10QSB

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2006

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission file number 333-127185

URANIUM ENERGY CORP.

(Exact name of small business issuer as specified in its charter)

NEVADA	88-0399476
(State or other jurisdiction of incorporation of organization)	(I.R.S. Employer Identification No.)

Austin Centre

701 Brazos, Suite 500 PMB#

Austin, Texas 78701

(Address of Principal Executive Offices)

(512) 721-1022

(Issuer's telephone number)

n/a

(Former name, former address and former fiscal year,

if changed since last report)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yesx Noo

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No x

Applicable only to issuers involved in bankruptcy proceedings during the preceding five years.

N/A

1

Check whether the Registrant filed all documents required to be filed by Section 12, 13 and 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.

Yes o No o

Applicable only to corporate issuers

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:

Class	Outstanding as of May 14, 2006
Common Stock, $.001 par value	27,027,338

Transitional Small Business Disclosure Format (check one)  Yes o No x

2

	Table Of Contents	Page
PART I.	FINANCIAL INFORMATION	4
ITEM 1.	INTERIM FINANCIAL STATEMENTS	4
	BALANCE SHEETS	5
	INTERIM STATEMENTS OF OPERATIONS	6
	INTERIM STATEMENTS OF CASH FLOWS	7
	NOTES TO INTERIM FINANCIAL STATEMENTS	8
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION	17
ITEM 3.	CONTROLS AND PROCEDURES	22
PART II.	OTHER INFORMATION	23
ITEM 1.	LEGAL PROCEEDINGS	23
ITEM 2.	CHANGES IN SECURITIES AND USE OF PROCEEDS	23
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	25
ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	25
ITEM 5.	OTHER INFORMATION	25
ITEM 6.	EXHIBITS AND REPORTS ON FORM 8-K	26
	SIGNATURES	26

3

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

INTERIM FINANCIAL STATEMENTS

MARCH 31, 2006

(unaudited)

4

URANIUM ENERGY, CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

BALANCE SHEETS

		March 31,			December 31,
		2006			2005
		(unaudited)
CURRENT ASSETS
Cash and cash equivalents	$	102,865		$	107,160
Other current assets		300			300
Prepaid expenses		20,527			-
	$	123,692		$	107,460
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	146,601		$	114,456
Due to related parties (Note 7)		76,832			208,832
		223,433			323,288
CONTINGENCIES AND COMMITMENTS (Notes 1, 3 & 4)
STOCKHOLDERS' EQUITY (DEFICIENCY)
Capital Stock (Note 4)
Common stock $0.001 par value: 75,000,000 shares authorized
22,752,338 shares issued and outstanding
(2005 - 20,461,083)		22,752			20,461
Additional paid-in capital		5,069,488			2,565,172
Share subscriptions		250,000			-
Deferred compensation (Note 4)		(2,050,855	)		(650,000	)
Deficit accumulated during the exploration stage		(3,391,126	)		(2,151,461	)
		(99,741	)		(215,828	)
	$	123,692		$	107,460

The accompanying notes are an integral part of these interim unaudited financial statements.

5

URANIUM ENERGY, CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

INTERIM STATEMENTS OF OPERATIONS

(unaudited)

		Three months Ended March 31, 2006			Three months Ended March 31, 2005			For the Period from May 16, 2003 (inception) to March 31, 2006
EXPENSES
Exploration costs, net of recoveries		238,288			64,946			1,271,968
General and administrative		158,195			12,062			308,467
Management fees		178,207			27,655			351,668
Professional fees		59,223			22,570			169,263
Stock-based compensation (Note 5)		605,752			-			1,289,760
		1,239,665			127,233			3,391,126
NET LOSS FOR THE PERIOD		(1,239,665	)	$	(127,233	)	$	(3,391,126	)
BASIC AND FULLY DILUTED NET LOSS PER SHARE	$	(0.06	)	$	(0.01	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		21,854,791			16,328,658

The accompanying notes are an integral part of these interim unaudited financial statements.

6

URANIUM ENERGY, CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

INTERIM STATEMENTS OF CASH FLOWS

(unaudited)

		Three months Ended March 31, 2006			Three months Ended March 31, 2005			For the Period from May 16, 2003 (inception) to March 31, 2006
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period	$	(1,239,665	)	$	(127,233	)	$	(3,391,126	)
Adjustments to reconcile net loss to net cash from operating activities:
Stock based compensation		605,752			-			1,289,760
Accrued and unpaid management fees		18,000						18,000
Non-cash property and drill data costs		-			-			275,000
Non-cash exploration expenses		-			-			10,000
Non-cash exploration recoveries		-			-			(20,000	)
Prepaid expenses		(20,527	)					(20,527	)
Other current assets		-			(977	)		(300	)
Accounts payable and accrued liabilities		32,145			(3,476	)		146,601
NET CASH FLOWS USED IN OPERATING ACTIVITIES		(604,295	)		(131,686	)		(1,692,592	)
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of shares for cash		350,000			145,000			1,300,696
Common shares subscriptions		250,000						250,000
Convertible debenture proceeds		-			-			20,000
Advances from related parties					13,338			224,761
NET CASH FLOWS FROM FINANCING ACTIVITIES		600,000			158,338			1,795,457
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(4,295	)		26,652			102,865
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		107,160			406,270			-
CASHAND CASH EQUIVALENTS, END OF PERIOD	$	102,865		$	432,922		$	102,865
CASH AND CASH EQUIVALENTS CONSIST OF:
Cash in bank	$	102,865		$	302,353		$	102,865
Short term investments		-			130,569			-
	$	102,865		$	432,922		$	102,865
SUPPLEMENTAL DISCLOSURES:
Interest paid	$	-		$	-		$	-
Taxes paid	$	-		$	-		$	-
SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS (Note 9)

The accompanying notes are an integral part of these interim unaudited financial statements.

7

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 1:NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Uranium Energy Corp. (the “Company”) was incorporated on May 16, 2003 in the State of Nevada as Carlin Gold, Inc. The Company is an exploration stage company that was originally organized to explore and develop precious metals in the United States.

During 2004, the Company changed its business direction from the exploration of precious metals to the exclusive focus on the exploration and development of uranium deposits in the United States and internationally. Due to the change in the Company’s core business direction, the Company disposed of its 18 mineral property claims in the State of Nevada. In addition, the Company commenced reorganization, including a reverse stock split by the issuance of 1 new share for each 2 outstanding shares of the Company’s common stock and the raising of further capital for its new operating directives (refer to Notes 3 and 9). On January 24, 2005, the Company approved a special resolution to change the name of the Company from Carlin Gold, Inc. to Uranium Energy Corp. On February 28, 2006; the Company completed a forward stock split by the issuance of 1.5 new shares for each 1 outstanding shares of the Company’s common stock.

Since November 1, 2004, the Company has acquired mineral leases, directly and under options, for the purposes of exploring for economic deposits of uranium in the States of Arizona, Texas, Colorado, and Utah. To March 31, 2006, interests in approximately 8,844 net acres of mineral properties have been staked or leased by the Company.

Going Concern

The Company commenced operations on May 16, 2003 and has not realized any significant revenues since inception. As at March 31, 2006, the Company has a working capital deficiency of $99,741 and an accumulated deficit of $3,391,126. The Company is in the exploration stage of its mineral property development and to date has not yet established any known mineral reserves on any of its existing properties. The ability of the Company to continue as a going concern is dependent on raising capital to fund its planned mineral exploration work and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company intends to continue to fund its initial operations by way of private placements and advances from related parties as may be required. To date, the Company has completed private placements and the exercise of options for total proceeds of $1,700,696 from the issuance of shares of the Company’s common stock.

Unaudited Interim Financial Statements

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principals for interim financial information and with the instructions to Form 10-QSB of Regulation S-B. They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there have been no material changes in the information disclosed in the notes to the financial statements for the year ended December 31, 2005 included in the Company’s Annual Report on Form 10-KSB filed with the Securities and Exchange Commission. The interim unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-KSB. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the three months ended March 31, 2006 are not necessarily indicative of the results that may be expected for the year ending December 31, 2006.

