned above. See "Risk Factors — Risks
    Related to Our Business— We identified a material
    weakness in our internal control over financial reporting which,
    if not satisfactorily remediated, could result in material
    misstatements in our consolidated financial statements in future
    periods" and "We will be required by Section 404
    of the Sarbanes-Oxley Act to evaluate the effectiveness of our
    internal controls. If we are unable to achieve and maintain
    effective internal controls, our operating results and financial
    condition could be harmed" included elsewhere in this
    prospectus.
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RARE
    EARTH INDUSTRY OVERVIEW
The Rare
    Earth Elements
The REE group includes 17 elements, namely the
    15 lanthanide elements, which are cerium, lanthanum,
    neodymium, praseodymium, promethium (which does not occur
    naturally), samarium, europium, gadolinium, terbium, dysprosium,
    holmium, erbium, thulium, ytterbium and lutetium, and two
    elements that have similar chemical properties to the lanthanide
    elements — yttrium and scandium. The oxides produced
    from processing REEs are collectively referred to as REOs. Light
    and heavy REEs are contained in all rare earth deposits. Cerium,
    lanthanum, neodymium, praseodymium and samarium are considered
    "light REEs" that are more predominant in bastnasite,
    while europium, gadolinium, terbium, dysprosium, holmium,
    erbium, thulium, ytterbium and lutetium are considered
    "heavy REEs" that are more predominant in monazite.
    Our reserves are bastnasite, but there are also known monazite
    occurrences on our property that we are currently examining.
Global
    Rare Earth Market
REEs have unique properties that make them critical materials to
    many existing applications upon which society has become
    dependent and emerging applications that are rapidly gaining
    traction. Examples include:
•
Clean-Energy Technologies:
hybrid and electric
    vehicles, wind power turbines and compact fluorescent lighting;
•
High-Technology Applications:
miniaturization of
    cell phones, personal digital assistant devices, digital music
    players, hard disk drives used in computers, computing devices,
    "ear bud" speakers and microphones, as well as fiber
    optics, lasers and optical temperature sensors;
•
Critical Defense Applications:
guidance and control
    systems, communications, global positioning systems, radar and
    sonar; and
•
Advanced Water Treatment:
industrial, military,
    homeland security and domestic and foreign aid applications.
Rechargeable
    Batteries
One of the most effective rechargeable batteries is the NiMH
    battery, which is used in nearly all hybrid and electric
    vehicles and many other electronic products. A mixed rare earth
    metal alloy is used as the anode in the NiMH battery. Cerium and
    lanthanum are the main REEs used in the NiMH battery.
Magnets
REEs are critical elements in the world's strongest
    permanent magnets. These magnets are utilized in electric
    motors, a key component of all motor vehicles, especially hybrid
    and electric vehicles. A new and rapidly expanding use of rare
    earth permanent magnets is in wind turbine permanent magnet
    generators. Owing to the high
power-to-weight
ratio of the magnets, less material is required, permitting
    engines and
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generators to be considerably more powerful while at the same
    time smaller and lighter. The powerful
REE-based
magnets have made possible the miniaturization of hard disk
    drives used in computers and many other electrical devices such
    as personal digital assistant devices and digital music players.
    Neodymium, praseodymium, samarium, and dysprosium are critical
    to the permanent magnet industry due to their unique magnetic
    properties. Based on estimates by IMCOA, by 2014, global demand
    for rare earths used in magnets is estimated at 40,000 mt of
    REO, excluding demand from the wind energy sector. The wind
    energy sector could consume up to an additional 9,000 mt of
    REO, 1,350 mt of which is estimated solely for the United
    States. According to IMCOA, the wind energy sector in the United
    States alone could lead to a 3% to 4% increase in global demand
    for REOs used in magnets. If China succeeds with its current
    target, then this could lead to additional consumption of REOs
    used in magnets of 8% to 10% by 2014. Today, nearly all magnetic
    rare earth products are produced from Chinese-sourced REOs, and
    there is no U.S. domestic manufacturer of NdFeB magnets.
Catalysts
REEs are commonly used as a form of catalyst, referred to as a
    fluid bed cracking catalyst. Fluid bed cracking catalysts are
    being used increasingly in the oil industry because they enhance
    the efficiency of separating various fractions from crude oil
    during the refining process. Lanthanum is the main REE used in
    fluid bed cracking catalysts.
REEs are also used in another form of catalyst in vehicles. A
    catalytic converter is a device fitted to the exhaust system of
    a combustion engine that reduces the toxicity of emissions.
    Recent technological advances have seen the emergence of the
    three-way catalytic converter. This device reduces toxic
    nitrogen oxides to more benign nitrogen and oxygen, oxidizes
    toxic carbon monoxide to carbon dioxide and oxidizes unburnt
    hydrocarbons. Cerium is the REE used in catalytic converters,
    where it forms part of the catalyst. Increasingly stringent
    vehicle emission laws are being introduced throughout the world,
    and, according to the Manufacturers of Emission Controls
    Association, 100% of new vehicles sold in the United States are
    equipped with three-way catalytic converters while many
    developing nations are also mandating that new passenger cars be
    equipped with three-way catalytic converters.
Water
    Treatment
We have developed
    XSORBX
®
,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX
®
is protected by over 100 issued and pending U.S. and
    foreign patents and patent applications. This product, which we
    have proven to be effective in removing arsenic and other
    contaminants from water, is applicable to a broad range of
    applications. There are several opportunities for us to
    commercialize this technology in the industrial, defense,
    foreign aid and outdoor enthusiast sectors. For example, we have
    applied the technology in the mining and smelting industries as
    a means to improve management of arsenic-laden process streams
    and have also developed a portable drinking water filtration
    system for U.S. defense applications and for the outdoor
    recreation industry.
Demand
    for Rare Earth Products
The lack of available substitutes makes REEs essential for
    existing and emerging technologies. According to Roskill, global
    demand in 2010 is estimated to be approximately 124,000 mt of
    REO, roughly equivalent to the 2008 demand level.
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Global demand for rare earths by market (in thousands of tons
    of REO)
Source: IMCOA and Roskill
Factors that could influence upward demand for rare earth
    products include:
•
the use of neodymium, praseodymium and dysprosium in
    high-strength NdFeB magnets that are critical to hybrid and
    electric vehicles and the increased construction of wind power
    generation facilities, particularly off-shore installations;
•
the use of lanthanum and cerium for NiMH batteries that are
    utilized in hybrid and electric vehicles;
•
the use of europium, terbium and yttrium in the production of
    compact fluorescent light bulbs;
•
the use of high-strength NdFeB magnets in the miniaturization of
    electronic products;
•
the use of lanthanum by refineries processing lower quality
    crude oil that consumes greater quantities of fluid cracking
    catalysts;
•
the increased use of REEs in the drive to improve energy
    efficiency and reduce GHGs by the United States and the European
    Union;
•
the use of cerium in advanced water filtration
    applications; and
•
continued research and commercialization of new applications for
    rare earths products.
Global consumption of REEs is projected to steadily increase
    both due to continuing growth in existing applications and
    increased innovation and development of new end uses. For
    example, the integration of rare earth permanent magnet drives
    into wind power turbines has substantially reduced the need for
    gearboxes, which increases overall efficiency and reliability.
    According to IMCOA and Roskill, total demand for rare earths
    outside of China is expected to increase at a CAGR of
    approximately 4% to 5% between 2008 and 2014. In addition,
    according to Roskill, global demand for the more important
    magnetic rare earths, neodymium, praseodymium and dysprosium, is
    expected to grow at CAGRs of approximately 8%, 6% and 6%,
    respectively, over the same period. Both IMCOA and Roskill
    estimate that total global demand for rare earths is expected to
    increase at a CAGR of approximately 6% from 2008 through 2014,
    from approximately 124,000 mt to approximately 180,000 mt per
    annum.
Supply
    for Rare Earth Products
China has dominated the global supply of REOs for the last ten
    years and, according to Roskill, accounted for approximately 97%
    of global REO production in 2008. Even with our planned
    production, global supply is expected by analysts to remain
    tight due to the combined effects of growing demand and actions
    taken by the Chinese government to restrict exports. The Chinese
    government heightened international supply concerns in August
    2009 when China's Interior Ministry signaled that it would
    further restrict exports of Chinese rare earth resources. Citing
    the importance of REE availability to internal industries and
    the desire to conserve resources, the Chinese government has
    announced export quotas, increased export tariffs and
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introduced a "mining quotas policy." China's
    internal consumption of rare earths is expected to continue to
    grow, leaving the Rest of World with a supply gap within the
    next two years, during a period of projected increasing global
    demand. China also dominates the manufacture of rare earth
    metals, producing substantially all of the world's supply,
    and the manufacture of NdFeB magnets, producing approximately
    80% of the world's supply. Neither capability currently
    exists in the United States, as confirmed by the April 2010
    U.S. GAO briefing.
China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S. Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
According to the April 2010 briefing prepared by the
    U.S. GAO:
•
the Mountain Pass mine is the largest non-Chinese rare earth
    deposit in the world;
•
other U.S. rare earth deposits exist, but these deposits
    are still in early exploratory stages of development;
•
officials emphasized the significance of the widespread use of
    commercial-off-the-shelf products in defense systems that
    include rare earth materials, such as computer hard drives;
•
government and industry officials told the U.S. GAO that
    where rare earth materials are used in defense systems, the
    materials are responsible for the functionality of the component
    and would be difficult to replace without losing performance;
•
a 2009 National Defense Stockpile configuration report
    identified lanthanum, cerium, europium and gadolinium as having
    already caused some kind of weapon system production delay and
    recommended further study to determine the severity of the
    delays; and
•
defense systems will likely continue to depend on rare earth
    materials, based on their life cycles and lack of effective
    substitutes.
The price of rare earths rose significantly in the three years
    before the recent financial turmoil due to constraints placed on
    mining, processing and exporting by the Chinese authorities.
    According to Metal Pages, since October 2009, prices for REOs
    have risen by approximately 60% on average.
Current estimates indicate that global demand for REEs will
    exceed global supply by 2011. This shortage will continue unless
    Mountain Pass and other rare earths projects achieve projected
    production capacities. IMCOA and Roskill expect that this
    anticipated excess demand will underpin strong pricing.
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Global
    Supply and Demand of Rare Earths
(2000-2015)
(mt)
Source: Roskill
Roskill has assumed that our Mountain Pass facility will provide
    a significant portion of the increased supply after 2011.
ROW
    Supply and Demand of Rare Earths
(2000-2015)
(mt)
Source: Roskill
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As a result of the global economic crisis, rare earth product
    prices declined by approximately 50% during 2008 and through the
    third quarter of 2009. According to Metal Pages, since the
    beginning of the fourth quarter of 2009, prices have risen by
    approximately 60% and continue to rise.
Rare
    Earth Product Prices(1)
Rare Earth Product
2010
2014
2020
2030
Lanthanum Oxide
$
7.50
$
6.00
$
7.00
$
10.00
Cerium Oxide
4.00
2.50
2.50
3.00
Praseodymium Oxide
22.50
30.00
40.00
60.00
Neodymium Oxide
22.50
30.00
40.00
60.00
Samarium Oxide
4.50
4.50
5.00
8.00
Europium Oxide
475.00
600.00
750.00
1,000.00
Gadolinium Oxide
7.00
8.00
10.00
15.00
Terbium Oxide
500.00
650.00
850.00
1,200.00
Dysprosium Oxide
120.00
155.00
200.00
250.00
Yttrium Oxide
20.00
27.50
35.00
50.00
(1)
Rare earth product prices in US$/kg,
free-on-board
China (+/− 20%)
Source: IMCOA. Although IMCOA and Roskill predict strong growth,
    their projections with respect to certain years are slightly
    different.
In 2008, global production of rare earths was estimated at
    approximately 124,000 mt of REO according to Roskill. China
    accounted for approximately 97% of this total. As a result of
    economic, environmental and regulatory factors in China, as well
    as internal industrial development, there is uncertainty with
    respect to the availability of rare earth products from China.
    Although Chinese production of rare earth materials is
    increasing, export quotas imposed by the Chinese government are
    decreasing, thus reducing the amount of rare earth materials
    that China may export for the rest of the world. This is
    occurring at a time when the demand for REEs is growing
    significantly.
In expectation of increasing demand, there are a limited number
    of rare earth projects outside of China that are in various
    stages of development. None of these deposits are currently in
    production. The success of any other rare earth projects depends
    on a number of factors, including:
•
REO grade;
•
obtaining and maintaining operating and environmental permits;
•
acceptance in the marketplace as a long-term viable alternative
    to Chinese production;
•
the amount of recoverable high-value REEs contained in ore (such
    as neodymium, praseodymium, europium and dysprosium);
•
reserve life;
•
the ability to separate and concentrate rare earth minerals;
•
the ability to economically crack rare earth mineral
    concentrates and produce high yields;
•
the ability to separate REEs and manufacture finished products;
•
natural radioactive material content of the ore and the ability
    to responsibly and economically manage radioactive waste;
•
the cost of bringing the property into production; and
•
access to critical infrastructure, including electricity, fuel
    and transportation.
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BUSINESS
Our
    Business
We are the only REO producer in the Western hemisphere and own
    the world's largest, most fully developed rare earth
    project outside of China. Furthermore, following the execution
    of our "mine-to-magnets" strategy and completion of
    our modernization and expansion efforts, we expect to be one of
    the world's most integrated producers of rare earth
    products, including oxides, metals, alloys and magnets. Our rare
    earths are critical inputs in existing and emerging applications
    including: clean energy technologies, such as hybrid and
    electric vehicles and wind power turbines; multiple high-tech
    uses, including fiber optics, lasers and hard disk drives;
    numerous defense applications, such as guidance and control
    systems and global positioning systems; and advanced water
    treatment technology for use in industrial, military and outdoor
    recreation applications. Global demand for REEs is projected to
    steadily increase both due to continuing growth in existing
    applications and increased innovation and development of new end
    uses. We have made significant investments, and expect to
    continue to invest, in developing technologically advanced
    applications for individual REEs.
For the year ended December 31, 2009, we generated
    approximately $7.1 million of revenue from sales of
    products manufactured from stockpiled feedstocks, although this
    level of revenue is not representative of our planned level of
    operations after we restart mining operations. Following the
    finalization of our financing plan in connection with, and
    including, this offering, we expect to be fully funded through
    our modernization and expansion efforts, which we expect will
    continue through 2012.
Mine-to-Oxides
We and SRK Consulting estimate total proven and probable
    reserves of 2.21 billion pounds of REO, with an average ore
    grade of 8.24%, using a cut-off grade of 5.0%, at our Mountain
    Pass mine. Based on these estimated reserves and an expected
    annual production rate of 19,090 mt of REO, our expected mine
    life is in excess of 30 years. According to Roskill, global
    REO production in 2008 was approximately 124,000 mt, of which
    only approximately 4,300 mt originated from outside of China,
    with Molycorp producing approximately 1,700 mt from its
    stockpiles and Russian producers producing approximately 2,500
    mt. This contrasts with total demand outside of China in 2008 of
    approximately 50,000 mt, according to Roskill, with rapid growth
    expected by industry analysts. Upon completion of our
    modernization and expansion efforts, we will have the ability to
    produce 19,090 mt of REO per year to supply this non-Chinese
    demand and expect to have the capability to increase production
    to 40,000 mt of REO per year, if warranted by market conditions.
At our Mountain Pass facility, we have the ability to mine,
    crush, mill and separate rare earth ore to produce individual
    REEs. We hold a
30-year
mine
    plan permit and an associated environmental impact report, both
    of which were issued in 2004. Since our acquisition of the
    Mountain Pass facility, we have been producing and selling REOs
    from stockpiled feedstocks to significantly improve our solvent
    extraction technologies and capabilities. We are now achieving
    greater than 98% recovery in our solvent extraction units at
    commercial scale, which we believe is one of the highest
    recovery rates in the world. We have developed the expertise to
    produce the following REEs in many usable forms: bastnasite
    concentrate; cerium; lanthanum; neodymium; praseodymium;
    europium; samarium; gadolinium; dysprosium; and terbium.
Processing at our Mountain Pass facility entails mining the
    bastnasite ore followed by crushing and milling it to a fine
    powder. Milled bastnasite ore is then processed by flotation
    whereby the bastnasite, which is a mineral containing light and
    heavy rare earth elements, floats to the surface and is
    separated from the waste material, which sinks in a series of
    flotation cells. The resultant bastnasite concentrate is then
    processed by leaching with strong acid solutions followed by a
    series of solvent-extraction separation steps that produce
    various individual REO minerals, generally in a high purity
    (greater than 99%) oxide form. Beginning in the second quarter
    of 2010, we plan to begin processing bastnasite concentrate from
    our stockpiles in an effort to commercially demonstrate our new
    cracking technology while at the same time continue to further
    optimize our processing technologies and improve recovery rates
    compared to historical operations at the Mountain Pass facility.
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We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with modernization of our
    processing capabilities to efficiently produce at a rate of
    19,090 mt of REO per year by the end of 2012. The U.S. GAO
    April 2010 briefing stated that, for a typical exploration-stage
    mine, once a company has secured the necessary capital to start
    a mine, government and industry officials said it can take from
    seven to 15 years to bring a property fully online, largely
    due to the time it takes to comply with multiple state and
    federal regulations. Since Molycorp's Mountain Pass
    facility is not an early stage rare earth project, we believe it
    has significant timeline advantages as it has a well-defined ore
    body, an existing open pit with over 50 years of production
    history, an existing mine and reclamation plan, proven reserves,
    substantial permitting, and all necessary technology to
    successfully process and separate the rare earth elements at a
    commercial scale.
Oxides-To-Metals/Alloys
We expect to sell and transport a portion of the REOs we produce
    to customers for use in their particular applications. The
    remainder of the REOs will be processed into rare earth metals.
    A portion of these metals will be sold to end users and we
    expect to process the rest into rare earth alloys. These rare
    earth alloys can be used in a variety of applications, including
    but not limited to: electrodes for NiMH battery production;
    samarium cobalt magnet production; and NdFeB magnet production.
Initially, our modernization and expansion plans envisioned
    adding facilities and equipment for metal conversion and alloy
    production at the Mountain Pass facility. However, we have
    entered into a letter of intent to acquire a third-party
    producer of rare earth metals and alloys in the United States.
    If we complete the acquisition instead of adding such facilities
    and equipment at Mountain Pass, we plan to transport cerium,
    lanthanum, neodymium/praseodymium (didymium) and samarium oxide
    products from our Mountain Pass facility to our new off-site
    location that already possesses the technological capability to
    produce rare earth metals and alloys.
Magnet
    Production
We are currently evaluating joint venture opportunities to
    integrate downstream into NdFeB magnet manufacturing in the
    United States. NdFeB magnets, which are critical components in
    "green" technologies and the miniaturization of
    electronics, are primarily manufactured in China (approximately
    80%) and Japan (approximately 20%). We are currently working to
    secure a collaborative joint venture agreement with a
third-party
manufacturer of NdFeB magnets. This joint venture will provide
    us with access to the intellectual property, technology, people
    and facilities to convert our rare earth materials into the
    high-performance permanent magnets required for production of
    hybrid and electric vehicles, wind power turbines, high-tech
    applications and numerous advanced defense systems on which the
    U.S. economy and national security depend. The consummation
    of such a joint venture, in conjunction with our current
    modernization plans and the potential acquisition of a
    third-party rare earth metals and alloys producer, is expected
    to provide us with the capability to mine, process, separate and
    alloy individual REEs before manufacturing them into NdFeB
    magnets. This downstream integration would make us the only
    fully integrated producer of NdFeB magnets outside of China,
    helping to secure rare earth supply for the Rest of World.
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Rare
    earth "mine-to-magnets" production supply
    chain
Our
    Strengths
We believe that we possess a number of competitive strengths
    that position the Mountain Pass facility to regain its role as
    one of the leading global suppliers of REOs.
We
    have a proven source of REOs with high-grade ore and long
    reserve life.
Prior to the end of the last mining campaign at the Mountain
    Pass facility in 2002, the mine had been in continuous operation
    for over 50 years. Since our acquisition of the Mountain
    Pass facility, we have been processing stockpiled feedstocks as
    part of our ongoing effort to significantly improve our solvent
    extraction technologies and other processing capabilities.
    Today, based on estimated reserves of 2.21 billion pounds
    of REO with an average ore grade of 8.24%, using a cut-off grade
    of 5.0%, the Mountain Pass mine has a life in excess of
    30 years at an annual production rate of 19,090 mt of REO.
    Our leadership team is committed to the continuous and
    sustainable manufacture of rare earth products at the Mountain
    Pass facility using advanced milling and processing technologies
    that will significantly increase the life of the known ore body
    at the Mountain Pass facility. Additionally, we have recently
    expanded our
on-site
exploratory drilling program to confirm the existence and extent
    of bastnasite, monazite and other rare earth phosphate mineral
    occurrences in unexplored areas of the Mountain Pass facility.
    This program will also help to establish that our measured,
    indicated and inferred resources can become proven or probable
    reserves.
We
    expect to be well-positioned to capitalize on the tightening
    balance of global supply and demand of rare earth
    products.
As worldwide demand for rare earth products increases, the
    supply of REOs is limited by available production capacity,
    which is currently concentrated in China. According to Roskill,
    China accounted for approximately 97% of global REO production
    in 2008. China also dominates the manufacture of metals and
    NdFeB magnets from rare earths, capabilities that are not
    currently found in the United States.
Chinese government policies will also impact the supply and
    demand of REOs and rare earth products. We believe that the
    Chinese government intends to increase wind generated power to
    100 gigawatts with an investment expected to be above
    $150 billion and has also proposed a package of over
    $29 billion to fund hybrid and electric vehicle production,
    placing additional strain on the REE supply chain. Citing the
    importance of REE availability to internal industries and the
    desire to conserve resources, the Chinese government has also
    announced export quotas, increased export tariffs and introduced
    a "mining quotas policy."
Given China's estimated consumption levels and the
    limitations its government has put on exports, Roskill projects
    a global deficit beginning in 2011 without the advent of
    production from new projects, such as Mountain Pass. Limits on
    rare earth exports from China and the lack of available
    substitutes make the development of new sources of REEs
    essential to meet the growing demand for existing and emerging
    technologies, such as hybrid and electric vehicles, wind power
    turbines, compact fluorescent light bulbs, hard disk drives and
    dual use electronics.
China has also announced a national stockpile program, as has
    South Korea. Additionally, Japan has increased its national
    stockpile program. The U.S. Department of Defense is
    conducting a study, which is expected to be completed by
    September 2010, to determine its rare earth requirements and
    supply chain vulnerabilities and whether to build a strategic
    stockpile. These stockpile programs will likely accelerate the
    pace of the projected global REE deficit.
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U.S. federal government investments and policies may
    materially increase end-market demand for our rare earth
    products. For example, the U.S. federal government recently
    approved $45 billion in grant funding and loan guarantees
    directed toward wind power generation projects and hybrid and
    electric vehicles. Pending energy legislation may also increase
    demand for clean technology applications, which use rare earth
    products.
Upon reaching full planned production rates for REOs in 2012, we
    expect to be in a position to supply a substantial portion of
    the U.S. demand and also sell to export markets.
We
    have a highly experienced and qualified management
    team.
Our President and Chief Executive Officer has 29 years of
    experience, 24 of which are associated with the Mountain Pass
    facility. In addition, our Chief Technology Officer, General
    Counsel and Chief Financial Officer have over 75 years of
    combined technical, operational, legal, financial and management
    experience. Many of our key employees have worked with the
    Mountain Pass facility for over 20 years each. We also have
    a proven technology and product development group and as of
    April 1, 2010, held 18 issued and pending U.S. patents
    and patent applications, and 146 issued and pending foreign
    patents and patent applications. Management has also created a
    work environment that prioritizes safety. Since July 2005, the
    Mountain Pass facility has not had a lost-time accident and has
    received the coveted "Sentinels of Safety" award from
    the MSHA for three of the last four years.
Our
    Business Strategy
Our business strategy is to:
Build
    the largest, most advanced and efficient fully integrated REO
    processing facility in the world.
We intend to refurbish or replace existing equipment at the
    Mountain Pass facility in connection with our modernization and
    expansion efforts. We also intend to build the largest, most
    advanced and efficient fully integrated REO processing facility
    in the world to support our anticipated production requirements.
    Following the refurbishment of existing equipment and the
    purchase, delivery, installation, and
start-up
of
    new equipment, our fully integrated facility will allow us to
    reach full production, utilizing our newly optimized and
    commercially proven REO processing operations. Additionally, we
    expect that our proprietary production technology and our
    planned new paste tailings operation will reduce our
    environmental footprint and set the standard in the industry for
    environmental stewardship.
Successfully
    complete modernization and expansion efforts and reach full
    planned production rates for REOs at the Mountain Pass facility
    by the end of 2012.
After reaching full planned production rates for REOs at the
    Mountain Pass facility, we expect to produce 19,090 mt of REO
    per year. We operate the Mountain Pass facility pursuant to a
30-year
mining permit issued in 2004 that allows us to feed ore to the
    mill at a rate of 2,400 tons per day. While the Mountain Pass
    facility historically required 2,000 tons of mill feed per day
    to manufacture 19,090 mt of REO per year, we expect that new
    proprietary technologies we developed will allow us to extract
    the same 19,090 mt of REO per year while only using
    approximately 1,100 to 1,500 tons of mill feed per day, thus
    allowing for potential increases in annual REO production beyond
    the planned 19,090 mt per year without any change in the permit
    limit.
Improve
    our operating efficiencies with technically advanced
    manufacturing techniques.
We intend to continue to improve the efficiency of our
    operations through the creation and use of technically advanced
    manufacturing processes for production of rare earth products,
    which will allow us to deliver high-quality rare earth products
    at globally competitive prices. We have already invested
    significant resources towards perfecting our REO processing
    operations and developing new and proprietary applications for
    individual REEs. We expect that by advancing all of these
    technologies, we will continue to lower our operating costs.
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Table of Contents
Manage
    our costs to be cost competitive.
The success of our business will depend on our ability to manage
    our costs. We will manage these costs through the use of new
    production technologies that have been developed by our research
    and development group, which will use less energy and raw
    materials and will result in a reduced environmental footprint.
    These production technologies will substantially reduce the
    amount of water consumption and waste water generation. We plan
    to use our proprietary technology to maximize our process
    recoveries and maximize REO concentrate production per unit of
    extracted ore. We plan to install a natural gas powered
    co-generation power plant as part of our modernization and
    expansion of the Mountain Pass facility to reduce energy
    consumption and costs as well as minimize or eliminate our
    reliance on the regional electric power grid. We intend to
    produce our own hydrochloric acid and sodium hydroxide at the
    Mountain Pass facility and recycle our acid and base, thereby
    reducing our reliance on external sources of reagents. After
    completion of our modernization and expansion efforts, we
    anticipate our most significant cash operating costs will
    consist of natural gas and labor.
Secure
    customer commitments to provide a stable revenue
    stream.
We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    at the Mountain Pass facility, we expect to produce
    approximately 19,090 mt of REO per year. As of April 1,
    2010, we had 19 letters of intent to sell our rare earth
    products, representing approximately 138% of our anticipated
    production for 2013. We are continuing to seek additional
    letters of intent and, prior to commencing full production, we
    intend to enter into short- and long-term sales contracts with
    existing and new customers. In addition, we are in discussions
    with multiple large, globally diversified mining companies
    regarding the sale of
    XSORBX
®
.

    XSORBX
®
is a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX
®
is protected by over 100 issued and pending U.S. and
    foreign patents and patent applications.
The following table compares the volume under our letters of
    intent to our anticipated production for 2013 (in mt):
Volume Under
Percent of
Letters of
Uncommitted
2013
Projected 2013
Product Type
Intent (1)(2)
Volume
Production(1)(2)
Production
Lanthanum non-metal
11,427
—
3,104
368
%
Lanthanum metal
436
(3)
2,071
2,507
17
%
Cerium non-metal
6,914
(4)
2,770
9,684
71
%
Cerium metal
200
(3)
—
—
—
Neodymium non-metal
50
—
—
—
Neodymium metal
3,318
(5)
—
313
1,060
%
Praseodymium metal
1,091
(5)
—
116
941
%
Europium oxide
—
(6)
19
19
—
Samarium metal(8)
—
191
191
—
NdPr metal in NdFeB alloy
1,000
(7)
964
1,964
51
%
NdPr metal in NdFeB magnets
291
(7)
—
—
—
TOTAL
24,727
6,015
17,898
138
%
(1)
Alloy and magnet production and letter of intent volume are
    reported on a rare earth metal basis.
(2)
There is a 14.2% loss of mass when REOs are converted to rare
    earth metal due to oxygen evolution.
(3)
Contained within mischmetal, a combination of lanthanum, cerium
    and iron, for battery alloy producers.
