Rex Resources Corp. — M&A Activity 2023

Mar 3, 2023

REX RESOURCES CORP.

Suite 1570, 505 Burrard Street Vancouver, BC, V7X 1M5

March 3, 2023

TSX-V: OWN

REX RESOURCES CORP. ANNOUNCES LETTER OF INTENT FOR PROPOSED REVERSE TAKEOVER TRANSACTION WITH SOUTHERN SKY RESOURCES CORP.

Not for distribution to United States newswire services or for release publication, distribution or dissemination directly, or indirectly, in whole or in part, in or into the United States.

VANCOUVER, B.C. – REX RESOURCES CORP. ( TSX-V: OWN ) (“ Rex ”), a mineral exploration company listed on the TSX Venture Exchange (the “ Exchange ”), is pleased to announce that it has entered into a binding letter of intent (the “ Letter of Intent ”) dated February 24, 2023 with Southern Sky Resources Corp. (“ Southern Sky ”) in respect of a proposed business combination (the “ Proposed Transaction ”). It is anticipated that the Proposed Transaction will constitute a “Reverse Takeover” of Rex in accordance with Policy 5.2 – Changes of Business and Reverse Takeovers of the Exchange. All currency references herein are in Canadian currency unless otherwise specified.

About Southern Sky

Southern Sky is a private company existing under the laws of Ontario and is based in Toronto, Ontario. Immediately prior to closing of the Proposed Transaction, Southern Sky shall have 42,847,438 common shares (the “ Southern Sky Shares ”) outstanding, as well as 2,341,538 common share purchase warrants to acquire up to 2,341,538 Southern Sky Shares at an exercise price of $0.0294 per share.

Southern Sky’s material asset consists of its rights to acquire a 100% interest in two non-contiguous licences, 016270M and 034769M, comprising the Wings Point Project (the “ Property ”) pursuant to an option agreement (the “ Option Agreement ”) dated January 17, 2023 with Zonte Metals Inc. (“ Zonte ”). The Property comprises approximately 1,825 hectares and is located 35 kilometres north Gander, Newfoundland. Zonte is a publicly traded company listed on the TSX Venture Exchange (TSXV - ZON).

Wings Point Property (two-year option to acquire a 100% interest)

Geology of the Wings Point Project

The Property lies in the eastern edge of the Dunnage Zone, within the Exploits Subzone. Rocks underlying the Property are the Davidsville Group and are dominantly shallow marine siltstones and shales with sandstones and limestones of Middle Ordovician age. Mineralization identified to date through this belt includes vein hosted gold and sediment hosted disseminated gold. To date, the gold discovered by New Found Gold Corp. and Labrador Gold Corp. occurs mainly in second order cross cutting structures associated with the Appleton Fault Zone, which all lie in the Ordovician Davidsville Group sediments. Sulphide mineralization is characterized mainly as pyrite and needle arsenopyrite.

The Property has undergone previous exploration programs consisting of geological mapping, soil and rock sampling, a ground magnetic survey, an Induced Polarization (“ IP ”) survey and diamond drilling.

Currently, the major asset associated with the Property is a strategic land position covering prospective lithologies and faults for gold deposits. The Property hosts two underexplored IP anomalies which returned elevated gold values in diamond drilling thus merits additional exploration.

Licence 016270M

Exploration on Licence 016270M completed by Zonte commenced in 2011 with a comprehensive data compilation followed by Phase 1 exploration program of prospecting, rock and soil sampling as well as ground IP and magnetic

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surveys. Two parallel, IP Chargeability and Resistivity anomalies each being approximately one kilometre in length which are associated with mineralized sandstones and shales with some graphite being delineated. Additional soil and rock sampling was carried out in 2019. A six-hole diamond drilling program totaling 1,296 m carried out in 2020 tested a small portion of the kilometre long anomalies on licence 016270M. The drill program confirmed the mapped lithological units and returned a few elevated gold values, the best being 0.48 m grading 1.296 g/t.

