Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of the financial condition and results of operations of REA includes information that REA's management believes is relevant to an assessment and understanding of the Company's historical operations. You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited financial statements for the three months ended March 31, 2026 and 2025 and the respective notes thereto, which are included elsewhere in this Quarterly Report on Form 10-Q, as well as our audited financial statements for the years ended December 31, 2025 and 2024 and the respective notes thereto previously filed with the SEC.

This discussion also contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to our current plans, estimates and assumptions, and events and financial trends that may affect our future operating results or financial position. We use terminology such as "aim," "anticipate," "assume," "believe," "contemplate," "continue," "could," "design," "due," "estimate," "expect," "goal," "intend," "may," "objective," "plan," "positioned," "potential," "predict," "seek," "should," "target," "will," "would," and other similar expressions to identify forward-looking statements. The forward-looking statements contained herein involve risks and uncertainties that could cause our actual results and the timing of events to differ materially from those expressed in these forward-looking statements due to a number of factors, including those discussed in "Special Note Regarding Forward-Looking Statements" appearing elsewhere in this Quarterly Report on Form 10-Q.

Any reference in this section to "we", "us", "our", "REA", or the "Company" refers to Rare Earths Americas, Inc. and our consolidated subsidiaries for the periods subsequent to the formation of Rare Earths Americas Ltd. on February 28, 2025 or, as the context requires, to the historical results of Alpha Minerals Brazil Participações Ltda "AMBPL." Any reference to AMBPL refers to AMBPL prior to the consummation of the Acquisitions (as defined below). Refer to the discussion of "Our Corporate and Operating History and the Related Financial Information Reflected in Our Reported Results" for additional details regarding the operations that comprise REA for the reporting periods discussed in this Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A").

Overview

Our Corporate and Operating History and the Related Financial Information Reflected in Our Reported Results

In February 2025, we were incorporated as Rare Earths Americas Ltd., under the laws of the Cayman Islands, for the purposes of acquiring AMBPL and Foothills Rare Earths Limited ("FRE Australia") in two transactions that were contingent upon the completion of each other (the "Acquisitions"), as well as to raise the initial capital necessary to support the continued operations of the acquired and combined entities in a private placement transaction ("Private Placement"). The acquisition of AMBPL, a company organized under the laws of Brazil and with a history of exploration activities primarily conducted at two sites in Brazil, and the acquisition of FRE Australia, an Australian incorporated public unlisted Corporation that had performed limited exploration activities in the United States, were both completed on July 22, 2025 (the "Merger Date"). Consideration for the Acquisitions consisted of REA common shares issued to the former shareholders of each entity and, in the case of FRE Australia, the issuance of warrants exercisable for shares of REA's common stock in exchange for FRE Australia's previously outstanding options. The Private Placement, which resulted in the raise of $15.9 million after transaction costs, was completed on July 30, 2025. We subsequently completed a re-domestication through the filing of a certificate of conversion, becoming a Texas corporation on October 15, 2025. Following the redomestication, our name changed to Rare Earths Americas, Inc.

We determined that our acquisition of AMBPL is a transaction between entities under common control because the former sole shareholder of AMBPL, Rare Earths Americas Limited ("REA Australia"), retained control of AMBPL through its majority ownership in REA. Furthermore, as (1) our activities through the Merger Date were limited to administrative tasks supporting the Acquisitions and Private Placement and (2) we succeeded to substantially all of the operations of AMBPL, we determined that AMBPL is the predecessor entity to REA for financial statements purposes. As REA and AMBPL were determined to be entities under common control, the acquisition of AMBPL's net assets were recorded at their historical carrying amounts and these financial statements reflect REA and AMBPL on a consolidated basis for periods following REA's incorporation in February 2025. Periods prior to February 2025 relate solely to the predecessor operations of AMBPL. FRE Australia was determined to be a variable interest entity and its acquisition was an asset acquisition. See "Note 4 - Asset Acquisition and Variable Interest Entity" in our financial statements for the years ended December 31, 2025 and 2024 included in our final prospectus filed pursuant to Rule 424(b)(4) on May 7, 2026 (File No. 333-295032) (the "Prospectus"). The operating results and cash flows of FRE Australia are reflected in our consolidated results of operations and statement of financial condition for reporting periods subsequent to the Merger Date.