(4)
Volume shown is used in traditional glass or catalyst market
    segments and represents only a very small fraction of cerium
    buyers. Although IMCOA predicts that there will be a surplus of
    cerium in the future, we anticipate most of our production will
    serve the new, proprietary
    XSORBX
®
market segment. This segment alone is expected to consume many
    times more cerium units than we can produce. We believe the new
    segment negates the need for additional letters of intent at
    this time.
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(5)
We have received letters of intent for 9,700,000 pounds of Nd
    and/or NdPr metal (otherwise known as didymium metal). To
    demonstrate the Nd and Pr breakdown, we have split the didymium
    requirement to the generally accepted ratio of 75/25 Nd to Pr in
    the didymium metal. Some of our metal production will be
    consumed internally for downstream NdFeB alloy/magnet production.
(6)
We expect to receive letters of intent from a number of phosphor
    producers, which will easily consume our europium production. At
    this time, we are the only producer outside of China for this
    element, which enables energy efficient, compact fluorescent
    lights and straight tube T-8 lamps.
(7)
This represents the estimated NdPr metal contained in the letter
    of intent volume for NdFeB alloy and magnets.
(8)
IMCOA predicts that there will be a surplus of samarium metal.
Integrate
    downstream to profitably capture the full value
    chain.
We intend to utilize vertical integration through further
    downstream processing of our REOs into rare earth metals, alloys
    and finished magnets. We have entered into a letter of intent to
    acquire a third-party producer of rare earth metals and alloys
    in the United States. This acquisition would provide us with a
    license to technology related to the production of rare earth
    metals and alloys. Additionally, we are currently working to
    secure a collaborative joint venture agreement with a
    third-party manufacturer to produce NdFeB magnets in the United
    States. This
"mine-to-magnets"
strategy will make us the first fully integrated supplier of
    NdFeB magnets in the world and the only producer of NdFeB
    magnets in the United States. In addition, we are working to
    identify and develop new downstream opportunities for the REOs,
    rare earth metals and alloys and rare earth products we will
    manufacture.
Develop
    new higher margin products.
We intend to develop new higher margin products and processes
    for REEs that historically have had lower demand. For example,
    cerium is used primarily for glass polishing and has typically
    sold at prices lower than those for other REEs. However, we have
    developed
    XSORBX
®
,

    a proprietary product and process, primarily consisting of
    cerium, that removes arsenic and other heavy metals from
    industrial processing streams and will allow our customers to
    more safely sequester arsenic and increase their production.
    XSORBX
®
is protected by over 100 issued and pending U.S. and
    foreign patents and patent applications. This product, which we
    have proven to be effective in removing arsenic and other
    contaminants from water, is applicable to a broad range of
    applications with higher margins. We have entered into a
    non-binding letter of intent with a water filtration company to
    jointly develop water treatment products. We will continue to
    focus on establishing proprietary markets for low-demand REEs to
    provide us with an opportunity to sell these REEs as higher
    margin products.
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Our
    Corporate History and Structure
Molycorp Minerals, LLC, a Delaware limited liability company
    formerly known as Rare Earth Acquisitions LLC, was formed on
    June 12, 2008 to purchase the Mountain Pass, California
    rare earth deposit and associated assets from Chevron Mining
    Inc., a subsidiary of Chevron Corporation. Prior to the
    acquisition, the Mountain Pass facility was owned by Chevron
    Mining Inc. and, before 2005, by Unocal Corporation. Molycorp,
    LLC, the parent of Molycorp Minerals, LLC, is a Delaware limited
    liability company that was formed on September 9, 2009.
    Molycorp, Inc. was formed on March 4, 2010 as a new
    Delaware corporation that is not, to date, conducting any
    activities other than those incident to its formation and the
    preparation of this registration statement.
The members of Molycorp, LLC have contributed either
    (a) all of their member interests in Molycorp, LLC or
    (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class A common stock. Additionally, all of
    the holders of profits interests in Molycorp Minerals, LLC,
    which were represented by incentive shares, have contributed all
    of their incentive shares to Molycorp, Inc. in exchange for
    shares of Molycorp, Inc. Class B common stock. Accordingly,
    Molycorp, LLC and Molycorp Minerals, LLC have become
    subsidiaries of Molycorp, Inc. All of the shares of Class A
    common stock and Class B common stock will convert into
    shares of common stock immediately prior to the consummation of
    this offering.
The
    Mountain Pass Facility
At the Mountain Pass facility, we own an open-pit mine
    containing the world's most fully developed rare earth
    deposit outside of China. In addition to the mine, the Mountain
    Pass facility includes associated crushing, milling, flotation
    and separation facilities. These facilities are not currently in
    operation, and will need to be modernized or refurbished before
    we can recommence mining operations. The Mountain Pass facility
    is located approximately 60 miles southwest of Las Vegas,
    Nevada near Mountain Pass, San Bernardino County,
    California, straddles Interstate 15 and may be accessed by
    existing hard-surface roads.
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The Mountain Pass facility represents the only developed
    commercial source of rare earth material in the Western
    hemisphere. Molybdenum Corporation of America began REO mining
    operations at the Mountain Pass facility in 1952. REO production
    at the Mountain Pass facility, as well as milling and separation
    processes, continued under Unocal Corporation, which purchased
    Molybdenum Corporation of America in 1977, until 1998 when all
    chemical processing operations were suspended. Mining and
    milling operations continued until 2002 when those operations
    were also placed on standby due to softening prices for REOs and
    a lack of additional tailings disposal capacity. Unocal
    Corporation thereafter sold or otherwise disposed of
    substantially all of the mining equipment at the Mountain Pass
    facility (e.g., shovels, haul trucks, etc.) prior to being
    acquired by Chevron Corporation in 2005. Operations at the
    Mountain Pass facility remained suspended until September 2007
    when Chevron Mining Inc., a wholly-owned subsidiary of Chevron
    Corporation, commenced a NFL pilot processing campaign. Under
    the NFL campaign, lanthanum, which was produced prior to
    suspending activities in 1998 and held in lanthanum pond
    stockpiles at the Mountain Pass facility, was processed in order
    to recover the related neodymium and praseodymium. The NFL
    campaign did not constitute the restart of fully integrated
    operations at the Mountain Pass facility and was used as an
    opportunity to improve processing technologies and generate very
    modest revenue. On September 30, 2008, we acquired the
    Mountain Pass, California rare earth deposit and associated
    assets from Chevron Mining Inc. through Rare Earth Acquisitions
    LLC (which was later renamed Molycorp Minerals, LLC). The
    acquisition by us excluded certain assets and liabilities,
    including certain liabilities related to environmental and
    employment matters, that were retained by Chevron Corporation.
    As part of the acquisition, we also acquired the services of
    approximately 100 employees from Chevron Mining, including
    43 non-union employees and 57 union employees. Under the terms
    of the asset purchase agreement, we agreed to maintain all
    acquired employees' salaries at their previous levels for a
    period of 12 months, provide comparable 401(k) and health
    benefits and to honor all vacation days accrued prior to the
    asset purchase.
We currently hold a
30-year
mine
    plan permit and associated environmental impact report, which
    were issued in 2004. Since our acquisition of the Mountain Pass
    facility in 2008, we have been processing stockpiled lanthanum
    in an effort to significantly improve our solvent extraction
    technologies and capabilities. This effort has been successful
    and we are now achieving greater than 98% recovery in our
    solvent extraction units at commercial scale, which we believe
    is one of the highest recovery rates in the world.
We are preparing to recommence mining operations, which we
    expect to occur in late 2010. Recommencement of mining
    operations is expected to coincide with modernization of our
    processing capabilities in order to efficiently produce 19,090
    mt of REO per year by the end of 2012. In 2010, we plan to
    process bastnasite concentrate from our stockpiles in an effort
    to optimize our processing technologies to further improve
    recovery rates. This new technology is expected to be scaled up
    to commercial levels through 2011. We are also positioning our
    company to move further downstream into metals, alloy and magnet
    production through our
"mine-to-magnets"
strategy. In addition, we are exploring new downstream markets
    for rare earths and rare earth products.
The Mountain Pass facility consists of approximately
    2,222 acres of fee land, of which approximately
    770 acres are currently in use (e.g., existing buildings,
    infrastructure or active disturbance). The lands surrounding the
    Mountain Pass facility are mostly public lands managed by the
    Bureau of Land Management and the National Park Service. In
    addition to the ground that we hold in fee in and around the
    Mountain Pass facility, we also hold 55 patented claims and 489
    unpatented mining claims and mill sites under The Mining Law of
    1872. These mining claims and mill sites provide land for
    mining, ancillary facilities and expansion capacity around the
    Mountain Pass facility.
The Mountain Pass facility includes an open-pit mine, overburden
    stockpiles, a crusher and mill/flotation plant, a separation
    plant, a mineral recovery plant and
on-site
evaporation ponds, as well as laboratory facilities to support
    research and development activities, offices, warehouses and
    support buildings. The majority of the physical plant and
    equipment at the Mountain Pass facility is over 20 years old,
    substantially all of which will be replaced or refurbished as
    part of our modernization effort. We expect to expand the
    open-pit mine both laterally to the west, southwest and north as
    well as deepening vertically. In addition to the existing
    overburden stockpile located west of the pit, which will serve
    as the initial overburden stockpile when mining recommences, we
    will need to construct additional overburden stockpiles to the
    north or east of the pit
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to provide additional storage capacity sufficient to accommodate
    the remaining overburden material for the existing permitted
    life of the mine.
In connection with our modernization and expansion efforts at
    the Mountain Pass facility, we expect to build new facilities,
    including the construction of a control lab, additional
    warehousing and raw material storage facilities. We had
    initially planned to add facilities and equipment for metal
    conversion and alloy production, but we have entered into a
    letter of intent to acquire a producer of rare earth metals and
    alloys located off-site, which would obviate the need for such
    facilities and equipment at the Mountain Pass facility. We also
    expect to build a new paste tailings operation and new roads at
    the Mountain Pass facility. Although the operating cost of the
    paste tailings operation is expected to be greater than it would
    be for a tailings pond, which is the method prior owners used at
    the Mountain Pass facility, we expect that the increased water
    recycling and reduced environmental risks associated with the
    paste tailings facility will ultimately mitigate that additional
    cost.
In addition, we intend to produce hydrochloric acid and sodium
    hydroxide at our own chlor-alkali plant at the Mountain Pass
    facility, thereby reducing our reliance on external sources of
    reagents. While the production of our own hydrochloric acid and
    sodium hydroxide will utilize proven technologies, these
    technologies have not yet been implemented in the rare earth
    industry. Not only would the chlor-alkali plant reduce our need
    for external sources of reagents, but it would also reduce our
    production of waste salt water. Previous owners of the Mountain
    Pass facility disposed of waste salt water in evaporation ponds
    on the Ivanpah dry lake bed, which is no longer an available
    option for the Mountain Pass facility. Accordingly, waste water
    must be dealt with in a different manner. We intend to utilize
    our chlor-alkali plant to convert waste salt water to
    hydrochloric acid and sodium hydroxide, which will be recycled
    into the process. Through this process, approximately
    913 million pounds of water and 101 million pounds of
    salt would be recycled back to the chlor-alkali plant per year.
    This process would avoid the need for disposal of waste salt
    water in evaporation ponds. Additionally, because the water is
    internally recycled, the need for fresh water to run the
    Mountain Pass processing facilities would be dramatically
    reduced.
Following the completion of our modernization and expansion
    efforts, we expect to have the ability to mine, crush, mill and
    separate 2,000 tons of rare earth ore per day to produce
    individual REOs that meet or exceed industry standards for
    purity. However, we will only need to process 1,100 to 1,500
    tons of rare earth ore per day to meet our production goals. In
    addition, as part of our
"mine-to-magnets"
strategy, we have entered into a letter of intent to acquire a
    third-party producer of rare earth metals and alloys in NdFeB
    magnet the United States, which acquisition would provide us
    with a license to the technology required to process and
    manufacture rare earth metals, compositions containing rare
    earth metals and rare earth alloys, including the rare earth
    alloys used in NdFeB and samarium cobalt magnet production. We
    also expect to build a magnet production and finishing facility
    as part of a joint venture with an existing magnet producer to
    produce finished NdFeB magnets in the United States and plan to
    begin producing finished NdFeB magnets by the end of 2012. We
    are working to identify and develop new downstream opportunities
    for the REOs and rare earth alloys we produce.
Our facilities currently rely on electricity provided by
    Southern California Edison. Due to its position on the regional
    electric grid, the Mountain Pass facility can experience power
    shortages during peak periods. Instability in electrical supply
    in past years has caused sporadic outages and brownouts. Such
    outages and brownouts have had a negative impact on our
    production. In connection with our modernization and expansion
    efforts at the Mountain Pass facility, we expect to build a new
    22 megawatt co-generation power plant that will use natural gas
    to provide reliable electricity and steam to our facilities. The
    completion of the co-generation power plant is dependent on
    several factors, including obtaining the permits required to
    build and operate the co-generation power plant. Following the
    completion of the co-generation power plant, we expect it to
    provide 100% percent of our production power requirements and
    95% of our overall power requirements.
Numerous other governmental permits and approvals are required
    in order for us to proceed with our modernization and expansion
    efforts. These include a conditional use permit and reclamation
    plan approval, air permits, water usage permits, an agreement
    and permit to alter the streambeds affected by our new plant
    site or a natural gas pipeline, various building permits and
    permits related to the use and storage of radioactive
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or hazardous materials. See "— Environmental,
    Health and Safety Matters" for a detailed discussion of
    certain of the permits, licenses and approvals we will be
    required to obtain or maintain.
The bastnasite ore body at the Mountain Pass facility has been
    mined as a principal source of REEs for over 50 years. The
    currently defined zone of REE mineralization exhibits a strike
    length of approximately 2,750 feet in a north-northwest
    direction and extends for approximately 7,000 feet down dip
    from surface. The true thickness of the greater than 3.0% REO
    zone ranges from 15 feet to 250 feet. The percentage
    of each rare earth material contained in the Mountain Pass
    facility bastnasite ore is estimated to be as follows:
Estimated
Percentage of
Element
Bastnasite Ore
Cerium
48.8
%
Lanthanum
34.0
%
Neodymium
11.7
%
Praseodymium
4.2
%
Samarium
0.79
%
Gadolinium
0.21
%
Europium
0.13
%
Dysprosium
0.05
%
Other REE (including Terbium)
0.12
%
Rare
    Earth Reserves and Non-Reserve Deposits
As of February 6, 2010, SRK Consulting, an independent
    consulting firm that we have retained to assess our reserves,
    estimates total proven and probable reserves based on historic
    and estimated recoveries of 2.21 billion pounds of REO,
    with an average ore grade of 8.24%, using a cut-off grade of
    5.0%.
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SEC
    Guidelines
The SEC has established guidelines contained in Industry Guide
    No. 7 to assist registered companies as they estimate ore
    reserves. These guidelines set forth technical, legal and
    economic criteria for determining whether our ore reserves can
    be classified as proven and probable.
"Reserves" are defined by the SEC Industry Guide 7 as
    that part of a mineral deposit that could be economically and
    legally extracted or produced at the time of the reserve
    determination. SEC Industry Guide 7 divides reserves between
    "proven reserves" and "probable reserves,"
    which are defined as follows:
•
"Proven reserves" are reserves for which:
•
quantity is computed from dimensions revealed in outcrops,
    trenches, workings or drill holes; grade
and/or
quality are computed from the results of detailed
    sampling; and
•
the sites for inspection sampling and measurement are spaced so
    closely and the geologic character is so well defined that size,
    shape, depth and mineral content of reserves are
    well-established.
•
"Probable reserves" are reserves for which quantity
    and grade
and/or
quality are computed from information similar to that used for
    proven reserves, but the sites for inspection, sampling, and
    measurement are farther apart or are otherwise less adequately
    spaced. The degree of assurance, although lower than that for
    proven reserves, is high enough to assume continuity between
    points of observation.
Methodology
We currently rely on the interpretations made during prior
    mining campaigns at our Mountain Pass facility, the
    U.S. Geological Survey and various consulting companies,
    including SRK Consulting, to identify the regional and mine area
    geology and hydrogeology, regional and local structure, deposit
    geology, current pit slope stability conditions and REE
    recoveries.
Proven Reserves.
SRK Consulting compiled a
    drillhole database from prior drilling at the Mountain Pass site
    that includes a total of 137 drillholes with a cumulative length
    of 79,453.3 feet. Individual drillholes range in length
    from 56 feet to 2,012 feet, and averaged
    580 feet. The majority of core samples in the deposit area
    analyzed by SRK Consulting range from 50 feet to
    250 feet along strike of the ore body and 150 feet to
    350 feet down dip. The sample data for proven ore reserves
    consists of survey data, lithologic data and assay results.
Based on the review of historic sample preparation and
    analytical procedures, SRK Consulting initiated a sample check
    assay program of 1% of the assay database. The material
    remaining from previous drilling programs consisted of split
    core stored at the Mountain Pass facility. SRK Consulting
    examined the existing split core using third-party preparation
    and analytical laboratories. SRK Consulting determined that the
    overall results of the sample check assay program indicated that
    our historic data was acceptable for use in preparing their
    report. SRK Consulting based the mining cut-off calculation on a
    grade of 5.0% REO given historical performance at the Mountain
    Pass mine and a determination that a cut-off grade below 5.0%
    was relatively sensitive to economic variables.
Probable Reserves.
Probable ore reserves are
    based on longer projections and the maximum distance between
    drill holes is 200 meters. Statistical modeling and the
    established continuity of the bastnasite ore body as determined
    from results of over 50 years of mining activity to date
    support our technical confidence in estimates of tonnage and
    grade over this projection distance. Where appropriate,
    projections for the probable ore reserve determination are
    constrained by any known or anticipated restrictive geologic
    features. SRK generated a resource estimate based on composites
    derived from drillhole sample assay results. Grade interpolation
    was based on the geology, drillhole spacing and geo-statistical
    analysis of the data. The resources were classified by their
    proximity to the sample locations and number of drillholes. SRK
    considers the resource model and resource classification to be
    consistent with Canadian Institute of Mining and Metallurgy
    guidelines.
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The proven and probable ore reserves are then modeled as a
    long-term mine plan and additional factors including recoveries,
    metal prices, mine operating costs and capital estimates are
    applied to determine the overall economics of the ore reserves.
Results
Proven and probable reserves at the Mountain Pass facility as of
    February 6, 2010 are estimated to be approximately
    2.21 billion pounds of REO, with an average ore grade of
    8.24%, using a cut-off grade of 5.0%. We base our REO reserve
    estimates and non-reserve REO deposit information on
    engineering, economic and geological data assembled and analyzed
    by SRK Consulting, which includes various engineers and
    geologists. The Mountain Pass facility has been subject to
    extensive drilling since the beginning of mining operations in
    1952, including drilling data for 152 holes totaling
    83,216 feet. We also maintain detailed geologic logs,
on-site
assay records and databases and geologic cross-sections. Our
    estimates of REO reserves and non-reserve REO deposits as to
    both quantity and quality will be regularly updated to reflect
    new drilling or other data received.
The following table provides information as of February 6,
    2010 on the amount of our proven and probable REO reserves.
Average Ore
Recoverable REO
Category of Reserves
Grade (%)
(Pounds)
Proven
9.38
%
88,000,000
Probable
8.20
%
2,122,000,000
Proven and Probable
8.24
%
2,210,000,000
In making the estimate above, SRK Consulting:
•
assumed full mining recovery;
•
assumed that mine reserves are not diluted and assume
    selectivity in mining;
•
assumed a historic cut-off grade of 5.0% REO within the pit
    design;
•
assumed an average REO mill recovery estimated at 63%;
•
used the 1997 surface topography for volume control of reserves;
    and
•
rounded values to the nearest significant number.
There are numerous uncertainties inherent in estimating
    quantities and qualities of REO reserves and
non-reserve
REO deposits and costs to mine recoverable reserves, including
    many factors beyond our control. We will regularly evaluate our
    REO reserve and non-reserve REO estimates. This will typically
    be done in conjunction with expanded, phased drilling programs.
    Cores are analyzed by geologists to determine mineral types and
    to identify geological anomalies. Samples along the length of
    the core are logged and analyzed for total rare earth content,
    rare earth distribution and mineralogy. This data is entered
    into a master database and statistically analyzed. The resulting
    information is used to enhance the mine plan. We also gain
    information from blast hole cuttings. The estimates of REO
    reserves and non-reserve REO deposits as to both quantity and
    quality will also be updated to reflect new drilling or other
    data received. Estimates of economically recoverable REO
    reserves, however, necessarily depend upon a number of variable
    factors and assumptions, all of which may vary considerably from
    actual results, such as:
•
geological and mining conditions and/or effects from prior
    mining that may not be fully identified by available data or
    that may differ from experience;
•
assumptions concerning future prices of rare earth products,
    operating costs, mining technology improvements, development
    costs and reclamation costs; and
•
assumptions concerning future effects of regulation, including
    the issuance of required permits and taxes by governmental
    agencies.
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Although SRK Consulting assumed pricing levels consistent with
    those estimated by Roskill, a 38% decrease in average REE prices
    from such levels, holding all other variables constant, would
    not materially reduce reserve estimates.
Actual REO tonnage recovered from identified REO reserve and
    non-reserve REO deposit areas and revenues and expenditures with
    respect to the same may vary materially from estimates. These
    estimates may not accurately reflect our actual REO reserves or
    non-reserve REO deposits. Any inaccuracy in our estimates
    related to our REO reserves and non-reserve REO deposits could
    result in lower than expected revenues and higher than expected
    costs.
Additionally, we have recently expanded our
on-site
exploratory drilling program to confirm the existence and extent
    of bastnasite, monazite and other rare earth phosphate mineral
    occurrences in unexplored areas of the Mountain Pass facility.
    This program will also help to establish that our measured,
    indicated and inferred resources can become proven or probable
    reserves.
Customers
We are working to establish stable revenue streams for the rare
    earth minerals and products we produce at the Mountain Pass
    facility. Upon reaching full planned production rates for REOs
    and other planned downstream products at the Mountain Pass
    facility, we expect to produce 19,090 mt of REO per year.
    As of April 1, 2010, we had 19 letters of intent to
    sell our rare earth products, representing approximately 138% of
    our anticipated production for 2013. Over the next two years, we
    intend to enter into short- and long-term sales contracts with
    existing and new customers. For certain REEs where the market
    demand is high, such as europium, we do not expect to enter into
    letters of intent or contracts, given that these REEs can be
    easily sold. None of our existing customer relationships are
    from contracts we assumed from Chevron Mining Inc.
There is a limited market for our lanthanum and our two largest
    customers comprised 82% (55% of the total corresponds to our
    largest customer and 27% of the total corresponds to our second
    largest customer) and 72% (57% of the total corresponds to our
    largest customer and 15% of the total corresponds to our second
    largest customer) of our total product revenue for the year
    ended December 31, 2009 and the period ended
    December 31, 2008, respectively.
Additionally, we have developed
    XSORBX
®
,

    a patented, proprietary product, and process, primarily
    consisting of cerium, to remove arsenic and other heavy metals
    from industrial processing streams that will allow our customers
    to more safely sequester arsenic and increase their production
    of metal products. We are in discussions with multiple large,
    globally diversified mining companies for the sale of
    XSORBX
®
.
We anticipate that the location of the Mountain Pass facility,
    just off the Interstate 15 and along the train route
    leading to the Los Angeles port, will be an advantage in the
    transportation and delivery of our rare earth products to our
    customers as compared to other rare earth mining and development
    projects.
Suppliers
We use significant amounts of hydrochloric acid and sodium
    hydroxide as reagents to process REOs. We ultimately intend to
    produce and recycle our own hydrochloric acid and sodium
    hydroxide at the Mountain Pass facility, however, the technology
    we are developing to internally produce these reagents to
    significantly reduce our dependence on external supplies has not
    yet been implemented. Accordingly, we currently purchase
    hydrochloric acid and sodium hydroxide in the open market
    through multiple suppliers and, as a result, could be subject to
    significant volatility in the cost or availability of these
    reagents, although they are currently in ample supply. We may
    not be able to pass increased prices for these reagents through
    to our customers in the form of price increases. A significant
    increase in the price of these reagents, or limited availability
    of such materials, could materially increase our operating costs
    and adversely affect our profit margins from quarter to quarter.
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Patents,
    Trademarks and Licenses
We rely on a combination of trade secret protection,
    nondisclosure and licensing agreements, patents and trademarks
    to establish and protect our proprietary intellectual property
    rights. We utilize trade secret protection and nondisclosure
    agreements to protect our proprietary rare earth technology. We
    also have a proven technology and product development group and
    as of April 1, 2010, held 18 issued and pending
    U.S. patents and patent applications, and 146 issued and
    pending foreign patents and patent applications. We intend to
    rely on patented products, such as
    XSORBX
®
,

    and related licensing agreements to establish proprietary
    markets for low demand REEs. These intellectual property rights
    may be challenged or infringed upon by third parties or we may
    be unable to maintain, renew or enter into new license
    agreements with
third-party
owners of intellectual property on reasonable terms. In
    addition, our intellectual property will be subject to
    infringement or other unauthorized use outside of the United
    States. In such case, our ability to protect our intellectual
    property rights by legal recourse or otherwise may be limited,
    particularly in countries where laws or enforcement practices
    are undeveloped or do not recognize or protect intellectual
    property rights to the same extent as the United States.
    Unauthorized use of our intellectual property rights or
    inability to preserve existing intellectual property rights
    could adversely impact our competitive position and results of
    operations.
Competition
In 2008, global production of rare earth products was estimated
    at 124,000 mt of REO. China accounted for approximately 97% of
    this total. The majority of the remaining production in 2009 was
    from Mountain Pass and Russia. Although exploration programs for
    REEs exist outside of China, Russia, Mountain Pass and
    Australia, none of the deposits that are the subject of these
    programs is currently in production and, according to IMCOA, it
    may take ten years or more following the discovery of additional
    REE deposits before such deposits are brought into production.
Once we reach full planned production rates for REOs and other
    planned downstream products, the increased competition may lead
    our competitors to engage in predatory pricing behavior. Any
    increase in the amount of rare earth products exported from
    other nations, and increased competition, whether legal or
    illegal, may result in price reductions, reduced margins and
    loss of potential market share, any of which could materially
    adversely affect our profitability. As a result of these
    factors, we may not be able to compete effectively against
    current and future competitors.
Research
    and Development
We have invested significant resources to improve the efficiency
    of our REO processing operations and the development of new
    applications for individual REEs. As of December 31, 2009,
    our product development group consisted of 17 scientists and
    engineers. In addition, we spent $1.5 million for the year
    ended December 31, 2009 and $0.4 million for the
    period ended December 31, 2008 on research and development.
Environmental,
    Health and Safety Matters
We are subject to numerous and detailed, federal, state and
    local laws, regulations and permits affecting the mining and
    mineral processing industry, including those pertaining to
    employee health and safety, environmental permitting and
    licensing, air quality standards, GHG emissions, water
    pollution, waste management, plant and wildlife protection,
    handling and disposal of radioactive substances, remediation of
    soil and groundwater contamination, land use, reclamation and
    restoration of properties, the discharge of materials into the
    environment and groundwater quality and availability. These
    laws, regulations and permits have had, and will continue to
    have, a significant effect on our results of operations and
    competitive position and have tended to become increasingly
    stringent over time. Future laws, regulations or permits, as
    well as the interpretation or enforcement of existing
    requirements, may require substantial increases in capital or
    operating costs or otherwise delay, limit or prohibit our
    current or future operations. Our management team and employees
    have a significant amount of experience working with various
    federal, state and local authorities to
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address compliance with such laws, regulations and permits.
    However, we cannot assure you that we have been or will be at
    all times in compliance with such requirements.
We expect to incur approximately $3 million per year in
    2010 and 2011 for ongoing operating environmental expenditures,
    including salaries, monitoring, compliance, reporting and
    permits. In addition, we plan to invest significant capital in
    certain infrastructure, including iron and lead removal
    equipment in our processing facilities, a chlor-alkali plant, a
    co-generation power plant and a paste tailings plant and related
    storage facility. Our planned chlor-alkali plant is expected to
    reduce the amount of waste salt water that otherwise would be
    produced by our processing facilities and eliminate the need for
    evaporation ponds to dispose of this waste water. Our planned
    co-generation power plant is expected to increase the energy
    efficiency of our Mountain Pass facility by generating steam
    with waste heat from the power generation process. Our planned
    paste tailings plant and related storage facility are expected
    to increase the extent of our water recycling and present lower
    environmental risks than storing tailings in ponds. We expect to
    invest approximately $187 million in these capital projects
    from 2010 to 2012, in addition to the costs of air emissions
    offset credits, which may become necessary.
