The 2010/2011 financial year was a significant period of development for AusAmerican. The most significant development
was the capital raising concluded in December 2010 which saw the Company raise $8.5 million before costs. This allowed
the Company to cancel the convertible note facility the Company had previously negotiated and most importantly, provide the
working capital which allowed the Company to pursue its exploration and development opportunities and discover/acquire a
number of prospective new projects to add to the Company's growing inventory of assets.
During the period a number of significant events occurred including the following:
1. A convertible note financing agreement was announced with SpringTree Special Opportunities Fund, LLP of New York City for $3.65 million.
2. The Company changed from an N.L. company to a Limited company
3. The Company announced a capital raising consisting of a placement and a share purchase plan (SPP). It also saw the first instance of participation by North American institutions who took up $2.2 million of the total $8.5 million
raised.
The following shares were issued during the reporting period:
(i) On 16 August 2010, 5,000,000 partly paid shares were auctioned as fully paid ordinary shares, raising $159,400.
(ii) On 27 August 2010, 2,522,800 fully paid ordinary shares were issued at $0.04 per share as part of a placement.
(iii) On 15 September 2010, 8,050,123 fully paid ordinary shares were issued at $0.031 per share to assist in securing a convertible note agreement.
(iv) On 15 September 2010, 2,077,200 fully paid ordinary shares were issued at $0.04 per share as part of a placement.
(v) On 12 October 2010, 3,086,420 fully paid ordinary shares were issued at $0.0324 per share to pursuant to the conversion of a convertible note under the convertible note agreement.
(vi) On 14 October 2010, 1,851,852 fully paid ordinary shares were issued at $0.0324 per share to pursuant to the conversion of a convertible note under the convertible note agreement.
(vii) On 29 October 2010, 2,777,778 fully paid ordinary shares were issued at $0.0324 per share to pursuant to the conversion of a convertible note under the convertible note agreement.
(viii) On 10 November 2010, 94,097,328 fully paid ordinary shares were issued at $0.06 per share as part of a placement.
(ix) On 18 November 2010, 3,000,000 fully paid ordinary shares were issued at $0.05 per share to pursuant to the conversion of a convertible note under the convertible note agreement.
(x) On 18 November 2010, 3,000,000 fully paid ordinary shares were issued at $0.05 per share as part of the consideration to acquire mineral properties.
(xi) On 13 December 2010, 16,391,611 fully paid ordinary shares were issued at $0.06 per share per a Share Purchase Plan.
(xii) On 17 December 2010, 32,499,932 fully paid ordinary shares were issued at $0.06 per share pursuant to the shortfall of the Share Purchase Plan.
(xiii) On 29 April 2011, 5,000,000 fully paid ordinary shares were issued at $0.045 per share pursuant to an agreement with Lone Star LLC.
a) The following share options to take up ordinary shares were issued during the reporting period:
(i) On 31 August 2010, 43,461,400 share options were issued with exercise prices of $0.10 and expiry dates of 31 Dec 2010.
(ii) On 15 September 2010, 8,000,000 share options were issued with exercise prices of $0.0462 and expiry dates of 15 September 2013.
(iii) On 21 September 2010, 1,038,600 share options were issued with exercise prices of $0.10 and expiry dates of 31 December 2010.
(iv) On 12 October 2010, 308,642 share options were issued with exercise prices of $0.0421 and expiry dates of 6 October 2013.
(v) On 14 October 2010, 185,185 share options were issued with exercise prices of $0.0421 and expiry dates of 13 October 2013.
(vi) On 29 October 2010, 277,778 share options were issued with exercise prices of $0.0421 and expiry dates of 20 October 2013.
(vii) On 18 November 2010, 10,000,000 share options were issued with exercise prices of $0.10 and expiry dates of 31 December 2010.
(viii) On 18 November 2010, 300,000 share options were issued with exercise prices of $0.065 and expiry dates of 16 November 2013.
(ix) On 17 December 2010, 95,325,825 share options were issued with exercise prices of $0.10 and expiry dates of 31 December 2010.
(x) On 17 December 2010, 23,950 share options were issued with exercise prices of $0.10 and expiry dates of 31 December 2012.
(xi) On 3 March 2011, 1,000,000 share options were issued with exercise prices of $0.10 and expiry dates of 31 December 2012.
The options are exercisable on issue, hold no voting or dividend rights and are not transferable.
Company Notes
AusAmerican announced its intention to apply to have its ordinary shares listed for trading on the Toronto Stock Exchange (TSX). With the decline in the market capitalisation of the Company resultant from the downturn in the uranium/nuclear market, it was later considered that a TSX Venture Exchange (TSXV) listing was more appropriate.
The Directors of the Company, whilst maintaining their ambition to eventually be listed on the TSX main board, consider that it is still in the best interest of the Company and its shareholders to list on the TSXV and an application to the TSXV was made in September 2011 and is currently being reviewed by the TSXV. We are hopeful that this application will be successful, and that we will list on the TSXV in October 2011.