Gold mineralization occurs on Licence 016270M at the Ledrew Quarry in sheared and altered shales, siltstones and greywacke of the Indian Islands Group. Arsenopyrite needles, 2 to 4 mm long, along with quartz-carbonate, sericitic and siliceous alteration are the primary characteristic of the mineralization found in this area. Pyrite, pyrrhotite and chalcopyrite have also been observed. Elevated gold values in rock grab samples to date are in the range of 200 ppb to 1,500 ppb.

Licence 034769M

Exploration on Licence 034769M carried out by Zonte in 2021 consisted of a rock and soil sampling program that focused on two 2012-IP lines, which delineated a resistivity anomaly. Zonte completed a compilation of historical soil and rock data in 2022. Elevated arsenic values were returned for some of the soil samples.

Historical data research and compilation followed by field exploration confirmed the presence of gold mineralization associated with altered, sulphide-rich, sediments in two distinct stratigraphic horizons known as the Western and Eastern Geophysical Targets in the Ledrew Quarry area. The gold-bearing, arsenopyrite and pyrite-rich shales and greywacke are exposed in surface trenches and are readily identified by Induced Polarization chargeability anomalies as well as by anomalous gold and arsenic values in-soil anomalies.

Two glacial till samples taken by Noranda Inc. in 1998 assayed 59.22 g/t Au and 5.26 g/t Au, but they have not been verified.

Terms of the Option Agreement for Wings Point Project

Pursuant to the terms of the Option Agreement, Southern Sky may acquire a 100% interest in the Property by issuing 750,000 Southern Sky Shares and paying a total of $100,000 in cash to Zonte over a two-year period as follows:

• a) Issuing 250,000 Southern Sky Shares to Zonte upon the receipt by Southern Sky of all required regulatory and stock exchange approvals including to commence trading (the “ Effective Date ”);

• b) Issuing 250,000 Southern Sky Shares and paying $50,000 to Zonte one year after the Effective Date; and

• c) Issuing 250,000 Southern Sky Shares and paying $50,000 to Zonte two years after the Effective Date.

Southern Sky is required to complete $100,000 in annual expenditures on the Property until such time as the option is exercised including $9,300 on Licence 034769M prior to June 6, 2023.

Zonte retains a 2% net smelter return (“ NSR ”) from production on Licence 034769M which Southern Sky may, at any time after the commencement of commercial production, may reduce from two percent (2%) to one percent (1%) upon payment of $1,000,000 to Zonte.

Licence 016270M is subject to a 3% NSR from a previous agreement. Zonte has the option to reduce the NSR to 1% by paying the original vendors $2,000,000. In the event that Southern Sky exercises the Option Agreement it would be required to issue 150,000 Southern Sky Shares to the original vendors upon the determination of 1 million ounces of gold and an additional 200,000 Southern Sky Shares 2 million ounces of gold in the measured and indicated resource categories.

It is anticipated that, following the Proposed Transaction, the requirement to issue Southern Sky Shares under the Option Agreement would be satisfied by issuance of post-Consolidation (as defined below) Rex common shares (“ Rex Shares ”).

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NI 43-101 Technical Report on Wings Point Project

Southern Sky has retained Stanley Robinson, MSc., P.Geo to prepare a technical report (the “ Technical Report ”) specific to the standards dictated by National Instrument 43 - 101 and Form 43 - 101F Standards of Disclosure for Mineral Projects (“ NI 43-101 ”) with respect to the Property.

Brad Dyke, P.Geo of NCD Consulting Ltd. was contracted by Southern Sky to collect representative mineralized rock grab samples from the Wing's Point Project. The sudden onset of winter conditions limited the sampling program as a 10 to 15 cm blanket of snow covered the area. A recent mild period exposed some outcrop and boulders in open areas. On November 28, 2022 four samples were collected from within the Property area from various locations with varying concentrations of acicular arsenopyrite, pyrrhotite and pyrite. The samples collected all weathered a rusty orange color and were fine grained, dark grey in color on an un-weathered broken surface. There was some quartz and/or carbonate veinlets observed and weak pervasive silica alteration. The samples all appear to be an altered sedimentary unit, possibly a siltstone or sandstone.

