Stillwater’s Magnet USAR Facility Deal: Wall Street Wins, Oklahoma Loses

STILLWATER, Okla., (The Oklahoma Post) –

While Mayor Will Joyce cut the ceremonial ribbon and local officials touted the arrival of a high-tech magnet manufacturing facility in Stillwater, the real story, the one buried in over 100 pages of SEC filings—isn’t about jobs, innovation, or economic revival.

It’s about financial engineering, hedge fund protection, and a cleverly disguised wealth transfer—from Oklahoma’s taxpayers straight into the pockets of Wall Street billionaires.

And while Stillwater’s leadership posed for photo ops, Governor Kevin Stitt was nowhere to be found. Sources say that wasn’t a scheduling issue—it was an intentional decision. If there was ribbon-cutting to be done, Stitt might have shown up in Colorado, where earlier parts of the project originated, or perhaps at another site where the rare earth materials were sourced—from a different company entirely.

Instead, Oklahomans and investors got the PR rollout, but not the full truth.

What’s Really Happening?

The Stillwater project is being advanced by USA Rare Earth, a private firm now merging with Inflection Point Acquisition Corp. II (NASDAQ: IPAX), a Cayman Islands-based shell company.

As of May 17, 2025, USA Rare Earth Inc. (USAR) is trading at $9.77 per share, showing a modest 3.91% gain from the previous close. Despite this short-term bump, technical signals are split: some algorithms flag a Stochastic Buy Signal and Directional Movement crossover, while broader trends—including a bearish MACD over the past three months—indicate ongoing downward pressure. For a company backed by $8.9 million in public subsidies mostly from the City of Stillwater and a small portion from the Governor’s Fund, these mixed trading signals raise urgent questions: Is this a national security investment—or just another SPAC bubble dressed in red, white, and rare earths?

On paper, this merger forms “USA Rare Earth, Inc.” A name that sounds patriotic—until you read the fine print.

Here’s what the official filings and agreements show:

• No enforceable job guarantees in Oklahoma
• No financial protections for the City of Stillwater or the state
• No local equity, oversight, or ownership
• But millions in risk-free returns guaranteed for elite hedge funds like L1 Capital and Harraden Circle Investors

In short: Oklahoma takes the risk. Wall Street takes the profits.

The Hedge Fund Scheme Mayor Joyce Won’t Mention

In November 2024, two hedge funds—L1 Capital and Harraden Circle Investors—signed what are called Non-Redemption Agreements. These deals look innocuous, but they’re the linchpin of how insiders rig the system.

Here’s how they work:

1. The hedge funds agree not to redeem (cash out) their SPAC shares before the merger vote.
2. In return, they’re granted a Forward Purchase Option—an arrangement that guarantees a return on their investment, regardless of what happens to the company post-merger.
3. The cash comes from the SPAC’s trust account—funded by public markets and small investors—not from operational revenues or job creation.

If the stock does well, these firms sell for a profit.

If the stock tanks, they return the shares and get their original investment back—plus interest.

• L1 Capital got this deal on 300,000 shares.
• Harraden Circle got 700,000.
• Stillwater got risk and political spin.

Stillwater’s Role—And Mayor Will Joyce’s Failure

Mayor Will Joyce championed the project with talking points and press quotes. But behind closed doors, he failed to secure even basic protections for Stillwater or Oklahoma. We asked for these records through FOIA within the city of Stillwater and we refused documentation. The mayor also went on a public attack against the Oklahoma Post and it’s owner. So what we can only assume is; there’s no binding job quota, fraudulent local ownership stake, no clawback provisions if the company folds.

Instead, he helped approve a $7 million city incentive, which the city claims is secured by a lien on the property—but that won’t stop the SPAC insiders from walking away with a fortune.

Here’s what’s actually in place:

• A SPAC incorporated in the Cayman Islands
• $18,000/month in consulting fees going to insiders through private LLCs
• Insider equity and preferred shares that dilute local benefit while protecting hedge fund exposure

It’s the perfect corporate honeypot. And one powerful name proves it.

Enter Mike Pompeo: Strategic Advisor, or Strategic Profiteer?

In 2023, Mike Pompeo, former Secretary of State under President Trump, joined USA Rare Earth as a “Strategic Advisor.”

He has no background in rare earth chemistry, engineering, or advanced manufacturing. But he does have something even more valuable: access to power and influence inside the Department of Defense and Congress.

So how does Pompeo likely get paid?

1. Stock Options & Insider Shares – These “advisor” positions typically include deeply discounted shares or warrants that skyrocket if the merger is successful.
2. Backdoor SPAC Profits – SEC filings show private placement arrangements that could tie Pompeo to the same risk-free deals enjoyed by Harraden and L1 Capital.
3. Consulting Fees via Shell LLCs – These payments often flow through consulting entities that don’t appear in executive compensation disclosures, creating plausible deniability.
4. Federal Grant Influence – His real value may be lobbying for grants or DOD contracts under the guise of “national security,” with Oklahoma merely the stage set.