Permits
    and Approvals
Numerous governmental permits and approvals are required for our
    current and future operations. We hold a 30 year mine plan
    permit and an associated environmental impact report, both of
    which were issued in 2004 in connection with our conditional use
    permit from San Bernardino County. We hold numerous other
    permits and approvals, including permits to operate from the
    Lahontan Regional Water Quality Control Board and orders for
    wastewater treatment and other facilities. Our ability to build
state-of-the-art
processing facilities at Mountain Pass depends upon obtaining
    the necessary installation and operation permits from a variety
    of governmental entities. In connection with our planned
    expansion, we will be required to obtain permit modifications
    and additional permits for new and replacement processing
    facilities and utilities, including a chlor-alkali plant and
    co-generation power plant, and also may be required to prepare a
    risk management plan in connection with the storage of ammonia
    for use at the planned co-generation power plant. To obtain,
    maintain and renew these and other environmental permits, we may
    be required to conduct environmental studies and collect and
    present to governmental authorities data pertaining to the
    potential impact that our current or future operations may have
    upon the environment.
We may be unable to obtain permits unless we are able to avoid
    or mitigate those impacts, particularly impacts to desert flora
    and fauna. The permitting processes and development of
    supporting materials, including any environmental impact
    statements, may be costly and time consuming. Any failure to
    obtain, maintain or renew required permits, or other permitting
    delays or conditions, may delay, limit or prohibit current or
    future operations. Consequently, the expansion and modernization
    of the Mountain Pass facility may be delayed, curtailed or
    prevented, particularly in the event any environmental impact
    statement is required in connection therewith. These permit
    processes and requirements, and the interpretation and
    enforcement thereof, change frequently, and any such future
    changes could materially adversely affect our mining operations
    and results of operations.
Mine
    Health and Safety Laws
The Federal Mine Safety and Health Act of 1977, as amended by
    the Mine Improvement and New Emergency Response Act of 2006, and
    the regulations adopted by the California Occupational Safety
    and Health Administration, impose stringent health and safety
    standards on numerous aspects of mining operations, including
    training of mine personnel, mining procedures, blasting, the
    equipment used in mining operations and other matters. As a
    result of increasing scrutiny surrounding mine safety, federal
    and state legislatures and other regulatory authorities have
    imposed more stringent regulatory requirements on mining
    operations. In 2006, the MSHA promulgated new emergency rules on
    mine safety that address mine safety equipment, training and
    emergency reporting requirements. The U.S. Congress enacted
    the Mine Improvement and New Emergency Response Act of 2006,
    which significantly amended the Federal Mine Safety and Health
    Act of 1977, requiring improvements in mine safety practices,
    increasing criminal penalties and establishing a maximum civil
    penalty for non-compliance, and expanding the scope of federal
    oversight, inspection and
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enforcement activities. The MSHA published final rules
    implementing the Mine Improvement and New Emergency Response Act
    to revise both the emergency rules and the MSHA's existing
    civil penalty assessment regulations, which resulted in an
across-the-board
increase in penalties from the existing regulations.
Since July 2005, the Mountain Pass facility has not had a
    lost-time accident and has received the coveted "Sentinels
    of Safety" award from the MSHA for three of the last four
    years. Lost-time incidence rate is an industry standard used to
    describe occupational injuries that result in loss of one or
    more days from an employee's scheduled work. Our lost-time
    incidence rate for all operations for the year ended
    December 31, 2009 was zero as compared to the national
    average of 1.78 for the same period, as reported by the MSHA.
Workers'
    Compensation
Although, as of April 1, 2010, the Mountain Pass Facility
    has not experienced a lost-time workplace injury since
    July 11, 2005, we are required to compensate employees for
    work-related injuries. The states in which we operate consider
    changes in workers' compensation laws from time to time. We
    are insured under various state workers' compensation
    programs for our operations at the Mountain Pass facility, our
    offices in Greenwood Village, Colorado and the State of
    Washington.
Surface
    Mining Control and Reclamation
Our San Bernardino County conditional use permit, approved
    mining plan and state laws and regulations establish
    operational, reclamation and closure standards for all aspects
    of our surface mining operations. Comprehensive environmental
    protection and reclamation standards must be met during the
    course of and upon completion of mining activities, and our
    failure to meet such standards may subject us to fines,
    penalties or other sanctions.
Although we expect the Mountain Pass facility to remain open for
    significantly longer than 30 years, our
30-year
mine
    plan requires that we restore the surface area upon completion
    of mining. Financial assurances are generally required to secure
    the performance of these reclamation obligations. To satisfy
    these financial assurance requirements, we typically obtain
    surety bonds, which are renewable on a yearly basis. Although we
    expect to continue to obtain and renew such bonds, it has become
    increasingly difficult for mining companies to secure new or
    renew existing surety bonds without the posting of partial or
    full collateral. In addition, surety bond costs have increased
    while the market terms of surety bonds have generally become
    less favorable. It is possible that surety bond issuers may
    refuse to provide or renew bonds or may demand additional
    collateral upon those issuances or renewals. Our inability to
    obtain or failure to maintain or renew these bonds could have a
    material adverse effect on our business and results of
    operations.
As of December 31, 2009, there was approximately
    $27 million in surety bonds to secure the performance of
    our reclamation obligations.
Water
    Usage and Pollution Control
The federal Clean Water Act and similar state and local laws and
    regulations affect surface mining and processing operations by
    imposing restrictions on the discharge of pollutants, including
    tailings and other material, into waters of the United States.
    These requirements are complex and subject to amendments, legal
    challenges and changes in implementation. Recent court
    decisions, regulatory actions and proposed legislation have
    created uncertainty over the jurisdiction and permitting
    requirements of the federal Clean Water Act. Individual or
    general permits under Section 404 of the Clean Water Act
    are required if we discharge dredged or fill materials into
    jurisdictional waters of the United States. In addition, our
    Lahontan Regional Water Quality Control Board permit establishes
    treatment standards for wastewater discharges to evaporation
    ponds. Regular monitoring by the Lahontan Regional Water Quality
    Control Board, as well as compliance with reporting requirements
    and performance standards, are preconditions for the issuance
    and renewal of our permits.
Our operations require significant quantities of water to
    process REOs. As part of the modernization and expansion of the
    Mountain Pass facility, we expect to significantly reduce our
    need for fresh water by
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recycling available water resources. Current design
    specifications for our modernization project indicate an
    approximately 90% reduction of fresh water consumption as
    compared to water consumption in the
mid-1990's,
when the mine was producing 20,000 mt of REO per year.
Air
    Pollution Control
The federal Clean Air Act and similar state and local laws and
    regulations affect our surface mining and processing operations
    both directly and indirectly. We currently operate and maintain
    numerous air pollution control devices under permits from the
    California Mojave Desert Air Quality Management District. We
    generally must obtain permits before we install new sources of
    air pollution, which may require us to do air quality studies
    and obtain emission offset credits, which can be costly and time
    consuming to procure. We expect that our new and expanded
    facilities will require us to obtain emission credits or offsets
    for nitrogen oxides, particulate matter (10 microns), sulfur
    oxide and volatile organic compounds. The increased emissions
    from these facilities may trigger permitting under Title V
    of the Clean Air Act. In addition, the regulations of the
    California Air Resources Board will require us to retrofit or
    replace off-road, on-road and forklift vehicles to achieve
    emission standards for nitrogen oxides and particulate matter
    (10 microns).
Our operations also emit GHGs. Pursuant to existing GHG
    requirements, we expect that following the expansion of the
    Mountain Pass facility we will be required to report annual GHG
    emissions from our operations. Additional GHG emission related
    requirements are in various stages of development. For example,
    the U.S. Congress is considering various legislative
    proposals to address climate change, including a nationwide
    limit on GHGs. In addition, the EPA has issued vehicle emissions
    regulations that would subject GHG emissions from stationary
    sources to the Prevention of Significant Deterioration and
    Title V provisions of the federal Clean Air Act. California
    also may establish GHG emission regulations pursuant to its
    Global Warming Solutions Act. If made effective, any such
    regulations could require us to modify existing permits or
    obtain new permits, implement additional pollution control
    technology, curtail operations or increase significantly our
    operating costs. Any regulation of GHG emissions, including
    through a
cap-and-trade
system, technology mandate, emissions tax, reporting requirement
    or other program, could adversely affect our business, financial
    condition, reputation, operating performance and product demand.
    However, such regulations might also present opportunities for
    our industry to the extent they increase the demand for rare
    earth products used in clean-technology applications, such as
    hybrid and electric vehicles and wind power turbines.
The Mountain Pass facility consumes significant amounts of
    energy and, accordingly, is subject to fluctuations in energy
    costs. These costs may increase significantly in part as an
    indirect result of GHG and other air emission regulations
    applicable to third-party power suppliers.
Hazardous
    and Radioactive Substances and Wastes
CERCLA and analogous state laws impose liability, without regard
    to fault or the legality of the original conduct, on certain
    classes of persons that are considered to have contributed to
    the actual or threatened release of a "hazardous
    substance" into the environment. Persons who are or were
    responsible for such releases of hazardous substances under
    CERCLA, which can include waste generators, site owners, lessees
    and others, may be subject to joint and several liability for
    the costs of remediating such hazardous substances and for
    damages to natural resources. Accordingly, we may be subject to
    liability under CERCLA and similar state laws for properties
    that we currently own, lease or operate or that we or our
    predecessors have previously owned, leased or operated, and
    sites to which we or our predecessors sent waste materials.
    Pursuant to a 1998 clean up and abatement order issued by the
    Lahontan Regional Water Quality Control Board, we have conducted
    and are continuing to conduct various investigatory, monitoring
    and remedial activities related to contamination at and around
    the Mountain Pass facility. These activities include the
    operation of groundwater monitoring and recovery wells, water
    treatment systems and evaporation ponds. Although Chevron Mining
    Inc. is obligated to indemnify us for certain potential
    environmental losses associated with activities that occurred
    prior to our purchase of the Mountain Pass facility, the amount
    of such indemnity is limited and may not be sufficient to cover
    such losses.
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In 2009, the EPA announced that it is developing financial
    responsibility requirements under CERCLA for certain facilities
    within the hardrock mining industry. If applicable to our
    current or future operations, these requirements could impose on
    us significant additional costs or obligations.
REOs contain naturally occurring radioactive substances, such as
    thorium and uranium. The mining and processing of REOs involves
    the handling and disposal of such substances, and accordingly we
    are subject to extensive safety, health and environmental laws,
    regulations and permits regarding radioactive substances.
    Significant costs, obligations or liabilities may be incurred
    with respect to such requirements, and any future changes in
    such requirements (or the interpretation or enforcement thereof)
    may have a material adverse effect on our business or results of
    operations. One such permit pursuant to which we currently
    operate is a Radioactive Materials License issued and
    administered by the California Department of Health Services
    Radiologic Health Branch. The license applies to the use of
    sealed radioactive sources used for gauging volumes of
    materials, as well as certain other activities. A failure to
    maintain or renew this license could materially adversely affect
    our business or results of operations.
We generate, manage and dispose of solid and hazardous waste.
    Demolition of structures in connection with facility expansion
    and modernization generates waste in addition to that associated
    with processing and remediation activities. In connection with
    our modernization and expansion effort at the Mountain Pass
    facility, we will incur additional costs to handle, store and
    dispose of such wastes.
Endangered
    Species Act
The federal Endangered Species Act and counterpart state
    legislation protect species threatened with possible extinction.
    Such laws and related regulations may have the effect of
    prohibiting or delaying us from obtaining mining permits and may
    impose restrictions on pipeline or road building and other
    mining or construction activities in areas containing the
    affected species or their habitats. Several species indigenous
    to Mountain Pass, California, including the desert tortoise, are
    protected under the Endangered Species Act and California
    Endangered Species Act.
Use of
    Explosives
In connection with our surface mining activities, we use
    explosives, which are subject to regulation, including under the
    federal Safe Explosives Act. Violation of these regulatory
    requirements may result in fines, imprisonment, revocation of
    permits
and/or
seizure or forfeiture of explosive materials.
Other
    Environmental Laws
We are required to comply with numerous other federal, state and
    local environmental laws and regulations in addition to those
    previously discussed. These additional laws include, for
    example, the California Environmental Quality Act, the National
    Environmental Policy Act, the Emergency Planning and Community
Right-to-Know
Act and the California Accidental Release Prevention Program.
Facilities
    and Employees
We own the Mountain Pass facility. We also lease our executive
    office space at 5619 Denver Tech Center Parkway,
    Suite 1000, Greenwood Village, Colorado, which lease
    expires November 2011, subject to a renewal option.
As of December 31, 2009, we had 116 employees. In
    connection with our ongoing modernization and expansion efforts
    at the Mountain Pass facility, we expect to hire additional
    employees by the end of 2012. As of December 31, 2009, 60
    of our employees were represented by the United Steelworkers of
    America. Our contract with the United Steelworkers of America
    expires in 2012. We have not experienced any work stoppages and
    consider our employee relations to be good.
Legal
    Proceedings
From time to time, we may become subject to various legal
    proceedings that are incidental to the ordinary conduct of our
    business. We are not currently party to any legal proceedings.
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MANAGEMENT
Executive
    Officers and Directors
The following table sets forth certain information regarding the
    individuals who are expected to be our executive officers and
    directors as of the consummation of this offering.
Name
Age
Position
Mark A. Smith
51
President, Chief Executive Officer and Director
James S. Allen
43
Chief Financial Officer
John L. Burba, PhD
58
Executive Vice President and Chief Technology Officer
John F. Ashburn, Jr.
55
Executive Vice President and General Counsel
Ksenia A. Adams
28
Corporate Controller
Russell D. Ball
41
Director
Ross R. Bhappu
50
Chairman of the Board
Brian T. Dolan
69
Director
Charles R. Henry
72
Director
Mark S. Kristoff
48
Director
Alec Machiels
37
Director
Jack E. Thompson
60
Director
Executive
    Officers
Mark A. Smith
has been our Chief Executive Officer and
    has served as a Director since October 2008 and our President
    since March 2010. From April 2006 until October 2008,
    Mr. Smith was president and chief executive officer of
    Chevron Mining Inc., a wholly-owned subsidiary of Chevron
    Corporation, and from August 2005 until April 2006 he was vice
    president of Chevron Mining Inc. In his positions at Chevron
    Mining Inc., Mr. Smith was responsible for
    1,500 employees, approximately $500 million in
    revenue, three coal mines, one molybdenum mine and the Mountain
    Pass rare earth mine. From June 2000 until August 2005,
    Mr. Smith was a vice president for Unocal Corporation, an
    oil and gas exploration and production company, that previously
    owned the Mountain Pass facility, where he was responsible for
    managing all real estate, remediation, mining and carbon groups.
    Mr. Smith has served on the board of directors of Avanti
    Mining Inc., a molybdenum mining company, since November 2009.
    Mr. Smith received his B.S. degree in agricultural
    engineering from Colorado State University in 1981 and his J.D.,
    cum laude, from Western State University School of Law in 1990.
    Mr. Smith's broad experience in the rare earths mining
    industry and deep understanding of the operations at our
    Mountain Pass facility make him a valuable member of our
    management and board of directors.
James S. Allen
has been our Chief Financial Officer since
    December 2009. From October 2005 until April 2009,
    Mr. Allen was an audit partner at KPMG LLP, a public
    accounting firm, and from June 2002 until September 2005,
    Mr. Allen was an audit senior manager at KPMG. During his
    time at KPMG, Mr. Allen was responsible for the
    professional development of managers and staff, the execution of
    audit engagements and other projects in accordance with firm and
    professional standards, as well as various other business
    development and administrative matters including maintenance of
    client relationships. A Certified Public Accountant,
    Mr. Allen received his B.S. degree in business
    administration — accounting from Colorado State
    University in 1989.
John L. Burba, PhD
has been our Chief Technology Officer
    since October 2008, and was promoted to the position of
    Executive Vice President and Chief Technology Officer in
    September of 2009. From August 2005 until October 2008,
    Mr. Burba was vice president of technology at Chevron
    Mining Inc., where he was involved in identifying and developing
    technologies for Chevron Mining's businesses, including
    coal, molybdenum and rare earths. From July 2002 until August
    2005, Mr. Burba was vice president of technology
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at Molycorp Inc., a subsidiary of Unocal Corp. Mr. Burba
    received his B.S. degree in chemistry in 1974, his M.S. in
    physical chemistry in 1976 and his PhD in physical chemistry
    from Baylor University in 1979.
John F. Ashburn, Jr.
has been General Counsel,
    Secretary and Executive Vice President since December 2008. From
    August 2005 until November 2008, Mr. Ashburn was senior
    counsel of Chevron Mining Inc. From April 1990 until August
    2005, Mr. Ashburn was senior counsel of Unocal Corporation,
    an oil and gas exploration and production company.
    Mr. Ashburn received his B.S. degree in psychology from
    Northern Illinois University in 1976 and his J.D. from Northern
    Illinois University School of Law in 1980.
Ksenia A. Adams
has been our Corporate Controller since
    July 2009. From May 2007 until July 2009, Ms. Adams was an
    audit manager with KPMG LLP. From October 2002 until May 2007,
    Ms. Adams was a senior member of the audit staff of KPMG.
    Ms. Adams is a certified public accountant and received her
    B.S. degree in accounting from Colorado State University in 2002.
Directors
Russell D. Ball
has been a Director since March
    2010.  Since July 2007, Mr. Ball has been the
    Chief Financial Officer and since October 2008, he has been
    the Executive Vice President of Newmont Mining Corporation, a
    gold mining and production company. Before becoming Chief
    Financial Officer, Mr. Ball held a variety of senior
    positions with the Newmont Mining Corporation, including Vice
    President and Controller from 2004 until 2007. Mr. Ball is
    both a chartered accountant in South Africa and a Certified
    Public Accountant in the United States. Mr. Ball brings a
    unique and important understanding of finance and accounting in
    the international mining industry to our board of directors.
Ross R. Bhappu
has been our Chairman of the Board since
    September 2008. Since 2005, Mr. Bhappu has been a partner
    with Resource Capital Funds, a series of private equity funds
    investing exclusively in the mining and minerals industry, and
    from 2001 until 2005 Mr. Bhappu was vice
    president/principal of Resource Capital Funds. Mr. Bhappu
    has served on the board directors of EMED Mining Public Ltd., a
    copper mining company, since October 2008, and he has been a
    director of Traxys S.A., a metal trading and distribution
    company, since January 2007. Previously, Mr. Bhappu served
    on the board of directors of Constellation Copper Corporation, a
    copper mining company, from July 2002 until November 2007 and
    Anglo Asian Mining, a gold mining company, from November 2005
    until September 2006. Mr. Bhappu has prior experience
    constructing and operating complex mining and processing
    operations as well as mining related merger and acquisition
    activities. He was previously employed by Newmont Mining
    Corporation, GTN Copper Corporation and Cyprus Minerals Company.
    With his comprehensive knowledge of the mining industry and his
    extensive board experience, Mr. Bhappu is a key member of
    our board of directors.
Brian T. Dolan
has been a Director since September 2008.
    Mr. Dolan has been a partner of RCF Management, L.L.C., a
    company that provides management services to the several
    Resource Capital Funds, since January 2002. Mr. Dolan is
    currently serving as a member of the board of directors of the
    following companies: Fund Three Inc.; Fund Four Inc.;
    Fund Five Inc.; American Tripoli, Inc.; CDU Drilling Pty
    Ltd.; Connors Drilling LLC; Dampier International; Dampier
    Master Fund; NYCO Mexico; NYCO Minerals LLC; RCF IV Speedwagon
    Inc.; Resource Capital Funds Foundation; Rolling Rock Minerals,
    Inc.; and Sanderson Drilling Pty. Mr. Dolan is also
    currently serving in the following executive officer positions:
    assistant secretary of American Tripoli, Inc.; secretary of HR
    Lincoln Holdings, Inc.; vice president and assistant secretary
    of NYCO Minerals LLC; vice president and secretary of RCF IV
    Speedwagon, Inc.; vice president of Resource Capital Funds
    Foundation; vice president and secretary of Rolling Rock
    Minerals, Inc.; vice president and secretary of Tarn Drilling
    LLC; and vice president and secretary of Tecate Minerals LLC.
    Mr. Dolan's extensive and ongoing experience as
    director of a wide spectrum of companies makes him a vital part
    of our board of directors.
Charles R. Henry
has been a Director since August 2009.
    Mr. Henry is currently the president of CRH, Inc., a
    consulting firm specializing in defense acquisition issues, and
    has been associated with CRH since its formation in 1993. From
    2005 to 2007, Mr. Henry was the chief operating officer of
    CEG Company, a leading producer of wiring harnesses for military
    vehicles. He has served on the board of directors of Gaming
    Partners International, a gaming products company, since June
    2006. Mr. Henry is a retired two-star general who
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served 32 years in the U.S. Army. With his strong
    background in management, Mr. Henry brings significant
    organizational acumen to our board of directors.
Mark S. Kristoff
has been a Director since September
    2008. Since April 2005, Mr. Kristoff has been the chief
    executive officer of Traxys North America, a metal trading and
    distribution company. Before becoming chief executive officer,
    Mr. Kristoff was chief operating officer of Traxys North
    America from January 2003 until April 2005. Mr. Kristoff
    has served as the chief executive officer of Traxys S.A., a
    metal trading and distribution company, since 2005 and as the
    manager of MP Rare, a REE trading and distribution company,
    since 2008. Mr. Kristoff's experience in the trade and
    distribution of metals and REEs provides valuable insight to our
    board of directors regarding existing and potential
    opportunities in the rare earths market.
Alec Machiels
has been a Director since September 2008.
    Mr. Machiels has served as a partner at Pegasus Capital
    Advisors, L.P., a private equity fund manager, since May 2006.
    Prior to becoming a partner at Pegasus, Mr. Machiels was as
    vice president from June 2004 until May 2006 and an associate
    from August 2002 until June 2004. Mr. Machiels served as a
    member of the board of directors of Coffeyville Resources, LLC,
    an oil refinery and ammonia plant in Coffeyville, KS, from 2003
    until 2005 as well as a member of the board of directors of
    Merisant Company, a manufacturer and distributor of sugar
    substitute sweeteners, from 2005 until 2008. He has served on
    the board of directors of Traxys S.A., a global metal trading
    and distribution company, since January 2006. He started his
    career as a financial analyst in the Financial Services Group at
    Goldman Sachs International in London and in the Private Equity
    Group at Goldman, Sachs & Co. in New York from July
    1996 until June 1999. From July 2001 to July 2002,
    Mr. Machiels served as chief executive officer and chairman
    of Potentia Pharmaceuticals, Inc. Mr. Machiels attended
    Harvard Business School from August 1999 to June 2001 and
    received an MBA. Mr. Machiels also received a masters in
    law from KU Leuven Law School in Belgium and a masters in
    international economics from Konstanz University in Germany. His
    strong background in financial management and investment in
commodity-related
businesses provides our board of directors with a valuable
    perspective on strategic, financial and capital raising matters.
Jack E. Thompson
has been a Director since August 2009.
    From December 2001 until April 2005 he was the vice chairman of
    Barrick Gold Corporation, a gold mining company.
    Mr. Thompson has served as a member of the boards of
    directors of Tidewater, Inc., an offshore oil services company,
    and Century Aluminum Co., an aluminum smelting company, since
    February 2005. He has also served as a member of the board of
    directors of Centerra Gold, Inc., a gold mining company, since
    May 2009 and as a member of the board of directors of Anglo
    American, a mining company, since November 2009. Previously,
    Mr. Thompson served as a member of the board of directors
    of: Stillwater Mining Co., a palladium and platinum mining
    company, from March 2003 until July 2007; Rinker Group Limited,
    a sand and gravel company, from May 2006 until April 2007; and
    Phelps Dodge Corporation, a copper mining company, from January
    2003 until March 2007. Mr. Thompson brings extensive
    knowledge of the mining industry and broad management experience
    to our board of directors.
Board
    Composition
Our certificate of incorporation will provide that our board of
    directors will consist of no less
    than          
    or more
    than          
    persons. The exact number of members on our board of directors
    will be determined from time to time by resolution of a majority
    of our full board of directors. Upon consummation of this
    offering, our board will be divided into three classes, with
    each director serving a
three-year
term and one class being elected at each year's annual
    meeting of stockholders.
,          
    and           will
    serve initially as Class I directors (with a term expiring
    in 2010).
,          
    and           will
    serve initially as Class II directors (with a term expiring
    in 2011).
,          
    and           will
    serve initially as Class III directors (with a term
    expiring in 2012).
Committees
    of Our Board of Directors
Audit
    and Ethics Committee
Our Audit and Ethics Committee is expected to consist of Russell
    Ball, Jack E. Thompson, Alec Machiels and Charles R. Henry as of
    the consummation of this offering. The Audit and Ethics
    Committee,
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among other things, will oversee our accounting practices and
    processes, system of internal controls, independent auditor
    relationships, financial statement audits and audit and
    financial reporting processes. All of the members of our Audit
    and Ethics Committee are expected to be independent under
Rule 10A-3
under the Securities Exchange Act. Each of the committee members
    is financially literate within the requirements of the NYSE and
    Mr.          is
    an audit committee financial expert within the applicable rules
    of the SEC and the NYSE.
Compensation
    Committee
Our Compensation Committee is expected to consist of Jack E.
    Thompson, Mark S. Kristoff and Brian T. Dolan as of
    the consummation of this offering. The Compensation Committee
    will establish and administer our policies, programs and
    procedures for compensating our executive officers and
    directors. The Compensation Committee's duties will
    include, among other things, reviewing and approving executive
    officer compensation and recommending incentive compensation
    plans and equity-based plans. All of the members of our
    Compensation Committee are expected to be independent under the
    rules of the NYSE.
Nominating
    and Corporate Governance Committee
Our Nominating and Corporate Governance Committee is expected to
    consist of Mark S. Kristoff, Ross R. Bhappu and Alec Machiels as
    of the consummation of this offering. The Nominating and
    Corporate Governance Committee will identify individuals
    qualified to become board members, recommend director nominees,
    recommend board members for committee membership, develop and
    recommend corporate governance principles and practices, oversee
    the evaluation of our board of directors and its committees and
    formulate a description of the skills and attributes of
    desirable board members. All of the members of our Nominating
    and Corporate Governance Committee are expected to be
    independent under the rules of the NYSE.
Health,
    Safety and Environment Committee
Our Health, Safety and Environment Committee is expected to
    consist of Charles R. Henry, Brian T. Dolan and Mark A. Smith as
    of the consummation of this offering. The Health, Safety and
    Environment Committee will establish and oversee administration
    of our policies, programs and procedures for ensuring that we
    continue to provide a safe working environment for our
    employees. The Health, Safety and Environment Committee will
    also establish and oversee administration of our policies,
    programs and procedures for ensuring our continued commitment to
    protecting the environment.
Executive
    Committee
Our board of directors is expected to establish an Executive
    Committee that will act, when necessary, in place of our full
    board of directors during periods in which our board of
    directors is not in session. The Executive Committee will be
    authorized and empowered to act as if it were the full board of
    directors in overseeing our business and affairs, except that it
    will not be authorized or empowered to take actions that have
    been specifically delegated to other board committees or to take
    actions with respect to:
•
the declaration of distributions on our capital stock;
•
a merger or consolidation of our company with or into another
    entity;
•
a sale, lease or exchange of all or substantially all of our
    assets;
•
a liquidation or dissolution of our company;
•
any action that must be submitted to a vote of our
    stockholders; or
•
any action that may not be delegated to a board committee under
    our certificate of incorporation or the General Corporation Law
    of the State of Delaware.
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We expect that the Executive Committee will consist of Ross R.
    Bhappu, Mark S. Kristoff and Mark A. Smith.
Compensation
    Committee Interlocks and Insider Participation
Our Compensation Committee is expected to consist of Jack E.
    Thompson, Mark S. Kristoff and Brian T. Dolan as of
    the consummation of this offering. None of these individuals has
    ever been an officer or employee of Molycorp or any of our
    subsidiaries. None of our executive officers serves or have
    served as a member of the compensation committee or other board
    committee performing equivalent functions of any entity that has
    one or more executive officers serving as one of our directors
    or on our Compensation Committee.
Code of
    Ethics
Prior to the consummation of this offering, we will adopt a Code
    of Business Conduct and Ethics applicable to all officers, other
    employees and directors that will become effective upon
    completion of this offering. We intend to post the full text of
    our Code of Business Conduct and Ethics on our website at
    www.molycorp.com promptly following the completion of this
    offering. We intend to disclose future amendments to certain
    provisions of our Code of Business Conduct and Ethics or waivers
    of such provisions applicable to any director, principal
    executive officer, principal financial officer, principal
    accounting officer or controller, or persons performing similar
    functions, on our website identified above. The information on
    or accessible through our website is not a part of this
    prospectus.