Below is the sample location information for each site and the type of grab sample collected as well as the gold results from Eastern Analytical who completed the geochemical analysis.

Sample#	Sample Location	**Sample Type **	Au(ppb)
WP-22-001	682,235 mE / 5,466,699 mN (UTM NAD83 Zone 21)	Grab sample collected from bedrock	134
WP-22-002	682,223 mE / 5,466,628 mN (UTM NAD83 Zone 21)	Grab sample collected from subcrop	59
WP-22-003	682,383 mE / 5,466,762 mN (UTM NAD83 Zone 21)	Grab sample collected from bedrock	84
WP-22-004	682,623 mE / 5,466,863 mN (UTM NAD83 Zone 21)	Grab sample collected from bedrock	102

Additional Information Regarding Southern Sky Resources Corp.

Southern Sky has acquired beneficial rights over mineral properties in Guyana since 2011. Southern Sky acquired all of the shares of Guyana Au Corp Inc., a corporation incorporated under the laws of Guyana, in December 2016. Guyana Au Corp. Inc. is the 100% beneficial owner of the Aurora South Property, which it acquired on August 29, 2011 by way of a Deed of Assignment of a Mining Joint Venture Agreement with the subsidiary of a Canadian, former-publicly traded company, Guyana Frontier Mining Corp. (“ Guyana Frontier ”). Historic work performed on the Aurora South Property includes an airborne geophysical program flown over the property during 2011 by a previous joint venture partner of Southern Sky. No other work has been completed by Southern Sky on this property and no work is planned.

Roger Connors, a resident of Toronto, Ontario, is the only controlling shareholder of Southern Sky.

A press release with further information in respect of Southern Sky, including significant financial information, will follow in accordance with the policies of the Exchange.

For further information regarding Southern Sky and the Proposed Transaction, please contact Roger Connors, Chief Executive Officer, at (647) 920-3877 or roger@southernsky.ca.

Summary of the Proposed Transaction

The Letter of Intent contemplates that Rex and Southern Sky will negotiate and enter into a definitive agreement in respect of the Proposed Transaction (the “ Definitive Agreement ”), pursuant to which it is anticipated that Rex will acquire all of the issued and outstanding Southern Sky Shares, and shareholders of Southern Sky will receive postConsolidation (as defined below) Rex common shares (the “ Rex Shares ”) in exchange for their Southern Sky Shares,

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resulting in a reverse takeover of Rex by Southern Sky. The Proposed Transaction will be structured as a threecornered amalgamation, plan of arrangement or other structure based on the advice of the parties’ respective advisors and taking into account various securities, tax, operating and other considerations.

Prior to the closing of the Proposed Transaction, Rex will consolidate its outstanding Rex Shares on the basis of one (1) new Rex Share for each 1.5 old Rex Shares (the “ Consolidation ”), such that, prior to closing of the Proposed Transaction, Rex will have approximately 8,979,333 Rex Shares issued and outstanding on a non-diluted basis.

It is intended that Rex Shares will be issued to holders of Southern Sky Shares on the basis of one (1) postConsolidation Rex Share for every one (1) Southern Sky Share, resulting in the issuance of an aggregate 42,847,438 post-Consolidation Rex Shares to the shareholders of Southern Sky. It is expected that outstanding Southern Sky warrants will become exercisable for post-Consolidation Rex Shares, in accordance with the terms of such warrants, as applicable.

It is anticipated that the resulting entity (the “ Resulting Issuer ”) will continue the business of Southern Sky under a name to be determined by Southern Sky (the “ Name Change ”). The business of the Resulting Issuer will be primarily focussed on the exploration of the Property.