The Company announced changes to the Board and management of the Company with Don Falconer and Simon Jackson, both experienced Canadian based resource veterans, agreeing to join the Board of Directors and Nerida Schmidt becoming Company Secretary.
An NI 43-101 resource on the Apex uranium project was released (refer Company website). This report upgraded the resource at Apex by 52% to 1.452 million pounds grading 700ppm at a cut-off of 100 ppm.
The Company is in the process of completing an NI 43-101 report on the Rio Puerco uranium project and expects this to be completed in October 2011. Significant development has been completed at the Rio Puerco project this financial year and a 20 hole, 5,000 metre drilling programme commenced in July 2011 (this has recently been delayed due to rig problems and will recommence in the near future)
The Company completed the acquisition of the Lone Star Joint Venture ("JV") which included a number of leased uranium projects in the state of Texas. The major project of the JV, the North Trend project, was drilled out in the 1960's by Union Carbide and has significant potential based on historical data for uranium. Exploration target is 3-4 million pounds U3O8. An agreement with Lone Star LLC was completed for consideration of 5,000,000 shares. Lone Star have a 10% free carry in the JV and have further incentives to earn shares in the Company based on proving up JORC /NI 43-101 resources on the various uranium projects identified and developed by the JV. Permits were approved to commence exploration drilling on the Fayette County leases and drilling is expected to commence in the near future
The Company announced the discovery of the White Picacho pegmatite specialty metal project in Arizona as well as announcing that it had completed the acquisition of properties which were part of the White Picacho pegmatite specialty metals project in Arizona. This transaction involved the purchase of a number of claims which comprised the total area of the pegmatite project at White Picacho which the Company had not already staked to allow the Company to control the entire project area. An agreement with Stith Mining was completed for consideration of 3,000,000 shares and US $25,000 in cash consideration. A large channel sampling programme (approximately 1,300 samples collected) was carried out on the project. Results from all of the samples indicated the presence of high grade Lithium, Cesium and Rubidium.
The Company announced (refer Company website) the discovery of the San Marcos gold project and also the results of an intensive sampling exercise at this project where 24 of the 84 samples returned gold grades of greater than 1 gram per tonne (g/t). The highest return was 98.2 g/t. Drilling permits have been obtained and drilling commenced in July 2011.
Preliminary sampling was undertaken on an exciting Rare Earth Element project held by the Company in Arizona. This sampling identified a large low grade Rare Earth Element mineralised zone believed to be 10 to 30 meters in depth from surface. Drilling was completed in June 2011 at La Paz Rare Earth Element project and a Rare Earth Element metallurgical scoping study was commenced by Saskatchewan Research Council, a reputable metallurgical facility based in Saskatoon, Canada.
On 9 September 2011 a General Meeting of shareholders approved the consolidation of the number of Shares and Options on issue on a 1 for 5 basis. The exercise price of Options was to be amended in inverse proportion to the Consolidation ratio. The consolidation was completed on 26 September 2011.
Also on 9 September 2011 the shareholders approved the issue of 1,000,000 listed options each to new directors Simon Jackson and Don Falconer. This issue was on a pre-consolidation basis and has since been consolidated to 200,000 listed options each exercisable at $0.50 before 31 December 2012
The Company's wholly owned subsidiary Uranium Company of Arizona LLC ("UCA") executed a Heads of Agreement with Cristol Enterprises LLC ("Cristol"), an exploration company based in Nevada, USA on 24 June 2009. The agreement covers the Bernard gold, uranium and manganese project located in La Paz County, Arizona which had been secured by UCA and covers 212 claims for an aggregate area of approximately 11km2. The agreement was subject to the following basic conditions, viz:
− UCA and Cristol created a new limited liability company (Buckskins Mountains Mining Company LLC) into which the Bernard claims were transferred. Initial equity in the new company was 100% UCA;
− Cristol was to expend a total of $5.1M in stages to earn a 49% interest in the new company;
− Thereafter, further funding of the project is to be on a pro-rata basis, subject to an industry standard dilution clause;
− The first stage was to entail expenditures of $475,000 and involve a comprehensive drilling program; and
− UCA was the project manager.
In this period Cristol earnt 10% of Buckskin Mountains Mining Company LLC through expenditure on the project.
Iii) Vale Exploration Canada Inc.
In June 2009 Vale North America informed AusAmerican it would be withdrawing from the joint venture agreement. The original JV agreement was for Vale to spend US$3.25 million to earn 60% with a minimum commitment of $750k in the first year. Vale spent the US$750k in the first year but pulled out after this and did not reach their minimum expenditure requirement and as a result did not earn an interest. AusAmerican have retained 100% of the project.