NOTE 2:SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

The Company was incorporated on May 16, 2003 in the State of Nevada. The Company’s fiscal year end is December 31.

Basis of Presentation

These financial statements are presented in United States dollars and have been prepared in accordance with United States generally accepted accounting principles.

8

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 2:SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Cash and Cash Equivalents

The Company considers all highly liquid instruments with an original maturity of three months or less at the time of issuance to be cash equivalents.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Significant areas requiring management’s estimates and assumptions are determining the fair value of shares of common stock and convertible debentures.

Mineral Property Costs

Mineral property acquisition, exploration and development costs are expensed as incurred until such time as economic reserves are quantified. To date the Company has not established any proven or probable reserves on its mineral property

interests. Estimated future removal and site restoration costs are provided over the life of proven reserves on a units-of-production basis. Costs, which include production equipment removal and environmental remediation, are estimated each

period by management based on current regulations, actual expenses incurred, and technology and industry standards. Any charge is included in exploration expense or the provision for depletion and depreciation during the period and the actual restoration expenditures are charged to the accumulated provision amounts as incurred.

Asset Retirement Obligations

The Company has adopted the provisions of SFAS No. 143 "Accounting for Asset Retirement Obligations," which establishes standards for the initial measurement and subsequent accounting for obligations associated with the sale, abandonment or other disposal of long-lived tangible assets arising from the acquisition, construction or development and for normal operations of such assets. The adoption of this standard has had no effect on the Company's financial position or results of operations. To March 31, 2006 any potential costs relating to the ultimate disposition of the Company's mineral property interests have not yet been determinable.

Financial Instruments

The fair values of cash and cash equivalents, other current assets, accounts payable and accrued liabilities, convertible debentures and amounts due to related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. The Company’s operations and financing activities are conducted primarily in United States dollars, and as a result the Company is not subject to significant exposure to market risks from changes in foreign currency rates.

Management has determined that the Company is exposed to significant credit risk.

Loss per Common Share

Basic loss per share includes no dilution and is computed by dividing loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings (loss) of the Company. The common shares potentially issuable on

conversion of outstanding convertible debentures and exercise of stock options were not included in the calculation of weighted average number of shares outstanding because the effect would be anti-dilutive.

Foreign Currency Translation

The financial statements are presented in United States dollars. In accordance with SFAS No. 52, “Foreign Currency Translation”, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Revenue and expenses are translated at average rates of exchange during the year. Related translation adjustments are reported as a separate component of stockholders’ equity, whereas gains or losses resulting from foreign currency transactions are included in results of operations.

9

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 2:SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income Taxes

The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment. As at March 31, 2006, the Company had net operating loss carry forwards; however, due to the uncertainty of realization, the Company has provided a full valuation allowance for the potential deferred tax assets resulting from these losses carry forwards.

Stock-based compensation

On January 1, 2006, the Company adopted SFAS No. 123 (revised 2004) (SFAS No. 123R), Share-Based Payment, which addresses the accounting for stock-based payment transactions in which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments. In January 2005, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 107, which provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R eliminates the ability to account for stock-based compensation transactions using the intrinsic value method under Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, and instead generally requires that such transactions be accounted for using a fair-value-based method. The Company uses the Black-Scholes-Merton (“BSM”) option-pricing model to determine the fair-value of stock-based awards under SFAS No. 123R, consistent with that used for pro forma disclosures under SFAS No. 123, Accounting for Stock-Based Compensation. The Company has elected the modified prospective transition method as permitted by SFAS No. 123R and accordingly prior periods have not been restated to reflect the impact of SFAS No. 123R. The modified prospective transition method requires that stock-based compensation expense be recorded for all new and unvested stock options, restricted stock, restricted stock units, and employee stock purchase plan shares that are ultimately expected to vest as the requisite service is rendered beginning on January 1, 2006 the first day of the Company’s fiscal year 2006. Stock-based compensation expense for awards granted prior to January 1, 2006 is based on the grant date fair-value as determined under the pro forma provisions of SFAS No. 123. There were no stock option grants or vesting during the three month period ended March 31, 2005. Therefore no comparative proforma information is provided.

Prior to the adoption of SFAS No. 123R, the Company measured compensation expense for its employee stock-based compensation plans using the intrinsic value method prescribed by APB Opinion No. 25. The Company applied the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure, as if the fair-value-based method had been applied in measuring compensation expense. Under APB Opinion No. 25, when the exercise price of the Company’s employee stock options was equal to the market price of the underlying stock on the date of the grant, no compensation expense was recognized.

10

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 3:MINERAL EXPLORATION PROPERTIES

Precious Metals Exploration

During 2003, the Company acquired 50 mineral claims in Elko County, Nevada, for consideration of $10,000 which was paid by a shareholder on behalf of the Company and formed part of the consideration received by the Company in connection with a Convertible Debenture. In connection with this acquisition, the Company granted a gold and silver production royalty to this shareholder in the amount of $36,000 for the first three years of production, $50,000 for subsequent years of production, plus a 4% net smelter royalty. No amount was recorded in connection with the granting of these royalties as the fair value was not readily determinable nor considered material given the preliminary exploration stage of the property. These mineral claims were acquired for the purpose of exploring for mineable reserves of precious metals. A total of $5,006 was spent on initial exploration in 2004 ($10,354 in 2003) on these claims. The results of preliminary exploration were unfavorable and accordingly during 2003, 32 of the mineral claims were sold to the aforementioned shareholder in settlement of $20,000 of the Convertible Debenture. The $20,000 settlement was recorded as a reduction of exploration expenses in 2003. During 2004, management determined that its 18 remaining mineral claims had nominal value, and a decision was made to abandon or dispose of the remaining 18 mineral claims commensurate with the reorganization initiatives pursued by the Company. During July, 2005, the Company disposed of these remaining mineral claims to the same shareholder for no further consideration and accordingly no gain or loss on disposal has been recorded.

Uranium Exploration

Since November 1, 2004, the Company has been acquiring mineral leases for the purposes of exploring for economic deposits of uranium in the States of Arizona, Colorado, Utah, Wyoming, and Texas. As December 31, 2005, five claim blocks in Arizona comprising 1,540 acres of mineral properties have been staked or leased by the Company. A total of $11,649 was expended in the year ended December 31, 2004 to acquire these mineral claims.

On October 11, 2005, the Company entered into a Mineral Asset Option Agreement (the “Option”) granting the Company the option to acquire certain uranium leases in the State of Texas for total consideration of $200,000 and 2,000,000 common shares at a deemed value of $0.50 per share. In consideration for the Option and its partial exercise over the option term, the Company made a cash payment of $50,000 and issued 500,000 shares of restricted common stock (750,000 post-split). On February 1, 2006 the Company paid a further cash payment of $150,000. The Option, if fully exercised will require the further issuance of 1,500,000 shares of restricted common stock in 500,000 share installments due six, twelve, and eighteen months from the effective date of the Option. Title to the properties to be acquired will transfer upon payment of all remaining shares of stock required under the Option, the timing of which may be accelerated at the Company’s discretion. During the Option term, the Company has the right as operator to conduct or otherwise direct all exploration on the properties to be acquired under the Option.

During 2005, the Company acquired lease interests in twenty-one further uranium exploration mineral properties totaling 7,413 gross acres in the States of Arizona, Colorado, Texas, Wyoming, and Utah, for five years with an option to renew for five years.

During the first quarter of 2006 the Company acquired an additional 640 acres in Wyoming at a cost of $640. As of March 31, 2006, a total of 9,593 gross acres (9,443 net mineral acres) of mineral properties have been staked or leased by the Company in the states of Arizona, Colorado, Wyoming, Texas and Utah for the purposes of uranium exploration for a total cost of $177,676.  These leases are also subject to a 5.0% to 8.25% net royalty interests.

