Business Wire ”Press Releases – English ”
Eliminates costly legal fees while enabling discussions on additional properties with approximately 250,000 pounds of in place mineralized uranium material
LEWISVILLE, Texas –(BUSINESS WIRE)– Uranium Resources, Inc. (NASDAQ:URRE) (URI?) announced today that the counsel for Uranium Resources, Inc. and the plaintiffs signed a settlement agreement in the matter entitled Saenz v. URI Inc. pending in the 105th Judicial District Court , Kleberg County, Texas . The matter, as disclosed previously by the Company, was commenced in 2008 by the owners of the mineral estate of property leased to the Company, seeking to invalidate the lease.
While the Company believes that its defense in this matter is valid, counsel to the Company is unable to predict the outcome of the litigation and a reasonable cost for completion. Also, if a determination was made that invalidated the leases on which the Company has previously produced uranium, the outcome could have had material adverse affect on the Companys financial condition. As a result, the Company believed it was in its best interest to settle the matter.
Don Ewigleben , President and CEO of URI, commented, We are pleased to have come to an agreement on the lease regarding these properties in Texas . In addition to eliminating the cost associated with the law suit, we can now better focus our efforts on building our opportunities in Texas . Importantly, with this agreement, we can now broach additional discussions with the mineral rights owners. Theres an estimated 250,000 pounds of uranium within nearby acreage that could potentially be leased. Although this additional acreage would require permitting, it also makes mining the remaining 50,000 pounds of in place mineralized uranium material in our currently permitted area feasible.?
He concluded, As we have discussed, Texas is an important component of our strategy and being able to move forward with opportunities without being encumbered with legal issues is critical to our success.? The Company produced approximately 338,000 pounds of uranium in 2007 and 2008 from wellfields 13 and 14 that were on the subject properties. These were among the best performing wellfields the Company operated.
Under the Settlement, the Plaintiffs will ratify, confirm and recognize the validity in all respects of the leases, agree to cooperate with the Company and execute a stipulation of interest with regard to their respective interests and agree to support and not interfere, either directly or indirectly, with the Companys efforts to obtain permits, licenses or other authorizations from the different regulatory and governmental agencies with regard to any mining or other operations. The Company will pay to Plaintiffs $1.375 million in cash which includes amounts for prior royalties that the plaintiffs had previously refused to accept. In addition the royalty for future production from the leases will be amended from a 6.25% royalty rate to a sliding scale royalty. The Settlement, which was agreed to on September 29, 2010 , is subject to execution of amendments to the leases to reflect the foregoing and to documentation of other aspects of the settlement and dismissal of the suit.