Corporate
    Governance Guidelines
Prior to the consummation of this offering, we will adopt
    Corporate Governance Guidelines to assist us with the proper
    management and governance of the activities of our board of
    directors. A complete copy of the Corporate Governance
    Guidelines will be available prior to the consummation of this
    offering on our website at www.molycorp.com. Our Corporate
    Governance Guidelines cover, among other topics:
•
director independence;
•
board structure and composition;
•
board member nomination and eligibility requirements;
•
board leadership and executive sessions;
•
limitations on other board and committee service;
•
committees of the board;
•
director responsibilities;
•
board and committee resources, including access to officers and
    employees;
•
director compensation;
•
director orientation and ongoing education;
•
succession planning; and
•
board and committee self evaluations.
Review
    and Approval of Related-Party Transactions
Following the consummation of this offering, our Audit and
    Ethics Committee will be responsible for the review and approval
    of all related-party transactions required to be disclosed to
    the public under SEC rules. This procedure will be contained in
    the written charter of our Audit and Ethics Committee. In
    addition, we will maintain a written Code of Ethics that will
    require all employees, including our officers, to disclose to
    the Audit and Ethics Committee any material relationship or
    transaction that could reasonably be expected to give
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rise to a personal conflict of interest. Related-party
    transactions will be reviewed and approved by the Audit and
    Ethics Committee on a
case-by-case
basis.
Compensation
    Discussion and Analysis
Executive
    Summary
As further discussed in this section, our compensation and
    benefit programs help us attract, retain and motivate
    individuals who will maximize our business results by working to
    meet or exceed established company or individual objectives.
    This section focuses on our compensation programs for executive
    officers, including the following officers whom we refer to as
    our named executive officers:
Name
Title
Mark A. Smith
President and Chief Executive Officer
James S. Allen
Chief Financial Officer
Ksenia A. Adams
Corporate Controller
John F. Ashburn
Executive Vice President and General Counsel
John L. Burba
Executive Vice President and Chief Technology Officer
Between the time when Molycorp Minerals, LLC acquired the
    Mountain Pass California rare earth deposit and associated
    assets from Chevron Mining Inc. in September 2008 and the
    formation of Molycorp, LLC in September 2009, the board of
    directors of Molycorp Minerals, LLC, our subsidiary,
    historically had the overall responsibility for monitoring and
    approving our executive compensation programs and making
    decisions regarding compensation to be paid or awarded to our
    executive officers. Since September 2009, our board of directors
    has had responsibility for monitoring executive compensation.
    Going forward, our Compensation Committee will administer our
    compensation plans, policies and programs for the named
    executive officers.
The following discussion and analysis of our compensation and
    benefit programs should be read together with the compensation
    tables and related disclosures that follow this section. This
    discussion includes forward-looking statements based on our
    current plans, considerations, expectations and determinations
    about our compensation program. Actual compensation decisions
    that we may make for 2010 and beyond may differ materially from
    those made in our recent past.
Overview,
    Philosophy and Objectives
Our compensation and benefit program seeks to attract and retain
    talented and qualified individuals to manage and lead our
    company and to motivate them to pursue our long-term business
    objectives. In 2009, our compensation program consisted of a mix
    of cash and equity-based components. This mix provided an
    attractive total compensation package that rewarded individual
    and company performance.
We compete with a variety of companies and organizations to hire
    and retain individual talent. As a result, the primary goal of
    our compensation program is to help us attract, motivate and
    retain the best people possible. We implement this philosophy by:
•
encouraging, recognizing and rewarding outstanding performance;
•
recognizing and rewarding individuals for their experience,
    expertise, level of responsibility, leadership, individual
    accomplishment and other contributions to Molycorp;
•
recognizing and rewarding individuals for work that helps
    increase the value of Molycorp; and
•
providing compensation packages that are competitive with those
    offered by companies with whom we compete in hiring and
    retaining talented individuals.
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Executive compensation is a management tool that we use to
    provide reasonable financial security for our executive officers
    in exchange for their service. We also use executive
    compensation to align our executive officers' behavior with
    our mission, business strategy, values and culture.
We have not engaged third-party consultants to assist in the
    formation of our compensation packages. However, going forward,
    our Compensation Committee may retain third-party executive
    compensation specialists in connection with determining cash and
    equity-based compensation and related compensation policies in
    the future.
This Compensation Discussion and Analysis provides you with a
    description of the material factors underpinning our
    compensation policies and decisions for our named executive
    officers. We refer to these policies and decisions as our
    compensation program.
Allocation
    of Compensation Components
Our compensation program consists of the following components:
    base salary, annual cash bonus,
equity-based
awards, health and welfare benefits and retirement benefits.
Compensation
    Administration and Consulting
Role of the Board of Directors of Molycorp Minerals, LLC
    Prior to This Offering.
Until September 10,
    2009, the board of directors of Molycorp Minerals, LLC
    historically had the overall responsibility for monitoring and
    approving our compensation program. After September 10,
    2009, our board of directors has responsibility for monitoring
    executive compensation. The compensation we paid our named
    executive officers for fiscal year 2009 is disclosed in detail
    in the tables and narratives that follow under the heading
    "— Executive Compensation." We describe and
    discuss the particular compensation decisions made by the board
    of directors of Molycorp Minerals, LLC regarding the 2009
    compensation of our named executive officers below under
    "— Primary Components of Executive
    Compensation."
Role of Compensation Consultant.
Neither the
    board of Molycorp Minerals, LLC nor our board of directors
    employed a compensation consultant in 2009.
Role of Executive Officers.
Since the
    acquisition by Molycorp Minerals, LLC from Chevron Mining Inc.
    in September 2008, our President and Chief Executive Officer has
    taken the lead in providing our board of directors, and before
    that, the board of directors of Molycorp Minerals, LLC, with
    recommendations regarding our compensation program and the
    compensation of our named executive officers other than himself.
Role of Compensation Committee after Completion of This
    Offering.
In connection with this offering, we
    will to form a Compensation Committee that will oversee our
    compensation program for the named executive officers. Under the
    rules of the NYSE, our Compensation Committee will be required
    to be composed entirely of independent directors. In addition,
    all members of the Compensation Committee will be
    (i) "non-employee directors" within the meaning
    of
Rule 16b-3
promulgated under the Exchange Act and (ii) "outside
    directors" within the meaning of Section 162(m) of the
    Internal Revenue Code of 1986, as amended, or the Code.
After completion of this offering, the Compensation Committee
    will have the primary responsibility under its charter for:
•
determining, or recommending to our board of directors, our
    President and Chief Executive Officer's compensation and
    compensation for our other executive officers; and
•
administering the equity and incentive compensation plans in
    which our executive officers and other employees participate.
Our Compensation Committee will also generally be responsible
    for evaluating and administering our compensation program to
    ensure that it properly motivates our executive officers and
    appropriately drives our operational and financial performance.
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Each year, our Compensation Committee will review base salaries,
    determine and make annual cash incentive awards, approve payout
    amounts earned for the past year's annual cash incentive
    awards, and determine and make equity incentive awards under the
    Molycorp, Inc. 2010 Equity and Performance Incentive Plan. In
    fulfilling its duties and responsibilities, the Compensation
    Committee will receive input in the form of:
•
reports and updates from our executive officers on company and
    individual executive performance that will be measured against
    quantitative and qualitative performance goals established to
    help determine individual performance and business
    success; and
•
recommendations from our President and Chief Executive Officer
    regarding the compensation for our executive officers.
The Compensation Committee will not be bound by the input it
    receives from our President and Chief Executive Officer or any
    other executive officer. Instead, the Compensation Committee
    will exercise independent discretion when making executive
    compensation decisions.
Compensation
    Program Overview
We believe our compensation program, when judged on a
component-by-component
basis and in total, effectively achieves our compensation
    philosophy and objectives described above. The following chart
    summarizes the primary components of our compensation program
    for 2009:
Component
Primary Purpose
Base Salary
Base salary rewards an individual for his or her position's
    responsibilities, skills, experience and performance.
Base salaries are intended to provide a level of compensation
    sufficient to attract and retain an effective management team,
    when considered in combination with the other components of our
    compensation program. The relative levels of base salary for our
    named executive officers are designed to reflect each executive
    officer's scope of responsibility and accountability with
    us.
Annual Cash Bonuses
Annual cash bonuses are used to reward named executive officers
    for our achievement of superior operating performance.
    Participants in the annual cash bonus plan can achieve bonuses
    equal to a percentage of their salaries in the discretion of our
    board.
Long-Term Equity-Based Awards
Equity-based awards motivate individuals to help achieve an
    increase in stockholder value and promote retention.
Amount realized by the individual depends on appreciation in our
    value.
Awarded based on individual responsibilities and the
    position's organizational value to us.
Health and Welfare Benefits
Health and welfare benefits provide for basic health, life and
    income security needs.
Retirement Benefits
Our 401(k) plan encourages and rewards long-term service by
    providing market-based benefits upon retirement. All employees
    are eligible to participate in our 401(k) plan.
Our nonqualified deferred compensation plan provides a
    tax-efficient vehicle to accumulate retirement savings.
    Participation in our nonqualified deferred compensation plan is
    limited to a select group of other highly compensated
    individuals, including our executive officers
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Primary
    Components of Executive Compensation
2009 Base Salaries.
For 2009, none of our
    executive officers received an increase in base salary compared
    to 2008. The salaries for Mr. Allen and Ms. Adams, who were
    hired in 2009, were determined by our board of directors based
    on the recommendation of our President and Chief Executive
    Officer. These salaries were set at levels designed to attract
    Mr. Allen and Ms. Adams to Molycorp.
Annual Cash Bonuses.
We maintain a Management
    Incentive Plan for our key employees, including our named
    executive officers, pursuant to which we award annual cash
    bonuses based on company performance. Additionally, participants
    can defer a portion of their salaries pursuant to the Management
    Incentive Plan. Bonuses under the Management Incentive Plan are
    purely at the discretion of our board of directors. For 2009,
    our board of directors determined that participants were
    entitled to bonuses equal to 2% of their respective salaries
    based on our performance.
Long-Term Equity-Based Awards.
In September
    2009, the board of directors of Molycorp Minerals, LLC made
    discretionary grants to each of Messrs. Smith, Ashburn and
    Burba of profits interests in Molycorp Minerals, LLC, which we
    refer to as incentive shares, pursuant to Molycorp Minerals,
    LLC's Second Amended and Restated Operating Agreement that
    were designed to provide an opportunity for compensation after
    our initial investors receive their annually compounded return
    and their initial capital contribution. These incentive shares
    represented an indirect ownership interest in Molycorp Minerals,
    LLC, providing the holder with a specified percentage of cash
    distributions from of Molycorp Minerals, LLC from the date of
    grant. The incentive shares were structured as one-time grants
    that we believe immediately aligned the interests of the
    recipients, including Messrs. Smith, Ashburn and Burba,
    with the investors in Molycorp Minerals, LLC and with each
    other. The number of incentive shares awarded to each executive
    officer was determined by the board of directors of Molycorp
    Minerals, LLC commensurate with the executive officer's
    position and responsibilities.
The incentive shares provide the named executive officers who
    received them rights that were parallel to those of other
    indirect owners with respect to future profits of Molycorp
    Minerals, LLC, thereby motivating and rewarding those named
    executive officers for our profitability. In addition, these
    awards provided a retention tool because they were scheduled to
    vest ratably over a three-year period, subject to the applicable
    named executive officer's continued employment on each
    annual vesting date. See the "2009 Grants of Plan-Based
    Awards" table below for more information regarding the
    vesting schedule of the incentive shares held by certain of our
    named executive officers.
All outstanding incentive shares were converted into restricted
    shares of Class B common stock of Molycorp, Inc. in the
    corporate reorganization.
Pursuant to his employment agreement, Mark A. Smith, our
    President and Chief Executive Officer, was granted an option to
    purchase 3,798 of our shares, which was immediately exercisable.
    In granting Mr. Smith the option, we believe that we were
    aligning his interests with those of our other investors.
In connection with this offering, we intend to adopt the
    Molycorp, Inc. 2010 Equity and Performance Incentive Plan so
    that we can continue to provide our named executive officers and
    other employees with equity-based compensation. For details on
    the 2010 Equity and Performance Incentive Plan, see "—
    Molycorp, Inc. 2010 Equity and Performance Incentive Plan."
Health and Welfare Benefits.
Each of our named
    executive officers is entitled to participate in our employee
    benefit plans (including medical, dental, and life insurance
    benefits) on the same basis as other employees.
Retirement Benefits.
We have established a
    401(k) plan for our employees that encourages and rewards
    long-term service by providing market-based benefits upon
    retirement. Each of our named executive officers is entitled to
    participate in our 401(k) plan on the same basis as other
    employees. For more information on our 401(k) plan, please see
    "— Executive Compensation — Retirement
    Plans."
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Our nonqualified deferred compensation plan provides a
    tax-efficient vehicle to accumulate retirement savings. For more
    information on our nonqualified deferred compensation plan,
    please see "— Executive Compensation —
    Nonqualified Deferred Compensation."
Executive
    Compensation
The following table sets forth compensation information
    regarding our President and Chief Executive Officer, Chief
    Financial Officer and each of our three other most highly
    compensated executive officers serving as of December 31,
    2009.
2009
    SUMMARY COMPENSATION TABLE
Non-Equity
Stock
Option
Incentive Plan
All Other
Salary
Bonus
Awards
Awards
Compensation
Compensation
Total
Name and Principal Position
Year
($)
($)(3)
($)
($)
($)
($)
($)
Mark A. Smith,
2009
400,000
8,000
(4
)
241,000
(5)
—
30,245
(6)
679,245
President and Chief Executive Officer
James S. Allen,
2009
12,179
77
—
—
—
—
12,256
Chief Financial Officer(1)
Ksenia A. Adams
2009
52,308
946
—
—
—
—
53,254
Corporate Controller(2)
John F. Ashburn,
2009
215,000
34,900
(4
)
—
—
9,800
(7)
259,700
Executive Vice President and General Counsel
John L. Burba,
2009
213,701
4,274
(4
)
—
—
25,644
(8)
243,619
Executive Vice President and chief Technology Officer
(1)
Mr. Allen was hired on December 9, 2009.
(2)
Ms. Adams was hired on July 27, 2009.
(3)
Represents cash bonuses awarded under our Management Incentive
    Plan, other than $30,000 paid to Mr. Ashburn, which consisted of
    the remaining portion of his signing bonus that was contingent
    upon his employment continuing in 2009.
(4)
On September 10, 2009, our board of directors awarded
    incentive shares of Molycorp Minerals, LLC to certain employees,
    including 2,310,000 shares to Mr. Smith,
    700,000 shares to Mr. Ashburn and 875,000 shares
    to Mr. Burba. Additional information regarding the
    incentive shares, which are intended to constitute "profits
    interests" under IRS Revenue Procedures
93-27
and
2001-43,
is
    included in note 7 to the consolidated financial statements
    included elsewhere in this prospectus.
(5)
The value of this option award represents the amount of
    compensation recognized for financial statement purposes.
    Additional information regarding the determination of the grant
    date fair value of this award and the underlying assumption is
    included in Note 8 to the consolidated financial statements
    included elsewhere in this prospectus.
(6)
Includes $29,400 for employer contributions to our 401(k) plan
    on behalf of Mr. Smith for 2009, and $845 in 2009 for the
    premiums paid on a term life insurance policy for the benefit of
    Mr. Smith.
(7)
Represents employer contributions to our 401(k) plan on behalf
    of Mr. Ashburn for 2009.
(8)
Represents employer contributions to our 401(k) plan on behalf
    of Mr. Burba for 2009.
Employment
    Agreements
We have not entered into employment agreements or severance
    agreements with any of our named executive officers, except for
    Mr. Smith. In connection with the consummation of this
    offering, we anticipate that we will enter into employment
    agreements with certain other of our named executive officers.
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Mark A.
    Smith Employment Agreement
We entered into an executive employment agreement with
    Mr. Smith, our President and Chief Executive Officer, on
    November 1, 2009. The agreement terminates under its own
    term on October 8, 2011, but it can be renewed upon our
    mutual agreement with Mr. Smith. Mr. Smith's
    employment agreement provides for, among other things:
•
an annual base salary of $400,000, subject to increases at our
    discretion;
•
eligibility to participate in our employee benefit plans;
•
eligibility to participate in our annual bonus plan for officers
    and directors;
•
eligibility to participate in our executive nonqualified
    deferred compensation plan; and
•
a term life insurance policy in the amount of $1,000,000 for the
    benefit of Mr. Smith.
If we terminate Mr. Smith's employment without cause,
    Mr. Smith would be entitled to receive any accrued salary
    and vacation pay up to and including the date or termination and
    severance payments in an amount equal to either two years of his
    base salary, if the termination occurs prior to November 1,
    2010, or one year of his base salary, if the termination after
    November 1, 2010.
Under his employment agreement, Mr. Smith is subject to a
    three-year prohibition on "competitive conduct," as
    defined in his agreement, anywhere in the world following the
    termination of his employment for any reason.
The following table sets forth information with respect to
    non-equity and equity incentive plan awards granted to our named
    executive officers during 2009. The Summary Compensation Table
    above provides information regarding the actual dollar amounts
    earned under our incentive plans.
2009
    GRANTS OF PLAN-BASED AWARDS
Other
Exercise
Stock Awards:
Price of
Grant Date
Grant
Incentive Share
Option Awards
Fair Value
Name
Grant Type
Date
Stock Options
Awards(1)
($/Sh)
of Awards($)
Mark A. Smith
option
4/10/09
3,798
$
92.15
240,843
incentive shares
9/10/09
2,310,000
—
James S. Allen
—
—
—
—
—
Ksenia A. Adams
—
—
—
—
—
John F. Ashburn
incentive shares
9/10/09
700,000
—
—
John L. Burba
incentive shares
9/10/09
875,000
—
—
(1)
In connection with the corporate reorganization, all of the
    incentive shares were converted into restricted shares of
    Class B common stock, each of which will convert
    into          
    shares of common stock (based upon an assumed offering price of
    $     per share) immediately prior to
    this offering.
OUTSTANDING
    EQUITY AWARDS AT DECEMBER 31, 2009
The following table provides information about the incentive
    shares held by each of our named executive officers as of
    December 31, 2009.
Number of
Number of
Securities
Securities
Underlying
Underlying
Unexercised
Unexercised
Option
Option
Options
Options
Exercise
Expiration
Name
(#) Exercisable
(#) Unexercisable
Price
Date
Mark A. Smith
3,255(1
)
—
$
92.15
2/1/12
(1)
Options for member interest in Molycorp Minerals, LLC, which
    were assumed by Molycorp, LLC were immediately vested and
    exercisable on the grant date.
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The following table provides information about the incentive
    shares held by each of our named executive officers as of
    December 31, 2009.
Market Value of
Number of Shares or
Shares or Units of
Units of Stock That
Stock That Have Not
Have Not Vested
Vested
Name
(#)(1)
($)
Mark A. Smith
1,540,000
James S. Allen
—
Ksenia A. Adams
—
John F. Ashburn
466,666.66
John L. Burba
583,333.33
(1)
In connection with the corporate reorganization, all of the
    incentive shares were converted into restricted shares of
    Class B common stock, each of which will convert
    into          
    shares of common stock (based upon an assumed offering price of
    $     per share) immediately prior to
    this offering.
2009
    OPTION EXERCISES AND STOCK VESTED
Option Awards
Number of
Shares Acquired on
Value Realized on
Exercise (#)
Exercise ($)
Mark A. Smith
543
$
34,432
Retirement
    Plans
Our named executive officers are eligible to participate in our
    tax-qualified Molycorp Minerals, LLC 401(k) Plan on the same
    basis as other employees under the plan. We make safe harbor
    contributions to this plan equal to 100% of each
    participant's own elective deferrals of up to 3% of each
    participant's salary and 50% of each participant's own
    elective deferrals of the next 2% of the participant's
    salary. We also have the discretion to make annual profit
    sharing contributions that are allocated among all eligible
    participants in proportion to their respective compensation. The
    Summary Compensation Table above reflects the actual dollar
    amounts contributed to our 401(k) plan on each named executive
    officer's behalf.
Nonqualified
    Deferred Compensation
The following table reflects the amounts credited under our
    Management Incentive Plan on behalf of our named executive
    officers. We do not maintain any other nonqualified deferred
    compensation plans.
2009
    NONQUALIFIED DEFERRED COMPENSATION
Executive
Registrant
Aggregate
Aggregate
Contributions
Contributions
Earnings
Aggregate
Balance at
in Last
in Last
in Last
Withdrawals/
Last
Fiscal Year
Fiscal Year
Fiscal Year
Distributions
Fiscal Year End
Name
($)(1)
($)
($)
($)
($)
Mark A. Smith
12,667
—
—
—
—
James S. Allen
77
—
—
—
—
Ksenia A. Adams
946
—
—
—
—
John F. Ashburn
4,900
—
—
—
—
John L. Burba
4,274
—
—
—
—
(1)
The amounts reported are fully reported as part of the
    "Salary" and "Bonus" columns of the Summary
    Compensation Table.
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On April 1, 2009, we established the Management Incentive
    Plan, which is a nonqualified deferred compensation plan for the
    purpose of providing deferred compensation benefits for a select
    group of management or highly compensated employees. Under the
    Management Incentive Plan, participants can defer their base
    salary and any bonus, commission or other extraordinary
    compensation that is supplemental to the participant's base
    salary and is dependent upon achievement of individual or
    company performance goals. It is intended that the Management
    Incentive Plan constitute an unfunded plan for purposes of the
    Employee Retirement Income Security Act of 1974, as amended.
    Pursuant to the Management Incentive Plan, a deferred
    compensation account is established for each participant, as
    determined by the plan's administrative committee. The
    amounts of compensation or awards deferred with respect to each
    deferred compensation account are credited to such account and
    are deemed invested in a hypothetical investment as of the date
    of deferral.
Potential
    Payments upon Termination or Change in Control
We currently do not have any termination or change of control
    agreements with any of our named executive officers, except for
    Mr. Smith as described under "— Employment
    Agreements" above.
Director
    Compensation
Fees Paid
Stock
in Cash
Awards
Name
($)
($)
Total
Jack E. Thompson
25,000
—(1
)
25,000
Charles R. Henry
25,000
—(1
)
25,000
(1)
On September 10, 2009, our board of directors awarded
    350,000 incentive shares of Molycorp Minerals, LLC to each of
    Mr. Thompson and Mr. Henry. Additional information
    regarding the incentive shares, which are intended to constitute
    "profits interests" under IRS Revenue Procedures
93-27
and
2001-43,
is
    included in note 7 to the consolidated financial statements
    included elsewhere in the prospectus.
Our non-employee directors receive an annual cash retainer in
    the amount of $25,000. We anticipate that after the consummation
    of this offering, non-employee directors will also receive an
    annual cash retainer of $5,000 for each committee on which the
    director serves, other than the chairman of the Audit and Ethics
    Committee, who will receive an additional cash retainer of
    $10,000.
Molycorp,
    Inc. 2010 Equity and Performance Incentive Plan
We expect our board of directors to adopt the Molycorp, Inc.
    2010 Equity and Performance Incentive Plan, which we refer to as
    the Plan, prior to the consummation of this offering and subject
    to the approval of our stockholders. The Plan is expected to
    provide for the grant of incentive stock options and
    nonqualified stock options, the grant or sale of restricted
    shares of common stock and restricted stock units, the grant of
    appreciation rights and the grant of performance shares and
    performance units to our non-employee directors, officers and
    other employees. Under the Plan, our board of directors is
    expected to be able to provide for the payment of dividend
    equivalents on a current, deferred or contingent basis, on
    restricted stock units or performance shares granted or sold
    under the Plan. Our board of directors may condition the grant
    of any award under the Plan on a participant's surrender or
    deferral of his or her right to receive a cash bonus or other
    compensation payable by us, so long as such surrender or
    deferral would not result in negative tax consequences under
    Section 409A of the Code.
Options.
Incentive and nonqualified stock
    options have an exercise price of 100% or more of the market
    value of our common stock on the date of grant. No stock option
    will be exercisable more than ten years from its date of grant.
Appreciation Rights.
Participants who are
    awarded stock options may also be granted tandem appreciation
    rights, which may be used as an alternative to exercising the
    stock option. Participants may also be granted free-standing
    appreciation rights, which will entitle them to payments equal
    to a percentage, not to
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exceed 100%, of the difference of the market value per share on
    the exercise date minus the base price, which base price will to
    be equal to or greater than the market value per share on the
    date of grant.
Restricted Stock.
Restricted stock may be
    granted or sold to participants in consideration of the
    performance of services or payments by a participant that may be
    less than the market value of our common stock on the date of
    grant. Each grant or sale is expected to constitute an immediate
    transfer of the ownership of common stock to the participants.
    The restricted shares were subject to a substantial risk of
    forfeiture for a period to be determined by our board of
    directors at the time of grant and such other terms and
    restrictions as provided for by our board of directors.
Restricted Stock Units.
Restricted stock units
    granted or sold to a participant are expected to constitute an
    agreement between the participant and us that we will deliver
    shares of common stock or cash to the participant in the future
    in consideration of the performance of services by the
    participant. The restricted stock units will be subject to the
    fulfillment of the conditions that the board of directors sets
    forth in its grant of the award.
Performance Shares and Performance
    Units.
Performance shares and performance units
    granted to a participant are expected to set forth certain
    management objectives to be achieved during a specified
    performance period. A performance share is a bookkeeping entry
    that represents the equivalent of one share of common stock. A
    performance unit is a bookkeeping entry that represents the
    equivalent of $1.00 or other such value as determined by the
    board of directors. The participant will receive full payment
    upon satisfaction of the management objectives or, short of
    meeting the management objectives, partial payment upon reaching
    a minimum acceptable level of performance.
Shares Reserved; Plan Limits.
We expect
    to
    reserve          
    common shares of our common stock for issuance under the Plan,
    subject to adjustment to prevent dilution or enlargement of the
    rights of participants. The aggregate number of shares that may
    be issued upon the exercise of incentive stock options is not
    expected to
    exceed          
    common shares. The number of shares that may be issued as
    full-value awards is not expected to
    exceed          
    common shares.
Eligibility.
Officers, employees and
    non-employee directors of us and any of our subsidiaries may be
    selected by the board of directors to receive benefits under the
    Plan. Non-employee directors are expected to be subject to
    additional terms and conditions regarding equity awards under
    the Plan. Our board of directors may provide for special terms
    for awards to participants who are foreign nationals or who are
    employed by us outside the United States as our board of
    directors may deem necessary or appropriate to accommodate
    differences in local law, tax policy or custom.
Administration.
Our board of directors is
    expected to administer the Plan and may delegate its authority
    to our Compensation Committee. Our board of directors or the
    Compensation Committee may delegate certain administrative
    powers to one or more of our officers, agents or advisors.
    Delegated officers who are authorized to administer the plan may
    designate employees to be recipients of awards and determine the
    size of the awards so long as this responsibility is not
    delegated for awards granted to "officers," as defined
    by
Rule 16a-1(f)
of the Exchange Act. Such delegation will also be contingent
    upon an authorizing resolution that sets forth the number of
    shares that such officers may grant and periodic reporting by
    such officers to our board of directors regarding the nature and
    scope of the awards granted pursuant to the authority delegated.
Adjustments.
The number and kind of shares
    covered by outstanding awards, certain other provisions
    contained in outstanding awards, the number of shares reserved
    for issuance under the Plan and the other share limits contained
    in the Plan will be subject to adjustment in certain
    transactions or events as provided in the Plan. Moreover, in the
    event of any such transaction or event or in the event of a
    change of control, our board of directors may provide in
    substitution for any or all outstanding awards under the Plan
    such alternative consideration (including cash), if any, as it
    may determine to be equitable in the circumstances. Our board of
    directors may require in connection with such substitution the
    surrender of all awards that are replaced in a manner that
    complies with Section 409A of the Code. In addition, for
    each stock option or stock appreciation right with an option
    price or base price greater than the consideration offered in
    connection with any such
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transaction or event or change of control, our board of
    directors may elect to cancel such stock option or stock
    appreciation right without any payment to the person holding
    such stock option or stock appreciation right.
Amendments.
Our board of directors may at any
    time amend the Plan in whole or in part. However, an amendment
    to the Plan will be subject to stockholder approval if such
    amendment:
•
would materially increase the benefits accruing to participants
    under the Plan;
•
would materially increase the number of securities which may be
    issued under the Plan;
•
would materially modify the requirements for participation in
    the Plan; or
•
must otherwise be approved by our stockholders in order to
    comply with applicable law or the rules of the NYSE or, if our
    common shares are not traded on the NYSE, the principal national
    securities exchange upon which our common shares are traded or
    quoted.
Except in connection with a corporate transaction or event
    described in the Plan, the terms of outstanding awards may not
    be amended to reduce the exercise price of outstanding stock
    options or the base price of outstanding stock appreciation
    rights, or cancel outstanding stock options or stock
    appreciation rights in exchange for cash, other awards or stock
    options or stock appreciation rights with an exercise price or
    base price, as applicable, that is less than the exercise price
    of the original stock options or base price of the original
    stock appreciation rights, as applicable, without stockholder
    approval.