Our Business and Our Strategy

We are an exploration-stage company focused on advancing a portfolio of critical mineral projects targeting high-grade heavy rare earth mineral assets. Our portfolio includes three material projects - Alpha, Constellation, and Shiloh, along with certain non-material early-stage exploration projects, most notably our Homer Project in Goiás, Brazil. All of our properties are currently in exploration stage, and we have not yet commenced mining operations or generated any revenue. Our current operations are focused on defining mineralization

for our projects and increasing our understanding of the characteristics and economics of each project. We hold options to purchase or lease mining rights to all of the properties we are exploring. Those options are described in detail in "Note 6 - Mineral Interests" in our financial statements for the years ended December 31, 2025 and 2024. Advancing these projects to development will require significant capital.

We intend to grow the value of our assets by: (1) advancing our project portfolio through land acquisition, drilling, exploration, land consolidation, process flowsheet development, resource definition, metallurgical test work, permitting, and engineering studies in accordance with S-K 1300; (2) pursuing strategic partnerships and financing to accelerate project development; and (3) developing a U.S.-aligned platform to strengthen critical mineral supply chains.

We have assembled a team with extensive mining sector-related experience, including exploration, development, permitting, operations and capital markets, to execute our strategy and pursue the market opportunity available to us.

Summary of Historical Operations and Expected Trends

General

As an exploration-stage company, we have not begun to generate operating revenues, nor can we expect to generate operating revenues in the foreseeable future. Our financial results reported for the three months ended March 31, 2026 and 2025 are not reflective of our expectations for our ongoing operations, as further discussed in the sections titled "Factors that Will Impact Our Exploration Costs" and "Factors that Will Impact Our General and Administrative and Other Operating Costs" included the Prospectus.

Results of Operations

Summary

We have no operating revenues. We are dependent on equity or other external financings to fund the execution of our business plans and operations, including mineral exploration and evaluation for economic viability; general and administrative ("G&A") costs; interest expense and other costs. We expect to incur operating losses until such time that an economic mineral resource is identified, developed and put into profitable commercial production.

Comparison of three months ended March 31, 2026 and 2025

The following tables set forth our historical results for the periods indicated, and the variances in amounts reported for the comparable reporting periods (dollars in thousands), percent changes are not included as they are not meaningful in this comparison:

Operating Costs and Expenses

Overall, the increase in operating expenses during the quarter reflects the Company's expanded scale of operations following recent acquisitions and the continued build-out of its organizational exploration capabilities.

Exploration and evaluation expenses. Exploration and evaluation expenses increased by $2.0 million in the three months ended March 31, 2026 as compared to three months ended March 31, 2025. The increase was primarily attributable to increased exploration activity following the acquisition of FRE Australia, which expanded the Company's exploration portfolio and operational footprint. Exploration and evaluation expenses during the prior-year period were minimal, reflecting the Company's more limited scope of operations at that time.

General and administrative expenses. General and administrative expenses increased by $2.5 million in the three months ended March 31, 2026 as compared to three months ended March 31, 2025. The increase was primarily driven by higher personnel-related costs and professional service fees associated with the Company's initial public offering, the growth of the Company's operations following the acquisition of FRE Australia, including the expansion of management and administrative functions and increased public-company and regulatory compliance activities. General and administrative expenses in the prior-year period were comparatively low due to the Company's more limited operating activities.

Depreciation expense. Depreciation expense increased by $22 thousand in the three months ended March 31, 2026 as compared to three months ended March 31, 2025. The increase was primarily attributable to depreciation of property and equipment placed in service during 2025 and the first quarter of 2026, including vehicles, exploration and field equipment, and computer and office equipment, as the Company expanded its operations following recent acquisitions.