NOTE 4:CAPITAL STOCK

The Company’s capitalization at March 31, 2006 was 75,000,000 authorized common shares with a par value of $0.001 per share. On January 9, 2006, a majority of shareholders voted to amend the Company's Articles of Incorporation to increase the authorized capital from 75,000,000 shares of common stock to 750,000,000 shares of common stock. The increase in authorized capital was effective on February 1, 2006.

11

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 4:CAPITAL STOCK (continued)

On January 24, 2005, a majority of shareholders and the directors of the Company approved a special resolution to undertake a reverse stock split of the common stock of the Company on a 1 new share for 2 old shares basis. The par value and the number of authorized but un-issued shares of the Company’s common stock was not changed as a result of the reverse stock split. On February 14, 2006, the directors of the Company approved a special resolution to undertake a forward stock split of the common stock of the Company on a 1.5 new shares for 1 old share basis whereby 7,484,116 common shares were issued pro-rata to shareholders of the Company as of the record date on February 28, 2006.

All references in these financial statements to number of common shares, price per share and weighted average number of common shares outstanding prior to the 1:2 reverse stock split and the 1.5:1 forward stock split have been adjusted to reflect these stock splits on a retroactive basis, unless otherwise noted.

Effective July 27, 2004 the Company issued 1,575,000 shares of common stock to the original founders of the Company at a price of $0.0013 per share for total proceeds of $2,100 and effective August 23, 2004, the Company issued 349,820 shares of

common stock at $0.20 per share for total proceeds of $69,967 in connection with the Company’s original precious metal exploration program of which 79,647 shares were issued on settlement of amounts owing to related parties in the aggregate amount of $15,929, and 35,000 shares were issued on the conversion of debentures in the aggregate amount of $7,000.

On December 7, 2004, the Company issued 12,225,000 shares of common stock to the Company’s new management team, consultants, and stakeholders in connection with the reorganization and change of business direction of the Company as described in Note 1 at a price of $0.0013 per share for total proceeds of $16,300 of which 2,250,000 shares were issued on the conversion of debentures in the aggregate amount of $3,000.

On December 31, 2004, the Company issued 2,178,764 shares of common stock in connection with private placements of common stock at a price of $0.20 per share for total proceeds of $435,758 to fund the Company’s intended uranium exploration program.

On October 11, 2005, the Company entered into a Mineral Asset Option Agreement (the “Option”) granting the Company the option to acquire certain uranium leases in the State of Texas. In consideration for the Option, the Company made a cash payment of $50,000 and issued 750,000 shares of restricted common stock at a value of $0.333 per share for a total value of $250,000 which was recorded as mineral property costs. Subsequent to year end, the Company paid a further cash payment of $150,000 on February 1, 2006 under the terms of the Option. The Option, if fully exercised requires a further issuance of an additional 1,500,000 shares of restricted common stock in 500,000 share installments due six, twelve, and eighteen months from the effective date of the Option. (refer to Note 3)

On December 12, 2005, the Company entered into an Agreement to acquire drill data from a third party in consideration for a cash payment of $5,000 and issued 75,000 shares of restricted common stock at a price of $0.333 per share for a total value of $25,000 which was recorded as mineral property costs.

On December 16, 2005 the Company issued 1,950,000 shares of restricted common stock at a price of $0.333 per share for a value of $650,000 to three members of management as per their management agreement with the Company which is for a one year term commencing January 1, 2006. Accordingly this cost has been recorded as deferred compensation in the statement of stockholders’ equity as of December 31, 2005. The amount expensed to stock-based compensation for the period ended March 31, 2006 was $162,500.

During the year ended December 31, 2005, the Company issued 1,357,000 shares of common stock in connection with private placements of common stock at a price of $0.333 per share for total proceeds of $452,500.

On January 15, 2006 the Company issued 18,750 restricted common shares at a price of $0.3333 per share for a value of $6,250 in connection with a drilling database information agreement. The agreement requires cash payments of $2,000 per month payable quarterly and quarterly issuances of 12,500 restricted common shares for three further quarters following the effective date of the agreement.

12

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 4:CAPITAL STOCK (continued)

On February 1, 2006, the Company issued 772,500 restricted common shares at a price of $0.3333 per share for a value of $257,000 to a consultant in connection with a corporate finance consulting services agreement of the same date. The consultant will provide among other things, assistance in the initiation, coordination, implementation and management of all aspects of any program or project in connection with the corporate finance development and maintenance of the Company’s various business interests over a one year initial term. Accordingly this cost has been recorded as deferred compensation in the statement of stockholders equity. The amount expensed to stock-based compensation for the period ended March 31, 2006 was $42,917.

On March 1, 2006, the Company entered into a corporate relations consulting services agreement with a shareholder of the Company for a six month initial term. The agreement requires the Company to pay $5,000 per month during the initial term and issue 500,000 warrants exercisable at $1.00 per share for a ten year term. The shares underlying the warrants have piggy back registration rights. The fair value of these warrants at the date of grant of $1,618,526 was estimated using the Black-Scholes warrant pricing model with an expected life of 10 years, a risk free interest rate of 5.09%, a dividend yield of 0%, and an expected volatility of 79% and has been recorded as a consulting expense in the period. Accordingly this cost has been recorded as deferred compensation in the statement of stockholders equity. The amount expensed to stock-based compensation for the period ended March 31, 2006 was $269,754.

On March 10, 2006, the Company received a subscription for 250,000 units at $1.00 per share purchase unit from a shareholder and consultant to the Company for net proceeds to the Company of $250,000. Shares were issued subsequent to the period. The 250,000 units are comprised of 250,000 restricted common shares and 125,000 common share purchase warrants in the capital of the Company with piggyback registration rights for all securities underlying the units issued. The warrants are exercisable at $1.50 per share for a term which is the earlier of (i) 12 months from the date of issuance or (ii) six months from the effective date of registration.

NOTE 5:STOCK OPTION PLAN

On December 19, 2005 the Board of Directors of the Company ratified, approved and adopted a Stock Option Plan for the Companyin the amount of 5,250,000 shares at $0.333 per share. The majority of shareholders of the Company ratified and approved the Stock Option Plan effective February 1, 2006.

On December 20, 2005, 2,970,000 stock options were granted to consultants at $0.333 per share. The term of these options is ten years. The fair value of these options at the date of grant of $684,008 was estimated using the Black-Scholes option pricing model with an expected life of 10 years, a risk free interest rate of 4.47%, a dividend yield of 0%, and an expected volatility of 55.21% and has been recorded as a consulting expense in the period.

On December 20, 2005, 1,755,000 stock options were granted at $0.333 per share to various officers and directors of the Company.The term of these options is ten years. The fair value of these options at the date of grant of $458,084 was estimated using the Black-Scholes option pricing model with an expected life of 10 years, a risk free interest rate of 4.47%, a dividend yield of 0%, and an expected volatility of 55.21%, and in accordance with the provisions of SFAS 148, has been disclosed on a pro-forma basis in Note 2.

On February 1, 2006, the Company granted 285,000 stock options as follows: 172,500 to an officer and 112,500 to an employee, at $0.333 per share. The term of these options is ten years. The fair value of these options at the date of grant of $124,331 was estimated using the Black-Scholes option pricing model with an expected life of 10 years, a risk free interest rate of 5.09%, a dividend yield of 0%, and expected volatility of 79% and has been recorded as a stock based compensation expense in the period.

On February 14, 2006, 1,200,000 share options were exercised at $0.333 per share by consultants to the Company. On March 2, 2006, 300,000 share options were exercised at $0.333 per share by consultants to the Company. During the three month period ended March 31, 2006, the Company received a total of $350,000 on the exercise of stock options, net of $150,000 of prior period advances that were settled on the exercise of 450,000 options at $0.33 per share. (Note 7)

13

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 5:STOCK OPTION PLAN (continued)

As of March 31, 2006, 5,010,000 options under the Company’s current SOP had been granted and 1,500,000 were exercised during the quarter.

