Texas Mineral Resources and USA Rare Earth Merger Sparks Stockholder Lawsuits and Leads to Supplemental Disclosure

Merger Agreement Details and Timeline

On March 4, 2026, Texas Mineral Resources Corp. and USA Rare Earth, Inc. entered into a binding merger agreement that will result in TMRC becoming a wholly owned subsidiary of USAR. Under the terms, TMRC common stock (par value $0.01 per share) will convert into 3,823,328 shares of USAR common stock. The transaction involves two merger subsidiaries formed by USAR: Hamer Merger Sub, Inc. (a corporation) and Hamer Merger Sub, LLC (a limited liability company).

The merger process included regulatory review and stockholder notifications. USAR filed a Form S-4 registration statement with the SEC on May 13, 2026, amended it on June 23, 2026, and received effectiveness on June 29, 2026. The definitive proxy statement and prospectus were filed and mailed to TMRC stockholders on June 29, 2026, combining proxy and prospectus disclosures for both companies.

Legal Challenges and Stockholder Demands Post-Announcement

Since the merger announcement, two individual stockholder lawsuits were filed in New York Supreme Court, County of New York. The first, Anthony Malone v. Texas Mineral Resources Corp. et al., was filed on July 7, 2026 (Index No. 654004/2026). The second, Nathan Turner v. Texas Mineral Resources Corp. et al., was filed on July 8, 2026 (Index No. 654028/2026). Both name TMRC, USAR, and others as defendants.

Additionally, multiple demand letters from legal counsel representing purported TMRC stockholders have been received, requesting supplemental disclosures and alleging violations of state securities laws, common law, Sections 14(a) and 20(a) of the Securities Exchange Act of 1934, and Rule 14a-9. Plaintiffs claim the defendants filed a false and misleading registration statement with the SEC.

Company Stance on Disclosure and Supplemental Filing

TMRC and USAR maintain that supplemental disclosures were not legally required. Nonetheless, they voluntarily provided additional information to stockholders to avoid transaction delays, minimize costs and uncertainties, and reduce distractions during the merger process.

The supplemental materials are for informational purposes only and should not be interpreted as an admission of legal necessity or materiality. These disclosures supplement and supersede prior information in the definitive proxy statement and prospectus filed on June 29, 2026.

Preparation and Limitations of Round Top Project Financial Projections

TMRC management prepared the prospective financial information for the Round Top Project, its primary asset, based on assumptions regarding future production and market conditions. This information was developed for internal advisory use and was not reviewed or verified by USAR before disclosure.

TMRC generally does not publicly release projections about future financial performance. The inclusion of this prospective data does not imply that TMRC, USAR, or their affiliates consider it predictive of actual results. Recipients are cautioned not to rely on it for investment or business decisions.

Uncertainties and Assumptions in Financial Forecasts

The prospective financial information is subjective and carries no assurance that projected outcomes will be achieved. The multi-year projections become less predictive over time due to numerous variables and assumptions beyond TMRC management's control.

Factors impacting actual results include operational risks, industry performance, regulatory environments, and broader economic conditions. The assumptions were deemed reasonable as of February 26, 2026, but future changes or unforeseen factors could affect outcomes.

Independent Auditor Disclaimer and Accounting Standards

No independent registered public accounting firm or other accounting professionals have audited or reviewed the prospective financial information. No assurance or opinion has been provided regarding its accuracy or achievability.

The audit reports included in the proxy statement relate solely to historical financial data and do not cover forward-looking projections. The prospective information was not prepared to comply with American Institute of Certified Public Accountants standards for prospective financial information.

Regulatory Filings and Document Access

All transaction-related filings have been submitted to the SEC in accordance with regulatory requirements. USAR initially filed the Form S-4 registration statement on May 13, 2026, with an amendment on June 23, 2026, reflecting updated disclosures.

The SEC declared the registration statement effective on June 29, 2026, enabling distribution of the combined definitive proxy statement and prospectus to stockholders. Supplemental disclosures referenced herein complement these materials to provide comprehensive merger information.

Round Top Project Overview and Asset Significance

The Round Top Project is a major mineral extraction initiative that will be integrated into USAR's operations post-merger. TMRC has concentrated development efforts on this project, which aims to produce multiple marketable substances.

The financial projections reflect assumptions on production volumes, market prices, and operational costs. Near-term projections are considered more reliable, while long-term success depends on factors including commodity markets, regulatory approvals, and operational execution.

Stockholder Voting and Merger Progress

TMRC stockholders received definitive proxy materials on June 29, 2026, to vote on the merger proposal. The supplemental disclosures address litigation and stockholder demands, though the companies assert these were not legally mandated. Stockholders have access to all original and supplemental materials to inform their decisions.

Upon completion of all mergers and satisfaction or waiver of closing conditions, TMRC will become a wholly owned subsidiary of USAR, with TMRC shareholders receiving USAR common stock as consideration. Both companies remain committed to finalizing the transaction while managing legal and procedural challenges.