Other Income and Expense

Interest income. Interest income increased by $127 thousand in the three months ended March 31, 2026 as compared to three months ended March 31, 2025 The increase was primarily due to higher balances held in money market funds during the quarter.

Interest expense. Interest expense increased by $44 thousand in the three months ended March 31, 2026 as compared to three months ended March 31, 2025. The increase was due to the related party loan agreement with Brazil Royalty Corp Participacoes E Investments Ltda. ("BRC"), which was executed in 2025.

Foreign exchange gain. Gain on foreign exchange was $4 thousand in three months ended March 31, 2026 as compared to $0 in three months ended March 31, 2025, due to remeasurement of cash accounts held at FRE Australia.

Change in fair value of SAFE. Change in fair value of Simple Agreement for Future Equity ("SAFE") was a $3.4 million loss in three months ended March 31, 2026. The change was attributable to the remeasurement of the SAFE liability at fair value during the quarter, reflecting changes in valuation assumptions, primarily the share price assumptions, and including the passage of time. No change in fair value of SAFE was recognized in the prior-year period as the SAFE was executed in December 2025.

Change in fair value of warrants. Change in fair value of warrants was an $8.6 million loss in three months ended March 31, 2026. The change was attributable to the remeasurement of warrant liabilities at fair value during the quarter, reflecting changes in valuation assumptions, primarily the share price assumptions, and including the passage of time. No change in fair value of warrants was recognized in the prior-year period as the warrants were issued in during the transaction in July 2025.

Supplemental Discussion of Performance by Reportable Segment

United States Mining Operations Segment

Segment Operating Loss for the Company's United States Mining Operations was as follows (dollars in thousands):

Operating loss from our United States Mining Operations increased $1.9 million compared to the prior year period, driven primarily by the acquisition of FRE Australia and the related exploration activities and costs incurred related to the Shiloh Project. Operating loss of our United States Mining Operations segment is expected to further increase in subsequent periods. Refer to the discussions of "Factors that Will Impact Our Exploration Costs" and "Acquisition of FRE Australia" included in the Prospectus.

Brazil Mining Operations Segment

Segment Operating Loss for the Company's Brazil Mining Operations was as follows (dollars in thousands):

Operating loss from our Brazil Mining Operations increased $0.4 million compared to the prior year period, primarily due to increases in general and administrative costs and exploration activities and exploration spend during the quarter. The increase in general and administrative costs is due to changes in the Company's operating structure and are expected to remain consistent at the segment level in future periods. Refer to the discussions of "Factors that Will Impact Our Exploration Costs" and "Acquisition of FRE Australia" included in the Prospectus.

Liquidity and Capital Resources

Sources and Uses of Liquidity

We consider highly liquid investments purchased with original maturities of three months or less to be cash equivalents. As of March 31, 2026 and December 31, 2025, we had $20.4 million and $22.8 million, respectively, in cash and cash equivalents.

We are an exploration stage company and, since our inception, we have not generated revenues. We incurred operating losses of $16.8 million and $0.3 million in three months ended March 31, 2026 and 2025, respectively, and have reported an accumulated deficit of $36.6 million and $19.8 million as of March 31, 2026 and December 31, 2025, respectively. We have primarily relied on equity financing to fund our operating and investing activities - including, development and pursuit of our business plan; our mineral exploration and evaluation activities; our general and administrative costs and our capital expenditures. In addition, in the future we will continue to rely on equity financing to meet obligations as they become due and for future purchases of exploration and evaluation assets.

Our predominant source of cash is from financing activities. In 2025, we raised cash through issuances of our common stock for the primary purpose of funding working capital associated with exploration expenses and general and administrative expenses, capital expenditures, and investments supporting our strategy for advancing our portfolio of critical mineral projects targeting high-grade heavy rare earths mineral assets. In 2024, we were primarily funded though payables to related parties.