A summary of the Company’s stock options as of March 31, 2006 and changes during the period ended is presented below:

	Number of options	Weighted average exercise price per share	Weighted average remaining contractual life (in years)
Outstanding at December 31, 2004	-	-	-
Granted	4,725,000	-	-
Cancelled	-	-	-
Exercised	-	-	-
Outstanding at December 31, 2005	4,725,000	0.333	9.98
Granted	285,000	-	-
Exercised	(1,500,000)	-	-
Outstanding as March 31, 2006	3,510,000	0.333	9.74

NOTE 6:INCOME TAXES

The Company has adopted FASB No. 109 for reporting purposes. As of March 31, 2006, the Company had net operating loss carry forwards of approximately $2,254,022 that may be available to reduce future years’ taxable income. These carry forwards will begin to expire, if not utilized, commencing in 2023. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry forwards.

The Company reviews its valuation allowance requirements on an annual basis based on projected future operations. When circumstances change and this causes a change in management’s judgment about the recoverability of future tax assets, the impact of the change on the valuation allowance is generally reflected in current income.

A reconciliation of income tax computed at the federal and state statutory tax rates and the Company’s effective tax rate is as follows

	Three months ended March 31, 2006		Three months ended March 31, 2005
Federal income tax provision at statutory rate	(35.0	)%	(35.0	)%
States income tax provision at statutory rates, net of federal income tax effect	(7.0	)	(7.0	)
Total income tax provision	(42.0	)%	(42.0	)%

The tax effects of temporary differences that give rise to the Company’s deferred tax assets (liabilities) are as follows:

		March 31, 2006			December 31, 2005
Loss carry forwards	$	946,889		$	615,000
Valuation allowance		(946,889	)		(615,000	)
	$	-		$	-

14

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 6:INCOME TAXES (continued)

As the criteria for recognizing deferred income tax assets have not been met due to the uncertainty of realization, a valuation allowance of 100% has been recorded for the current period and prior periods.

NOTE 7:DUE TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS

On February 15, 2006 the Company executed an employment agreement with its Chief Operating Officer and committed to pay him a monthly fee of $10,000 and to grant him 375,000 stock options in 2005 exercisable over a ten year term at $0.333 per share. The options were granted as follows: 202,500 on December 20, 2005 and 172,500 on February 1, 2006.

During the period ended March 31, 2006, the Company had transactions with certain officers and directors of the Company as follows: the Company incurred $178,246 in management fees and benefits - $160,246 was paid against outstanding management fees. Also during the period $150,000 of advances to the Company from a shareholder were settled on the exercise of 450,000 options at $0.333 per share. As at March 31, 2006, $76,832 is owing to an officer and director in fees and expenses.

Amounts owing to related parties are unsecured, non-interest bearing and without specific terms of repayment.

Other related party transactions are disclosed in notes 3 and 4.

NOTE 8 - COMMITMENTS

On December 1, 2005 the Company entered into a Financial Consulting Services Agreement with International Market Trend, AG. The term of the Agreement is for twelve months, effective February 1, 2006. In consideration for IMT entering into this Agreement, the Company agreed to deliver to IMT or its nominees 1,300,000 pre-forward split stock options of the Company’s common stock at a price of $0.50 per share. These options were granted on December 20, 2005. In addition, IMT will receive $10,000 per month.

In March, 2006, the Company committed to spend approximately $450,000 on Company image market development (spent in April 2006).

NOTE 9 - SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

On January 15, 2006 the Company issued 18,750 restricted common shares at a price of $0.3333 per share for a value of $6,250 in connection with a drilling database information agreement. The agreement requires cash payments of $2,000 per month payable quarterly and quarterly issuances of 12,500 restricted common shares for three further quarters following the effective date of the agreement. (refer to Note 4)

On February 1, 2006, the Company issued 772,500 restricted common shares at a price of $0.3333 per share for a value of $257,000 to a consultant in connection with a corporate finance consulting services agreement of the same date. Accordingly this cost has been recorded as deferred compensation in the statement of stockholders equity. The amount expensed to stock-based compensation for the period ended March 31, 2006 was $42,917. (refer to Note 4 and 7)

NOTE 10:SUBSEQUENT EVENTS

On April 1, 2006, the Company entered into a one year consulting contract with a third party contractor, to provide financial and investor public relations and related matters in Germany. In connection with this agreement the Company issued 400,000 restricted shares of the Company’s common stock and agreed to pay approximately $375,000 (EUR $290,000) over the term of the agreement.

On April 10, 2006 1,500,000 stock options were granted to consultants at $1.00 per share.

On April 21, 2006, the Company issued 610,000 S-8 registered common shares in connection with the exercise of share options by consultants to the Company for $450,000.

On April 24, 2006, the Company issued 500,000 S-8 registered common shares in connection with the exercise of share options by consultants to the Company for $500,000.

15

URANIUM ENERGY CORP.

(formerly Carlin Gold Inc.)

(an exploration stage company)

Interim Notes to Financial Statements

March 31, 2006

(unaudited)

NOTE 10:SUBSEQUENT EVENTS (continued)

On April 24, 2006, the Company received a subscription for 50,000 units for $50,000. The 50,000 units are comprised of 50,000 restricted common shares and 25,000 common share purchase warrants in the capital of the Company with piggyback registration rights for all securities underlying the units issued. The warrants are exercisable at $1.50 per share for a term which is the earlier of (i) 12 months from the date of issuance or (ii) six months from the effective date of registration. On May 10, 2006, the shares pursuant to this subscription were issued.

On May 3, 2006, the Company issued 300,000 S-8 registered common shares in connection with the exercise of share options by consultants to the Company for $100,000.

On May 11, 2006, the Company completed the initial tranche of a private placement pursuant to which the Company issued an aggregate of 1,652,500 units ("Unit") of the Company at a subscription price of U.S. $2.00 per Unit; with each such Unit being comprised of one common share and one-half of one non-transferable common stock purchase warrant ("Warrant") in the capital of the Company, and with each such resulting whole Warrant entitling the subscriber thereof to purchase an additional common share (“Warrant Share”) of the Company for the period commencing upon the date of issuance of the within Units by the Company; that being on May 11, 2006; and ending at 5:00 p.m. on the day which is the earlier of (i) 12 months from the date of issuance of the within Units and (ii) six months from the effective date of the Company’s proposed registration statement, if any, pursuant to which the Warrant Shares underlying the Warrants are to be proposed for registration under the United States Securities Act of 1933, as amended (the earlier such time period being the “Warrant Exercise Period” herein), at an exercise price of U.S. $2.50 per Warrant Share during the Warrant Exercise Period. A total of 1,652,000 restricted common shares were issued pursuant to the closing of the initial tranche of units.

On May 11, 2006, the Company issued500,000 further restricted common shares pursuant to the Mineral Asset Option Agreement (the “Option”) granting the Company the option to acquire certain uranium leases in the State of Texas. The Option, if fully exercised will require the further issuance of 1,000,000 shares of restricted common stock in 500,000 share installments due October 11, 2006 and April 9, 2007 (refer to notes 3 and 4).

On May 11, 2006, the Company issued 12,500 restricted common shares in connection with a drilling database information agreement (refer to Note 3).  The agreement requires cash payments of $2,000 per month payable quarterly and quarterly issuances of 12,500 restricted common shares during the second and third quarters of 2006. 

On May 11, 2006, the Company issued 250,000 restricted common shares associated with the sale of 250,000 units at $1.00 per share purchase unit from a consultant to the Company for net proceeds received in the first quarter. (refer to Note 4). 

16

Statements made in this Form 10-QSB that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events. Please note that throughout this Quarterly Report, and unless otherwise noted, the words “we”, “our” or the “Company” refer to Lexington Resources, Inc.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

GENERAL

Uranium Energy Corp. is a corporation organized under the laws of the State of Nevada. After the effective date of our registration statement filed with the Securities and Exchange Commission (December 5, 2005), we commenced trading on the Over-the-Counter Bulletin Board under the symbol “URME:OB”.

Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," the "Company," or "Uranium Energy," refers to Uranium Energy Corp.

Recent Developments

Forward Stock Split

On February 14, 2006, our Board of Directors pursuant to minutes of written consent in lieu of a special meeting authorized and approved a forward stock split of 1.5-for-one of our total issued and outstanding shares of common stock (the “Forward Stock Split”).

The Forward Stock Split was effectuated based on market conditions and upon a determination by our Board of Directors that the Forward Stock Split was in our best interests and of the shareholders. In our judgment the Forward Stock Split would result in an increase in our trading float of shares of common stock available for sale resulting in facilitation of investor liquidity and trading volume potential. The intent of the Forward Stock Split was to increase the marketability of our common stock.

The Forward Stock Split was effectuated with a record date of February 28, 2006 upon filing the appropriate documentation with NASDAQ. The Forward Stock Split increased our issued and outstanding shares of common stock from 14,968,222 to approximately 22,452,338 shares of common stock. The common stock will continue to be $0.001 par value.

17

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION - continued

 Amendment to Articles of Incorporation

Effective February 28, 2006, we filed an amendment to our articles of incorporation with the Nevada Secretary of State. The amendment revised Section 3 of the articles of incorporation increasing the authorized capital stock from 75,000,000 shares of common stock at $0.001 par value to 750,000,000 shares of common stock par value $0.001.

CURRENT BUSINESS OPERATIONS

We are a natural resource exploration and development company engaged in the exploration and development of properties that may contain uranium minerals in the United States. Our strategy is to acquire properties that are thought to contain economic quantities of uranium ore and have undergone some degree of uranium exploration but have not yet been mined. We plan an aggressive acquisition strategy for the next 12 to 24 months to build uranium resources of 50 million pounds. To date, we have acquired interests in 9,593 gross acres of leased or staked mineral properties, consisting of claim blocks located in the States of Arizona, Colorado, Utah, Wyoming, and Texas. Other mineral property acquisitions are contemplated in the States of interest that include Arizona, Utah, Colorado, Texas, and Wyoming. These potential acquisition properties have not yet been specifically identified. As of the date of this Quarterly Report, we do not have proven reserves of any kind.

We have acquired interests in twenty-two uranium exploration mineral properties totaling 9,593 gross acres in the States of Arizona, Colorado, Texas, Wyoming and Utah for aggregate consideration of $177,676. As of the date of this Quarterly Report, we have interests in an aggregate of 9,593 gross acres (9,443 net mineral acres) of properties that have been either leased or staked, which we intend to explore for economic deposits of uranium. These leases are also subject to 5.0% to 8.25% net royalty interests. These properties consist of claim blocks located in the States of Arizona, Colorado, Wyoming, Utah, and Texas. Each of these properties has been the subject of historical exploration by other mining companies, and provides indications that uranium may exist in economic concentrations. We have access to historical exploration data that may provide indications of locations that may contain unknown quantities of uranium. These data consist chiefly of drill hole assay results, drill hole logs, studies, publicly published works, our own created work product, and maps, that help guide our property acquisition strategy. The basis for management's belief that there may be indications uranium may exist in economic concentrations on our leased and claimed properties are based as follows with specific reference to each state where we have leased or claimed exploration property interests. The basis of information in each state pertains to prior exploration conducted by other companies, or management information and work product derived from various reports, maps, radioactive rock samples, exploratory drill logs, state organization reports, consultants, geological study, and other exploratory information.

During the quarter ended March 31, 2006, we acquired 640 acres of leases in the State of Wyoming.

MINERALS EXPLORATION PROPERTIES

We are participating in our mineral properties in the States of Arizona and Colorado by way of quitclaim deed. The properties were staked and claimed by us and registered with the United States Bureau of Land Management ("BLM"). There are claim blocks deeded to us in this manner in Arizona, and further claim blocks in Colorado. We have unfettered surface access, and complete mineral rights to an unlimited depth below surface. The deeds are in effect for five years, and carry renewable five-year terms for an indefinite period, provided that the annual processing fees are in good standing with the BLM. The claims were entered into between November 4, 2004 and May 25, 2005, corresponding to initial terms of expiry between November 4, 2009 and April 21, 2010. Annual processing fees to be paid to the BLM vary from county to county but are relatively nominal. We will also be required to remediate the land upon termination of the deed - bringing the land back into the state it was originally in prior to the commencement of our exploration activities. These costs are not determinable at this time.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION - continued

In the States of Utah and Texas, we are participating in our mineral properties by way of property lease directly from the owners of the land/mineral rights. As of the date of this Quarterly Report, we have executed one lease in Utah, and further leases in Texas. These leases give us similar access and privileges as described above, however with some important differences. Although we will have access to the surface, the mineral rights below surface are restricted to uranium only, with any other minerals, including, for example, petroleum, reverting to the lessor. The lease terms are for five years, and include five-year renewal periods. After the expiration of the second five-year term, we must renegotiate the terms of a new lease. Royalty payments must be made to the lessor in event that we extract uranium ore from the properties in the amount of 8.25% of the gross revenue so generated.

We have the following gross and net acre mineral property interests in states indicated below under lease:

	Gross Acres	Net Acres
Arizona	2,160.00	2,160.00
Colorado	1,040.00	1,040.00
Utah	640.00	640.00
Wyoming	3,827.00	3,827.00
Texas	1,926.32	1,776.82
	9,593.32	9,444.82

These properties do not have any indicated or inferred minerals or reserves. We plan to conduct exploration programs on these properties with the intent to prove or disprove the existence of economic concentrations of uranium.

Since inception, we have not established any proven or probable reserves on its mineral property interests.

RESULTS OF OPERATION

Three-Month Period Ended March 31, 2006 Compared to Three-Month Period Ended March 31, 2005

Our net loss for the three-month period ended March 31, 2006 was approximately ($1,239,665) compared to a net loss of ($127,233) during the three-month period ended March 31, 2005 (an increase of $1,112,432). During the three-month periods ended March 31, 2006 and 2005, respectively, we did not generate any revenue from operations.

During the three-month period ended March 31, 2006, we incurred expenses of approximately $1,239,665 compared to $127,233 incurred during the three-month period ended March 31, 2005 (an increase of $1,112,432). These operating expenses incurred during the three-month period ended March 31, 2006 consisted of: (i) exploration costs, net of recoveries of $238,288 (2005: $64,946); (ii) general and administrative expenses of $158,195 (2005: $12,062); (iii) management fees of $178,207 (2005: 27,655); (iv) professional fees of $59,223 (2005: $22,570); and (v) stock-based compensation relating to the valuation of Stock Options granted to our officers, directors and consultants of $605,752 (2005: $-0-).

Operating expenses incurred during the three-month period ended March 31, 2006 increased primarily due to the increase in exploration costs associated with the increased acquisition and development of our uranium properties. General and administrative expenses incurred during the three-month period ended March 31, 2006 increased primarily relating to corporate marketing. General and administrative expenses generally include corporate overhead, financial and administrative contracted services, marketing, and consulting costs. Stock based compensation incurred during the three-month period ended March 31, 2006 increased due to the recording of the non-cash expense of $605,752 in connection with the grant of the Stock Options.

Of the $1,239,665 incurred as expenses during the three-month period ended March 31, 2006, an aggregate of $30,000 was incurred payable to International Market Trend (“IMT”) for amounts due and owing for operational, administrative and financial services rendered during the three-month period ended March 31, 2006. On December 1, 2005, we entered into a financial consulting agreement with IMT (the “Consulting Agreement”). In accordance with the terms and provisions of the Consulting Agreement: (i) we pay to IMT $10,000 monthly for services rendered by IMT; and (ii) we granted to IMT and/or its designates 1,300,000 Stock Options exercisable at $0.50 per share.

