Unassociated Document


    
      Exhibit
10.12

       

      MOLYCORP,
INC.

      


      


      LOCK-UP
LETTER

      


      


      February
10, 2011

      


      


      J.P.
Morgan Securities LLC

      383
Madison Avenue

      New York,
NY 10179

      


      Morgan
Stanley & Co. Incorporated

      1585
Broadway

      New York,
NY 10036

      


      Ladies
and Gentlemen:

      


      The undersigned understands that J.P.
Morgan Securities LLC and Morgan Stanley & Co. Incorporated (the “Representatives”) propose to
enter into (i) an Underwriting Agreement (the “Common Stock Underwriting
Agreement”) with Molycorp, Inc., a Delaware corporation (the “Company”), and certain
stockholders of the Company (the “Selling Stockholders”),
providing for the public offering by the several Underwriters to be named in
Schedule 1 to the Common Stock Underwriting Agreement, including the
Representatives (the “Underwriters”), of shares (the
“Shares”) of the common
stock of the Company (the “Common Stock”) and (ii) an
Underwriting Agreement (the “Convertible Preferred Underwriting
Agreement” and, together with the Common Stock Underwriting Agreement,
the “Underwriting
Agreements”) with the Company, providing for the public offering
(together with the public offering of the Common Stock , the “Public Offerings”) by the
several Underwriters of shares of mandatory convertible preferred stock of the
Company (the “Preferred
Stock”).

      


      To induce the Underwriters that may
participate in the Public Offerings to continue their efforts in connection with
the Public Offerings, the undersigned hereby agrees that, without the prior
written consent of the Representatives acting on behalf of the Underwriters, it
will not, during the period (the “restricted period”) commencing
on the date hereof and ending 90 days after the date of the final prospectuses
relating to the Public Offerings (each, a “Prospectus”), (1) 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 the Common Stock or Preferred Stock beneficially owned (as such term
is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)), by the
undersigned or any other securities so owned convertible into or exercisable or
exchangeable for Common Stock or Preferred Stock or

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      (2) 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 or Preferred Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise.  The foregoing sentence shall not apply to (a) the exercise
of a warrant or an option to purchase, or the settlement of any other equity
award for, shares of Common Stock (provided that any Shares received are subject
to the restrictions contained in this agreement), (b) in the case of an option
to purchase shares of Common Stock expiring or restricted shares of Common Stock
vesting during the restricted period, the sale or transfer of such shares of
Common Stock to the Company to satisfy any payment or withholding obligations in
connection with the exercise of such option or vesting of such restricted
shares, or in connection with any cashless exercise of a warrant to purchase
shares of Common Stock, (c) the conversion of any Preferred Stock or other
equity interest of the Company into shares of Common Stock, (d) the disposition
of shares of Common Stock or Preferred stock pursuant to the Public Offerings,
(e) transactions relating to shares of Common Stock, Preferred Stock or other
securities acquired in open market transactions after the completion of the
Public Offerings, 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 Preferred Stock or other securities acquired in such
open market transactions; (f) transfers of shares of Common Stock, Preferred
Stock or any security convertible into Common Stock or Preferred Stock (1) as a
bona fide gift or (2) to any affiliate of the undersigned; (g) distributions of
shares of Common Stock, Preferred Stock or any security convertible into Common
Stock or Preferred Stock to any partner, member or stockholders of the
undersigned; provided
that in the case of any transfer or distribution pursuant to clause (f) and (g)
above, (i) each transferee or distribute shall sign and deliver a lock-up letter
substantially in the form of this letter and (ii) no filing under Section 16(a)
of the Exchange Act, reporting a reduction in beneficial ownership of shares of
Common Stock or Preferred Stock, shall be required or shall be voluntarily made
during the 90-day restricted period referred to in the foregoing sentence, (h)
the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange
Act for the transfer of shares of Common Stock or Preferred Stock, provided that such plan does
not provide for the transfer of Common Stock or Preferred Stock during the
90-day 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 undersigned or the Company during the 90-day
restricted period.  In addition, the undersigned agrees that, without
the prior written consent of the Representatives acting on behalf of the
Underwriters, it will not, during the period commencing on the date hereof and
ending 90 days after the date of the Prospectus, make any demand for or exercise
any right with respect to, the registration of any shares of Common Stock,
Preferred Stock or any security convertible into or exercisable or exchangeable
for Common Stock or Preferred Stock (except in respect of the Public
Offerings).  The undersigned also agrees and consents to the entry of
stop transfer instructions with the Company’s transfer agent and registrar
against the transfer of the undersigned’s shares of Common Stock and Preferred
stock except in compliance with the foregoing restrictions.

      


      If:

      


      (1)           during
the last 17 days of the 90-day restricted period the Company issues an earnings
release or material news or a material event relating to the Company occurs;
or

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
 

      (2)           prior
to the expiration of the 90-day restricted period, the Company announces that it
will release earnings results during the 16-day period beginning on the last day
of the restricted period;

      


      the
restrictions imposed by this agreement shall 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, unless the Representatives waive, in
writing, such extension.

      


      The undersigned hereby acknowledges
that the Company has agreed in the Underwriting Agreement to provide written
notice of any event that has resulted in an extension of the restricted period
and agrees that any such notice properly delivered will be deemed to have given
to, and received by, the undersigned.

      


      This agreement shall automatically
terminate and be of no further effect upon the earliest to occur, if any,
of:  (i)(x) the Company advising the Representatives in writing, prior
to execution of the Convertible Preferred Underwriting Agreement, that it has
determined not to proceed with the Public Offerings and (y) the Selling
Stockholders advising the Representatives in writing, prior to the execution of
the Common Stock Underwriting Agreement, that they have determined not to
proceed with the Public Offering of Common stock, (ii) the termination of both
the Common Stock Underwriting Agreement and the Convertible Preferred
Underwriting Agreement before the sale of any Common Stock or Preferred Stock to
the Underwriters and (iii) April 30, 2011 if a closing for neither of the Public
Offerings has occurred as of that time.

      


      The undersigned understands that the
Company and the Underwriters are relying upon this agreement in proceeding
toward consummation of the Public Offerings.  The undersigned further
understands that this agreement is irrevocable and shall be binding upon the
undersigned’s heirs, legal representatives, successors and assigns.

      


      Whether or not the Public Offerings
actually occur depends on a number of factors, including market
conditions.  Any Public Offering will only be made pursuant to an
Underwriting Agreement, the terms of which are subject to negotiation between
the Company and the Underwriters.

      


       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      


      


      


      


      
        
          
            
              
                
                  
                    
                      	 
      	
                              Very
      truly yours,

                            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                              /s/ Mark S. Kristoff

                            
	 
      	
                              (Name)

                            	
                              Mark
      S. Kristoff, Manager

                            
	 
      	 
      	
                              TNA
      Moly Group LLC

                            
	 
      	 
      	
                              825
      Third Avenue

                            
	 
      	 
      	
                              New
      York, NY 10022

                            
	 
      	
                                  
      

                            
	 
      	
                              (Address)

                            


                    

                  

                

              

            

          

        

      

      


      


      


      


      


      


      


      


      


      


      


      


      


      [Signature
page to lock-up letter]