In December 2025, we raised $11.7 million in proceeds through the issuance of SAFE agreements in a private placement, and in January 2026 we raised an additional $3.4 million through the issuance of SAFE agreements.

Our current assets exceeded our current liabilities by $17.7 million as of March 31, 2026, compared to current liabilities exceeding current assets by $19.3 million as of December 31, 2025. The decrease of $1.6 million was primarily attributable to cash used in operating activities and increased spending to support the advancement of our exploration and corporate activities, including higher prepaid and offering-related expenditures, partially offset by a reduction in current liabilities.

The following table is a condensed schedule of cash flows provided as part of the discussion of liquidity and capital resources:

Cash flow Statement

Currently, we do not maintain a credit facility or have debt from financial institutions. Since inception, we have predominately relied on equity financing to fund our operations, land acquisitions, and capital expenditures.

As of March 31, 2026, we expect material cash requirements over the next twelve months to include the following:

We believe that funds raised in our Private Placement, through issuance of SAFE agreements and the net proceeds from our initial public offering that closed on May 7, 2026 will be sufficient to fund our cash needs for the 12 months. Historically, we have been successful in raising cash through equity financings; however, no assurances can be given that additional financing will be available in amounts sufficient to meet our needs or on terms that are acceptable to us.

Operating Activities

During the three months ended March 31, 2026, our operating activities used $4.4 million of net cash, as compared to net cash provided of $0.1 million during the three months ended March 31, 2025. The $4.5 million increase in net cash used in operating activities was primarily due to a $16.5 million increase in net loss due to the expanded operational activities of the Company as a result of the acquisition of FRE Australia. This increase in reported net loss is partially offset by non-cash items, including an $8.6 million increase in the fair value of warrant liabilities, a $3.4 million increase in the fair value of SAFE liabilities, and $0.8 million of stock-based compensation. Changes in operating assets and liabilities resulted in $0.5 million of net cash used from changes in working capital, primarily related to the Company's expanded operational activities.

Investing Activities

Our investing activities used $0.2 million of cash in the three months ended March 31, 2026, as compared to $0 during the three months ended March 31, 2025. Cash used by investing activities increased primarily due to purchases of property and equipment and investments in mineral interests.

Financing Activities

During the three months ended March 31, 2026 and 2025, our financing activities provided $2.2 million and used $0.1 million of cash, respectively. Financing activities during the three months ended March 31, 2026 included $3.4 million of SAFE proceeds, offset partially by payments of deferred offering costs occurring in both periods.

Off-Balance Sheet Arrangements

Other than as otherwise described in the Prospectus, we do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material current or future effect on our financial condition, changes in financial condition, revenues, expenses, results of operations, liquidity, capital expenditures or capital resources.

Risks and Uncertainties Associated with Future Results of Operations

We operate in an industry that is subject to intense competition, development risk, and changes in U.S. governmental policies related to green energy, defense spending and dependence on foreign suppliers. Our operations are subject to significant risks and uncertainties including financial and operational risks, as well as the potential risk of business failure.

We have not yet established that our projects contain any commercially exploitable quantities of proven and probable mineral reserves, and we may not be able to do so. Even if we eventually establish commercially exploitable quantities of mineral reserves, we may not be able to extract those minerals economically. Both mineral exploration and development involve a high degree of risk, and few properties that are explored are ultimately developed into producing mines. The commercial viability of an established mineral deposit will depend on several factors including the size, grade, and other attributes of the mineral deposit, as well as proximity of the deposit to infrastructure, government regulation, and market prices, among other things. Most of these factors will be beyond our control, and any of them could increase costs and make extraction of any identified mineral deposit unprofitable.

Our ability to advance projects depends on successfully completing studies to verify resources, reserves, and commercial viability, securing sufficient financing for exploration, permitting, and infrastructure development, and managing potential cost increases in exploration, construction, and operations due to fluctuations in fuel, power, materials, and other supplies.