If permitted by Section 409A of the Code, in the case of a
    change of control or in case of termination of employment by
    reason of death, disability or normal or early retirement, in
    the case of unforeseeable emergency or other special
    circumstances of a participant who holds an unvested or
    unexercisable award, our board of directors may accelerate the
    time at which:
•
such award may be exercised;
•
the substantial risk of forfeiture or prohibition or restriction
    on transfer of such award will lapse;
•
the restriction period of such award will end;
•
such award will be deemed to have been fully earned; or
•
such award's transfer restriction will terminate.
Likewise, our board of directors may waive any other limitation
    or requirement under any such unvested or unexercisable award.
Our board of directors may amend the terms of any award granted
    under the Plan prospectively or retroactively. No such amendment
    may impair the rights of any participant without his or her
    consent. Our board of directors may terminate the Plan at any
    time. Termination of the Plan will not affect the rights of
    participants or their successors under any awards outstanding
    under the Plan and not exercised in full on the date of
    termination.
Effective Date; Termination.
We intend for the
    Plan to become effective on the date on which the Plan is
    adopted by our board of directors. The Plan will be submitted to
    our current stockholders for approval. Unless the Plan is
    approved by our current stockholders within twelve months after
    the date on which the Plan is adopted by our board of directors,
    the Plan and all awards made under it will be void and of no
    force and effect. No grant is expected to be made under the Plan
    after the ten-year anniversary of the effective date of the Plan
    but all grants made on or prior to such date are expected to
    continue in effect subject to the terms of their award
    agreements and the terms of the Plan.
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CERTAIN
    RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS
Inventory
    Financing and Resale Agreement
Molycorp, LLC entered into an inventory financing and resale
    agreement with Traxys North America, LLC, dated as of
    May 15, 2009. Pursuant to this agreement, Traxys has agreed
    to purchase, and Molycorp, LLC agreed to sell, approximately one
    million pounds of didymium oxide and up to 18 million
    pounds of bastnasite at fixed prices. The purchase price paid by
    Traxys is treated as an advance, on which Molycorp, LLC pays
    finance charges, until the products are ultimately sold by
    Traxys to third-party purchasers. The net revenue from sales to
    such third-party purchasers is then allocated between Traxys and
    Molycorp, LLC according to a fixed schedule. Pursuant to this
    agreement, Molycorp, LLC is obligated to repurchase from Traxys
    any unsold didymium oxide and any unsold bastnasite at
    May 15, 2010 and May 15, 2011, respectively. At
    certain periods during the term of the agreement, Traxys also
    has the right to convert any amounts owed by us into member
    interests in Molycorp, LLC in the form of shares at a fixed
    price. On November 15, 2009, Traxys converted outstanding
    advances and finance charges totaling $6.8 million into
    59,311 shares.
On April 16, 2010, Molycorp Minerals, LLC executed an
    agreement under which an affiliate of Traxys agreed to purchase
    up to $5 million of product from us through
    December 31, 2010. Purchases under the agreement would
    occur at our request at a price per pound based on published
    index pricing. Upon the resale of any acquired product, we are
    entitled to receive 50% of the sales price that exceeds a
    specified level.
Contribution
    Agreement
Each of Resource Capital Fund IV L.P., Resource Capital
    Fund V L.P., PP IV Mountain Pass II, LLC, PP IV MP AIV 1,
    LLC PP IV MP AIV 2, LLC, PP IV MP AIV 3, LLC, TNA Moly Group
    LLC, MP Rare Company LLC and KMSMITH LLC were members of
    Molycorp, LLC. In connection with our corporate reorganization
    and pursuant to a contribution agreement, these parties
    contributed either (a) all of their member interests in
    Molycorp, LLC or (b) all of their equity interests in
    entities that hold member interests in Molycorp, LLC (and no
    other assets or liabilities) to Molycorp, Inc. in exchange for
    shares of Class A common stock of Molycorp, Inc. See
    "Principal and Selling Stockholders."
Registration
    Rights
Resource Capital Fund IV L.P., Resource Capital Fund V
    LP, PP IV MP AIV 1, LLC, PP IV MP AIV 2, LLC, PP IV MP AIV 3,
    LLC, TNA Moly Group LLC, PP IV MP AIV 1, LLC, PP IV MP AIV 2,
    LLC, PP IV MP AIV 3, LLC, TNA Moly Group LLC, MP Rare Company
    LLC and KMSMITH LLC have registration rights beginning six
    months after completion of this offering with respect to the
    shares of capital stock that they will hold after giving effect
    to the corporate reorganization. For a description of these
    registration rights, see "Description of Capital
    Stock — Registration Rights."
Letters
    of Credit
In February 2009, the members of Molycorp Minerals, LLC incurred
    certain costs in providing letters of credit
and/or
cash
    collateral to secure surety bonds issued for the benefit of
    certain regulatory agencies relating to our Mountain Pass
    facility closure and reclamation obligations. The total amount
    of collateral provided by these members at December 31,
    2009 was $18.2 million. We have agreed to pay each member a
    five percent annual return on the amount of collateral provided.
    Under the terms of the agreement, the members may receive
    quarterly payments, delayed payments or
payments-in-kind.
After the completion of this offering, we intend to terminate
    this agreement with these members.
Mountain
    Pass Acquisition
In connection with our acquisition of the Mountain Pass,
    California rare earth deposit and associated land, facilities,
    rare earth processing facilities and intellectual property from
    Chevron Mining Inc., a subsidiary of Chevron Corporation,
    certain members of Molycorp Minerals, LLC incurred acquisition
    costs that were
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subsequently reimbursed by Molycorp Minerals, LLC. At
    December 31, 2008, accrued expenses included approximately
    $0.2 million related to this reimbursement obligation.
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PRINCIPAL
    AND SELLING STOCKHOLDERS
The following table sets forth certain information regarding the
    beneficial ownership of shares of common stock as
    of          ,
    as adjusted to reflect the corporate reorganization and the sale
    of common stock offered by us and the selling stockholders in
    this offering, for:
•
each person who we know beneficially owns more than 5% of our
    common stock;
•
each of the individuals whom we expect to be our directors as of
    the consummation of this offering;
•
each of our named executive officers;
•
all of the individuals whom we expect to be our directors and
    our executive officers as a group; and
•
all selling stockholders.
We have determined beneficial ownership in accordance with the
    rules of the SEC. Except as indicated by the footnotes below, we
    believe, based on the information furnished to us, that the
    persons and entities named in the table below have sole voting
    and investment power with respect to all shares of common stock
    that they beneficially own, subject to applicable community
    property laws.
The percentage ownership information shown in the table is based
    on          
    shares of common stock outstanding
    at          
    (after giving effect to the corporate reorganization). In
    computing the number of shares of common stock beneficially
    owned by a person and the percentage ownership of that person,
    we deemed to be outstanding all shares of common stock subject
    to options or warrants held by that person that are currently
    exercisable or exercisable within 60 days
    of     . We did not deem these shares
    outstanding, however, for the purpose of computing the
    percentage ownership of any other person. Beneficial ownership
    representing less than 1% is denoted with an asterisk
    "*".
Unless otherwise noted below, the address of the persons and
    entities listed on the table is
c/o Molycorp,
Inc., 5619 Denver Tech Center Parkway, Suite 1000,
    Greenwood Village, Colorado 80111.
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Shares Beneficially
Owned
After This Offering
Number
(assuming the
Shares Beneficially
of Shares
Shares Beneficially
underwriters exercise
Owned
Being
Owned
their over-allotment
Prior to This Offering
Offered
After This Offering
option in full)
Name and Address of Beneficial Owner
Number
Percentage
Number
Percentage
Number
Percentage
Resource Capital Funds
1400 Sixteenth Street, Suite 200
Denver, Colorado 80202
Pegasus Capital Advisors, LP
505 Park Avenue,
    22
nd
Floor
New York, New York 10022
Traxys North America LLC
825 Third Avenue
New York, New York 10022
MP Rare Company LLC
825 Third Avenue
New York, New York 10022
KMSMITH LLC
418 E. Fairchild Drive
Highlands Ranch, Colorado 80126
Russell D. Ball
Ross R. Bhappu
Brian T. Dolan
Charles R. Henry
Mark Kristoff
Alec Machiels
Mark A. Smith
Jack E. Thompson
James S. Allen
Ksenia A. Adams
John F. Ashburn
John L. Burba
All selling stockholders as a group
    (      entities)
All executive officers and directors as a group
    (      individuals)
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DESCRIPTION
    OF CAPITAL STOCK
General
The following is a summary of the rights of our capital stock,
    certain provisions of our certificate of incorporation and our
    bylaws that will be effective upon the completion of this
    offering, and certain provisions of applicable law. For more
    detailed information, please see the form of our certificate of
    incorporation and bylaws, which are filed as exhibits to the
    registration statement of which this prospectus is a part.
Authorized
    Capitalization
Immediately following the completion of this offering, our
    authorized capital stock will consist of shares, with a par
    value of $0.001 per share, of which:
•
shares will be designated as common stock; and
•
shares will be designated as preferred stock.
Common
    Stock
Following the completion of this offering, each outstanding
    share of common stock will be entitled to one vote on all
    matters submitted to a vote of stockholders. Pursuant to our
    certificate of incorporation, holders of our common stock will
    not have the right to cumulate votes in elections of directors.
    Subject to preferences that may be applicable to any outstanding
    shares of preferred stock, holders of our common stock will be
    entitled to receive ratably such dividends as may be declared
    from time to time by our board of directors out of legally
    available funds. For additional information, see "Dividend
    Policy." In the event of our liquidation, dissolution or
    winding up, holders of common stock will be entitled to share
    ratably in all assets remaining after payment of liabilities and
    any amounts due to the holders of preferred stock. Holders of
    our common stock will have no preemptive, conversion or
    subscription rights. No redemption or sinking fund provisions
    will apply to our common stock. All shares of common stock to be
    outstanding upon completion of this offering will be fully paid
    and non-assessable.
Preferred
    Stock
Our certificate of incorporation authorizes our board of
    directors, without stockholder approval, to designate and issue
    up
    to           shares
    of preferred stock in one or more series and to fix the rights,
    preferences, privileges and restrictions granted to or imposed
    upon each such series of preferred stock, including voting
    rights, dividend rights, conversion rights, terms of redemption,
    liquidation preference, sinking fund terms, subscription rights
    and the number of shares constituting any series or the
    designation of a series. Our board of directors can issue,
    without stockholder approval, preferred stock with voting and
    conversion rights that could adversely affect the voting power
    of the holders of common stock and reduce the likelihood that
    such holders will receive dividend payments or payments upon
    liquidation. Such issuance could have the effect of decreasing
    the market price of the common stock. The issuance of preferred
    stock or even the ability to issue preferred stock could also
    have the effect of delaying, deterring or preventing a change of
    control or other corporate action. Immediately after the
    completion of this offering, no shares of preferred stock will
    be outstanding, and we currently have no plans to issue any
    shares of preferred stock.
Registration
    Rights
After giving effect to the corporate reorganization, the holders
    of           shares
    of our common stock are entitled to rights with respect to the
    registration under the Securities Act of such shares of common
    stock. These registration rights are contained in the
    Registration Rights Agreement and are described below.
Form S-1
Demand Registration Rights
At any time following six months after the completion of this
    offering, the holders of shares of our common stock having
    demand registration rights under the Registration Rights
    Agreement have the right to
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require that we register their shares of common stock on
Form S-1,
provided such holders hold least 10% or 5% (depending on the
    stockholder) of the shares of our common stock outstanding
    immediately after giving effect to the corporate reorganization
    and the aggregate offering price to the public exceeds
    $10,000,000. In the event that such demand registration rights
    are exercised, stockholders party to the Registration Rights
    Agreement have the right to participate in offering. We are only
    obligated to effect one registration on
Form S-1
for each holder of our common stock possessing such demand
    registration rights. We may postpone the filing of a
    registration statement for up to 90 days once in any
12-month
period if our board of directors determines in good faith that
    the filing would be materially detrimental to our stockholders
    or us. In an underwritten offering, the holders of shares of our
    common stock having demand registration rights or the right to
    participate in such offering will have priority over us in
    including such shares in a registration statement filed in
    response to the exercise of these demand registration rights. We
    must pay all expenses, except for underwriters' discounts,
    selling commissions and the fees and expenses of each selling
    stockholder's own counsel, incurred in connection with the
    exercise of these demand registration rights.
Form S-3
Demand Registration Rights
If we are eligible to file a registration statement on
Form S-3,
the stockholders with
Form S-3
registration rights under the Registration Rights Agreement can
    request that we register their shares, provided that the total
    price of the shares of common stock offered to the public
    exceeds $5,000,000. In the event that such demand registration
    rights are exercised, stockholders party to the Registration
    Rights Agreement have the right to participate in offering.
    These
Form S-3
registration rights are wholly distinct from the
Form S-1
demand registration rights and piggyback registration rights
    described in this section. We are obligated to effect an
    unlimited number of registrations on
Form S-3
for each holder of our common stock possessing such demand
    registration rights. A holder of
Form S-3
registration rights may not require us to file a registration
    statement on
Form S-3
if we have already effected two registrations on
Form S-3
at the request of such holder in the last
12-month
period. We may postpone the filing of a
Form S-3
registration statement for up to 90 days once in any
12-month
period if our board of directors determines in good faith that
    the filing would be materially detrimental to our stockholders
    or us. In an underwritten offering, the holders of shares of our
    common stock having demand registration rights or the right to
    participate in such offering will have priority over us in
    including such shares in a registration statement filed in
    response to the exercise of these demand registration rights. We
    must pay all expenses, except for underwriters' discounts,
    selling commissions and the fees and expenses of each selling
    stockholder's own counsel, incurred in connection with the
    exercise of these demand registration rights.
Piggyback
    Registration Rights
If we register any securities for public sale, other than a
    registration statement filed on
Form S-1
or
Form S-3
pursuant to the stockholder demand registration rights described
    above, the stockholders with piggyback registration rights under
    the Registration Rights Agreement have the right to include
    their shares in the registration, subject to specified
    exceptions. In an underwritten offering, certain holders of
    shares of our common stock having piggyback registration rights
    will have priority over us in including such shares in the
    applicable registration statement. We must pay all expenses,
    except for underwriters' discounts, selling commissions and
    the fees and expenses of each selling stockholder's own
    counsel, incurred in connection with the exercise of these
    piggyback registration rights.
Anti-Takeover
    Effects of Delaware Law and Our Certificate of Incorporation and
    Bylaw Provisions
Our certificate of incorporation and bylaws contain several
    provisions that may make it more difficult to acquire us by
    means of a tender offer, open market purchase, proxy fight or
    otherwise. These provisions and certain provisions of Delaware
    law are expected to discourage coercive takeover practices and
    inadequate takeover bids.
These provisions of our certificate of incorporation and bylaws
    are designed to encourage persons seeking to acquire control of
    us to negotiate with our board of directors. We believe that, as
    a general rule, our interests and the interests of our
    stockholders would be served best if any change in control
    results from
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negotiations with our board of directors based upon careful
    consideration of the proposed terms, such as the price to be
    paid to stockholders, the form of consideration to be paid and
    the anticipated tax effects of the transaction.
Our certificate of incorporation and bylaws provisions could,
    however, have the effect of delaying, deferring or discouraging
    a prospective acquiror from making a tender offer for our shares
    or otherwise attempting to obtain control of us. To the extent
    that these provisions discourage takeover attempts, they could
    deprive stockholders of opportunities to realize takeover
    premiums for their shares. Moreover, these provisions could
    discourage accumulations of large blocks of common stock, thus
    depriving stockholders of any advantages which large
    accumulations of stock might provide.
Set forth below is a summary of the relevant provisions of our
    certificate of incorporation and bylaws and certain applicable
    sections of the General Corporation Law of the State of
    Delaware. For additional information we refer you to the
    provisions of our certificate of incorporation, our bylaws and
    the sections of the General Corporation Law of the State of
    Delaware.
Delaware
    Anti-Takeover Statute
We are subject to the provisions of Section 203 of the
    General Corporation Law of the State of Delaware regulating
    corporate takeovers. In general, Section 203, subject to
    certain exceptions, prohibits a publicly-held Delaware
    corporation from engaging in any business combination with any
    interested stockholder for a period of three years following the
    date that such person or entity became an interested
    stockholder, unless:
•
prior to such date, the board of directors of the corporation
    approved either the business combination or the transaction
    which resulted in the stockholder becoming an interested
    stockholder;
•
upon consummation of the transaction that resulted in the
    stockholder becoming an interested stockholder, the interested
    stockholder owned at least 85% of the voting stock of the
    corporation outstanding at the time the transaction commenced,
    excluding specified shares; or
•
at or subsequent to such date of the transaction that resulted
    in a person or entity becoming an interested stockholder, the
    business combination is approved by the board of directors and
    authorized at an annual or special meeting of stockholders, and
    not by written consent, by the affirmative vote of at least
    66
2
/
3
%
    of the outstanding voting stock that is not owned by the
    interested stockholder.
The application of Section 203 may limit the ability of
    stockholders to approve a transaction that they may deem to be
    in their best interests. In addition, Section 203 makes it
    more difficult for an interested stockholder to effect various
    business combinations with a corporation for a three-year
    period, although the stockholders may, by adopting an amendment
    to our certificate of incorporation or bylaws, elect not to be
    governed by this section, effective 12 months after
    adoption.
In general, Section 203 defines "business
    combination" as:
•
any merger or consolidation involving the corporation and the
    interested stockholder;
•
any sale, lease, exchange, mortgage, pledge, transfer or other
    disposition of 10% or more of the assets of the corporation to
    or with the interested stockholder;
•
subject to certain exceptions, any transaction which results in
    the issuance or transfer by the corporation of any stock of the
    corporation to the interested stockholder;
•
any transaction involving the corporation that has the effect of
    increasing the proportionate share of the stock of any class or
    series of the corporation beneficially owned by the interested
    stockholder; or
•
the receipt by the interested stockholder of the benefit of any
    loans, advances, guarantees, pledges or other financial benefits
    provided by or through the corporation.
In general, Section 203 defines an "interested
    stockholder" as any person that is:
•
the owner of 15% or more of the outstanding voting stock of the
    corporation;
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•
an affiliate or associate of the corporation and was the owner
    of 15% or more of the outstanding voting stock of the
    corporation at any time within three years immediately prior to
    the relevant date; or
•
an affiliate or associate of the above.
Our certificate of incorporation and bylaws do not exclude us
    from the restrictions imposed under Section 203. We
    anticipate that the provisions of Section 203 may encourage
    companies interested in acquiring us to negotiate in advance
    with our board of directors because the stockholder approval
    requirement would be avoided if a majority of the directors then
    in office approve either the business combination or the
    transaction that resulted in the stockholder becoming an
    interested stockholder.
Classified
    Board of Directors
Our certificate of incorporation provides for our board of
    directors to be divided into three classes of directors, as
    nearly equal in number as possible, serving staggered terms.
    Approximately one-third of our board of directors will be
    elected each year. Under Section 141 of the General
    Corporation Law of the State of Delaware, unless the certificate
    of incorporation provides otherwise, directors serving on a
    classified board can only be removed for cause. Accordingly, our
    directors may only be removed for cause. The provision for our
    classified board of directors may be amended, altered or
    repealed only upon the affirmative vote of the holders of
    66
2
/
3
%
    of our outstanding voting stock.
The provision for a classified board of directors could prevent
    a party that acquires control of a majority of the outstanding
    voting stock from obtaining control of our board of directors
    until the second annual stockholders meeting following the date
    the acquiror obtains the controlling stock interest. The
    classified board of directors provision could have the effect of
    discouraging a potential acquiror from making a tender offer for
    shares of common stock or otherwise attempting to obtain control
    of us and could increase the likelihood that our incumbent
    directors will retain their positions.
We believe that a classified board of directors will help to
    assure the continuity and stability of our board and our
    business strategies and policies as determined by our board of
    directors because a majority of the directors at any given time
    will have prior experience on our board. The classified board of
    directors provision should also help to ensure that our board of
    directors, if confronted with an unsolicited proposal from a
    third party that has acquired a block of our voting stock, will
    have sufficient time to review the proposal and appropriate
    alternatives and to seek the best available result for all
    stockholders.
Number of
    Directors; Removal; Vacancies
Our certificate of incorporation and bylaws provide that the
    number of directors shall be fixed by the affirmative vote of
    our board of directors or by the affirmative vote of holders of
    at least
    66
2
/
3
%
    of our outstanding voting stock. Upon consummation of this
    offering, the size of our board of directors will be fixed
    at          
    directors.
Pursuant to our certificate of incorporation, each director will
    serve until his or her successor is duly elected and qualified,
    unless he or she resigns, dies, becomes disqualified or is
    removed. Our certificate of incorporation also provides that,
    subject to the rights of the holders of any series of preferred
    stock, directors may be removed, but only for cause.
Our certificate of incorporation further provides that
    generally, vacancies or newly created directorships in our board
    may only be filled by a resolution approved by a majority of our
    board of directors and any director so chosen will hold office
    until the next election of the class for which such director was
    chosen.
Stockholder
    Action; Special Meetings
Our certificate of incorporation provides that stockholder
    action can be taken only at an annual or special meeting of
    stockholders and cannot be taken by written consent in lieu of a
    meeting. Our certificate of incorporation and bylaws provide
    that, except as otherwise required by law, special meetings of
    the stockholders can only be called by the Chairman of our board
    of directors, our Chief Executive Officer or our
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Secretary at the written request of a majority of the number of
    directors that we would have if there were no vacancies on our
    board of directors. Stockholders are not permitted to call a
    special meeting or to require our board of directors to call a
    special meeting. Stockholders also may not bring business before
    the special meeting of stockholders.
Stockholder
    Proposals and Nominations
Our bylaws provide that stockholders seeking to bring business
    before an annual meeting of stockholders or to nominate
    candidates for election as directors at an annual meeting of
    stockholders must provide timely notice of such proposed
    business in writing. To be timely, a stockholder's notice
    generally must be delivered to or mailed and received at our
    principal executive office not less than 90 days or more
    than 120 days prior to the first anniversary of the
    preceding year's annual meeting.
Our bylaws also provide certain requirements as to the form and
    content of a stockholder's notice. These provisions may
    preclude stockholders from bringing matters before an annual
    meeting of stockholders or from making nominations for directors
    at an annual meeting of stockholders. A stockholder's
    notice must set forth, among other things, as to each business
    matter or nomination the stockholder proposes to bring before
    the meeting:
•
the name and address of the stockholder and the beneficial
    owner, if any, on whose behalf the proposal or nomination is
    made;
•
the class and number of shares that are owned of record and
    beneficially by the stockholder proposing the business or
    nominating the nominee;
•
a representation that the stockholder giving the notice is a
    holder of record of shares of our voting stock entitled to vote
    at such annual meeting and intends to appear in person or by
    proxy at the annual meeting to propose the business or nominate
    the person or persons specified in the notice, as
    applicable; and
•
whether such stockholder or beneficial owner intends to deliver
    a proxy statement and forms of proxy to holders of at least the
    percentage of shares of our voting stock required to approve
    such proposal or nominate such nominee or nominees.
If the stockholder is nominating a candidate for director, the
    stockholder's notice must also include the name, age,
    business address, residence address and occupancy of the nominee
    proposed by the stockholder and the signed consent of the
    nominee to serve as a director on our board of directors if so
    elected.
In addition, a stockholder must also comply with all applicable
    requirements of the Exchange Act and the rules and regulations
    under the Exchange Act with respect to matters relating to
    nomination of candidates for directors.
Amendment
    of Certificate of Incorporation
Except as otherwise provided by law or our certificate of
    incorporation, our certificate of incorporation may be amended,
    altered or repealed at a meeting of the stockholders provided
    that such amendment has been described or referred to in the
    notice of such meeting or a meeting of our board of directors.
Amendment
    of Bylaws
Except as otherwise provided by law, our certificate of
    incorporation or our bylaws, our bylaws may be amended, altered
    or repealed at a meeting of the stockholders provided that such
    amendment has been described or referred to in the notice of
    such meeting or a meeting of our board of directors, provided
    that no amendment adopted by the board of directors may vary or
    conflict with any amendment adopted by the stockholders in
    accordance with our certificate of incorporation or bylaws.
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Transfer
    Agent and Registrar
We have
    appointed          
    as the transfer agent and registrar for our common stock.
Listing
We intend to apply to list our common stock on the NYSE under
    the symbol "MCP."
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SHARES ELIGIBLE
    FOR FUTURE SALE
Prior to this offering, there has been no public market for our
    common stock. Future sales of substantial amounts of our common
    stock in the public market, or the perception that substantial
    sales may occur, could adversely affect the prevailing market
    price of our common stock or impair our ability to raise equity
    capital in the future. Upon the completion of this offering,
    there will
    be           shares
    of common stock outstanding. Of these shares,
    the           shares
    sold in this offering by us and the selling stockholders, plus
    any shares sold upon exercise of the underwriters'
    over-allotment option, will be freely tradable in the public
    market without restriction or further registration under the
    Securities Act.
The
    remaining           shares
    of common stock will be "restricted securities," as
    that term is defined in Rule 144 under the Securities Act.
    These restricted securities are eligible for public sale only if
    they are registered under the Securities Act or if they qualify
    for an exemption from registration under Rules 144 or 701
    under the Securities Act, which are summarized below.
Subject to the
lock-up
agreements described below and the provisions of Rules 144
    and 701 under the Securities Act, these restricted securities
    will be available for sale in the public market as follows:
Number of
Date
Shares
On the date of this prospectus
Between 90 and 180 days after the date of this prospectus
At various times beginning more than 180 days after the
    date of this prospectus
Rule 144
In general, under Rule 144 as in effect on the date of this
    prospectus, a person who is not one of our affiliates at any
    time during the three months preceding a sale, and who has
    beneficially owned shares of our common stock for at least six
    months, would be entitled to sell an unlimited number of shares
    of our common stock provided that current public information
    about us is available and, after owning such shares for at least
    one year, would be entitled to sell an unlimited number of
    shares of our common stock without restriction. Our affiliates
    who have beneficially owned restricted shares of common stock
    for at least six months are entitled to sell within any
    three-month period a number of restricted shares that does not
    exceed the greater of:
•
1.0% of the number of shares of common stock then
    outstanding; or
•
the average weekly trading volume of our common stock on the
    NYSE during the four calendar weeks preceding the filing of a
    notice on Form 144 with respect to the sale.
Sales of restricted stock under Rule 144 by our affiliates
    are also subject to manner of sale provisions, notice
    requirements and the availability of current public information
    about us.
Rule 701
In general, under Rule 701 of the Securities Act, any of
    our directors, officers, employees, consultants or advisors who
    purchase shares of common stock from us in connection with a
    compensatory stock plan or other written agreement before the
    effective date of this offering, to the extent not subject to a
lock-up
agreement, is eligible to resell those shares 90 days after
    the effective date of this offering in reliance on
    Rule 144, but without compliance with some of the
    restrictions, including the holding period, contained in
    Rule 144.
Lock-Up
Agreements
We, all of our executive officers and directors and all of our
    stockholders have agreed that, without the prior written consent
    of J.P. Morgan Securities Inc. and Morgan Stanley Incorporated
    on behalf of the
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underwriters, we and they will not, directly or indirectly,
    during the period ending 180 days after the date of this
    prospectus:
•
offer, pledge, sell, contract to sell, sell any option or
    contract to purchase, purchase any option or contract to sell,
    grant any option, right or warrant for the sale of, or otherwise
    dispose of or transfer any shares of the our common stock or any
    securities convertible into or exchangeable or exercisable for
    our common stock, whether now owned or hereafter
    acquired; and
•
enter into any swap or any other agreement or any transaction
    that transfers, in whole or in part, directly or indirectly, the
    economic consequence of ownership of our common stock, whether
    any such swap or transaction is to be settled by delivery of
    shares of our common stock or other securities, in cash or
    otherwise.
This agreement is subject to certain exceptions, and is also
    subject to extension for up to an additional 34 days, as
    set forth in "Underwriting." In addition,
    substantially all of the holders of our member interests and
    holders of securities exercisable for or convertible into our
    member interests, or, after the consummation of this offering,
    shares of common stock, are subject to contractual
lock-up
restrictions with us for a period of 180 days following the
    date of this prospectus.
Stock
    Options and Other Equity Awards
Upon the completion of this offering, we intend to file a
    registration statement on
Form S-8
under the Securities Act covering the shares of common stock to
    be issued pursuant to options and other equity awards granted
    under our equity compensation plan. Based on the number of
    shares reserved for issuance under our equity compensation plan,
    the registration statement would cover
    approximately           shares.
