Texas Mineral Resources and JV Partner USA Rare Earth Enhance Round Top Operating Agreement to Include Flexible Financing Option to Meet Potential Future Cash Requirements

• TMRC will have an alternative option aside from cash to meet potential future Round Top capital calls by reducing its Round Top project equity based on a preset formula tied to TMRC market capitalization at the time of any potential cash call
• Financing option avoids any potential need to raise capital through the issuance of TMRC equity securities which could unnecessarily dilute TMRC shareholders

SIERRA BLANCA, TX, June 27, 2023 (GLOBE NEWSWIRE) -- via NewMediaWire – Texas Mineral Resources Corp. (OTCQB: TMRC)

Texas Mineral Resources Corp. (“TMRC”), an exploration company currently targeting the heavy rare earths, technology metals and a variety of industrial minerals through its 20% interest in the Round Top Mountain project in Texas, is pleased to announce that USA Rare Earth and TMRC have agreed to modify the existing Round Top Mountain Development (“Round Top”) operating agreement (“Operating Agreement”) to allow, at TMRC’s option, the right to meet potential future cash calls by reducing its Round Top project equity according to a preset formula.

TMRC will have the sole right, but not the obligation, to allow USA Rare Earth to fund its cash call and then reduce its Round Top project equity by a percentage, according to the following formula:  TMRC’s cash call that is funded by USA Rare Earth divided by TMRC’s market capitalization at the time of the cash call multiplied by TMRC’s Round Top then current equity interest.  For example, a $1 million TMRC cash call funded by USA Rare Earth (assuming today’s $70mm market cap) would result in a reduction in the TMRC Round Top 20% membership interest to approximately 19.71%  (1mm ÷ 70mm equals 1.428%, multiplied by the current membership interest of 20%, to result in adjusted ownership of 19.71%). 

Benefits to TMRC include:

• Avoids the need to raise capital to fund capital calls through the issuance of its equity securities; and
• Allows for any potential future financing to occur on an orderly basis.

“We wish to thank our joint venture partner USA Rare Earth for their unwavering support in working with us to structure a mechanism for meeting potential cash calls based on our market capitalization and without the need for us to raise outside capital,” said Anthony Marchese, Chairman.  “This financing option provides TMRC with enhanced flexibility and optionality to pursue any potential future financing on an opportunistic basis. Given that management and the board currently own approximately 33% of the TMRC shares outstanding, we have a significant vested interest in, and are committed to maximizing, shareholder value.”