Let’s ask the obvious question:

Why would a former CIA Director and Secretary of State involve himself in a speculative magnet plant in Stillwater?

Because this isn’t about Stillwater. It’s about influence, narrative control, and elite extraction.

A Honeypot Deal That’s Structurally Rigged

Behind the scenes, here’s what’s really happening:

• Inflection Point Acquisition Corp. II uses its IPO capital to fund the merger.
• USA Rare Earth gains a public listing without going through a traditional IPO, avoiding stricter audits and transparency requirements.
• Hedge funds and insiders are shielded from downside.
• Local officials cheerlead without reading the contracts.

This is economic displacement disguised as development—a model repeated across the country where vulnerable towns are used as backdrops for speculative finance, and the only guarantee is the payday for those at the top.

Audit Demanded Over SPAC Magnet Deal—“Public-Private Risk Inversion,” Says Source

An anonymous whistleblower has formally requested that Oklahoma State Auditor Cindy Byrd launch an immediate audit of the public funds and economic incentives tied to Stillwater’s $9.9 million magnet facility deal with USA Rare Earth, Inc. and its SPAC partner, Inflection Point Acquisition Corp. II (NASDAQ: IPAX). The request, sent May 16, 2025, calls into question the city’s legal position, the financial structure of the deal, and the real risks facing Oklahoma taxpayers.

According to the complaint, which was also sent to the Attorney General’s Public Protection Unit, the City of Stillwater has approved a $7 million incentive package for USA Rare Earth to refurbish a facility at 100 W. Airport Rd. However, the underlying financial arrangement—detailed in USA Rare Earth’s SEC Form S-4, including Exhibit 3.1—appears heavily tilted toward protecting East Coast hedge funds and SPAC insiders while exposing the city and state to outsized risk.

Key provisions flagged for investigation include:

• 12% cumulative quarterly dividends paid to preferred shareholders, regardless of profit—an unusually aggressive structure for a manufacturing startup.
• Conversion and anti-dilution protections, allowing early investors to avoid financial loss even if the project fails.
• Redemption rights, permitting hedge funds to cash out early using project or public funds.
• Liquidation preference, meaning Wall Street investors would be paid before Stillwater sees a dime in the event of bankruptcy.
• Voting takeover triggers, where missed dividend payments could give outside investors control of company decisions.

“These aren’t just red flags—they’re warning sirens,” the source wrote, calling the terms “a public-private risk inversion.” The deal, they argue, allows hedge funds like L1 Capital and Harraden Circle Investors to lock in guaranteed profits while taxpayers are left with empty promises of future jobs.

Adding to the confusion, the City claims to be a first lien holder on the property, yet officials also state that USA Rare Earth is purchasing the building outright in cash. The whistleblower questioned whether the City’s lien is enforceable or simply symbolic. “If USA Rare Earth paid in full, what exactly is Stillwater’s legal claim to the asset?” they asked.

Mayor Will Joyce, who has aggressively promoted the deal, is also quoted as saying that it may take “a couple decades” before Stillwater sees any real benefit—if at all. The audit request challenges the logic of front-loading millions in taxpayer investments without enforceable returns or a clear legal pathway to recoup funds in the event of failure.

The SPAC’s leadership includes some of Wall Street’s most well-connected figures:

• Michael Blitzer, co-CEO of Inflection Point and co-founder of Kingstown Capital
• Thomas Ricketts, Chairman of Inflection Point II and Executive Chairman of the Chicago Cubs
• James D. Bellis, CFO and former executive at SoftBank-backed ventures

“These are billionaires with built-in escape hatches,” the source noted. “Their returns are guaranteed. Ours are hypothetical.”

The letter ends with a call for a full compliance review of whether ARPA funds, education bonds, or state development dollars were tied to the deal, and whether any legal due diligence was conducted by the City or the State of Oklahoma before granting public support.

The Oklahoma Post has reviewed the filings, documents, and agreements submitted and can confirm that many of the concerns raised are substantiated in USA Rare Earth’s own SEC disclosures.

L1 Capital’s Deal Mirrors Harraden—With the Same Rigged Outcome

Just like Harraden Circle, L1 Capital Global Opportunities Master Fund entered into a Non-Redemption Agreement with Inflection Point Acquisition Corp. II in November 2024. While the public was told this merger would bring jobs and investment to Oklahoma, L1’s private deal all but guaranteed it would profit regardless of success or failure.

Key Terms from the Deal:

• 300,000 Shares Protected: L1 Capital agreed to not redeem its shares during the extension vote—ensuring the merger could proceed.
• In Return: L1 receives a Forward Purchase Option, entitling it to:
  
  • An escrow payout equal to the full redemption price of the shares,
  • The right to sell shares early and keep any gains,
  • Or a full return of principal plus interest 90 days post-merger.