The post-Consolidation Rex Shares to be issued pursuant to the Proposed Transaction will be issued pursuant to exemptions from the prospectus requirements of applicable securities legislation. Certain common shares of the Resulting Issuer to be issued pursuant to the Proposed Transaction are expected to be subject to restrictions on resale or escrow under the policies of the Exchange, including the securities to be issued to “Principals” (as defined under Exchange policies), which will subject to the escrow requirements of the Exchange.

The completion of the Proposed Transaction remains subject to a number of terms and conditions, among other standard conditions for a transaction of this nature, including, among other things: (i) the negotiation and execution of the Definitive Agreement; (ii) Southern Sky delivering a NI 43-101 compliant technical report for the Property that is acceptable to the Exchange and Rex; (iii) the delivery of audited, unaudited and pro forma financial statements of each party that are compliant with Exchange policies; (iv) if required by the Exchange, Southern Sky delivering a title opinion for each of its material international properties in form and content satisfactory to the Exchange and Rex; (v) no material adverse changes occurring in respect of either Rex or Southern Sky; (vi) the parties obtaining all necessary consents, orders and regulatory and shareholder approvals, including the conditional approval of the Exchange subject only to customary conditions of closing; (vii) if required by the Exchange, delivery of a sponsor report and an independent valuation satisfactory to the Exchange; (viii) the Consolidation, Name Change and any other corporate changes requested by Southern Sky, acting reasonably, shall have been implemented; (ix) completion of the Concurrent Financing described below; (x) completion of satisfactory due diligence by each Party of the other Party; (xi) if the Exchange deems any property of Southern Sky, other than the Property, to be a material property of Southern Sky, Southern Sky shall either deliver a technical report prepared in accordance with NI 43-101 for such property, or divest any interest or ownership it holds in such property; and (xii) Exchange acceptance. There can be no assurance that all of the necessary regulatory and shareholder approvals will be obtained or that all conditions of closing will be met.

Upon completion of the Proposed Transaction, it is anticipated that the Resulting Issuer will be listed as a Tier 2 Mining Issuer on the Exchange, with Southern Sky as its primary operating subsidiary.

Upon execution of the Definitive Agreement Rex will lend $25,000 to Southern Sky, which unsecured loan will be repayable to Rex in the event that the Definitive Agreement is terminated.

The following table sets out the expected share capital of the Resulting Issuer on a non-diluted basis after giving effect to the Proposed Transaction (including the securities to be issued pursuant to the Concurrent Financing, as described below):

Category of Security(1)	Number(1)	Percentage(1)
Rex Shares held byRex shareholders	8,979,333	13.86%

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Rex Shares issued to Southern Skyformer shareholders(2)	42,847,438	66.14%
Rex Shares underlying the Non-FT Units and FT Units issued to Concurrent FinancingSubscribers(3)	12,956,666	20.00%
TOTAL:	64,783,437	100%

Notes:

1. Calculated on a post-Consolidation basis.

2. Assumes there are no dissenting Southern Sky shareholders.

3. Assumes the Concurrent Private Placement is fully subscribed for gross proceeds of $1,993,500, consisting of 11,290,000 Non-FT Units (as defined herein) at a price of $0.15 per Non-FT Unit for gross proceeds of $1,693,500, and 1,666,666 FT Units (as defined herein) at a price of $0.18 per FT Unit for gross proceeds of $300,000.

Concurrent Financing

In connection with the Proposed Transaction, Southern Sky will arrange a concurrent non-brokered private placement of Rex units for gross proceeds of at least $1,993,500 (the “ Concurrent Financing ”). The Concurrent Financing will consist of the issuance of up to 11,290,000 non-flow through units (the “ Non-FT Units ”) at a price of $0.15 per NonFT Unit, for gross proceeds of up to $1,693,500, and up to 1,666,666 flow-through units (the “ FT Units ”) at a price of $0.18 per FT Unit, for gross proceeds of up to $300,000.

