American Atomics signs LOI for Utah uranium claims

Executive Summary

• American Atomics Inc. signed a non-binding Letter of Intent (LOI) to acquire uranium mining claims and mineral rights in the Lisbon Valley area of San Juan County, Utah, from Big Indian Prospectors LLC.
• The company can earn up to an 80% interest in the property over five years through a total of $18 million in exploration expenditures, with additional cash payments and equity/warrant issuances required at various milestones.
• The company simultaneously announced it is not exercising its existing option to acquire UR-Energy’s mining claims in Colorado due to regulatory risks in San Miguel County.

Key Details

• Transaction Structure: Non-binding LOI to acquire uranium mining claims and related mineral rights in the Lisbon Valley area, San Juan County, Utah.
• Property Details:
  • Consists of 217 claim blocks covering the majority of the east side of the Lisbon Valley anticline.
  • Located in the historic Lisbon Valley mining district, which has approximately 78 million pounds U3O8 of historical production at an average grade of ~0.37%.
  • Targeting the underexplored east flank of the salt-anticline, which is down-dropped 2,000 to 2,700 feet along the Lisbon Valley fault.
• Earn-In Schedule (Exploration Expenditures):
  • American Atomics can earn up to 80% interest by spending $3.6 million annually from 2026 to 2030.
  • 2026: $3.6 million for 40% interest.
  • 2027: $3.6 million for additional 10% interest.
  • 2028: $3.6 million for additional 10% interest.
  • 2029: $3.6 million for additional 10% interest.
  • 2030: $3.6 million for additional 10% interest.
  • Shortfalls in expenditure commitments (from 2027 onwards) can be satisfied by cash and/or common shares.
• Cash and Equity Considerations:
  • On LOI Signing: $20,000 cash.
  • On Definitive Agreement: $130,000 cash + 3,000,000 warrants.
  • 90 Days After Permits: $300,000 cash + $300,000 in common shares.
  • Jan 1, 2027: $150,000 cash + $1.3 million in common shares.
  • Jan 1, 2028: $550,000 cash + $1.5 million in common shares.
  • Jan 1, 2029: $650,000 cash + $1.7 million in common shares.
• Warrant Terms: 5-year term, vesting in tranches over a four-year period.
• Share Pricing: Common shares issued to vendor will be priced based on current trading prices and CSE policies, subject to CSE approval.
• Operational Control: American Atomics will act as operator with day-to-day control. Company bears costs for NI 43-101 compliant feasibility study; thereafter, costs shared pro-rata based on ownership.
• Timeline: Definitive agreement expected within 60-90 days. First phase drilling program planned for early 2026.
• UR-Energy Update: American Atomics elected not to exercise its option to acquire UR-Energy’s Colorado claims due to San Miguel County’s proposed actions impairing half the claim blocks. UR-Energy is released from obligations.

Notable Quotes

• David Mitchell, CEO, American Atomics: "We are extremely pleased to have executed this option agreement with Big Indian and plan to quickly move towards executing a definitive agreement in the weeks ahead. This is exactly the type of opportunity that American Atomics looks for to support its uranium and eventually, fuel cycle ambitions... We look forward to explaining to the market the history and story around this property and the area in general, as well as to start planning for a first phase drilling program early in 2026."
• Mark A. Steen, CEO, Big Indian Prospectors: "The Big Indian mining district in Lisbon Valley is Utah's premier uranium mining district, with historical production of over $1-billion between 1952 and 1988... Our company, Big Indian Prospectors, has been focusing on discovering another Big Indian ore belt by combining stratigraphy and structural geology with the examination of oil and gas drill hole logs."