NOTE 12 — COMMITMENTS AND CONTINGENCIES

Mining Leases

The CK Gold property position consists of two State of Wyoming Metallic and Non-metallic Rocks and Minerals Mining Leases: (1) State of Wyoming Mining Lease No. 0-40828, consisting of 640 acres, and (2) State of Wyoming Mining Lease No. 0-40858 consisting of 480 acres. These leases were assigned to the Company in July 2014 through the acquisition of the CK Gold Project. Leases to explore for or use natural resources are outside the scope of ASU 2016-02, Leases.

Lease 0-40828 was renewed in February 2023 for a 10 ten-year term and Lease 0-40858 was renewed for a 10 ten-year term in February 2024. Lease 0-40828 requires an annual payment of $3.00 per acre starting with the year beginning February 2023 and Lease 0-40858 requires an annual payment of $3.00 per acre starting with the year beginning February 2024. The Company paid yearly required minimum lease payments of $3,360 in each of January 2025 and January 2026.

In connection with the Wyoming Mining Leases, production royalties of 2.1% of net receipts are required to be paid to the State of Wyoming, although once the project is in operation, the Board of Land Commissioners has the authority to reduce the royalty payable to the State of Wyoming.

The future minimum lease payments at July 31, 2026, under these mining leases are as follows, with each payment to be made in the fourth quarter of the respective fiscal years:

 SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS 

The Company may renew each lease for a fourth term, which will require annual payments of $4.00 per acre.

NPRC option:

The Company acquired from Northern Panther Resources Corporation (“NPRC”) a mineral property called Challis Gold located in Idaho pursuant to an option agreement dated February 2020, which was later amended in June 2020. The Company paid the minimum royalty payment of $25,000 in June 2025 for fiscal year 2026. The Company paid the minimum royalty payment of $25,000 in June 2026 for fiscal year 2027.

The annual advance minimum royalty payments as of July 31, 2026, under the option agreement are as follows, with each payment to be made on the first anniversary of the effective date of the option agreement and continuing until the tenth anniversary:

 SCHEDULE OF ADVANCE MINIMUM ROYALTY PAYMENTS 

100% of the advance minimum royalty payments will be applied to the royalty credits.

Exploration Access and Option to Lease Agreement

On August 25, 2021 (“Effective Date”), the Company entered into an Exploration Access and Option to Lease Agreement (the “Agreement”) with a private-party landowner (the “Landowner”) whereby the Landowner granted the Company an option (the “Option”) to lease and right-of-way (the “Right-of-Way”) on a property located in Laramie County, Wyoming. The Company may exercise the Option for five years (“Option Term”) from the Effective Date. During the Option, the Landowner granted non-exclusive rights (the “Exploration Access Rights”) to the Company to use the surface of the property for an annual exploration and access right payment of $10,000, thirty days after the effective date and each year on the anniversary of the Effective Date during the Option Term until such time the Option is exercised or expires. The Company is also required to pay an annual Option payment of $35,780 for the lease and $6,560 for the Right-of-Way within thirty days after the Effective Date and each year on the anniversary of the Effective Date during the Option Term until such time the Option is exercised by the Company or expires. The Company paid a total of $42,340 for each of the periods ended on September 1, 2021, 2022, 2023, 2024 and 2025, pursuant to this Agreement.

U.S. GOLD CORP. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JULY 31, 2026

At any time during the Option Term, the Company may exercise the Option by providing a written notice to the Landowner and the Company shall pay a one-time right-of-way payment of $26,240 at closing and shall execute a lease agreement. The exclusive option to lease (the “Lease”) and Right-of-Way is for a term of ten years with the right to extend for an additional ten years and requires an annual lease payment of $50,000, compensation for loss of grazing of $40.00 per acre impacted land and annual Right-of-Way payments of $13,120. In consideration for the option rights, lease rights and Right-of-Way rights under this Agreement, the Company agreed to grant the Landowner shares of the Company’s common stock worth $50,000, which shares will not vest, or be issued, until the Company executes the Lease.

On March 13, 2026, the Company exercised its Option and paid a one-time Right-of-Way fee of $26,240, an annual lease payment of $50,000, an annual Right-of-Way fee of $13,120, and a loss of grazing fee of $90 (for 2.25 acres impacted by the Right-of-Way). The annual lease payment of $50,000 and annual Right-of-Way payment of $13,120 shall be amortized for one year. Upon exercise of the Option, the Company agreed to grant the Landowner shares of the Company’s common stock worth $50,000 as a one-time fee which has been recognized as an option expense during fiscal year 2026. The Company anticipates issuing the common stock during the second quarter of fiscal 2027 and, accordingly, has recorded a stock payable liability, as reflected in the accompanying unaudited condensed consolidated balance sheet as of July 31, 2026.

The future minimum annual lease payments at July 31, 2026, under the Agreement, are as follows, with each payment to be made in the fourth quarter of the respective fiscal years:

 SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS

Legal Matters

From time to time the Company may be involved in claims and legal actions that arise in the ordinary course of business. To the Company’s knowledge, there are no material legal proceedings pending to which the Company is a party or of which any of the Company’s property is the subject.