Each Non-FT Unit will be comprised of one post-Consolidation Rex Share and one-half of one post-Consolidation Rex Share purchase warrant (each whole warrant, a “ Unit Warrant ”). Each whole Unit Warrant will entitle the holder to purchase one additional post-Consolidation Rex Share (each, a “ Unit Warrant Share ”) for a period of 36 months from the closing date of the Concurrent Financing at an exercise price of $0.23 per Unit Warrant Share. Each FT Unit will be comprised of one post-Consolidation Rex Share, to be issued as a “flow-through share” within the meaning of the Income Tax Act (Canada), and one half-of one Unit Warrant.

Rex may pay finder’s fees in connection with the Concurrent Financing within the maximum amount permitted by the policies of the Exchange.

The proceeds of the Concurrent Financing will be used to fund (i) expenses of the Proposed Transaction and the Concurrent Financing, (ii) the exploration and other expenses relating to the Property, and (iii) the working capital requirements of the Resulting Issuer.

Prior to the completion of the Concurrent Financing, Southern Sky may complete a convertible debenture financing for gross proceeds of up to $50,000 for working capital purposes and for costs associated with the Proposed Transaction. The convertible debentures shall pay interest at 10% per annum and be exercisable into units of the Resulting Issuer at a 20% discount to the price of the Non-FT Units to be issued pursuant to the Concurrent Financing. Each unit will be comprised of one post-Consolidation Rex Share and one-half of one Unit Warrant. Each whole Unit Warrant will entitle the holder to purchase one additional Unit Warrant Share for a period of 36 months from the date of issuance at an exercise price of $0.23 per Unit Warrant Share.

Summary of Proposed Directors and Officers of the Resulting Issuer

In conjunction with and upon closing of the Proposed Transaction, the board of directors of the Resulting Issuer are expected to consist of four directors, each of whom will be nominated by Southern Sky. If applicable, the existing directors and officers of Rex shall resign at or prior to the closing of the Proposed Transaction.

The first directors of the Resulting Issuer are expected to be Roger Connors, Dominic O’Sullivan, Alan Hitchborn and Matthew Hoyt, and such other directors as determined by Southern Sky. These directors shall hold office until the first annual meeting of the shareholders of the Resulting Issuer following closing, or until their successors are duly appointed or elected. The first officers of the Resulting Issuer are expected to be Roger Connors (Executive Chairman and President), Rebecca Hudson (Chief Financial Officer) and Monique Hutchins (Corporate Secretary), and such other officers as determined by Southern Sky.

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The following is a brief description of the proposed directors and officers of the Resulting Issuer who have been identified as of the date hereof:

Roger Connors – Chairman, President and CEO

Mr. Connors is an entrepreneur and consultant based in Toronto, Ontario with 29 years of experience managing private and public resource companies including Kimber Resources Inc. and National Gold Corp., which merged to form Alamos Gold Inc. Mr. Connors has since been focused on acquiring exploration and development stage gold projects in underexplored regions of South America. Mr. Connors holds a Bachelor of Business Administration (BBA) from Acadia University and completed the Canadian Securities Course.

Rebecca Hudson – CFO

Ms. Hudson has 23 years’ experience as a Chartered Professional Accountant having worked as a senior auditor with firms Grant Thornton LLP in Toronto, Canada, and PricewaterhouseCoopers in the Dominican Republic. She is currently the CFO of Nova Mentis Life Science Corp., and a private drilling company, Andean Drilling Services Inc. Ms. Hudson also works as a consultant with Grove Corporate Services where she acts as Controller for several clients. She has held managerial positions at mining companies Xstrata, and Falconbridge, completed project-based work for IAMGOLD at its offices in Quito, Ecuador, and was the Controller of Royal Nickel Corporation and Barkerville Gold Mines Ltd. Ms. Hudson formerly served as the CFO of TerrAscend Corp., Hornby Bay Mineral Exploration Ltd., Wabi Exploration Inc., Lithium One Inc., and Claim Post Resources Inc. Ms. Hudson has both her Bachelor of Arts and Master’s Degrees from the School of Accountancy at the University of Waterloo. She is fluent in English and Spanish.