    The registration statement will become effective upon filing.
    Accordingly, shares registered under the registration statement
    on
Form S-8
will be available for sale in the open market immediately
    thereafter, after complying with Rule 144 volume
    limitations applicable to affiliates and with applicable 180-day
lock-up
agreements.
Registration
    Rights
The holders
    of           shares
    of common stock or their transferees will be entitled to various
    rights with respect to the registration of these shares under
    the Securities Act, including the shares offered by the selling
    stockholders in this offering. Registration of these shares
    under the Securities Act would result in these shares becoming
    fully tradable without restriction under the Securities Act
    immediately upon the effectiveness of the registration, except
    for shares purchased by affiliates. See "Description of
    Capital Stock — Registration Rights" for
    additional information. Shares covered by a registration
    statement will be eligible for sale in the public market upon
    the expiration or release from the terms of the
lock-up
agreement.
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MATERIAL
    U.S. FEDERAL INCOME TAX CONSEQUENCES
TO
NON-U.S.
HOLDERS
General
The following is a discussion of the material U.S. federal
    income tax consequences of the acquisition, ownership, and
    disposition of our common stock by a
non-U.S. holder,
as defined below, that acquires our common stock pursuant to
    this offering. This discussion assumes that a
non-U.S. holder
will hold our common stock issued pursuant to this offering as a
    capital asset within the meaning of Section 1221 of the
    Code. This discussion does not address all aspects of
    U.S. federal income taxation that may be relevant to a
    particular investor in light of the investor's individual
    circumstances. In addition, this discussion does not address
    (i) U.S. federal non-income tax laws, such as gift or
    estate tax laws, (ii) state, local or
non-U.S. tax
consequences, (iii) the special tax rules that may apply to
    certain investors, including, without limitation, banks,
    insurance companies, financial institutions, controlled foreign
    corporations, passive foreign investment companies,
    broker-dealers, grantor trusts, personal holding companies,
    taxpayers who have elected
mark-to-market
accounting, tax-exempt entities, regulated investment companies,
    real estate investment trusts, a partnership or other entity or
    arrangement classified as a partnership for United States
    federal income tax purposes or other pass-through entities, or
    an investor in such entities or arrangements, or
    U.S. expatriates or former long-term residents of the
    United States, (iv) the special tax rules that may apply to
    an investor that acquires, holds, or disposes of our common
    stock as part of a straddle, hedge, constructive sale,
    conversion or other integrated transaction, or (v) the
    impact, if any, of the alternative minimum tax.
This discussion is based on current provisions of the Code,
    applicable U.S. Treasury Regulations promulgated
    thereunder, judicial opinions, and published rulings of the
    Internal Revenue Service, or the IRS, all as in effect on the
    date of this prospectus and all of which are subject to
    differing interpretations or change, possibly with retroactive
    effect. We have not sought, and will not seek, any ruling from
    the IRS or any opinion of counsel with respect to the tax
    consequences discussed herein, and there can be no assurance
    that the IRS will not take a position contrary to the tax
    consequences discussed below or that any position taken by the
    IRS would not be sustained.
As used in this discussion, the term
    "U.S. person" means a person that is, for
    U.S. federal income tax purposes, (i) a citizen or
    individual resident of the United States, (ii) a
    corporation (or other entity taxed as a corporation) created or
    organized (or treated as created or organized) in the United
    States or under the laws of the United States or any state
    thereof or the District of Columbia, (iii) an estate the
    income of which is subject to U.S. federal income taxation
    regardless of its source, or (iv) a trust if (A) a
    court within the United States is able to exercise primary
    supervision over the administration of the trust and one or more
    U.S. persons have the authority to control all substantial
    decisions of the trust, or (B) it has in effect a valid
    election under applicable U.S. Treasury Regulations to be
    treated as a U.S. person. As used in this discussion, the
    term
"non-U.S. holder"
means a beneficial owner of our common stock (other than a
    partnership or other entity treated as a partnership or as a
    disregarded entity for U.S. federal income tax purposes)
    that is not a U.S. person.
The tax treatment of a partnership and each partner thereof will
    generally depend upon the status and activities of the
    partnership and such partner. A holder that is treated as a
    partnership for U.S. federal income tax purposes or a
    partner in such partnership should consult its own tax advisor
    regarding the U.S. federal income tax consequences
    applicable to it and its partners of the acquisition, ownership
    and disposition of our common stock.
THIS DISCUSSION IS ONLY A SUMMARY OF MATERIAL U.S. FEDERAL
    INCOME TAX CONSEQUENCES TO
NON-U.S. HOLDERS
OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR COMMON
    STOCK. IT IS NOT TAX ADVICE. EACH PROSPECTIVE INVESTOR SHOULD
    CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE PARTICULAR TAX
    CONSEQUENCES OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF
    OUR COMMON STOCK, INCLUDING THE APPLICABILITY AND EFFECT OF ANY
    STATE, LOCAL, AND
NON-U.S. TAX
LAWS, AS WELL AS U.S. FEDERAL ESTATE AND GIFT TAX LAWS, AND
    ANY APPLICABLE TAX TREATY.
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Income
    Tax Consequences of an Investment in Common Stock
Distributions
    on Common Stock
As discussed under "Dividend Policy," we do not
    anticipate paying dividends. If we pay cash or distribute
    property to holders of shares of common stock, such
    distributions generally will constitute dividends for
    U.S. federal income tax purposes to the extent paid from
    our current or accumulated earnings and profits, as determined
    under U.S. federal income tax principles. Distributions in
    excess of current and accumulated earnings and profits will
    constitute a return of capital that will be applied against and
    reduce (but not below zero) the holder's adjusted tax basis
    in our common stock. Any remaining excess will be treated as
    gain from the sale or exchange of the common stock and will be
    treated as described under "— Gain or Loss on
    Sale, Exchange or Other Taxable Disposition of Common
    Stock" below.
Dividends paid to a
non-U.S. holder
that are not effectively connected with the
non-U.S. holder's
conduct of a trade or business in the United States generally
    will be subject to withholding of U.S. federal income tax
    at a rate of 30% or such lower rate as may be specified by an
    applicable income tax treaty. A
non-U.S. holder
that wishes to claim the benefit of an applicable tax treaty
    withholding rate generally will be required to (i) complete
    IRS
Form W-8BEN
(or other applicable form) and certify under penalties of
    perjury that such holder is not a U.S. person and is
    eligible for the benefits of the applicable tax treaty or
    (ii) if our common stock is held through certain foreign
    intermediaries, satisfy the relevant certification requirements
    of applicable U.S. Treasury Regulations. These forms may
    need to be periodically updated.
A
non-U.S. holder
eligible for a reduced rate of withholding of U.S. federal
    income tax pursuant to an income tax treaty may obtain a refund
    of any excess amounts withheld by timely filing an appropriate
    claim for refund with the IRS.
Non-U.S. holders
should consult their own tax advisors regarding their
    entitlement to benefits under an applicable income tax treaty
    and the manner of claiming the benefits of such treaty
    (including, without limitation, the need to obtain a
    U.S. taxpayer identification number).
Dividends that are effectively connected with a
non-U.S. holder's
conduct of a trade or business in the United States, and, if
    required by an applicable income tax treaty, attributable to a
    permanent establishment or fixed base maintained by the
non-U.S. holder
in the United States, are subject to U.S. federal income
    tax on a net income basis at the U.S. federal income tax
    rates generally applicable to a U.S. holder and are not
    subject to withholding of U.S. federal income tax, provided
    that the
non-U.S. holder
establishes an exemption from such withholding by complying with
    certain certification and disclosure requirements. Any such
    effectively connected dividends (and, if required, dividends
    attributable to a U.S. permanent establishment or fixed
    base) received by a
non-U.S. holder
that is treated as a foreign corporation for U.S. federal
    income tax purposes may be subject to an additional branch
    profits tax at a 30% rate, or such lower rate as may be
    specified by an applicable income tax treaty.
Gain
    or Loss on Sale, Exchange or Other Taxable Disposition of Common
    Stock
Any gain recognized by a
non-U.S. holder
on a sale or other taxable disposition of our common stock
    generally will not be subject to U.S. federal income tax,
    unless:
(i) the gain is effectively connected with a trade or
    business of the
non-U.S. holder
in the United States (and, if required by an applicable income
    tax treaty, is attributable to a U.S. permanent
    establishment or fixed base of the
non-U.S. holder),
(ii) the
non-U.S. holder
is an individual who is present in the United States for
    183 days or more in the taxable year of that disposition,
    and certain other conditions are met, or
(iii) we are or have been a United States real property
    holding corporation, or a USRPHC, for U.S. federal income
    tax purposes at any time during the shorter of the five-year
    period ending on the date of disposition or the period that the
non-U.S. holder
held the common stock, and, in the case where the shares of our
    common stock are regularly traded on an established securities
    market, the
non-U.S. holder
holds or held (at any time during the shorter of the five-year
    period ending on the date of disposition or the
non-U.S. holder's
holding period) more than five percent of our common stock. A
    corporation
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generally is a USRPHC if the fair market value of its
    U.S. real property interests equals or exceeds 50% of the
    sum of the fair market value of its worldwide real property
    interests plus its other assets used or held for use in a trade
    or business. We believe that we currently are a USRPHC, and we
    expect to remain a USRPHC.
Any gain recognized by a
non-U.S. holder
that is described in clause (i) or (iii) of the
    preceding paragraph generally will be subject to tax at the
    U.S. federal income tax rates generally applicable to a
    U.S. person and be required to file a U.S. tax return.
    Such
Non-U.S. holders
are urged to consult their tax advisors regarding the possible
    application of these rules. Any gain of a corporate
non-U.S. holder
that is described in clause (i) above may also be subject
    to an additional branch profits tax at a 30% rate, or such lower
    rate as may be specified by an applicable income tax treaty. An
    individual
non-U.S. holder
that is described in clause (ii) of such paragraph
    generally will be subject to a flat 30% tax (or a lower
    applicable tax treaty rate) on the U.S. source capital gain
    derived from the disposition, which may be offset by
    U.S. source capital losses during the taxable year of the
    disposition.
Information
    Reporting and Backup Withholding
We generally must report annually to the IRS and to each
non-U.S. holder
of our common stock the amount of dividends paid to such holder
    on our common stock and the tax, if any, withheld with respect
    to those dividends. Copies of the information returns reporting
    those dividends and withholding may also be made available to
    the tax authorities in the country in which the
non-U.S. holder
is a resident under the provisions of an applicable income tax
    treaty or agreement. Information reporting also is generally
    required with respect to the proceeds from sales and other
    dispositions of our common stock to or through the
    U.S. office (and in certain cases, the foreign office) of a
    broker.
Under some circumstances, U.S. Treasury Regulations require
    backup withholding of U.S. federal income tax, currently at
    a rate of 28%, on reportable payments with respect to our common
    stock. A
non-U.S. holder
generally may eliminate the requirement for information
    reporting (other than in respect to dividends, as described
    above) and backup withholding by providing certification of its
    foreign status, under penalties of perjury, on a duly executed
    applicable IRS
Form W-8
or by otherwise establishing an exemption. Notwithstanding the
    foregoing, backup withholding and information reporting may
    apply if either we or our paying agent has actual knowledge, or
    reason to know, that a holder is a U.S. person.
Backup withholding is not a tax. Rather, the amount of any
    backup withholding will be allowed as a credit against a
non-U.S. holder's
U.S. federal income tax liability, if any, and may entitle
    such
non-U.S. holder
to a refund, provided that certain required information is
    timely furnished to the IRS.
Non-U.S. holders
should consult their own tax advisors regarding the application
    of backup withholding and the availability of and procedure for
    obtaining an exemption from backup withholding in their
    particular circumstances.
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UNDERWRITING
Under the terms and subject to the conditions in an underwriting
    agreement dated the date of this prospectus, the underwriters
    named below, for whom J.P. Morgan Securities Inc. and
    Morgan Stanley & Co. Incorporated are acting as
    representatives, have severally agreed to purchase, and we and
    the selling stockholders have agreed to sell to them, severally,
    the number of shares indicated below:
Number of
Name
Shares
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Total
The underwriters and the representatives are collectively
    referred to as the "underwriters" and the
    "representatives," respectively. The underwriters are
    offering the shares of common stock subject to their acceptance
    of the shares from us and subject to prior sale. The
    underwriting agreement provides that the obligations of the
    several underwriters to pay for and accept delivery of the
    shares of common stock offered by this prospectus are subject to
    the approval of certain legal matters by their counsel and to
    certain other conditions. The underwriters are obligated to take
    and pay for all of the shares of common stock offered by this
    prospectus if any such shares are taken. However, the
    underwriters are not required to take or pay for the shares
    covered by the underwriters' over-allotment option
    described below.
The underwriters initially propose to offer part of the shares
    of common stock directly to the public at the offering price
    listed on the cover page of this prospectus and part to certain
    dealers. After the initial offering of the shares of common
    stock, the offering price and other selling terms may from time
    to time be varied by the representatives.
We have granted to the underwriters an option, exercisable for
    30 days from the date of this prospectus, to purchase up
    to          
    additional shares of common stock at the public offering price
    listed on the cover page of this prospectus, less underwriting
    discounts and commissions. The underwriters may exercise this
    option solely for the purpose of covering over-allotments, if
    any, made in connection with the offering of the shares of
    common stock offered by this prospectus. To the extent the
    option is exercised, each underwriter will become obligated,
    subject to certain conditions, to purchase about the same
    percentage of the additional shares of common stock as the
    number listed next to the underwriter's name in the
    preceding table bears to the total number of shares of common
    stock listed next to the names of all underwriters in the
    preceding table.
The following table shows the per share and total public
    offering price, underwriting discounts and commissions, and
    proceeds before expenses to us and the selling stockholders.
    These amounts are shown assuming both no exercise and full
    exercise of the underwriters' option to purchase up to an
    additional           shares
    of common stock.
Total per Share
No Exercise
Full Exercise
Public offering price
$
$
$
Underwriting discounts and commissions to be paid by:
Us
$
$
$
The selling stockholders
$
$
$
Proceeds, before expenses, to us:
$
$
$
Proceeds, before expenses, to selling stockholders
$
$
$
The estimated offering expenses payable by us, exclusive of the
    underwriting discounts and commissions, are approximately
    $      .
The underwriters have informed us that they do not intend sales
    to discretionary accounts to exceed 5% of the total number of
    shares of common stock offered by them.
We intend to apply to list our common stock on the NYSE under
    the symbol "MCP."
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We and all directors and officers and the holders of all of our
    outstanding stock have agreed that, without the prior written
    consent of J.P. Morgan Securities Inc. and Morgan
    Stanley & Co. Incorporated on behalf of the
    underwriters, we and they will not, during the period ending
    180 days after the date of this prospectus (the
    "restricted period"):
•
offer, pledge, sell, contract to sell, sell any option or
    contract to purchase, purchase any option or contract to sell,
    grant any option, right or warrant to purchase lend or otherwise
    transfer or dispose of, directly or indirectly, any shares of
    common stock or any securities convertible into or exercisable
    or exchangeable for shares of common stock;
•
file any registration statement with the SEC relating to the
    offering of any shares of common stock or any securities
    convertible into or exercisable or exchangeable for common
    stock; or
•
enter into any swap or other arrangement that transfers to
    another, in whole or in part, any of the economic consequences
    of ownership of the common stock.
whether any such transaction described above is to be settled by
    delivery of common stock or such other securities, in cash or
    otherwise. In addition, we and each such person agrees that,
    without the prior written consent of J.P. Morgan Securities
    Inc. and Morgan Stanley & Co. Incorporated on behalf
    of the underwriters, we or such person will not, during the
    period ending 180 days after the date of this prospectus,
    make any demand for, or exercise any right with respect to, the
    registration of any shares of common stock or any security
    convertible into or exercisable or exchangeable for common stock.
The restrictions described in the immediately preceding
    paragraph do not apply to the sale of shares to the underwriters.
With respect to our directors and officers, the restrictions
    described above do not apply to:
•
the exercise of a warrant or an option to purchase, or other
    equity award for, shares of our common stock (provided that any
    shares of common stock received pursuant to such exercise are
    subject to the same restrictions as those described above);
•
in the case of an option expiring during the restricted period,
    the sale or transfer of shares of our common stock to satisfy
    any payment or withholding obligations in connection with the
    exercise of an option to purchase, or other equity award for,
    shares of our common stock, or in connection with any cashless
    exercise of a warrant to purchase shares of our common stock;
•
the conversion of any preferred stock, Class A common
    stock, Class B common stock or other equity interest of Molycorp
    into shares of our common stock;
•
transactions relating to shares of our common stock or other
    securities acquired in open market transactions after the
    completion of this offering (provided that no filing under
    Section 16(a) of the Exchange Act shall be required or
    shall be voluntarily made in connection with subsequent sales of
    common stock or other securities acquired in such open market
    transactions);
•
transfers of shares of our common stock or any security
    convertible into our common stock (a) as a bona fide gift,
    (b) to any trust for the direct or indirect benefit of the
    director or officer or an immediate family member of the
    director or officer or (c) to any immediate family member
    of the director or officer;
•
transfers of shares of our common stock or any security
    convertible into our common stock pursuant to the laws of
    descent or distribution; and
•
the establishment of a trading plan pursuant to
Rule 10b5-1
under the Exchange Act for the transfer of shares of our common
    stock (provided that such plan does not provide for the transfer
    of shares of our common stock during the restricted period and
    no public announcement or filing under the Exchange Act
    regarding the establishment of such plan shall be required of or
    voluntarily made by or on behalf of the director of officer or
    us during the restricted period);
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provided that, in the case of any transfer or distribution
    pursuant to the fifth or sixth bullet above, (x) each
    transferee shall sign and deliver a
lock-up
letter substantially in the form of the
lock-up
letter signed by the director or officer and (y) no filing
    under Section 16(a) of the Exchange Act, reporting a
    reduction in beneficial ownership of shares of our common stock,
    shall be required or shall be voluntarily made during the
    restricted period.
The restricted period described in the preceding paragraph will
    be extended if:
•
during the last 17 days of the restricted period we issue
    an earnings release or material news event relating to us
    occurs, or
•
prior to the expiration of the restricted period, we announce
    that we will release earnings results during the 16-day period
    beginning on the last day of the restricted period,
in which case the restrictions described in the preceding
    paragraph will continue to apply until the expiration of the
    18-day period beginning on the issuance of the earnings release
    or the occurrence of the material news or material event.
In order to facilitate the offering of the common stock, the
    underwriters may engage in transactions that stabilize, maintain
    or otherwise affect the price of the common stock. Specifically,
    the underwriters may sell more shares than they are obligated to
    purchase under the underwriting agreement, creating a short
    position. A short sale is covered if the short position is no
    greater than the number of shares available for purchase by the
    underwriters under the over-allotment option. The underwriters
    can close out a covered short sale by exercising the
    over-allotment option or purchasing shares in the open market.
    In determining the source of shares to close out a covered short
    sale, the underwriters will consider, among other things, the
    open market price of shares compared to the price available
    under the over-allotment option. The underwriters may also sell
    shares in excess of the over-allotment option, creating a naked
    short position. The underwriters must close out any naked short
    position by purchasing shares in the open market. A naked short
    position is more likely to be created if the underwriters are
    concerned that there may be downward pressure on the price of
    the common stock in the open market after pricing that could
    adversely affect investors who purchase in this offering. As an
    additional means of facilitating this offering, the underwriters
    may bid for, and purchase, shares of common stock in the open
    market to stabilize the price of the common stock. These
    activities may raise or maintain the market price of the common
    stock above independent market levels or prevent or retard a
    decline in the market price of the common stock. The
    underwriters are not required to engage in these activities and
    may end any of these activities at any time.
We, the selling stockholders and the underwriters have agreed to
    indemnify each other against certain liabilities, including
    liabilities under the Securities Act.
A prospectus in electronic format may be made available on
    websites maintained by one or more underwriters, or selling
    group members, if any, participating in this offering. The
    representatives may agree to allocate a number of shares of
    common stock to underwriters for sale to their online brokerage
    account holders. Internet distributions will be allocated by the
    representatives to underwriters that may make Internet
    distributions on the same basis as other allocations.
Pricing
    of the Offering
Prior to this offering, there has been no public market for our
    common stock. The initial public offering price was determined
    by negotiations between us and the representatives. Among the
    factors considered in determining the initial public offering
    price were our future prospects and those of our industry in
    general, our sales, earnings and certain other financial and
    operating information in recent periods, and the price-earnings
    ratios, price-sales ratios, market prices of securities, and
    certain financial and operating information of companies engaged
    in activities similar to ours.
European
    Economic Area
In relation to each Member State of the European Economic Area
    which has implemented the Prospectus Directive, each underwriter
    has represented and agreed that with effect from and including
    the date on which
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the Prospectus Directive is implemented in that Member State it
    has not made and will not make an offer of Shares to the public
    in that Member State, except that it may, with effect from and
    including such date, make an offer of Shares to the public in
    that Member State:
(a) at any time to legal entities which are authorized or
    regulated to operate in the financial markets or, if not so
    authorized or regulated, whose corporate purpose is solely to
    invest in securities;
(b) at any time to any legal entity which has two or more
    of (1) an average of at least 250 employees during the
    last financial year; (2) a total balance sheet of more than
    €43,000,000 and (3) an annual net turnover of more
    than €50,000,000, as shown in its last annual or
    consolidated accounts; or
(c) at any time in any other circumstances which do not
    require the publication by us of a prospectus pursuant to
    Article 3 of the Prospectus Directive.
For the purposes of the above, the expression an "offer of
    Shares to the public" in relation to any Shares in any
    Member State means the communication in any form and by any
    means of sufficient information on the terms of the offer and
    the Shares to be offered so as to enable an investor to decide
    to purchase or subscribe the Shares, as the same may be varied
    in that Member State by any measure implementing the Prospectus
    Directive in that Member State and the expression Prospectus
    Directive means Directive
2003/71/EC
and includes any relevant implementing measure in that Member
    State.
United
    Kingdom
Each underwriter has represented and agreed that it has only
    communicated or caused to be communicated and will only
    communicate or cause to be communicated an invitation or
    inducement to engage in investment activity (within the meaning
    of Section 21 of the Financial Services and Markets Act
    2000) in connection with the issue or sale of the shares of
    our common stock in circumstances in which Section 21(1) of
    such Act does not apply to us and it has complied and will
    comply with all applicable provisions of such Act with respect
    to anything done by it in relation to any Shares in, from or
    otherwise involving the United Kingdom.
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CHANGE IN
    ACCOUNTANTS
On January 14, 2010, the board of directors of Molycorp,
    LLC dismissed KPMG LLP as its independent registered public
    accounting firm.
The report of KPMG LLP on Molycorp Minerals, LLC's
    financial statements as of December 31, 2008 and for the
    period from June 12, 2008 (Inception) through
    December 31, 2008 (not included in this prospectus) did not
    contain an adverse opinion or a disclaimer of opinion, and was
    not qualified or modified as to uncertainty, audit scope or
    accounting principles.
During the period from June 12, 2008 (Inception) through
    January 14, 2010, there were: (i) no disagreements (as
    that term is defined in Item 304(a)(1)(iv) of
Regulation S-K
and the related instructions to Item 304 of
Regulation S-K)
with KPMG LLP on any matter of accounting principles or
    practices, financial statement disclosure, or auditing scope or
    procedure, which disagreements, if not resolved to the
    satisfaction of KPMG LLP, would have caused KPMG LLP to make
    reference to the subject matter of the disagreements in its
    reports on the consolidated financial statements for such years;
    or (ii) reportable events.
We provided KPMG LLP with a copy of the above disclosures, and
    requested that KPMG LLP furnish us with a letter addressed to
    the SEC stating that KPMG LLP agrees with the above statements.
    A copy of KPMG LLP's letter is filed as an exhibit to this
    registration statement.
On January 14, 2010, Molycorp, LLC's board of
    directors approved the appointment of PricewaterhouseCoopers LLP
    as our independent registered public accounting firm for the
    period from June 12, 2008 (Inception) through
    December 31, 2008 and for the year ended December 31,
    2009. Prior to their engagement on January 14, 2010,
    neither we nor anyone on our behalf consulted with
    PricewaterhouseCoopers LLP regarding: (i) the application
    of accounting principles to a specified transaction, either
    completed or proposed, or the type of audit opinion that might
    be rendered on our financial statements, and neither a written
    report was provided to us nor oral advice was provided that
    PricewaterhouseCoopers LLP concluded was an important factor
    considered by us in reaching a decision as to any accounting,
    auditing or financial reporting issue; or (ii) any matter
    that was either the subject of a disagreement (as that term is
    defined in Item 304(a)(1)(iv) of
Regulation S-K
and the related instructions to Item 304 of
Regulation S-K)
or a reportable event (as that term is defined in
    Item 304(a)(1)(v) of
Regulation S-K).
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LEGAL
    MATTERS
The validity of the issuance of the shares of common stock
    offered by this prospectus will be passed upon for us by Jones
    Day. Certain legal matters relating to this offering will be
    passed on for the underwriters by Davis Polk &
    Wardwell LLP, New York, New York.
EXPERTS
The consolidated financial statements as of December 31,
    2009 and 2008, and for the year ended December 31, 2009,
    the period from June 12, 2008 (Inception) through
    December 31, 2008, and cumulatively for the period from
    June 12, 2008 (Inception) through December 31, 2009
    included in this prospectus, have been so included in reliance
    on the report of PricewaterhouseCoopers LLP, an independent
    registered public accounting firm, given on the authority of
    such firm as experts in auditing and accounting.
The information appearing in this prospectus concerning
    estimates of our proven and probable REO reserves and
    non-reserve REO deposits for the Mountain Pass facility was
    derived from the report of SRK Consulting, independent mining
    consultants, and has been included herein upon the authority of
    SRK Consulting as experts with respect to the matters covered by
    such report and in giving such report.
WHERE YOU
    CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on
Form S-1
under the Securities Act to register our common stock being
    offered in this prospectus. This prospectus, which constitutes a
    part of the registration statement, does not contain all the
    information set forth in the registration statement or the
    exhibits and schedules filed thereto. For further information
    about us and the common stock offered by this prospectus, we
    refer you to the registration statement and the exhibits and
    schedules filed with the registration statement. Any statement
    contained in this prospectus regarding the contents of any
    contract or any other document that is filed as an exhibit to
    the registration statement is not necessarily complete and each
    such statement is qualified in all respects by reference to the
    full text of such contract or other document filed as an exhibit
    to the registration statement. A copy of the registration
    statement and the exhibits and schedules to the registration
    statement may be inspected without charge at the SEC's
    Public Reference Room, 100 F Street, N.E.,
    Room 1580, Washington, D.C. 20549. You may obtain
    information on the operation of the Public Reference Room by
    calling the SEC at
1-800-SEC-0330.
The SEC also maintains an Internet site at www.sec.gov that
    contains reports, proxy and information statement and other
    information regarding issuers who file electronically with the
    SEC. You may also inspect our SEC reports and other information
    at our website at www.molycorp.com. Information on or accessible
    through our website is not a part of this prospectus.
Upon completion of this offering, we will be subject to the
    information reporting requirements of the Exchange Act and we
    intend to file reports, proxy statements and other information
    with the SEC.
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GLOSSARY
    OF SELECTED MINING TERMS
The following is a glossary of selected mining terms used in
    this prospectus that may be technical in nature:
Assay
The analysis of the proportions of metals in ore, or the testing
    of an ore or mineral for composition, purity, weight, or other
    properties of commercial interest.
Bastnasite
Bastnasite is a mixed Lanthanide fluoro-carbonate mineral
    (Ln F CO3) that currently provides the bulk of the
    world's supply of the light REEs. Bastnasite and monazite
    are the two most common sources of cerium and other REEs.
    Bastnasite is found in carbonatites, igneous carbonate rocks
    that melt at unusually low temperatures.
Cerium
Cerium (Ce) is a soft, silvery, ductile metal which easily
    oxidizes in air. Cerium is the most abundant of the REEs, and is
    found in a number of minerals, including monazite and bastnasite.
Concentrate
A mineral processing product that generally describes the
    material that is produced after crushing and grinding ore
    effecting significant separation of gangue (waste) minerals from
    the metal and/or metal minerals, and discarding the waste and
    minor amounts of metal and/or metal minerals. The resulting
    "concentrate" of minerals typically has an order of
    magnitude higher content of minerals than the beginning ore
    material.
Cut-off grade
The lowest grade of mineralized material that qualifies as ore
    in a given deposit. The grade above which minerals are
    considered economically mineable considering the following
    parameters: estimates over the relevant period of mining costs,
    ore treatment costs, general and administrative costs, refining
    costs, royalty expenses, by-product credits, process and
    refining recovery rates and price.
Dysprosium
Dysprosium (Dy) is used in high power neodymium iron boron
    magnets to enhance thermal stability.
Europium
Europium (Eu) is desirable due to its photon emission.