For additional information see the section entitled "Risk Factors - Risks Related to Our Business" included in the Prospectus.

Critical Accounting Estimates

See Note 2. Significant Accounting Policies to our audited consolidated financial statements as of and for the years ended December 31, 2025 and 2024, included in the Prospectus for a description of our significant accounting policies. We consider the following accounting estimates critical to understanding and evaluating our consolidated financial condition and the results of our operations.

Exploration Costs and Mineral Interests

General

Mineral interests consist of options to acquire mineral properties with rights to explore during the option period. Capitalized costs of the

options were either asset purchases or payments to option counterparties. Mineral interests will not be amortized until the underlying property is converted to the production stage. As of March 31, 2026, none of the Company's properties were in the production stage and, therefore, the carrying values of the associated mineral interests are not being amortized. Exploration costs are being expensed as incurred until it is determined that a mining deposit can be economically and legally extracted or produced based upon established proven or probable reserves.

Assessments for Recoverability and Impairment

We assess the carrying values of our mineral interests for recoverability as of the end of each quarterly reporting period and whenever information or circumstances indicate the potential for impairment. There were no circumstances indicating the potential for impairment as of March 31, 2026.

To assess recoverability, we would compare estimated undiscounted future net cash flows attributable to a mineral interest (when determinable) with our carrying costs and future obligations related to the mineral interest. If it is determined that the estimated future undiscounted cash flows related to a mineral interest are less than the carrying value of the mineral interest, an impairment loss is required to be measured and recorded.

Future net cash flow estimates are dependent upon economic reserves being discovered or developed on the related property; the costs of permitting, financing, start-up, and commercial production related to a mineral interest; and commodity prices. When estimates of future net cash flows are not determinable and other conditions indicate the potential for impairment, management uses available market information and/or third-party valuation experts to assess if the carrying value of a mineral interest can be recovered and to estimate fair value.

Stock-Based Compensation

Our stock-based compensation consists primarily of restricted stock units ("RSUs") granted under the Rare Earth Americas Ltd. 2025 Equity Incentive Plan. We account for stock-based compensation awards based on the fair value of the award as of the grant date, which for RSUs was based on the fair value of the underlying common stock at the time of the grant.

The Company recognizes stock-based compensation expense on a straight-line basis over the awards' requisite service period, if any performance conditions in the award are considered probable. Some of our RSUs have a performance condition which delays the recognition of the expense until the occurrence of the performance condition is probable. If the performance condition had been considered probable as of March 31, 2026, the Company would have recognized $5,049 of stock-based compensation for all RSUs with a performance-based vesting condition and would have $1,542 of unrecognized compensation cost to be recognized over a weighted-average period of 0.4 years.

Instruments with Characteristics of Liabilities and Equity

As of March 31, 2026, the Company has outstanding warrants exercisable into shares of the Company's common stock and SAFE agreements that will convert into shares of the Company's common stock upon a qualifying equity financing. The Company accounts for these instruments as liability-classified based on an assessment of their specific terms and applicable authoritative guidance. The instruments are required to be recorded at their initial fair value on the date of issuance, and are remeasured to their fair value on each balance sheet date thereafter, with any change in fair value recognized in the Company's consolidated statements of operations. Both the warrants and SAFE were issued in 2025, and the SAFE were converted in connection with the completion of the Offering.

Recently Adopted Accounting Standards

See Note 2. Significant Accounting Policies of the notes to our condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q.

Emerging Growth Company Status

In April 2012, the JOBS Act was enacted. Section 107(b) of the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the extended transition period to comply with new or revised accounting standards and to adopt certain of the reduced disclosure requirements available to emerging growth companies. As a result of the accounting standards election, we will not be subject to the same implementation timing for new or revised accounting standards as other public companies that are not emerging growth companies which may make comparison of our financials to those of other public companies more difficult.

We expect to retain our emerging growth company status until the earliest of: