Uranium Resources, Inc. (NASDAQ:URRE; ASX:URI) announced
today that it has entered into a Binding Letter of Intent (LOI) for
the sale of its Churchrock and Crownpoint properties in New Mexico
to Laramide Resources Limited (TSX: LAM; ASX: LAM).
Under the LOI, Uranium Resources (URI) and its subsidiaries have
agreed, subject to the execution of definitive documentation, to
transfer ownership of URI’s Churchrock and Crownpoint properties to
Laramide Resources or its subsidiaries (LAM). URI will receive the
following consideration from LAM at closing:
- $5.25 million in cash;
- $7.25 million promissory note, secured
by a deed of trust or mortgage over the properties. The Note has a
3-year term and carries an initial interest rate of 5% which then
increases to 10% when Laramide makes a commercial production
decision on Churchrock. Principal payments of $2.42 million are due
and payable on the anniversary of the closing of the proposed
transaction in each of 2017, 2018 and 2019. Interest will be
payable on a quarterly basis; provided, however, that no interest
will be payable prior to the first principal payment in 2017;
and
- Assumption of any liabilities for
remediation on the subject lands by Laramide.
This sale of the Churchrock and Crownpoint properties continues
URI’s proactive M&A strategy, with the sale representing URI’s
second asset monetization transaction in 2015. While maintaining a
very significant inventory of non-reserve mineralized material
which provides the foundation for its future production growth, URI
is focused on improving its portfolio alignment with its production
experience and expertise in In-Situ Recovery of uranium, targeting
operations that fit into the lowest quartile of operating
costs.
The proceeds from this sale to Laramide will significantly
strengthen the financial position of URI, and assist in funding
development of the high-grade, low-cost Temrezli ISR Project in
Central Turkey. URI is progressing towards production at the
project, subject to receipt of all project permits and completion
of development financing.
The significant steps URI has taken in 2015 to realign is
project portfolio towards lowest quartile cost assets, including
this most recent sale to Laramide, have put the company on a clear
path for the future, which coincides favorably with the widely
forecast positive outlook for uranium.
Definitive documentation on the terms above is expected to be
executed by the end of 2015, with closing anticipated by late Q1
2016, subject to customary conditions, including applicable stock
exchange approvals, regulatory approvals for the transfer of the
projects to Laramide, and Laramide raising the capital required to
close the transaction.
Christopher M. Jones, President and Chief Executive Officer of
Uranium Resources, said,
“We are pleased to have worked with Laramide to achieve this
strategic transaction for our respective shareholders. With the
significant royalties that Laramide already own over the Churchrock
Project, this transaction makes a great deal of sense for both
companies, and importantly for URI, raises new capital to apply to
the progression of the Temrezli Project in a non-dilutive
manner.
“We have a clear focus in moving towards near-term, low-cost
uranium production using ISR production methods and this
transaction will significantly strengthen our financial position as
we accelerate down this path. We are very excited about our just
completed merger with Anatolia Energy Ltd. and work is already
underway for the relocation of our Rosita processing plant from
Texas to Turkey, which will provide significant costs capital costs
savings in the development of this world-class ISR project.”
URI and Laramide are working together towards a timely execution
of definitive documentation and all approvals required in respect
of the transaction, including the transfer of URI’s NRC licence as
it pertains to the sale properties. It is expected that the
transaction will close in late Q1 2016.
About Uranium Resources
Uranium Resources, Inc. (URI) is focused on advancing to
near-term production the Temrezli in-situ recovery (ISR) project in
Central Turkey. URI also controls extensive exploration properties
under nine exploration and operating licenses covering
approximately 44,700 acres (over 18,000 ha) with numerous
exploration targets, including the potential satellite Sefaatli
Project, which is 25 miles (40 km) southwest of the Temrezli
Project. In Texas, the Company has two licensed and currently idled
processing facilities and approximately 17,000 acres (6,900 ha) of
prospective ISR projects. In New Mexico, the Company controls
minerals rights encompassing approximately 186,000 acres (75,300
ha) in the prolific Grants Mineral Belt in New Mexico, which holds
one of the largest concentrations of sandstone-hosted uranium
deposits in the world. Incorporated in 1977, URI also owns an
extensive uranium information database of historic drill hole logs,
assay certificates, maps and technical reports for the Western
United States.
Cautionary Statement
This news release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are subject to risks, uncertainties and
assumptions and are identified by words such as "expects,"
"estimates," "projects," "anticipates," "believes," "could," and
other similar words. All statements addressing operating
performance, events or developments that the Company expects or
anticipates will occur in the future, including but not limited to
statements relating to the proposed transaction between URI and
Laramide, including entry into and the terms and conditions of
definitive documentation and the timing of definitive documentation
and closing, the benefits of the combination with Anatolia Energy,
the timing, occurrence or cost of production at the Company’s
properties, including the timing of construction, permits and
initial production at the Temrezli Project, the timing and
conclusions of the updated technical report and economic analysis
at the Temrezli Project, the potential relocation of the Rosita
plant to Turkey, and the availability of financing to the Company
are forward-looking statements. Because they are forward-looking,
they should be evaluated in light of important risk factors and
uncertainties. These risk factors and uncertainties include, but
are not limited to, (a) the Company's ability to raise additional
capital in the future; (b) spot price and long-term contract price
of uranium; (c) the Company's ability to reach agreements with
current royalty holders; (d) operating conditions at the Company's
projects; (e) government and tribal regulation of the uranium
industry and the nuclear power industry; (f) world-wide uranium
supply and demand; (g) maintaining sufficient financial assurance
in the form of sufficiently collateralized surety instruments; (h)
unanticipated geological, processing, regulatory and legal or other
problems the Company may encounter, including in Turkey; (i) the
ability of the Company to enter into and successfully close
acquisitions or other material transactions, including the proposed
transaction with Laramide, and other factors which are more fully
described in the Company's Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q, and other filings with the Securities and
Exchange Commission. Should one or more of these risks or
uncertainties materialize, or should any of the Company's
underlying assumptions prove incorrect, actual results may vary
materially from those currently anticipated. In addition, undue
reliance should not be placed on the Company's forward-looking
statements. Except as required by law, the Company disclaims any
obligation to update or publicly announce any revisions to any of
the forward-looking statements contained in this news release.
Competent Person
Technical information in this release as well as references to
mineral resources in Texas and New Mexico are based on information
compiled by Dean T. “Ted” Wilton (CPG-7659), who is Chief
Geologist and Vice President of URI, and a Qualified Person under
Canada National Instrument 43-101. Mr. Wilton is a Professional
Geologist in the State of Wyoming and is a Certified Professional
Geologist by the American Institute of Professional Geologists a
Recognized Overseas Professional Organization (ROPO) as listed by
the ASX. Mr. Wilton has over 40 years of minerals industry
experience, including more than 5 years of experience that are
relevant to the style of mineralization and type of deposit under
consideration. He is a Competent Person as defined in the 2012
Edition of the “Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves”. Mr. Wilton consents
to the inclusion in this release of the matters based on their
information in the form and context in which it appears.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20151109006734/en/
Uranium ResourcesWendy Yang,
303-531-0478www.uraniumresources.comorAlpha IR GroupRobert Winters,
929-266-6315robert.winters@alpha-ir.com
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