Iii) Lone Star
In April 2011 the Company's executed a JV agreement with Lone Star LLC ('Lone Star') which involved the acquisition, exploration and development of a number of uranium properties in the State of Texas in the USA. Under the JV agreement Uranium Company of Texas ("UCT") has been established as a 90% owned subsidiary of the Company and Lone Star will be free carried to the remaining 10%. The Company is the Manager of the JV. Lone Star personnel will work for the JV and will be responsible for identifying and acquiring leasehold properties with a track record of being drilled out and with historic drilling results. Under the JV agreement Lone Star receives shares in the Company based on the acquisition of these projects and on proving up JORC/NI 43-101 resources at the various uranium projects under the JV. As consideration for entering into the JV agreement, Lone Star being were issued 5 million shares in the Company. These shares were escrowed for a period of 6 months.
During the year ended 30 June 2011, the consolidated group disposed of its interest in Niger via the sale of Niger Energy Resources Ltd, thereby discontinuing its operations in this geographical region.
On 29 April 2010, the consolidated group announced its decision to dispose of its exploration assets in the Kyrgyz Republic via the sale of Carbeck Pty Ltd and its subsidiaries, a 100% owned group, thereby discontinuing its operations in this geographical region.
A new Employee Share Option Plan was approved by shareholders at a General Meeting held on 9 September 2011 to comply with TSX Venture Exchange requirements. To date no issues have been made under this plan.
JP MORGAN NOMINEES AUSTRALIA 9,167,433 13.61%
CITICORP NOMINEES PTY LIMITED 7,073,069 10.50%
MINERAL ENERGY AND TECHNOLOGY CORPORATION 5,471,782 8.13%
NATIONAL NOMINEES LIMITED 3,664,053 5.44%
NUMBER 7 INVESTMENTS PTY LTD 3,200,000 4.75%
HSBC CUSTODY NOMINEES <AUSTRALIA> LIMITED 1,974,786 2.93%
ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD <CUSTODIAN A/C> 1,194,676 1.77%
LONE STAR URANIUM INC 1,000,000 1.48%
URIO INVESTMENTS PTY LIMITED <URIO FAMILY A/C> 766,667 1.14%
ENSMANN, THOMAS FRITZ 700,000 1.04%
STITH MINING LLC 600,000 0.89%
MARANO, DANIEL DAVID 593,200 0.88%
TANUDISASTRO, DR NEIL 580,000 0.86%
GREER, JEFFREY JOHN 500,120 0.74%
VESELCIC, MATO & MACDONALD, REBECCA 489,520 0.73%
KILKENNY ENTERPRISES PTY LTD 458,993 0.68%
GREY NURSE PTY LTD <GLYNN JONES FAMILY A/C> 415,440 0.62%
URIO INVESTMENTS PTY LIMITED <STEPHEN URIO FAMILY A/C> 410,000 0.61%
DR ALASTAIR ROWLAND BROWN <HIPIKI STAFF FUND A/C> 400,000 0.59%
SAYERS INVESTMENTS (ACT) PTY LIMITED 400,000 0.59%
TOTAL 39,059,739 58.00%
Top twenty listed option holders with exercise
prices of $0.50 and expiring 31 December 2012
OPTION HOLDERS NUMBER OF OPTIONS PERCENTAGE
CITICORP NOMINEES PTY LIMITED 4,529,250 12.81%
DJ CARMICHAEL PTY LTD 2,527,088 7.15%
TEKOMA HOLDINGS PTY LTD 2,219,667 6.28%
ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD <CUSTODIAN A/C> 1,980,000 5.60%
KILKENNY ENTERPRISES PTY LTD 1,533,334 4.34%
GELDARD, D & PM 1,000,000 2.83%
GEBA PTY LTD <GEBA FAMILY A/C> 933,334 2.64%
BLUERISE HOLDINGS PTY LTD <THE BLUERISE A/C> 800,000 2.26%
AUSTRALIAN GLOBAL CAPITAL 625,000 1.77%
DORRINGTON, IAN WILLIAM 600,000 1.70%
MANCINI MANAGEMENT PTY LTD <ANTHONY MANCINI FAMILY A/C> 600,000 1.70%
GELDARD, PAULINE MARY 500,000 1.41%
PETERSEN, JOHN WILLIAM 500,000 1.41%
PENSON AUSTRALIA NOMINEES PTY LTD <ACCUM A/C> 493,778 1.40%
J ZECHNER ASSOCIATES INC 446,667 1.26%
BROWN, JOANNA OLENE 400,000 1.13%
MR DANIEL DAVID MARANO <INVESTMENT A/C> 395,467 1.12%
GENESTA HOLDINGS PTY LTD 393,245 1.11%
MR DAVID IAN LEES <INVESTMENT A/C> 391,844 1.11%
DR ALASTAIR ROWLAND BROWN <HIPIKI STAFF FUND A/C> 383,334 1.08%
TOTAL 21,252,008 60.11%
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