Of the $1,239,665 incurred as expenses during the three-month period ended march 31, 2006, an aggregate of $178,246 was incurred payable to certain officers and directors in management fees and benefits. On February 15, 2006, we executed an employment agreement with Harry Anthony, our Chief Operating Officer, pursuant to which we pay Mr. Anthony a monthly fee of $10,000. During this period, we paid an aggregate of $160,246 against the amounts due and owing in management fees. As at March 31, 2006, an aggregate of $76,832 is due and owing to an officer and director in fees and expenses.

19

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION - continued

Our net loss during the three-month period ended March 31, 2006 was ($1,239,665) or $0.06 per share compared to a net loss of ($127,233) or ($0.01) per share during the three-month period ended March 31, 2005. The weighted average number of shares outstanding was 21,854,791 for the three-month period ended March 31, 2006 compared to 16,328,658 for the three-month period ended March 31, 2005.

LIQUIDITY AND CAPITAL RESOURCES

Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.

Three-Month Period Ended March 31, 2006

As at the three-month period ended March 31, 2006, our current assets were $123,692 and our current liabilities were $223,433, which resulted in a working capital deficit of $99,741. As at the three-month period ended March 31, 2006, current assets were comprised of: (i) $102,865 in cash; (ii) $300 in other current assets; and (iii) $20,527 in prepaid expenses. As at the three-month period ended March 31, 2006, current liabilities were comprised of: (i) $146,601 in accounts payable and accrued liabilities; and (ii) $76,832 due to related parties.

As at the three-month period ended March 31, 2006, our total assets were $123,692 comprised of current assets. The increase in assets during the three-month period ended March 31, 2006 from fiscal year ended December 31, 2005 was primarily due to the increase in prepaid expenses.

As at the three-month period ended March 31, 2006, our total liabilities were $223,433 comprised of current liabilities. The decrease in liabilities during the three-month period ended March 31, 2006 from fiscal year ended December 31, 2005 was primarily due to the decrease in amounts due to related parties.

Stockholders' equity increased from ($215,828) for fiscal year ended December 31, 2005 to ($99,741) for the three-month period ended March 31, 2006.

We have not generated positive cash flows from operating activities. For the three-month period ended March 31, 2006, net cash flows used in operating activities was ($604,295), consisting primarily of a net loss of ($1,239,665). Net cash flows used in operating activities was adjusted by $605,752 to reconcile the non-cash expense of $605,752 for the grant of the Stock Options and by $32,145 to reconcile accounts payable and accrued liabilities.

For the three-month period ended march 31, 2006, net cash flows from financing activities was $600,000 pertaining primarily to $350,000 received from proceeds on the sale of our common stock and $250,000 received for common share subscriptions.

We expect that working capital requirements will continue to be funded through a combination of our existing funds, cash flow from operations and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

20

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION - continued

PLAN OF OPERATION AND FUNDING

Existing working capital and debt and equity fundings are expected to be adequate to fund our operations over the next twelve months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) uranium exploration operating activities; (ii) possible future reserve definition; (iii) possible future mining initiatives on current and future properties; and (iv) future possible property acquisitions. We intend to finance these expenses with further issuances of securities, and debt issuances. We expect we will need to raise additional capital to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

The independent auditors' report accompanying our December 31, 2005 and December 31, 2004 financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

MATERIAL COMMITMENTS

A material commitment for us during fiscal year 2006 is the aggregate approximate amount of $375,000 due and owing to EurXchange Consulting Ltd. (“EurXchange”) pursuant to the terms and provisions of a consulting agreement between us and EurXchange dated April 1, 2006 (the “Consulting Agreement”). In accordance with the terms and provisions of the Consulting Agreement: (i) we agreed to pay an aggregate of $290,000 EUR ($375,000 U.S. Dollars), with the first installment paid as of April 1, 2006 and the second and third installments of $80,000 EUR due and owing on April 30, 2006 and May 30, 2006, respectively; (ii) EurXchange agreed to render to us consulting services including, but not limited to, translations of webpage, business plan and new releases into German, establishment of communication during European business hours, chat line coordination, web portal presence through Wallstreet Online, production and distribution of a MIDAS research report and a penny stock report, presentation of roadshows, production of certain mailers, and establishment of a Stock Hotline telephone line; and (iii) we issued to EurXchange an aggregate of 400,000 shares of our restricted common stock.See “Part II. Item 2. Recent Sales of Unregistered Securities.”

During March 2006 the Company committed to spend approximately  $450,00 on company image market development (spent in April 2006).

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with us is a party, under which we have: (i) any obligation arising under a guaranteed contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.

21

ITEM 3. CONTROLS AND PROCEDURES

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

In accordance with Exchange Act Rules 13a-15 and 15d-15, an evaluation was completed under the supervision and with the participation of our management, including Mr. Amir Adnani, our Chief Executive Officer, and Mr. D. Bruce Horton, our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report. Based on that evaluation, our management including the Chief Executive Officer and Principal Financial Officer, concluded that our disclosure controls and procedures are effective, to provide reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms. There have been no changes to our internal controls over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) that occurred during our three-month quarterly period ended March 31, 2006, that materially affected, or were reasonably likely to materially affect, our internal controls over financial reporting.

Audit Committee Report

The Board of Directors has established an audit committee. The members of the audit committee are Mr. Steven Jewett, Mr. D. Bruce Horton and Mr. Alan Lindsay. Two of the three members of the audit committee are “independent” within the meaning of Rule 10A-3 under the Exchange Act. The audit committee was organized in April 2004 and operates under a written charter adopted by our Board of Directors.

The audit committee has reviewed and discussed with management our unaudited financial statements as of and for the three-month period ended March 31, 2006. The audit committee has also discussed with Dale Matheson Carr-Hilton LaBonte the matters required to be discussed by Statement on Auditing Standards No. 61, Communication with Audit Committees, as amended, by the Auditing Standards Board of the American Institute of Certified Public Accountants. The audit committee has received and reviewed the written disclosures and the letter from Dale Matheson Carr-Hilton LaBonte required by Independence Standards Board Standard No. 1, Independence Discussions with Audit Committees, as amended, and has discussed with Dale Matheson Carr-Hilton LaBonte their independence.

Based on the reviews and discussions referred to above, the audit committee has recommended to the Board of Directors that the unaudited financial statements referred to above be included in our Quarterly Report on Form 10-QSB for the three-month period ended March 31, 2006 filed with the Securities and Exchange Commission.

22

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

EURXCHANGE CONSULTING LTD.

On April 1, 2006, we authorized and approved the issuance to EurXchange an aggregate of 400,000 post-forward stock split shares of our restricted common stock at $0.50 in accordance with the terms and provisions of the Consulting Agreement.

EUROTRADE MANAGEMENT GROUP LTD.

During the three-month period ended March 31, 2006, we authorized and approved the issuance to Eurotrade Management Group Ltd. (“Eurotrade”) an aggregate of 515,000 pre-forward stock split shares (772,500 post forward stock split shares) of our restricted common stock at $0.50 per share in accordance with the terms and provisions of a consulting services agreement with Eurotrade dated February 1, 2006 (the “Consulting Services Agreement”). Pursuant to the terms and provisions of the Consulting Services Agreement, we agreed: (i) to retain Eurotrade as a consultant for a one-year period effective February 1, 2006 (the "Effective Date"); (ii) within ten calendar days from the Effective Date, to issue to Eurotrade an aggregate 515,000 pre-forward stock split shares of our restricted common stock (772,500 post-forward stock split shares); and (iii) to reimburse Eurotrade for all pre-approved, direct and reasonable expenses actually and properly incurred by Eurotrade for our benefit in connection with its performance of consulting services. The shares were issued pursuant to an exemption from registration under Section 4(2) of the Securities Act.

