Texas Mineral Resources Merger With USA Rare Earth Triggers Stockholder Litigation and Supplemental Disclosure Update

Merger Agreement Structure and Timeline

On March 4, 2026, Texas Mineral Resources Corp. and USA Rare Earth, Inc. entered into a binding merger agreement that establishes a series of corporate transactions resulting in TMRC becoming a wholly owned subsidiary of USAR. Under the transaction structure, TMRC common stock with a par value of $0.01 per share will be converted into an aggregate of 3,823,328 shares of USAR common stock. The agreement involved two merger subsidiaries created by USAR specifically for the transaction: Hamer Merger Sub, Inc., a wholly owned subsidiary structured as a corporation, and Hamer Merger Sub, LLC, organized as a limited liability company.

The merger process required regulatory review and stockholder notification procedures. USAR filed a registration statement on Form S-4 with the Securities and Exchange Commission on May 13, 2026, which was amended on June 23, 2026 and subsequently declared effective on June 29, 2026. The definitive proxy statement and prospectus document was filed on June 29, 2026, and was first mailed to TMRC stockholders on the same date. This disclosure package combined the proxy statement requirements for TMRC stockholders with the prospectus materials for USAR investors.

Litigation and Stockholder Demands Following Transaction Announcement

Since the merger agreement was announced, legal challenges have emerged from purported stockholders of TMRC. Two individual stockholder lawsuits were filed in New York Supreme Court, County of New York. The first action, captioned Anthony Malone v. Texas Mineral Resources Corp. et al., was filed with Index No. 654004/2026 on July 7, 2026. The second action, Nathan Turner v. Texas Mineral Resources Corp. et al., carries Index No. 654028/2026 and was filed on July 8, 2026. Both cases name TMRC and USAR as defendants along with other parties.

In addition to litigation, the companies received multiple demand letters from legal counsel representing individual purported stockholders of TMRC. These demands request supplemental disclosures and make allegations against the transaction parties. The combined legal actions and demand letters allege violations of state securities laws, common law principles, Section 14(a) of the Securities Exchange Act of 1934, Section 20(a) of the Securities Exchange Act of 1934, and Rule 14a-9 promulgated under that exchange act. The plaintiffs contend that defendants caused a false and misleading registration statement relating to the transaction to be filed with the SEC.

Company Position on Disclosure Adequacy and Supplemental Filing Rationale

TMRC and USAR have formally stated their position that no supplemental disclosure was required or necessary under applicable law. Despite this legal position, the companies elected to provide additional information to stockholders through the supplemental materials disclosed in this update. The companies characterize their decision as motivated by three primary considerations: avoiding the risk of transaction delay, minimizing potential expense and uncertainties, and reducing distraction to both organizations during the merger process.

The supplemental disclosures are expressly stated to be provided for informational purposes to stockholders, and the companies emphasize that the filing of this additional information should not be construed as an admission of legal necessity or materiality under applicable securities laws. The supplemental materials supplement the disclosures already contained in the definitive proxy statement and prospectus document filed on June 29, 2026. Where information in the supplemental update differs from or updates prior disclosures, the information in the supplemental materials supersedes and supplements the prior disclosure.

Round Top Project Prospective Financial Information Preparation and Limitations

TMRC's management prepared internal prospective financial information relating to the Round Top Project, which represents the primary asset base of the company. This Prospective Financial Information was developed based on management's judgment and assumptions regarding future production from the Round Top Project and the market for the substances yielded by that project. The prospective information was prepared for and provided to TMRC's financial advisor, but it was not reviewed, verified, or approved by USAR prior to being disclosed in the supplemental materials.

TMRC emphasizes that as a general practice, the company does not publicly announce projections or expectations regarding future revenues, performance, financial condition, or other forward-looking factors. The inclusion of the Prospective Financial Information in the supplemental disclosure should not be regarded as an indication that TMRC, USAR, or their respective affiliates, officers, directors, advisors, or other representatives consider the information to be necessarily predictive of actual future results. The companies and disclosure recipients explicitly caution against relying on the prospective information as a basis for investment or business decisions.