L1’s Agreement = Heads They Win, Tails Oklahoma Loses:

• Funds come directly from Inflection Point’s Trust Account, originally meant to support the merged company—not reward hedge funds.
• No requirement to hold shares long-term or actually support Stillwater operations.
• Just another quiet sweetheart deal, hidden in SEC filings and structured to insulate Wall Street from any risk.

Harraden Circle’s Non-Redemption Deal: Guaranteed Profits, Zero Risk

The Setup:

• Harraden Circle promised not to redeem 700,000 shares before the merger vote.
• In exchange, they were granted a Forward Purchase Option with virtually zero downside.

Mechanics of the Scheme:

1. Escrow Backing: Funds from the trust account are diverted into escrow—not for Oklahoma job creation, but to protect Harraden’s returns.
2. Guaranteed Returns: Harraden can either:
   
   • Sell high and pocket gains,
   • Or return shares after 90 days and receive full principal plus interest.
3. Free Exit: They can cash out anytime post-merger—risk-free.

The Catch for Oklahoma:

• These deals aren’t about investor “protection”—they’re about guaranteed arbitrage for elite funds.
• If the magnet facility flops, Harraden gets paid anyway—while Stillwater is left holding an empty warehouse.
• That money never touches local jobs, manufacturing, or mineral development.

Key Takeaways from Inflection Point’s November 2024 SEC 8-K Filing

A close look at the SPAC’s 8-K filing reveals even more red flags for Oklahoma stakeholders:

1. Cayman-Islands-Based Shell
   
   • Inflection Point is registered offshore, but operates out of 167 Madison Ave, NYC—typical for tax-light, transparency-shielded entities.
2. Insider Compensation via Private LLCs
   
   • Executives like Peter Ondishin and Kevin Shannon are paid through The Venture Collective LLC, an affiliate of director Nicholas Shekerdemian.
   • Despite fee reductions, they still collect $7,372.94/month from a shell company with no operations.
3. Hedge Fund Favoritism
   
   • Non-Redemption Agreements with L1 and Harraden grant risk-free profits in exchange for votes—not actual investment or operational risk.
   • The trust account—originally a safeguard—is now a hedge fund payout mechanism.
4. Litigation and Market Risk Warnings
   
   • The filing includes pages of risk disclosures, citing litigation, regulatory hurdles, environmental uncertainty, and speculative mineral reserves.
5. Timing Games and Shareholder Pressure
   
   • The vote to extend the merger was held just before the SPAC’s November 30 deadline.
   • Insiders sweetened deals with hedge funds while soliciting public investor votes, compromising market fairness.

Why This Matters for Oklahoma

Oklahoma’s public officials—including Stillwater’s Mayor Will Joyce—are supporting a project that:

• Prioritizes Wall Street insiders over local workers,
• Offers no binding job guarantees or production safeguards,
• Diverts funds from public infrastructure and economic security into private finance games,
• And hides critical terms deep inside SEC filings and legalese few citizens will ever see.

Meanwhile, construction crews prepare the site. Local schools, roads, and water systems brace for increased demand. But the financial upside is already spoken for—hedged, securitized, and escrowed in New York and offshore accounts.

What We’re Demanding

The Oklahoma Post calls on Mayor Will Joyce to:

• Release all communications and meeting records related to USA Rare Earth, Inflection Point, and their financial backers.
• Hold a public forum where city officials must answer to taxpayers and explain why this deal lacked enforceable guardrails.
• Disclose any and all consulting arrangements, reimbursements, or benefits received by city officials in connection with the project.

Because this deal doesn’t just reflect poor negotiation—it suggests deliberate obfuscation.

Conclusion: The People Deserve the Truth

Oklahoma is not Wall Street’s dumping ground. We are not a steppingstone for ex-politicians looking for their next cash-out. We are not pawns in someone else’s SPAC game.

The real winners of the Stillwater magnet deal aren’t Oklahomans. They’re hedge funds in Manhattan. They’re shell companies in the Caymans. And they’re political insiders like Mike Pompeo, who’s likely already been paid—before a single permanent Stillwater job is created. Mayor Joyce didn’t negotiate for the public.

He negotiated for the press release. And now, we all pay the price. The Oklahoma Post will continue investigating.

(Writing by DJ Vance; Editing by Robbie Robertson)

By The People’s Popular Paper | Oklahoma Special Report

2025 -The Oklahoma Post – TheOKPost.com is dedicated to delivering relevant news and information to Oklahomans, sharing their stories, pictures, and experiences. The content on this website includes contributions from various individuals and links to external public and privately owned sources. The views and opinions expressed in user-generated content are solely those of the respective authors and do not necessarily reflect The Oklahoma Post. The Oklahoma Post does not independently verify the accuracy of third-party contributions and rely upon contributors to fact-check their work. By sharing links and allowing open contributions, TheOKPost.com exercises the right to free speech and providing a platform for diverse perspectives.