Dominic O’Sullivan – Independent Director

Mr. O’Sullivan is a geologist and Member of the Australian Institute of Mining and Metallurgy. In a career that has spanned 30 years he has been involved in the exploration and mining of gold, diamonds, uranium and base metals and has been involved in several major discoveries in Australia, Guyana and Ghana, including the Plutonic Deeps and the Karouni Mine. He is currently Executive Chairman of Tajiri Resource Corp a TSXV listed company.

Mr. Matthew Hoyt, P.Eng., PMP – Independent Director

Mr. Hoyt is a Professional Engineer having over twenty years of experience across a wide variety of industrial construction projects for companies including Enbridge Pipelines Inc, CNRL, Graham Industrial Services, Imperial Oil Ltd., Bird, DOW, Kiewit, and Husky. These include pipeline facilities and terminals, refineries, thermal and hydro power, oilsands plants, offshore production, food production and wastewater treatment. Matthew graduated with a Bachelor of Science Chemical Engineering from the University of New Brunswick.

Mr. Alan Hitchborn – Independent Director

Mr. Hitchborn is a Professional Geologist (P.Geo) with over 40 years of exploration and development experience and is registered with Association of Professional Engineers and Geoscientists of British Columbia. Alan has generated early exploration targets from initial field reconnaissance, mapping and sampling, data compilation through drilling discoveries, resource estimation, QA/QC, feasibility and production. He has held senior exploration, development and mining positions with Aura Minerals, Placer Dome and Kimber Resources. Alan and his professional exploration team have made several discoveries including nearly 2 million ounces at Monterde in Mexico and 3 million ounces at the Bald Mountain Mine, Nevada. Mr. Hitchborn graduated from the University of Nevada in Reno Nevada with a Bachelor of Science Geology.

Ms. Monique Hutchins – Corporate Secretary

Ms. Hutchins is the Managing Director of DSA Corporate Services Inc. and has over fifteen years of corporate secretarial, corporate governance, client relationship and marketing experience. She was previously the Director of Business Development & Marketing and Corporate Secretary at Independent Review Inc., an organization that runs

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Independent Review Committees that is a part of the governance structure of every investment fund in Ontario. She has previously held senior roles at Kingsdale Shareholder Services and Institutional Shareholder Services. Ms. Hutchins is a member of the Chartered Governance Institute of Canada (CGIC) and holds a Bachelor of Commerce from John Molson School of Business, Concordia University.

Summary of Insiders of the Resulting Issuer other than Directors and Officers

No insiders of the Resulting Issuer are expected other than the board, management and control persons as set out herein.

Sponsorship of Proposed Transaction

Sponsorship of the Proposed Transaction may be required by the Exchange unless an exemption or waiver from this requirement is obtained in accordance with the policies of the Exchange. Southern Sky has not yet engaged a sponsor in connection with the Proposed Transaction. Southern Sky intends to apply for an exemption from the Exchange’s sponsorship requirement. Additional information on sponsorship arrangements will be provided once available.

Other Information relating to the Proposed Transaction

The Proposed Transaction is not a “related party transaction” as such term is defined by Multilateral Instrument 61101 – Protection of Minority Security Holders in Special Transactions and is not subject to Policy 5.9 of the Exchange.

No finder’s fees are expected to be payable in connection with the Proposed Transaction.

In accordance with Exchange Policy 5.2, Rex intends apply for an exemption from obtaining shareholder approval, as the Proposed Transaction exhibits the following characteristics: (i) the Proposed Transaction is not a related party transaction (and no other circumstances exist which may compromise the independence of Rex or other interested parties); (ii) except in connection with the Kalum property (for which Rex intends to cease all exploration and related development activities upon completion of the Proposed Transaction), Rex does not have active operations; (iii) Rex is not subject to a cease trade order and management believes it will not be suspended from trading on completion of the Proposed Transaction; and (iv) there is no requirement to obtain shareholder approval of the Proposed Transaction (or any element thereof) under any applicable corporate or securities laws.