    Excitation of the europium atom, by absorption of electrons or
    by UV radiation, results in changes in energy levels that create
    a visible emission. Almost all practical uses of europium
    utilize this luminescent behavior.
Gadolinium
Gadolinium (Gd) is a silvery-white, malleable and ductile
    rare-earth metal. Gadolinium has exceptionally high absorption
    of neutrons and therefore is used for shielding in neutron
    radiography and in nuclear reactors. Because of its paramagnetic
    properties, solutions of organic gadolinium complexes and
    gadolinium compounds are the most popular intravenous medical
    magnetic resonance imaging contrast agents in MRI.
Grade
The average REE content, as determined by assay of a ton of ore.
Lanthanum
Lanthanum (La) is the first member of the Lanthanide series.
    Lanthanum is a strategically important rare earth element due to
    its use in fluid bed cracking catalysts, FCCs, which are used in
    the production of transportation and aircraft fuel. Lanthanum is
    also used in fuel cells and batteries.
Mill
A processing plant that produces a concentrate of the valuable
    minerals contained in an ore.
Mineralization
The concentration of metals and their compounds in rocks, and
    the processes involved therein.
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Monazite
Monazite is a reddish-brown phosphate mineral. Monazite minerals
    are typically accompanied by concentrations of uranium and
    thorium. Because of this, there is no significant rare earth
    production from monazite today. Monazite is becoming more
    attractive because it typically has elevated concentrations of
    heavy rare earths.
Neodymium
Neodymium (Nd) is used in the production of NdFeB permanent
    magnets. These permanent magnets, which maximize the power/cost
    ratio, are used in a large variety of motors and mechanical
    systems. Cellular phones, vehicle systems and certain lasers
    contain both neodymium magnets and capacitors, which produce
    powerful electronic generation and boost the power of these
    devices.
Ore
That part of a mineral deposit which could be economically and
    legally extracted or produced at the time of reserve
    determination.
Overburden
In surface mining, overburden is the material that overlays an
    ore deposit. Overburden is removed prior to mining.
Praseodymium
Praseodymium (Pr) comprising about 4% of the lanthanide content
    of bastnasite, is a common coloring pigment. Along with
    neodymium, praseodymium is used to filter certain wavelengths of
    light. Praseodymium is used in photographic filters, airport
    signal lenses, and welder's glasses. As part of an alloy,
    praseodymium is used in permanent magnet systems designed to
    make smaller and lighter motors. Praseodymium is also used in
    automobile and other internal combustion engine pollution
    control catalysts.
Probable reserves
Reserves for which quantity and grade and/or quality are
    computed from information similar to that used for proven
    reserves, but the sites for inspection, sampling, and
    measurement are farther apart or are otherwise less adequately
    spaced. The degree of assurance, although lower than that for
    proven reserves, is high enough to assume continuity between
    points of observation.
Proven reserves
Reserves for which (a) quantity is computed from dimensions
    revealed in outcrops, trenches, workings or drill holes; grade
    and/or quality are computed from the results of detailed
    sampling; and (b) the sites for inspection, sampling and
    measurement are spaced so closely and the geologic character is
    so well defined that size, shape, depth and mineral content of
    reserves are well established.
Recovery
The percentage of contained metal actually extracted from ore in
    the course of processing such ore.
Reserves
That part of a mineral deposit which could be economically and
    legally extracted or produced at the time of the reserve
    determination.
REO cut-off
Cut-off grade is the percentage of REO that defines the minimum
    economically recoverable concentration in an ore body.
Samarium
Samarium (Sm) is a silvery-white metallic element that is
    predominantly used to produce high temperature, high power
    samarium cobalt.
Strike
The direction of the line of intersection of a REE deposit with
    the horizontal plane of the ground. The strike of a deposit is
    the direction of a straight line that connects two points of
    equal elevation on the deposit.
Tailings
That portion of the mined material that remains after the
    valuable minerals have been extracted.
G-2
Table of Contents
Terbium
Terbium (Tb) is a soft, malleable, silvery-grey element of the
    lanthanide series, used in x-ray and color television tubes.
Tolling
Processing of material owned by others for a fee without taking
    title to the material.
Yttrium
Yttrium (Y) is predominantly utilized in auto-catalysts. Other
    uses include resonators, microwave communication devices and
    other electronic devices.
G-3
INDEX TO
    FINANCIAL STATEMENTS
Page
Report of Independent Registered Public
    Accounting Firm
F-2
Consolidated Balance Sheets as of
    December 31, 2009 and December 31, 2008
F-3
Consolidated Statements of Operations for the
    year ended December 31, 2009, for the period from
    June 12, 2008 (Inception) through December 31, 2008
    and for the period from June 12, 2008 (Inception) through
    December 31, 2009
F-4
Consolidated Statements of Members' Equity
    for the year ended December 31, 2009 and for the period
    from June 12, 2008 (Inception) through December 31,
    2008
F-5
Consolidated Statements of Cash Flows for the
    year ended December 31, 2009, for the period from
    June 12, 2008 (Inception) through December 31, 2008
    and for the period from June 12, 2008 (Inception) through
    December 31, 2009
F-6
Notes to Consolidated Financial Statements
F-7
F-1
Table of Contents
Report of
    Independent Registered Public Accounting Firm
To the Members of Molycorp, LLC:
In our opinion, the accompanying consolidated balance sheets and
    the related consolidated statements of operations, of
    members' equity and of cash flows present fairly, in all
    material respects, the financial position of Molycorp, LLC and
    its wholly-owned subsidiary (a development stage company) at
    December 31, 2009 and 2008, and the results of their
    operations and their cash flows for the year ended
    December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008, and cumulatively for
    the period from June 12, 2008 (Inception) through
    December 31, 2009, in conformity with accounting principles
    generally accepted in the United States of America. These
    financial statements are the responsibility of the
    Company's management. Our responsibility is to express an
    opinion on these financial statements based on our audits. We
    conducted our audits of these statements in accordance with the
    standards of the Public Company Accounting Oversight Board
    (United States). Those standards require that we plan and
    perform the audit to obtain reasonable assurance about whether
    the financial statements are free of material misstatement. An
    audit includes examining, on a test basis, evidence supporting
    the amounts and disclosures in the financial statements,
    assessing the accounting principles used and significant
    estimates made by management, and evaluating the overall
    financial statement presentation. We believe that our audits
    provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Phoenix, Arizona
April 16, 2010
F-2
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Consolidated Balance Sheets
(In thousands)
December 31,
December 31,
2009
2008
ASSETS
Current assets:
Cash and cash equivalents
$
6,929
$
2,189
Trade accounts receivable
1,221
1,346
Inventory
8,545
2,990
Prepaid expenses and other
1,825
2,185
Total current assets
18,520
8,710
Non-current assets:
Property, plant and equipment, net
$
66,352
$
63,053
Inventory
12,090
13,122
Investment in joint venture
—
9,700
Intangible asset, net
704
770
Total non-current assets
79,146
86,645
Total assets
$
97,666
$
95,355
LIABILITIES AND MEMBERS' EQUITY
Current liabilities:
Trade accounts payable
$
2,886
$
2,250
Accrued expenses
5,963
1,446
Current portion of asset retirement obligation
693
387
Total current liabilities
9,542
4,083
Non-current liabilities:
Asset retirement obligation
$
13,509
$
13,196
Total liabilities
23,051
17,279
Members' equity:
Paid-in capital
117,276
92,150
Deficit accumulated during the development stage
(42,661
)
(14,074
)
Total members' equity
74,615
78,076
Total liabilities and members' equity
$
97,666
$
95,355
See accompanying notes to consolidated financial statements.
F-3
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Consolidated Statements of
    Operations
(In thousands, except share and per share data)
June 12, 2008
June 12, 2008
(Inception)
(Inception)
Year Ended
Through
Through
December 31, 2009
December 31, 2008
December 31, 2009
Net sales
$
7,093
$
2,137
$
9,230
Operating costs and expenses:
Cost of goods sold
(21,785
)
(13,027
)
(34,812
)
Selling, general, and administrative
(12,685
)
(2,979
)
(15,664
)
Depreciation and amortization
(191
)
(19
)
(210
)
Accretion expense
(1,006
)
(250
)
(1,256
)
Operating loss
(28,574
)
(14,138
)
(42,712
)
Other income (expense):
Other income
181
54
235
Interest income (expense)
(194
)
10
(184
)
Net loss
$
(28,587
)
$
(14,074
)
$
(42,661
)
Weighted average shares outstanding
1,017,959
1,000,000
1,011,561
Loss per share:
Basic
$
(28.08
)
$
(14.07
)
$
(42.17
)
Diluted
$
(28.08
)
$
(14.07
)
$
(42.17
)
See accompanying notes to consolidated financial statements.
F-4
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Consolidated Statements of Members'
    Equity
(In thousands, except share amounts)
Deficit
Accumulated
Common Stock
During the
Total
Common
Paid-in
Development
Members'
Shares
Capital
Stage
Equity
Balance at June 12, 2008 (Inception)
$
$
—
$
—
$
—
Issuance of common shares
998,276
92,000
—
92,000
Employee compensation agreement
1,724
150
—
150
Net loss
—
(14,074
)
(14,074
)
Balance at December 31, 2008
1,000,000
92,150
(14,074
)
78,076
Issuance of shares
99,019
18,004
—
18,004
Conversion of short-term borrowings from member plus related
    accrued interest into common shares
59,312
6,831
—
6,831
Exercise of employee options
543
50
50
Employee compensation agreement
241
—
241
Net loss
—
(28,587
)
(28,587
)
Balance at December 31, 2009
$
1,158,874
$
117,276
$
(42,661
)
$
74,615
See accompanying notes to consolidated financial statements.
F-5
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Consolidated Statements of Cash
    Flows
(In thousands)
June 12, 2008
June 12, 2008
(Inception)
(Inception)
Year Ended
Through
Through
December 31, 2009
December 31, 2008
December 31, 2009
Cash flows from operating activities:
Net loss
$
(28,587
)
$
(14,074
)
$
(42,661
)
Adjustments to reconcile net loss to net cash used in operating
    activities:
Depreciation and amortization
3,896
936
4,832
Accretion of asset retirement obligation
1,006
250
1,256
Non-cash inventory write-downs
9,035
9,509
18,544
Non-cash stock compensation expense
241
150
391
Loss on sale of assets
2
—
2
Changes in operating assets and liabilities:
Accounts receivable
125
(1,897
)
(1,772
)
Other current assets
345
—
345
Inventory
(13,557
)
(3,440
)
(16,997
)
Prepaid expenses
15
(1,634
)
(1,619
)
Accounts payable
(254
)
642
388
Asset retirement obligation
(387
)
—
(387
)
Accrued expenses
5,749
2,218
7,967
Net cash used in operating activities
(22,371
)
(7,340
)
(29,711
)
Cash flows from investing activities:
Acquisition of the Mountain Pass facility
—
(82,150
)
(82,150
)
Proceeds from sale of investment in joint venture
9,700
—
9,700
Capital expenditures
(7,285
)
(321
)
(7,606
)
Proceeds from sale of assets
5
—
5
Net cash provided by (used in) investing activities
2,420
(82,471
)
(80,051
)
Cash flows provided by financing activities:
Capital contributions from members
18,004
92,000
110,004
Proceeds from exercise of options
50
—
50
Short-term borrowings from member
6,637
—
6,637
Net cash provided by financing activities
24,691
92,000
116,691
Net increase in cash and cash equivalents
4,740
2,189
6,929
Cash and cash equivalents at beginning of the year
2,189
—
—
Cash and cash equivalents at end of year
$
6,929
$
2,189
$
6,929
Supplemental disclosure of non-cash activities:
Conversion of short-term borrowings from member plus accrued
    interest, into common shares
$
6,831
See accompanying notes to consolidated financial statements.
F-6
Table of Contents
MOLYCORP,
    LLC
(A Company in the Development Stage)
Notes to Consolidated Financial Statements
December 31, 2009 and 2008
(1)
Company
    Background
Molycorp, LLC (the "Company" or "Molycorp")
    was formed on September 9, 2009, as a Delaware limited
    liability company. Upon such formation, the members of Molycorp
    Minerals, LLC ("Molycorp Minerals") exchanged their
    ownership interests for ownership interests in Molycorp. These
    transactions were accounted for as a reorganization of entities
    under common control at historical cost. Accordingly, the
    accompanying financial information for periods prior to
    Molycorp's formation is the historical financial
    information of Molycorp Minerals.
Molycorp Minerals, previously known as Rare Earth Acquisition
    LLC (which was formed on June 12, 2008), acquired the
    Mountain Pass, California rare earth deposit and associated
    assets (the "Mountain Pass facility") and assumed
    certain liabilities from Chevron Mining, Inc.
    ("Chevron") on September 30, 2008.
The Mountain Pass facility is located in San Bernardino
    County, California and is the only significant developed rare
    earth resource in the western world. Rare earth elements
    ("REEs") are a group of specialty elements with unique
    properties that make them critical to many existing and emerging
    applications including:
•
Clean-energy technologies such as hybrid and electric vehicles,
    wind turbines and compact florescent lighting;
•
High-technology applications including cell phones, personal
    digital assistant devices, digital music players, hard disk
    drives used in computers, computing devices, "ear bud"
    speakers and microphones, as well as fiber optics, lasers and
    optical temperature sensors;
•
Critical defense applications such as guidance and control
    systems, communications, global positioning systems, radar and
    sonar; and
•
Advanced water treatment applications including those for
    industrial, military, homeland security, domestic and foreign
    aid use.
The REE group includes 17 elements, namely the
    15 lanthanide elements, which are lanthanum, cerium,
    praseodymium, promethium (which does not occur naturally),
    neodymium, samarium, europium, gadolinium, terbium, dysprosium,
    holmium, erbium, thulium, ytterbium, and lutetium, and two
    elements that have similar chemical properties to the lanthanide
    elements — yttrium and scandium. The oxides produced
    from processing REEs are collectively referred to as rare earth
    oxides ("REOs"). Bastnasite is a mineral that contains
    REEs.
Operations at the Mountain Pass facility began in 1952 under
    Molybdenum Corporation of America ("MCA"). MCA was
    purchased by Union Oil of California ("Unocal") in
    1997. In 2002, mining operations were suspended at the Mountain
    Pass facility primarily due to softening prices for REOs and a
    lack of additional tailings disposal capacity. Chevron
    Corporation purchased Unocal in 2005.
Prior to the acquisition, operations at the Mountain Pass
    facility had been suspended with the exception of a pilot
    processing project to recover neodymium from lanthanum
    stockpiles produced prior to Chevron's ownership of the
    Mountain Pass facility. The neodymium from lanthanum
    ("NFL") pilot processing project was undertaken to
    improve the facility's REE processing techniques. For the
    year ended December 31, 2009 and the period from
    June 12, 2008 (Inception) through December 31, 2008,
    revenue was generated primarily from the sale of products
    associated with the NFL pilot processing project.
(2)
Basis of
    Presentation
The Company's acquisition of the Mountain Pass facility has
    been accounted for as an acquisition of net assets and not a
    business combination. As described below, the Company's
    current business plan includes investing substantial capital to
    restart mining operations, construct and refurbish processing
    facilities and other
F-7
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
infrastructure, and to expand into metal and alloy production.
    Molycorp will continue as a development stage company until
    these activities have been completed which is currently expected
    by the end of 2012.
The accompanying consolidated financial statements include the
    accounts of the Company and its
wholly-owned
subsidiary. All intercompany balances and transactions have been
    eliminated in consolidation.
The Company has evaluated subsequent events through
    April 16, 2010, which is the date the accompanying
    financial statements were available to be issued.
(3)
Liquidity
    and Capital Requirements
Most of the facilities and equipment acquired with the Mountain
    Pass facility are at least 20 years old and must be
    modernized or replaced. Under its current business plan, the
    Company intends to spend approximately $511 million through
    2012 to restart mining operations, construct and refurbish
    processing facilities and other infrastructure at the Mountain
    Pass facility and expand into metal and alloy production.
    Capital expenditures under this plan total approximately
    $53 million in 2010. The Company expects to finance these
    expenditures, as well as its working capital requirements, with
    proceeds from planned public
and/or
private offerings of its securities or project financing. There
    can be no assurance that the Company will be successful in the
    anticipated offerings or that it will be successful in raising
    additional capital in the future on terms acceptable to the
    Company, or at all.
If the Company is unable to raise sufficient capital through the
    planned securities offerings, additional capital contributions
    from existing members or other alternative sources of financing,
    management will implement a short-term business plan in 2010.
    Under this plan, capital expenditures will be curtailed at
mid-year
and
    limited operations at the Mountain Pass facility will continue
    through December 31, 2010. The Company believes that it
    will be able to fund the short-term business plan with existing
    cash and cash equivalents, which totaled $6.9 million at
    December 31, 2009, and funding commitments from its members
    totaling $20.0 million.
The accompanying financial statements have been prepared on a
    going concern basis under which the Company is expected to be
    able to realize its assets and satisfy its liabilities in the
    normal course of business. To continue as a going concern beyond
    2010 and in order to continue the restart of mining operations
    and modernization of the Mountain Pass facility, the Company
    will need to complete the planned securities offerings or obtain
    alternative sources of financing. Absent additional financing,
    the Company will not have the resources to execute its current
    business plan.
(4)
Summary
    of Significant Accounting Policies
(a)
Use of
    Estimates
The preparation of the financial statements, in accordance with
    generally accepted accounting principles in the United States of
    America, requires management to make estimates and assumptions
    that affect the reported amounts of assets and liabilities, the
    disclosure of contingent assets and liabilities at the date of
    the financial statements and the reported amounts of revenues
    and expenses during the reporting period. Management bases its
    estimates on the Company's historical experience and on
    various other assumptions that are believed to be reasonable
    under the circumstances. Actual results may differ significantly
    from these estimates under different assumptions and conditions.
Significant estimates made by management in the accompanying
    financial statements include the allocation of the purchase
    price for the Mountain Pass facility to the assets acquired and
    liabilities assumed, the collectability of accounts receivable,
    the recoverability of inventory, the useful lives and
    recoverability of long-lived assets such as property, plant and
    equipment and intangible asset, and the adequacy of the
F-8
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
Company's asset retirement obligations. The current
    economic environment has increased the degree of uncertainty
    inherent in these estimates and the underlying assumptions.
(b)
Revenue
    and Cost of Goods Sold
Revenue is recognized when persuasive evidence of an arrangement
    exists, the risks and rewards of ownership have been transferred
    to the customer, which is generally when title passes, the
    selling price is fixed or determinable, and collection is
    reasonably assured. Title generally passes upon shipment of
    product from the Mountain Pass facility. Prices are generally
    set at the time of, or prior to, shipment. Transportation and
    distribution costs are incurred only on sales for which the
    Company is responsible for delivering the product. Our reported
    revenues are presented net of freight and shipping costs.
Cost of goods sold includes the cost of production as well as
    inventory write-downs caused by market price declines. Primary
    production costs include labor, supplies, maintenance costs,
    depreciation, and plant overhead.
(c)
Cash
The Company considers cash and all highly liquid investments
    with an original maturity of three months or less to be cash
    equivalents.
(d)
Trade
    Accounts Receivable
Trade accounts receivable are recorded at the invoiced amount
    and do not bear interest. The Company reviews its allowance for
    doubtful accounts on a quarterly basis. As of December 31,
    2009 and 2008, an allowance for doubtful accounts was not
    required.
(e)
Inventories
Inventories consist of
work-in-process,
finished goods, stockpiles of bastnasite and lanthanum
    concentrate, and materials and supplies. Inventory cost is
    determined using the lower of weighted average cost or estimated
    net realizable value. Inventory expected to be sold in the next
    12 months is classified as a current asset in the
    consolidated balance sheet.
Write-downs to estimated net realizable value are charged to
    cost of goods sold. Many factors influence the market prices for
    REOs and, in the absence of established prices contained in
    customer contracts, management uses an independent pricing
    source to evaluate market prices for REOs at the end of each
    quarter. For the year ended December 31, 2009, the period
    from June 12, 2008 (Inception) through December 31,
    2008, and cumulatively for the period from June 12, 2008
    (Inception) through December 31, 2009, the Company
    recognized write-downs of $9.0 million, $9.5 million
    and $18.5 million, respectively, as a result of declines in
    REO market prices.
The Company evaluates the carrying value of materials and supply
    inventories each quarter giving consideration to slow-moving
    items, obsolescence, excessive levels, and other factors and
    recognizes related write-downs as necessary.
F-9
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
At December 31, 2009 and 2008, inventory consisted of the
    following (in thousands):
December 31,
December 31,
2009
2008
Current:
Work in process
$
4,797
$
52
Finished goods
2,685
1,635
Materials and supplies
1,063
1,303
Total current
$
8,545
2,990
Long term:
Concentrate stockpiles
$
11,844
$
11,862
Work in process
—
681
Finished goods
246
579
Total long term
$
12,090
$
13,122
(f)
Property,
    Plant and Equipment, net
Property, plant and equipment associated with the acquisition of
    the Mountain Pass facility is stated at estimated fair value as
    of the acquisition date. Expenditures for new property, plant
    and equipment and improvements that extend the useful life or
    functionality of the asset are capitalized. The Company incurred
    $7.1 million in plant modernization costs in 2009, and
    anticipates incurring approximately $474 million in plant
    modernization costs from 2010 through 2012. Depreciation on
    plant and equipment is calculated using the straight-line method
    over the estimated useful lives of the assets. Depreciation
    expense for the year ended December 31, 2009, the period
    from June 12, 2008 (Inception) through December 31,
    2008, and cumulatively for the period from June 12, 2008
    (Inception) through December 31, 2009, was
    $3.9 million, $0.9 million and $4.8 million,
    respectively. Maintenance and repair costs are expensed as
    incurred.
Mineral properties at December 31, 2009 and 2008, represent
    the estimated fair value of the mineral resources associated
    with the Mountain Pass facility. The Company will begin to
    amortize such mineral properties using the units of production
    method over estimated proven and probable reserves once mining
    operations resume, which is currently expected to occur in late
    2010.
At December 31, 2009 and 2008, property, plant and
    equipment consisted of the following (in thousands):
December 31,
December 31,
2009
2008
Land
$
800
$
800
Land improvements (15 years)
17,954
17,923
Buildings and improvements (4 to 27 years)
8,458
8,335
Plant and equipment (2 to 12 years)
12,065
11,692
Vehicles (7 years)
1,023
1,031
Computer software (5 years)
1,116
164
Furniture and fixtures (5 years)
41
39
Construction in progress
6,506
851
Mineral properties
23,138
23,138
Property, plant and equipment at cost
71,101
63,973
Less accumulated depreciation
(4,749
)
(920
)
Property, plant and equipment, net
$
66,352
$
63,053
F-10
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
In accordance with ASC 360,
Property Plant and
    Equipment
, long-lived assets such as property, plant, and
    equipment, mineral properties and purchased intangible assets
    subject to amortization, are reviewed for impairment whenever
    events or changes in circumstances indicate that the carrying
    amount of an asset may not be recoverable. The Company did not
    recognize any impairment for the year ended December 31,
    2009 or the period from June 12, 2008 (Inception) through
    December 31, 2008.
(g)
Intangible
    Asset
The Company acquired its trade name in connection with the
    Mountain Pass facility acquisition. Amortization is provided
    using the straight-line method based on an estimated useful life
    of 12 years. Amortization expense for the year ended
    December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008, and cumulatively for
    the period from June 12, 2008 (Inception) through
    December 31, 2009 was $65,000, $17,000, and $82,000,
    respectively. Amortization expense is estimated to be $65,000
    annually for the following five years.
(h)
Investment
    in Joint Venture
In connection with the Mountain Pass facility acquisition, the
    Company acquired a one third interest in a joint venture with
    Sumitomo Metals Industries, Ltd. of Japan (Sumitomo) called
    Sumikin Molycorp (SMO). The Company sold its interest in the
    joint venture to Sumitomo on July 9, 2009 for
    $9.7 million for no gain.
(i)
Accrued
    Expenses
Accrued expenses as of December 31, 2009 and 2008 consisted
    of the following: (in thousands):
December 31,
December 31,
2009
2008
Waste disposal accrual
$
1,500
$
—
Completion bonus
1,445
650
Defined contribution plan
988
192
Other accrued expenses
2,030
604
Total accrued expenses
$
5,963
$
1,446
(j)
Asset
    Retirement Obligation
The Company accounts for reclamation costs, along with other
    costs related to the closure of the Mountain Pass facility, in
    accordance with
ASC 410-20
Asset Retirement Obligations
. This standard requires the
    Company to recognize asset retirement obligations at estimated
    fair value in the period in which the obligation is incurred.
    The Company recognized an asset retirement obligation and
    corresponding asset retirement cost of $13.3 million in
    connection with the Mountain Pass facility acquisition. The
    liability was initially measured at fair value and is
    subsequently adjusted for accretion expense and changes in the
    amount or timing of the estimated cash flows. The asset
    retirement cost was capitalized as part of the carrying amount
    of the related long-lived assets and is being depreciated over
    the assets' remaining useful lives. Depreciation expense
    associated with the asset retirement cost was $1.2 million,
    $0.3 million and $1.5 million for the year ended
    December 31, 2009, the period from June 12, 2008
    (Inception) through December 31, 2008, and
F-11
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
cumulatively for the period from June 12, 2008 (Inception)
    through December 31, 2009, respectively. The following
    table presents the activity in our asset retirement obligation
    (in thousands):
September 30, 2008
Year Ended
Through
December 31, 2009
December 31, 2008
Balance at beginning of period
$
13,583
$
13,333
Obligations settled
(387
)
—
Accretion expense
1,006
250
Balance at end of period
$
14,202
$
13,583
The Company is required to provide the applicable governmental
    agencies with financial assurances relating to its closure and
    reclamation obligations. As of December 31, 2008, the
    Company had financial assurance requirements of
    $26.3 million which were satisfied by instruments obtained
    by Chevron. In March 2009, the Company replaced these
    instruments with surety bonds secured by letters of credit or
    cash collateral provided by the individual members. As of
    December 31, 2009, the Company had financial assurance
    requirements of $27.4 million.
(k)
Income
    Taxes
As a limited liability company, the Company does not incur or
    pay federal or state income taxes. Rather, taxable income and
    losses of the Company are reported on the income tax returns of
    the Company's members. As a result, a provision for incomes
    taxes has not been included in the consolidated statements of
    operations.
(l)
Members'
    Equity
Members' interests are represented by 1,158,874 and
    1,000,000 shares of the Company's common stock at
    December 31, 2009 and 2008, respectively. Paid-in capital
    in the consolidated balance sheets represents amounts paid by
    members or interests earned under certain stock compensation
    agreements.
(m)
Earnings
    (loss) per Share
Basic income (loss) per share is computed by dividing the
    Company's net income (loss) by the weighted average number
    of common shares outstanding during the year. Diluted income
    (loss) per share reflects the dilution of potential common
    shares in the weighted average number of common shares
    outstanding during the year, if dilutive. For this purpose, the
    "treasury stock method" and "if converted
    method," as applicable, are used for the assumed proceeds
    upon the exercise of common share equivalents at the average
    selling prices of the shares during the year. For the year ended
    December 31, 2009, potential shares associated with 3,255
    outstanding stock options were excluded from the calculation of
    diluted earnings per share as their effect would have been
    anti-dilutive due to the Company's net loss for the year.
(n)
Comprehensive
    income (loss)
The Company does not have any items entering into the
    determination of comprehensive income (loss) other than net
    income (loss) for the period.
(5)
Acquisition
    of Mountain Pass Facility
On September 30, 2008, Molycorp completed the acquisition
    of the Mountain Pass facility for approximately
    $82.1 million, consisting of $80.0 million in cash
    paid to Chevron and $2.1 million in related
F-12
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
transaction costs. The acquisition has been accounted as an
    acquisition of net assets. The following table summarizes the
    allocation of the purchase price to the assets acquired and
    liabilities assumed (in thousands):
Acquired assets:
Inventory — concentrate stockpiles
$
19,201
Inventory — finished goods
1,506
Inventory — work in process
572
Inventory — material and supply
902
Mineral properties
23,138
Land and land improvements
18,723
Property, plant, and equipment
21,354
Trade name
786
Investment in joint venture
9,700
Total assets
95,882
Asset retirement obligation
13,333
Completion bonus
399
Net purchase price
$
82,150
As part of the purchase agreement, the Company also retained the
    services of approximately 100 employees from Chevron,
    including 43 non-union employees and 57 union employees. Under
    the terms of the purchase agreement, the Company agreed to
    continue to provide all retained employees' salaries at
    their previous levels for a period of 12 months; provide
    comparable 401(k) and health benefits, and to honor all vacation
    days accrued prior to the purchase.