DRILLING DATABASE INFORMATION AGREEMENT

During the three-month period ended March 31, 2006, we issued an aggregate of 18,750 pre-forward stock split shares of our restricted common stock (28,125 post-forward stock split shares) in accordance with the terms and provisions of a drilling database information agreement with Jim Knupke (“Knupke”) dated January 15, 2006 (the “Drilling Database Agreement”). On May 11, 2006, we issued a further 12,500 post-forward stock split shares of our restricted common stock. In accordance with the terms and provisions of the Drilling Database Agreement: (i) we are required to make cash payments to Knupke of $2,000 per month payable quarterly; (ii) issue an aggregate of 12,500 pre-Forward Stock Split shares of our restricted common stock (18,750 post-Forward Stock Split); and (iii) issue a further 12,500 pre-Forward Stock Split shares of our restricted common stock (18,750 post-Forward Stock Split) quarterly for the next three quarters following the effective date of the Drilling Database Agreement. The shares were issued pursuant to an exemption from registration under Section 4(2) of the Securities Act.

MINERAL ASSET OPTION AGREEMENT

On May 11, 2006, we issued an aggregate of 500,000 post-forward stock split shares of our restricted common stock to Brad A. Moore pursuant to the terms and provisions of a mineral asset option agreement dated October 11, 2005 with Brad A. Moore (the "Option"), giving us the option to acquire certain uranium leases from Mr. Moore in the State of Texas. In consideration for the Option, we previously issued 750,000 shares of our restricted common stock. The Option, if exercised, will require the further issuance of 1,000,000 restricted common shares in 500,000 share installments over the three month intervals following the effective date of the Option (October 11, 2005). Title to the properties to be acquired will transfer upon payment of all remaining stock required under the Option, the timing of which may be accelerated at our discretion. During the Option term, we have the right as operator to conduct or otherwise direct the all exploration on the properties to be acquired.

23

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS - continued

PRIVATE PLACEMENT OFFERING

During the three-month period ended March 31, 2006, we engaged in a private placement offering under Regulation D and Regulation S of the Securities Act. Pursuant to the terms of the private placement, we issued an aggregate of 1,652,500 units (the “Unit(s)”) at a subscription price of $2.00 per Unit. Each Unit is comprised of one share of our restricted common stock and one-half of one non-transferable common stock purchase warrant (the “Warrant”), with each such resulting whole Warrant entitling the holder thereof to purchase an additional shares of our restricted common stock (the “Warrant Share”) for the period commencing upon the date of issuance of the Units (May 11, 2006) and ending on the day which is the earlier of: (i) twelve months from the date of issuance of the Units; or (ii) six months from the effective date of a proposed registration statement, if any, pursuant to which the Warrant Shares are to be registered under the Securities Act, at an exercise price of $2.50 per Warrant Share. The per share price of the offering was arbitrarily determined by our Board of Directors based upon analysis of certain factors including, but not limited to, stage of development, industry status, investment climate, perceived investment risks, our assets and net estimated worth. We issued Units to investors who non-U.S. residents. The investors executed subscription agreements and acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities. Finder’s fees payable on the transaction is 7% of the gross proceeds raised from the sale of the Units payable in cash plus 10% of the gross Units issued payable in Warrants identical to those provided in the Units.

PRIVATE PLACEMENT OFFERING

On May 11, 2006, we issued 250,000 shares of our common stock in accordance with proceeds received by us during the three-month period ended March 31, 2006, in which we engaged in a private placement offering under Regulation D and Regulation S of the Securities Act. Pursuant to the terms of the private placement, we issued an aggregate of 250,000 Units at a subscription price of $1.00 per Unit. Each Unit is comprised of 250,000 shares of our restricted common stock and 125,000 common share purchase warrants with piggyback registration rights for all securities underlying the Units issued. The warrants are exercisable at $1.50 per share for a term which is the earlier of: (i) twelve months from the date of issuance, or (ii) six months from the effective date of registration.

On April 24, 2006, we received a subscription for 50,000 Units for $50,000 in the same private placement offering.

On May 10, 2006, the shares pursuant to the above noted subscriptions were issued in the aggregate of 300,000 restricted common shares.

STOCK OPTIONS

During the three-month period ended March 31, 2006, we issued an aggregate of 1,500,000 share of our common stock pursuant to the exercise of a total of 1,500,000 Stock Options for aggregate cash proceeds of $350,000. The shares of common stock were subject to S-8 registration statements.

During the three-month period ended March 31, 2006, we granted an aggregate of 285,000 Stock Options to certain officers, directors and consultants at $0.50 per share.

24

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

No report required.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No report required.

ITEM 5. OTHER INFORMATION

2005 STOCK OPTION PLAN

On April 10, 2006, our Board of Directors authorized and approved an amendment to the 2005 stock option plan (which was originally authorized and approved by our Board of Directors on December 19, 2005) (the “Stock Option Plan”).

The purpose of the Stock Option Plan is to enhance our long-term stockholder value by offering opportunities to our directors, officers, employees and eligible consultants to acquire and maintain stock ownership in order to give these persons the opportunity to participate in our growth and success, and to encourage them to remain in our service.

The Stock Option Plan is to be administered by our Board of Directors or a committee appointed by and consisting of two or more members of the Board of Directors, which shall determine (i) the persons to be granted Stock Options under the Stock Option Plan; (ii) the number of shares subject to each option, the exercise price of each Stock Option; and (iii) whether the Stock Option shall be exercisable at any time during the option period of ten (10) years or whether the Stock Option shall be exercisable in installments or by vesting only. The Stock Option Plan, as amended, provides authorization to the Board of Directors to grant Stock Options to purchase a total number of shares of Common Stock of the Company, not to exceed 7,500,000 shares as at the date of adoption by the Board of Directors of the Stock Option Plan. At the time a Stock Option is granted under the Stock Option Plan, the Board of Directors shall fix and determine the exercise price at which shares of our Common Stock may be acquired.

In the event an optionee ceases to be employed by or to provide services to us for reasons other than cause, retirement, disability or death, any Stock Option that is vested and held by such optionee generally may be exercisable within up to ninety (90) calendar days after the effective date that his position ceases, and after such 90-day period any unexercised Stock Option shall expire. In the event an optionee ceases to be employed by or to provide services to us for reasons of retirement, disability or death, any Stock Option that is vested and held by such optionee generally may be exercisable within up to one-year after the effective date that his position ceases, and after such one-year period any unexercised Stock Option shall expire.

No Stock Options granted under the Stock Option Plan will be transferable by the optionee, and each Stock Option will be exercisable during the lifetime of the optionee subject to the option period of ten (10) years or limitations described above. Any Stock Option held by an optionee at the time of his death may be exercised by his estate within one (1) year of his death or such longer period as the Board of Directors may determine.

The exercise price of a Stock Option granted pursuant to the Stock Option Plan shall be paid in full to us by delivery of consideration equal to the product of the Stock Option in accordance with the requirements of the Nevada Revised Statutes. Any Stock Option settlement, including payment deferrals or payments deemed made by way of settlement of pre-existing indebtedness from the Company may be subject to such conditions, restrictions and contingencies as may be determined.

25

2005 STOCK OPTION PLAN  - continued

Incentive Stock Options

The Stock Option Plan further provides that, subject to the provisions of the Stock Option Plan and prior shareholder approval, the Board of Directors may grant to any key individuals who are our employees eligible to receive options one or more incentive stock options to purchase the number of shares of common stock allotted by the Board of Directors (the "Incentive Stock Options"). The option price per share of common stock deliverable upon the exercise of an Incentive Stock Option shall be at least 100% of the fair market value of the common shares of the Company, and in the case of an Incentive Stock Option granted to an optionee who owns more than 10% of the total combined voting power of all classes of our stock, shall not be less than 100% of the fair market value of our common shares. The option term of each Incentive Stock Option shall be determined by the Board of Directors, which shall not commence sooner than from the date of grant and shall terminate no later than ten (10) years from the date of grant of the Incentive Stock Option, subject to possible early termination as described above.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

Reports on Form 8-K:

Report on Form 8-K Item 1.01 filed with the Securities and Exchange Commission on February 17, 2006.