The Proposed Transaction will require the approval of the shareholders of Southern Sky. Southern Sky intends to hold a shareholder meeting to seek all necessary approvals, the details of which will be disclosed once available.

In accordance with the policies of the Exchange, the Rex Shares are not currently trading and will not resume trading until such time as the Exchange determines, which, depending on the policies of the Exchange, may not occur until completion of the Proposed Transaction.

In connection with the Proposed Transaction, McMillan LLP is acting as legal counsel to Rex and Miller Thomson LLP is acting as legal counsel to Southern Sky.

Additional information concerning the Proposed Transaction, Rex, Southern Sky and the Resulting Issuer will be provided once determined in a subsequent news release and in the Filing Statement to be filed by Rex in connection with the Proposed Transaction and which will be available in due course under Rex’s SEDAR profile at www.sedar.com.

About Rex Resources Corp.

Rex is a mineral exploration company focused on the acquisition, exploration and development of mineral resource properties. Rex has an option to acquire a 60% interest and title to the Kalum property located in the Terrace area of British Columbia.

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For further information regarding Rex and the Proposed Transaction, please contact Craig Taylor, Chief Executive Officer of Rex, at (604) 318-4053 or ctagencies@hotmail.com.

ON BEHALF OF THE BOARD OF DIRECTORS OF REX RESOURCES CORP.

Anthony Zelen, Director (778) 338-5258 anthonyzelen88@gmail.com

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Qualified Person

Stanley Robinson, M.Sc., P.Geo. is a qualified person as defined by NI 43-101 and has reviewed and approved the contents and technical disclosures in this press release. Neither Mr. Robinson nor the Company has verified the technical information in this press release.

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, disinterested approval. Where applicable, the Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Rex should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.

All information contained in this news release with respect to Rex and Southern Sky was supplied by the parties, respectively, for inclusion herein, and Rex and its respective directors and officers have relied on Southern Sky for any information concerning such party.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “ U.S. Securities Act ”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Forward Looking Information

This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations (including negative and grammatical variations) of such words and phrases or state that certain acts, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”.

Forward-looking information in this press release may include, without limitation, statements relating to: the completion of the Proposed Transaction and the timing thereof, the execution of the Definitive Agreement, the proposed business of the Resulting Issuer, degree to which historical results are reflective of actual mineral resources, the completion of the proposed Concurrent Financing and the use of proceeds therefrom, the completion a NI 43-101 technical report for the Property, the proposed directors and officers of the Resulting Issuer, obtaining regulatory

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approval for the Property, Southern Sky or the Resulting Issuer satisfying terms of the Option Agreement and acquiring 100% interest in the Property, the completion of the Consolidation, the completion of the Name Change, completion of satisfactory due diligence, Exchange sponsorship requirements and intended application for exemption therefrom, shareholder and regulatory approvals, and future press releases and disclosure.

These statements are based upon assumptions that are subject to significant risks and uncertainties, including risks regarding the mining industry, commodity prices, market conditions, general economic factors, management’s ability to manage and to operate the business, and explore and develop the projects, of the Resulting Issuer, and the equity markets generally. Because of these risks and uncertainties and as a result of a variety of factors, the actual results, expectations, achievements or performance of each of Rex and Southern Sky may differ materially from those anticipated and indicated by these forward-looking statements. Any number of factors could cause actual results to differ materially from these forward-looking statements as well as future results. Although each of Rex and Southern Sky believes that the expectations reflected in forward looking statements are reasonable, they can give no assurances that the expectations of any forward-looking statements will prove to be correct. Except as required by law, each of Rex and Southern Sky disclaims any intention and assume no obligation to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise.

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