(6)
Employee
    Benefit Plans
The Company maintains a defined contribution plan for all
    employees who meet the related eligibility requirements. All
    former Chevron employees became eligible to participate in the
    plan on the date of the acquisition while all new employees
    become eligible to participate after 90 days of service.
    The Company currently makes a non-elective contribution equal to
    4% of compensation for each employee who performed at least
    1,000 hours of service and is employed on the last day of
    the year. In addition, the Company currently matches 100% of the
    first 3% contributed and 50% of the next 2% contributed by each
    eligible employee. Employees vest in Company contributions after
    three years of service. Expense related to this plan totaled
    $1.0 million, $0.2 million and $1.2 million for
    the year ended December 31, 2009, the period from
    June 12, 2008 (Inception) through December 31, 2008,
    and cumulatively for the period from June 12, 2008
    (Inception) through December 31, 2009, respectively.
    Additionally, accrued expenses at December 31, 2009 and
    2008, included $1.0 million and $0.2 million related
    to this plan, respectively.
On April 1, 2009, the Company established the Management
    Incentive Plan ("MIP"), which is a nonqualified
    deferred compensation plan for the purpose of providing deferred
    compensation benefits for certain members of management. Under
    the MIP, participants can defer their base salary and other
    compensation that is supplemental to his or her base salary and
    is dependent upon achievement of individual or Company
    performance goals. It is intended that the MIP constitute an
    unfunded plan for purposes of the Employee Retirement Income
    Security Act of 1974, as amended. The amounts of compensation or
    awards deferred are deemed to be invested in a hypothetical
    investment as of the date of deferral. For the year ended
    December 31, 2009, the Company elected to make
    discretionary contributions to the MIP totaling
F-13
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
approximately $47,000. In addition, participants in the MIP
    program elected to defer approximately $19,000 of their
    compensation, which is included in other accrued expenses at
    December 31, 2009.
(7)
Commitments
    and Contingencies
(a)
Self
    Insurance
The Company is self-insured for employee healthcare costs,
    subject to a related stop-loss agreement with an insurance
    company. The Company recorded a liability of $0.1 million
    associated with this obligation as of December 31, 2009.
(b)
Future
    Operating Lease Commitments
The Company has certain operating leases for office space, land,
    and certain equipment. Remaining annual minimum payments under
    these leases at December 31, 2009 were $0.2 million in
    2010 and $0.1 million in 2011.
(c)
Completion
    Bonus
In connection with the Mountain Pass facility acquisition, the
    Company assumed a $0.4 million obligation related to a
    completion bonus payable to union employees who worked on the
    NFL pilot processing development project. Under the terms of the
    related labor agreement, eligible employees were entitled to a
    bonus of 40 hours of pay at the employee's base rate
    for every month spent on the project, regardless of the number
    of hours worked. The Company recognized the related costs
    associated with this bonus as employees worked on the project.
    As of December 31, 2009 and 2008, the accrued completion
    bonus was $1.4 million and $0.7 million, respectively.
    The completion bonus was paid in March 2010.
(d)
Labor
    Contract
Certain Mountain Pass facility employees are covered by a
    collective bargaining agreement with the United Steelworkers of
    America which expires on March 15, 2012. At
    December 31, 2009, 60 employees, or approximately 50%
    of the Company's workforce, were covered by this collective
    bargaining agreement.
(e)
Reclamation
    Surety Bonds
As of December 31, 2009, Molycorp had placed
    $27.4 million of surety bonds with California state and
    regional agencies to secure its Mountain Pass facility closure
    and reclamation obligations.
(f)
Insurance
    Premium Financing Agreement
As of December 31, 2009, Molycorp was a party to a
    short-term premium financing agreement related to its property
    insurance policies. The unpaid principal balance of
    $0.4 million is included in accrued expenses in the
    consolidated balance sheet. The agreement requires monthly
    principal and interest payments of $41,592 through November 2010.
(g)
Licenses
    and Permits
The Company is subject to numerous and detailed federal, state
    and local environmental laws, regulations and permits including
    health and safety, environmental, and air quality. The Company
    must obtain a number of additional permits in order to complete
    the plant modernization and expansion. The Company is subject to
    strict conditions, requirements and obligations relating to
    various environmental and health and safety matters in
    connection with the current permits, and the Company anticipates
    additional conditions, requirements and
F-14
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
obligations associated with the additional permits required for
    future operations, including the modernization and expansion of
    the Mountain Pass facility. Certain conditions could be imposed
    in order to obtain the required permits including requirements
    to conduct additional environmental studies and collect and
    present data to government authorities pertaining to the
    potential impact of current and future operations upon the
    environment. Accordingly, the required permits may not be
    issued, maintained or renewed in a timely fashion if at all, or
    may be issued or renewed upon conditions that restrict the
    Company's ability to conduct its operations economically.
    Any failure, significant delay or significant change in
    conditions that is required to obtain, maintain or renew
    permits, could have a material adverse effect on the
    Company's business, results of operations and financial
    condition.
(8)
Stock
    Based Compensation
The Company's Chief Executive Officer received a signing
    bonus, of which $350,000 was paid in cash and $150,000 was paid
    through the issuance of 1,724 shares of common stock. The
    per share value of the common stock at the date of issuance
    approximates the per share amount contributed by other members.
    These shares vested immediately and the related expense was
    recognized during the period from June 12, 2008 (Inception)
    through December 31, 2008.
The Company issued an option to its Chief Executive Officer for
    the purchase of 3,798 shares of Company stock on
    April 10, 2009. The option vested on the date of grant and
    had a stated exercise price of $92.15 per share. The fair value
    of the stock at the time of issuance was estimated to be $115.17
    per share based on the share price established in a related
    party financing agreement executed shortly prior to the issuance
    of the option. In measuring compensation expense, the Company
    estimated the fair value of the award on the grant date using
    the Black-Scholes-Merton option valuation model. Option
    valuation models require the input of highly subjective
    assumptions, including the expected volatility of the price of
    the underlying stock.
The following assumptions were used to compute the fair value of
    the option grant:
Risk free interest rate
0.60
%
Dividend yield
—
Estimated volatility
146
%
Expected option life
10 months
The Company's computation of the estimated volatility was
    based on the historical volatility of a group of peer
    companies' common stock over the expected option life. The
    peer information was used because Molycorp is not publicly
    traded and therefore does not have the market trading history
    required to calculate a meaningful volatility factor. The
    computation of expected option life was determined based on a
    reasonable expectation of the option life prior to being
    exercised or forfeited. The risk-free interest rate assumption
    was based on the U.S. Treasury constant maturity yield at
    the date of grant over the expected life of the option.
For the year ended December 31, 2009, the Company
    recognized stock-based compensation related to this option grant
    of $241,000.
F-15
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
A summary of Molycorp's stock option activity for the year
    ended December 31, 2009, is as follows:
Estimated
Exercise
Grant-Date
Remaining
Shares
Price
Fair Value
Life
Outstanding options at beginning of period
—
—
—
—
Granted and vested
3,798
92.15
63.41
10 months
Exercised
543
92.15
63.41
—
Forfeited
—
—
—
—
Vested options outstanding end of period
3,255
92.15
63.41
2 months
Effective November 1, 2009, the Company issued 5,880,000
    incentive shares of Molycorp Minerals to certain employees and
    independent directors. Pursuant to the terms of Molycorp
    Minerals' Second Amendment and Restated Operating Agreement
    dated September 10, 2009, the incentive shares have no
    voting rights and are intended to constitute a "profits
    interests" as defined under Internal Revenue Service
    regulations. Holders of incentive shares have no capital
    accounts, but are entitled to receive cash distributions from
    the Company in amounts ranging from 3.2% to 7.0% of excess
    distributions after common shareholders have received an
    annually compounded 10% return of their capital contributions.
    The distribution percentage applied is based on the cumulative
    return on investment received by the common shareholders.
The incentive shares vest at a rate of one-third per year on the
    anniversary date of the award, subject to acceleration at the
    Company's discretion or six months after a change in
    control or a public offering of equity interest in the Company.
    Upon termination, unvested shares are forfeited and vested
    shares may be repurchased by the Company's at its
    discretion. The purchase price of vested shares is based upon an
    assumed liquidation of the Company's assets at book value
    and is subject to the same distribution terms as the cash
    distribution described above. Due to the Company's option
    to repurchase vested shares of terminated participants at a
    price other than fair value, the incentive shares are classified
    as liabilities measured using the intrinsic value method. These
    liabilities will be remeasured at each reporting date until the
    shares are forfeited or repurchased. As of December 31,
    2009, the intrinsic value of the incentive shares was zero.
(9)
Concentrations
(a)
Limited
    Number of Products
The Company's current operations are limited to the
    production and sale of REOs from stockpiled concentrates and it
    does not have the capability to significantly alter its product
    mix prior to completing the modernization and expansion of the
    Mountain Pass facility and the restart of mining operations.
    Sales of lanthanum concentrate accounted for 82% and 72% of our
    sales for the year ended December 31, 2009 and for the
    period from June 12, 2008 (Inception) through
    December 31, 2008, respectively.
(b)
Limited
    Number of Customers
There is a limited market for the Company's lanthanum
    concentrate and its two largest customers comprised 82% (55% of
    the total corresponds to the Company's largest customer and
    27% of the total corresponds to the Company's second
    largest customer) and 72% (57% of the total corresponds to the
    Company's largest customer and 15% of the total corresponds
    to the Company's second largest customer) of the
    Company's total product revenue for the year ended
    December 31, 2009 and for the period from June 12,
    2008 (Inception) through December 31, 2008, respectively.
F-16
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
(c)
Single
    Geographic Location
Currently, the Company's only mining and production
    facility is the Mountain Pass facility and the Company's
    viability is based on the successful modernization and expansion
    of its operations. The deterioration or destruction of any part
    of the Mountain Pass facility, or legal restrictions related to
    current or anticipated operations at the Mountain Pass facility,
    may significantly hinder the Company's ability to reach or
    maintain full planned production rates within the expected time
    frame, if at all.
(10)
Related
    Party Transactions
In connection with the Mountain Pass facility acquisition,
    certain members incurred acquisition costs that were
    subsequently reimbursed by Molycorp. At December 31, 2008,
    accrued expenses included approximately $0.2 million
    related to this reimbursement obligation.
In February 2009, the Company's members incurred certain
    costs in providing letters of credit
and/or
cash
    collateral to secure the surety bonds issued for the benefit of
    certain regulatory agencies relating to the Company's
    Mountain Pass facility closure and reclamation obligations. The
    total amount of collateral provided by the members at
    December 31, 2009 was $18.2 million. The Company has
    agreed to pay each member a 5% annual return on the amount of
    collateral provided. Under the terms of the agreement, the
    members may receive quarterly payments, delayed payments, or
payments-in-kind.
During the year ended December 31, 2009, the Company
    recognized approximately $0.8 million in compensation to
    the members under this agreement which is included in selling,
    general and administrative expense in the consolidated statement
    of operations. At December 31, 2009, accrued expenses in
    the consolidated balance sheet included $0.6 million
    payable to members.
In May and July 2009, Molycorp entered into transactions with a
    member under which it borrowed an aggregate $6.6 million,
    secured by certain product inventories. Borrowings under this
    agreement required interest at a variable rate of LIBOR plus one
    percent. On November 15, 2009, the member converted
    outstanding advances plus accrued interest totaling
    $6.8 million into 59,312 shares of Molycorp common
    stock in settlement of the obligation.
(11)
Recently
    Issued Accounting Pronouncements
Variable
    Interest Entities
In June 2009, the ASC guidance for consolidation accounting was
    updated to require an entity to perform a qualitative analysis
    to determine whether the enterprise's variable interest
    gives it a controlling financial interest in the variable
    interest entity ("VIE"). This analysis identifies a
    primary beneficiary of a VIE as the entity that has both of the
    following characteristics: (i) the power to direct the
    activities of a VIE that most significantly impact the
    entity's economic performance and (ii) the obligation
    to absorb losses or receive benefits from the entity that could
    potentially be significant to the VIE. The updated guidance also
    requires ongoing reassessments of the primary beneficiary of a
    VIE. The updated guidance is effective for the Company's
    fiscal year beginning January 1, 2010. The Company is
    evaluating the potential impact of adopting this guidance on the
    Company's consolidated financial position, results of
    operations and cash flows.
Fair
    Value Accounting
In January 2010, the ASC guidance for fair value measurements
    and disclosure was updated to require additional disclosures
    related to: i) transfers in and out of level 1 and 2 fair
    value measurements and ii) enhanced detail in the level 3
    reconciliation. The guidance was amended to provide clarity
    about: i) the level of disaggregation required for assets
    and liabilities and ii) the disclosures required for inputs
    and valuation techniques used to measure fair value for both
    recurring and nonrecurring measurements that fall in
F-17
Table of Contents
MOLYCORP,
    LLC
(A
    Company in the Development Stage)
Notes to
    Consolidated Financial
    Statements — (Continued)
either level 2 or level 3. The updated guidance is effective for
    the Company's fiscal year beginning January 1, 2010,
    with the exception of the level 3 disaggregation which is
    effective for the Company's fiscal year beginning
    January 1, 2011. The Company is evaluating the potential
    impact of adopting this guidance on the Company's
    consolidated financial position, results of operations and cash
    flows.
(12)
Subsequent
    Events
Molycorp, Inc. was formed on March 4, 2010, and on
    April 15, 2010, the members of Molycorp, LLC contributed
    either (a) all of their member interests in Molycorp, LLC
    or (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC (and no other assets or
    liabilities) to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class A common stock. Additionally, all
    holders of profits interests in Molycorp Minerals, LLC, which
    were represented by incentive shares, contributed all of their
    incentive shares to Molycorp, Inc. in exchange for shares of
    Molycorp, Inc. Class B common stock. Accordingly, Molycorp,
    LLC and Molycorp Minerals, LLC became subsidiaries of Molycorp,
    Inc. All of the shares of Class A common stock and
    Class B common stock will convert into shares of common
    stock immediately prior to the consummation of an initial public
    offering of Molycorp, Inc. common stock.
On April 16, 2010, Molycorp Minerals, LLC executed an
    agreement under which an affiliate of one of Molycorp,
    Inc.'s stockholders agreed to purchase up to
    $5 million of product from Molycorp, Inc. through
    December 31, 2010. Purchases under the agreement would
    occur at Molycorp, Inc.'s request at a price per pound
    based on published index pricing. Upon the resale of any
    acquired product, Molycorp, Inc. is entitled to receive 50% of
    the sales price that exceeds a specified level.
F-18
Table of Contents
Shares
Molycorp, Inc.
Common Stock
PROSPECTUS
Dealer
    Prospectus Delivery Obligation
Until          ,
    2010 (the 25th day after the date of this prospectus), all
    dealers that effect transactions in these securities, whether or
    not participating in this offering, may be required to deliver a
    prospectus. This is in addition to the dealer's obligation
    to deliver a prospectus when acting as an underwriter and with
    respect to unsold allotments or subscriptions.
Table of Contents
PART II
INFORMATION
    NOT REQUIRED IN THE PROSPECTUS
Item 13.
Other
    Expenses of Issuance and Distribution.
The following table shows the costs and expenses, other than
    underwriting discounts and commissions, to be paid by the
    registrant in connection with this offering. All amounts shown
    except the SEC registration fee, the FINRA fee and the New York
    Stock Exchange Listing Fee are estimates.
Amount
(In thousands)
SEC Registration Fee
$
24,955
NYSE Listing Fee
*
FINRA Filing Fee
$
35,500
Accounting Fees and Expenses
*
Legal Fees and Expenses
*
Printing and Engraving Expenses
*
Blue Sky Fees and Expenses
*
Transfer Agent and Registrar Fees and Expenses
*
Miscellaneous Expenses
*
Total
$
*
*
To be provided by amendment.
Item 14.
Indemnification
    of Officers and Directors.
Section 102(b)(7) of the General Corporation Law of the
    State of Delaware allows a corporation to include in its
    certificate of incorporation a provision that limits or
    eliminates the personal liability of directors of a corporation
    or its stockholders for monetary damages for a breach of a
    fiduciary duty as a director, except where the director breached
    his duty of loyalty, failed to act in good faith, engaged in
    intentional misconduct or knowingly violated a law, authorized
    the payment of a dividend or approved a stock repurchase or
    redemption in violation of Delaware corporate law or obtained an
    improper personal benefit.
Section 145 of the General Corporation Law of the State of
    Delaware allows a corporation to indemnify any person who was or
    is a party or is threatened to be made a party to any
    threatened, pending or completed action, suit or proceeding,
    whether civil, criminal, administrative or investigative (other
    than an action by or in the right of such corporation) by reason
    of the fact that such person is or was a director, officer,
    employee or agent of such corporation, or is or was serving at
    the request of such corporation as a director, officer, employee
    or agent of another corporation, partnership, joint venture,
    trust or other enterprise. The indemnity may include expenses
    (including attorneys' fees), judgments, fines and amounts
    paid in settlement actually and reasonably incurred by such
    person in connection with such action, suit or proceeding,
    provided that such person acted in good faith and in a manner
    such person reasonably believed to be in or not opposed to the
    best interests of the corporation and, with respect to any
    criminal action or proceeding, had no reasonable cause to
    believe such person's conduct was unlawful. A Delaware
    corporation may indemnify directors, officers, employees and
    other agents of such corporation in an action by or in the right
    of a corporation to procure a judgment in its favor under the
    same conditions against expenses (including attorneys'
    fees) actually and reasonably incurred by the person in
    connection with the defense or settlement of such action or
    suit, except that no indemnification is permitted without
    judicial approval if the person to be indemnified has been
    adjudged to be liable to the corporation with respect to such
    claim, issue or matter. Where a present or former director or
    officer of the corporation is successful on the merits or
    otherwise in the defense of any action, suit or proceeding
    referred to above or in defense of any claim, issue or matter
    therein, the corporation must indemnify such person against the
    expenses (including attorneys' fees) which he or she
    actually and reasonably incurred in connection therewith.
II-1
Table of Contents
Section 174 of the General Corporation Law of the State of
    Delaware provides, among other things, that a director who
    willfully or negligently approves of an unlawful payment of
    dividends or an unlawful stock purchase or redemption, may be
    held liable for such actions. A director who was either absent
    when the unlawful actions were approved or dissented at the
    time, may avoid liability by causing his or her dissent to such
    actions to be entered into the books containing the minutes of
    the meetings of the board of directors at the time such action
    occurred or immediately after such absent director receives
    notice of the unlawful acts.
Our certificate of incorporation contains a provision that
    provides that each person who was or is a party or is threatened
    to be made a party to or is otherwise involved in any
    threatened, pending or completed action, suit or proceeding,
    whether civil, criminal, administrative or investigative, or a
    proceeding, by reason of the fact that the person is or was a
    director or an officer of our company, or is or was serving at
    our request as a director, officer, employee or agent of another
    corporation, partnership, joint venture, trust or other
    enterprise, including service with respect to an employee
    benefit plan, or an indemnitee, whether the basis of such
    proceeding is alleged action in an official capacity as a
    director, officer, employee or agent or in any other capacity
    while serving as a director, officer, employee or agent, shall
    be indemnified and held harmless by us to the fullest extent
    permitted or required by the General Corporation Law of the
    State of Delaware, as the same exists or may hereafter be
    amended (but, in the case of any such amendment, only to the
    extent that such amendment permits us to provide broader
    indemnification rights than such law permitted us to provide
    prior to such amendment), against all expense, liability and
    loss (including attorneys' fees, judgments, fines, the
    Employment Retirement Income Security Act of 1974 excise taxes
    or penalties and amounts paid in settlement) reasonably incurred
    or suffered by such indemnitee in connection therewith;
    provided, however, that, with limited exceptions relating to
    rights to indemnification, we shall indemnify any such
    indemnitee in connection with a proceeding (or part thereof)
    initiated by such indemnitee only if such proceeding (or part
    thereof) was authorized by our board of directors.
Our policy is to enter into separate indemnification agreements
    with each of our directors and officers that provide the maximum
    indemnity allowed to directors and executive officers by
    Section 145 of the General Corporation Law of the State of
    Delaware and also provides for certain additional procedural
    protections.
In addition, our certificate of incorporation states that we may
    maintain insurance to protect ourselves and any person who is or
    was a director, officer, employee or agent of our company, or is
    or was serving at our request as a director, officer, employee
    or agent of another corporation, partnership, joint venture,
    trust or other enterprise against any liability asserted against
    such person and incurred by such person in any such capacity, or
    arising out of such person's status as such, whether or not
    we would have the power to indemnify such person against such
    liability under the General Corporation Law of the State of
    Delaware. We have and intend to maintain director and officer
    liability insurance, if available on reasonable terms.
Item 15.
Recent
    Sales of Unregistered Securities.
During the past two years, Molycorp, Inc.'s predecessors,
    Molycorp, LLC and Molycorp Minerals, LLC, issued unregistered
    securities to funds affiliated with Resource Capital Funds,
    Pegasus Capital Advisors, LP, GS Power Holdings LLC, Traxys
    North America LLC, MP Rare Company LLC and KMSMITH LLC in
    connection with capital contributions. Prior to February 4,
    2009, no additional securities were issued to members; rather,
    the percentage ownership of each member, and such member's
    capital account, was adjusted accordingly. Molycorp, LLC also
    granted an option to its Chief Executive Officer to purchase
    member interests, and Molycorp Minerals, LLC awarded profits
    interests to certain employee and non-employee directors of
    Molycorp, LLC. None of these transactions involved any
    underwriters or any public offerings, and we believe that each
    of these transactions was exempt from the registration
    requirements pursuant to Section 4(2) of the Securities Act
    of 1933. The recipients of the securities in these transactions
    represented their intention to acquire the securities for
    investment only and not with a view to or for sale in connection
    with any distribution thereof. The information presented below
    does not give effect to our corporate reorganization as
    described in the prospectus.
From July 30, 2008 through February 4, 2009 the
    members of Molycorp Minerals, LLC contributed an aggregate of
    $94,991,246 to Molycorp Minerals, LLC.
II-2
Table of Contents
From February 5, 2009 through September 8, 2009, the
    members of Molycorp Minerals, LLC contributed an aggregate of
    $50,000 to Molycorp Minerals, LLC in exchange for
    542.59 shares.
On September 9, 2009, the members of Molycorp Minerals, LLC
    exchanged all of their member interests in Molycorp Minerals,
    LLC in exchange for all of the member interests of Molycorp,
    LLC. On September 10, 2009, Molycorp Minerals, LLC granted
    profits interests represented by an aggregate of 5,880,000
    incentive shares to certain employees and non-employee directors.
From September 10, 2009 through April 14, 2010, the
    members of Molycorp, LLC contributed an aggregate of $27,130,946
    to Molycorp, LLC in exchange for 260,606.66 shares.
On April 15, 2010, the members of Molycorp, LLC exchanged
    either (a) all of their member interests in Molycorp, LLC
    or (b) all of their equity interests in entities that hold
    member interests in Molycorp, LLC to Molycorp, LLC in exchange
    for 1,261,149.24 shares of Class A common stock of
    Molycorp, Inc. Additionally on April 15, 2010, all of the
    holders of profits interests in Molycorp Minerals, LLC
    contributed all of their profits interests to Molycorp, Inc. in
    exchange for 78,788.33 shares of Class B common stock
    of Molycorp, Inc.
Item 16.
Exhibits
    and Financial Statement Schedules.
1
.1*
Form of Underwriting Agreement
3
.1
Certificate of Incorporation of Molycorp, Inc.
3
.2*
Form of Certificate of Incorporation of Molycorp, Inc.
3
.3
Bylaws of Molycorp, Inc.
3
.4*
Form of Bylaws of Molycorp, Inc.
4
.1*
Form of Certificate of Molycorp, Inc. Common Stock
5
.1*
Form of Opinion of Jones Day
10
.1*
Sales/Buy-Back Agreement, dated May 15, 2009, between
    Molycorp Minerals, LLC and Traxys North America LLC
10
.2*
Letter Agreement, dated April 16, 2010, between Molycorp
    Minerals, LLC and Traxys North America LLC
10
.3
Employment Agreement, dated November 1, 2009, between
    Molycorp, LLC and Mark A. Smith
16
.1
Letter from KPMG LLP to the Securities and Exchange Commission
21
.1
List of Subsidiaries
23
.1
Consent of PricewaterhouseCoopers LLP
23
.2
Consent of SRK Consulting (U.S.), Inc.
23
.3*
Consent of Jones Day (included in Exhibit 5.1)
24
.1
Power of Attorney
*
To be filed by amendment.
Item 17.
Undertakings.
The undersigned registrant hereby undertakes to provide to the
    underwriter at the closing specified in the underwriting
    agreement, certificates in such denominations and registered in
    such names as required by the underwriter to permit prompt
    delivery to each purchaser.
Insofar as indemnification for liabilities arising under the
    Securities Act of 1933 may be permitted to directors,
    officers and controlling persons of the registrant pursuant to
    the foregoing provisions, or otherwise, the registrant has been
    advised that in the opinion of the Securities and Exchange
    Commission such indemnification is against public policy as
    expressed in the Securities Act and is, therefore,
    unenforceable. In the event that a claim for indemnification
    against such liabilities (other than the payment by the
    registrant of expenses incurred or paid by a director, officer
    or controlling person of the registrant in the successful
    defense of any action, suit or proceeding) is asserted by such
    director, officer or controlling person in connection with the
    securities being registered, the registrant will, unless in the
    opinion of its counsel the matter has been settled by
    controlling precedent, submit to a court of appropriate
    jurisdiction the question whether such
II-3
Table of Contents
indemnification by it is against public policy as expressed in
    the Securities Act and will be governed by the final
    adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For the purposes of determining any liability under the
    Securities Act of 1933, the information omitted from the form of
    prospectus filed as a part of this registration statement in
    reliance upon Rule 430A and contained in a form of
    prospectus filed by the registrant pursuant to
    Rule 424(b)(1) or (4) or 497(h) under the Securities
    Act shall be deemed to be part of this registration statement as
    of the time it was declared effective.
(2) For the purpose of determining any liability under the
    Securities Act of 1933, each post-effective amendment that
    contains a form of prospectus shall be deemed to be a new
    registration statement relating to the securities offered
    therein, and this offering of such securities at that time shall
    be deemed to be the initial
bona fide
offering thereof.
II-4
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
    registrant has duly caused this registration statement to be
    signed on its behalf by the undersigned, thereunto duly
    authorized, in the city of Greenwood Village, Colorado, on the
    16
th
day

    of April 2010.
Molycorp,
    Inc.
By:
/s/
Mark
    A. Smith
Mark A. Smith
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
    registration statement has been signed by the following persons
    in the capacities and on the dates indicated.
Signature
Title
Date
/s/
Mark
    A. Smith
Mark
    A. Smith
President and Chief Executive Officer and Director (Principal
    Executive Officer)
April 16, 2010
*
James
    S. Allen
Chief Financial Officer (Principal Financial Officer and
    Principal Accounting Officer)
April 16, 2010
*
Russell
    D. Ball
Director
April 16, 2010
*
Ross
    R. Bhappu
Chairman of the Board
April 16, 2010
*
Brian
    T. Dolan
Director
April 16, 2010
*
Charles
    R. Henry
Director
April 16, 2010
*
Mark
    S. Kristoff
Director
April 16, 2010
*
Alec
    Machiels
Director
April 16, 2010
*
Jack
    E. Thompson
Director
April 16, 2010
*
The undersigned by signing his name hereto does sign and execute
    this registration statement on
Form S-1
pursuant to the Power of Attorney executed by the above-named
    directors and officers of the registrant, which is being filed
    herewith on behalf of such directors and officers.
By
/s/
Mark
    A. Smith
Attorney-in-Fact
April 16, 2010
II-5
Table of Contents
EXHIBIT INDEX
1
.1*
Form of Underwriting Agreement
3
.1
Certificate of Incorporation of Molycorp, Inc.
3
.2*
Form of Certificate of Incorporation of Molycorp, Inc.
3
.3
Bylaws of Molycorp, Inc.
3
.4*
Form of Bylaws of Molycorp, Inc.
4
.1*
Form of Certificate of Molycorp, Inc. Common Stock
5
.1*
Form of Opinion of Jones Day
10
.1*
Sales/Buy-Back Agreement, dated May 15, 2009, between
    Molycorp Minerals, LLC and Traxys North America LLC
10
.2*
Letter Agreement, dated April 16, 2010, between Molycorp
    Minerals, LLC and Traxys North America LLC
10
.3
Employment Agreement, dated November 1, 2009, between
    Molycorp, LLC and Mark A. Smith
16
.1
Letter from KPMG LLP to the Securities and Exchange Commission
21
.1
List of Subsidiaries
23
.1
Consent of PricewaterhouseCoopers LLP
23
.2
Consent of SRK Consulting (U.S.), Inc.
23
.3*
Consent of Jones Day (included in Exhibit 5.1)
24
.1
Power of Attorney
*
To be filed by amendment.