Inherent Uncertainties and Assumptions Underlying Financial Projections

The Prospective Financial Information is acknowledged to be subjective in many respects, with no assurance that projected results will be realized or that actual results will not be significantly higher or lower than estimated amounts. Because the projections cover multiple years, the forward-looking nature of the information becomes increasingly less predictive with each successive year covered by the projections. The information presented with apparent numeric specificity is actually based on numerous variables and assumptions that are inherently uncertain and reflect factors whose outcomes remain beyond the control of TMRC's management.

Key factors identified as potentially affecting actual results include risks and uncertainties relating to TMRC's business operations, industry-level performance metrics, the regulatory environment governing mineral extraction and processing, and general business and economic conditions. TMRC's management believed the assumptions underlying the Prospective Financial Information were reasonable as of February 26, 2026, the date the projections were prepared, given the information available to management at that time. However, the companies acknowledge that important factors affecting actual results and preventing the achievement of projected outcomes may emerge or change, including business decisions that remain subject to modification.

Independent Auditor Disclaimer and Accounting Standards

Neither TMRC's independent registered public accounting firm nor any other independent accounting professionals have compiled, examined, or performed any audit procedures with respect to the Prospective Financial Information contained in the supplemental disclosure materials. No independent accountant has expressed any opinion or any other form of assurance regarding the prospective information or its achievability. Independent auditors have specifically disclaimed any responsibility for or association with the Prospective Financial Information presented to stockholders.

The audit reports included in the proxy statement and prospectus document relate exclusively to historical financial information of the entities and do not extend to or cover the Prospective Financial Information. Readers should not interpret audit reports as providing any review of, commentary on, or assurance regarding forward-looking projections. The Prospective Financial Information was not prepared with a view toward public disclosure or with a view toward complying with guidelines established by the American Institute of Certified Public Accountants regarding prospective financial information preparation and presentation standards.

Regulatory Filing History and Document Availability

The transaction documentation and disclosures have been filed with the Securities and Exchange Commission according to applicable timelines and regulatory requirements. USAR filed the registration statement on Form S-4 on May 13, 2026, representing the initial regulatory filing in connection with the proposed merger. An amendment to the registration statement was filed on June 23, 2026, incorporating revisions to prior disclosure and reflecting updated information available to the transaction parties at that time.

The SEC declared the registration statement effective on June 29, 2026, permitting the distribution of definitive proxy and prospectus materials to stockholders. The definitive proxy statement and prospectus, filed on the same date, combined TMRC's proxy statement obligations to its shareholders with USAR's prospectus obligations to its security holders, reflecting the integrated nature of the merger transaction. All supplemental disclosures and materials referenced in this update are intended to be read in conjunction with the definitive proxy statement and prospectus to provide stockholders with complete information regarding the proposed merger.

Round Top Project Business Context and Asset Composition

The Round Top Project represents a significant mineral extraction initiative that will become integrated into USAR's operations upon completion of the merger. TMRC has focused its development and planning efforts on this project, which involves mining and processing operations intended to yield multiple substances with market demand. The project serves as the primary asset basis for the financial projections that TMRC's management developed and disclosed in the supplemental materials.

The prospective financial analysis prepared by TMRC management reflects assumptions about production volumes, market pricing for the substances extracted and processed by the Round Top Project, and operational cost structures. Because the Prospective Financial Information covers an extended timeline with multiple years of projected operation, the reliability of individual year projections varies, with nearer-term projections generally representing management's more informed estimates based on preliminary development activities. The project's ultimate success depends on numerous factors extending beyond TMRC management's direct control, including commodity market conditions, regulatory approvals at various levels of government, and operational execution capabilities.

Stockholder Action Requirements and Transaction Progress

TMRC stockholders received the definitive proxy materials on June 29, 2026, and were presented with the merger proposal for consideration and voting. The supplemental materials disclosed through this update represent additional information provided to stockholders in response to litigation and stockholder demands, although the companies maintain that such supplemental disclosure was not legally required. Stockholders reviewing the transaction materials have access to the original proxy statement and prospectus materials, as well as the supplemental disclosures and additional information contained in this update.

The transaction contemplates that upon completion of all mergers and satisfaction or waiver of closing conditions, TMRC will be converted into a wholly owned subsidiary of USAR and TMRC stockholders will receive their merger consideration in USAR common stock. The companies have indicated their commitment to completing the transaction while managing the various legal and procedural requirements that have emerged following the public announcement of the merger agreement.