ELEMENT 25 LIMITED — Capital/Financing Update 2019

Jul 7, 2019

ASX ANNOUNCEMENT

8 July 2019

==> picture [200 x 313] intentionally omitted <==

Option Granted to RareX to Acquire 100% of the Cummins Range Project for up to $3M

Element 25 Limited ( E25 or Company ) is pleased to advise that it has entered into an option agreement with RareX Pty Ltd ( RareX ) in relation to Exploration Licence E80/5092 ( Cummins Range ).

Pursuant to the agreement, E25 has granted RareX an exclusive 90 day

option to acquire 100% of Cummins Range for up to $3M as follows:

• RareX to pay E25 a $50,000 option fee within two business days of the date of the agreement.

• RareX may exercise the option within the option period and acquire 100% of the Cummins Range project by;

  • paying $500,000 cash and issuing $500,000 in shares in a listed company which has transacted with RareX to control RareX or the Cummins Range project ( List Co ); or

  • at RareX’s election, paying $1,000,000 in cash.

• Within twelve months of settlement of the acquisition, RareX/List Co must pay $500,000 in cash and issue $500,000 in shares in List Co or pay $1,000,000 in cash ( Deferred Consideration ).

• Within 36 months of settlement, and subject to the completion of a positive Bankable Feasibility Study ( BFS ) on the Cummins Range project, RareX/List Co must pay or issue $1,000,000 in cash or shares or a combination thereof to a total value of $1,000,000 ( Further Deferred Consideration ).

• If a BFS is unable to be completed within 36 months of the date of settlement, the further Deferred Consideration is not payable and RareX will, in lieu, grant E25 a 1% Net Smelter Return Royalty on future production from the Cummins Range project capped at $1,000,000.

Company Snapshot

ASX Code: E25 Board of Directors: Shares on Issue: 92M Seamus Cornelius Share Price: $0.19 Justin Brown Market Capitalisation: $17.5M John Ribbons

Chairman MD NED

Element 25 Limited is developing the world class Butcherbird manganese project in Western Australia to produce high purity manganese sulphate for lithium ion batteries and electrolytic manganese metal.

Element 25 Limited P +61 8 6315 1400 E admin@e25.com.au element25.com.au

Level 2, 45 Richardson Street, West Perth, WA, 6005 PO Box 910 West Perth WA 6872 Australia

==> picture [57 x 25] intentionally omitted <==

Page 1

8 July 2019

==> picture [107 x 34] intentionally omitted <==

The Company is very pleased with the outcome of this transaction. The additional cash will provide valuable working capital as the Company completes the Pre-Feasibility work at the 100% owned Butcherbird High Purity Manganese Project.

This transaction represents another important incremental step in the Company’s stated strategy to rationalise its project portfolio to allow the technical team to focus on the development of the high purity manganese business at Butcherbird.

Note: all paymjents referred to in the transaction details are ex-GST.

About the Cummins Range Project[1]

The Cummins Range project is a carbonatite rare earths deposit located in the Kimberely region of Western Australia covering approximately 48.5 square kilometres. Cummins Range is prospective for neodymium and praseodymium with the principal rare earth bearing minerals being apatite and monazite. Cummins Range is hosted within a carbonatite pipe, a 905Ma diatreme pipe forming part of an alkaline intrusive complex located near the junction of the Halls Creek Orogen and the King Leopold Orogen.

About RareX

RareX is a specialist rare earths company focused on acquiring world-class projects located in tier-1 jurisdictions. RareX is headed by Jeremy Robinson and backed by a team with a track record of taking Australian mining projects through to production. Mineral Intelligence advised RareX in relation to the transaction.

Justin Brown

Managing Director

Company information, ASX announcements, investor presentations, corporate videos and other investor material in the Company’s projects can be viewed at: http://www.element25.com.au.

1 Reference: http://www.ga.gov.au/webtemp/image_cache/GA19677.pdf

==> picture [57 x 25] intentionally omitted <==

Element 25 Limited P +61 8 6315 1400 E admin@e25.com.au element25.com.au

Level 2, 45 Richardson Street, West Perth, WA, 6005 PO Box 910 West Perth WA 6872 Australia

Page 2