Report on Form 8-K Item 5.02 filed with the Securities and Exchange Commission on February 17, 2006.

Report on Form 8-K Item 5.02 filed with the Securities and Exchange Commission on February 17, 2006.

Amendment to Report on Form 8-K Item 5.02 filed with the Securities and Exchange Commission on March 3, 2006.

Exhibits:

10.1 Amended 2005 Stock Option Plan of Uranium Energy Corp.

10.2 Consulting Agreement between Uranium Energy Corp. and EurXChange Consulting Ltd. dated April 1, 2006.

31.1 Certification of Chief Executive Officer pursuant to Securities  Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

31.2 Certification of Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

32.1 Certifications pursuant to Securities Exchange Act of 1934 Rule 13a- 14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrantcaused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

URANIUM ENERGY CORP.

Dated: May 14, 2006 

By: /s/ Amir Adnani

Amir Adnani, President and Chief Executive Officer

Dated: May 14, 2006

By: /s/ D. Bruce Horton

D. Bruce Horton, Chief Financial Officer

26

EX-31

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECURITIES EXCHANGE ACT OF 1934

RULE 13a-14(a) OR 15d-14(a)

I, Amir Adnani, President/Chief Executive Officer, certify that:

1. I have reviewed this Form 10-QSB for the period ended March 31, 2006 of URANIUM ENERGY CORP.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements

made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5. The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Dated: May 15, 2006

By: /s/ AMIR ADNANI

Amir Adnani, President/Chief

Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECURITIES EXCHANGE ACT OF 1934

RULE 13a-14(a) OR 15d-14(a)

I, D. Bruce Horton, Treasurer/Chief Financial Officer, certify that:

1. I have reviewed this Form 10-QSB for the period ended March 31, 2006 of URANIUM ENERGY CORP.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements

made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5. The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Dated: May 15, 2006

By: /s/ D. BRUCE HORTON

D. Bruce Horton, Treasurer

Chief Financial Officer

EX-32

EXHIBIT 32

CERTIFICATION PURSUANT TO

18 U.S.C. 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of URANIUM ENERGY CORP. (the "Company") on Form 10-QSB for the period ended March 31, 2006, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Amir Adnani, President/Chief Executive Officer of the Company and D. Bruce Horton, Treasurer/Chief Financial Officer of the Company , certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: May 15, 2006

By: /s/ AMIR ADNANI

Amir Adnani, President/Chief

Executive Officer

Dated: May 15, 2006

By: /s/ D. BRUCE HORTON

D. Bruce Horton, Treasurer/Chief

Financial Officer

EX-10.1

__________

2005 STOCK OPTION PLAN

For:

URANIUM ENERGY CORP.

Amended April 10, 2006

Uranium Energy Corp.

Suite 401, 318 Homer Street, Vancouver, British Columbia, Canada, V6B 2V2

__________

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

URANIUM ENERGY CORP.

2005 STOCK OPTION PLAN

ARTICLE 1. THE PLAN

1.1Title

This plan is entitled the “2005 Stock Option Plan” (the “Plan”) of Uranium Energy Corp., a Nevada corporation (the “Company”).

1.2Purpose

The purpose of the Plan is to enhance the long-term stockholder value of the Company by offering opportunities to directors, officers, employees and eligible consultants of the Company and any Related Company, as defined below, to acquire and maintain stock ownership in the Company in order to give these persons the opportunity to participate in the Company’s growth and success, and to encourage them to remain in the service of the Company or a Related Company.

ARTICLE 2. DEFINITIONS

The following terms will have the following meanings in the Plan:

               (a) “Board” means the Board of Directors of the Company;

(b) “Cause”, unless otherwise defined in the instrument evidencing the award or in an employment or services agreement between the Company or a Related Company and a Participant, means a material breach of the employment or services agreement, dishonesty, fraud, misconduct, unauthorized use or disclosure of confidential information or trade secrets, or conviction or confession of a crime punishable by law (except minor violations), in each case as determined by the Plan Administrator, and its determination shall be conclusive and binding;

(c) “Code” means the United States Internal Revenue Code of 1986, as amended from time to time;

(d) “Common Shares” means the common shares, no par value, of the Company;

(e) “Consultant Participant” means a Participant who is defined as a Consultant Participant in Article 5 hereinbelow;

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

(f) “Corporate Transaction”, unless otherwise defined in the instrument evidencing the Option or in a written employment or services agreement between the Company or a Related Company and a Participant, means consummation of either.

(i) a merger or consolidation of the Company with or into any other corporation, entity or person; or

(ii) a sale, lease, exchange or other transfer in one transaction or a series of related transactions of all or substantially all the Company’s outstanding securities or all or substantially all the Company’s assets; provided, however, that a Corporate Transaction shall not include a Related Party Transaction;

(g) “Disability”, unless otherwise defined by the Plan Administrator, means a mental or physical impairment of the Participant that is expected to result in death or that has lasted or is expected to last for a continuous period of 12 months or more and that causes the Participant to be unable, in the opinion of the Company, to perform his or her duties for the Company or a Related Company and to be engaged in any substantial gainful activity;

(h) “Employment Termination Date” means, with respect to a Participant, the first day upon which the Participant no longer has an employment or service relationship with the Company or any Related Company;

(i) “Exchange Act” means the United States Securities Exchange Act of 1934, as amended;

(j) “Fair Market Value” means the per share value of the Common Shares determined as follows:

(i) if the Common Shares are listed on an established stock exchange or exchanges or the NASDAQ National Market, the closing price per share on the last trading day immediately preceding such date on the principal exchange on which it is traded or as reported by NASDAQ; or

(ii) if the Common Shares are not then listed on an exchange or the NASDAQ National Market, but is quoted on the NASDAQ Small Cap Market, the NASDAQ electronic bulletin board or the National Quotation Bureau pink sheets, the average of the closing bid and asked prices per share for the Common Shares as quoted by NASDAQ or the National Quotation Bureau, as the case may be, on the last trading day immediately preceding such date; or

(iii) if there is no such reported market for the Common Shares for the date in question, then an amount determined in good faith by the Plan Administrator;

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

- -

(k) “Grant Date” means the date on which the Plan Administrator completes the corporate action relating to the grant of an Option or such later date specified by the Plan Administrator, and on which all conditions precedent to the grant have been satisfied, provided that conditions to the exercisability or vesting of Options shall not defer the Grant Date;

(l) “Incentive Stock Option” means an Option granted with the intention, as reflected in the instrument evidencing the Option, that it qualify as an “incentive stock option” as that term is defined in Section 422 of the Code;

(m) “Nonqualified Stock Option” means an Option other than an Incentive Stock Option;

(n) “Option” means the right to purchase Common Shares granted under Article 7 hereinbelow;

(o) “Option Expiration Date” has the meaning set forth in Article 7.6 hereinbelow;

(p) “Option Term” has the meaning set forth in Article 7.3 hereinbelow;

(q) “Participant” means the person to whom an Option is granted and who meets the eligibility requirements imposed by Article 5 hereinbelow, including Consultant Participants as defined in Article 5;

(r) “Participant” means the person to whom an Option is granted and who meets the eligibility requirements imposed by Article 5 hereinbelow, including Consultant Participants as defined in Article 5;

(s) “Plan Administrator” has the meaning set forth in Article 3.1 hereinbelow;

(t) “Related Company” means any entity that, directly or indirectly, is in control of or is controlled by the Company;

(u) “Related Party Transaction” means:

(i) a merger or consolidation of the Company in which the holders of Common Shares immediately prior to the merger hold at least a majority of the Common Shares in the Successor Corporation immediately after the merger;

(ii) a sale, lease, exchange or other transaction in one transaction or a series of related transactions of all or substantially all the Company’s assets to a wholly-owned subsidiary corporation;

(iii) a mere reincorporation of the Company; or

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

(iv) a transaction undertaken for the sole purpose of creating a holding company that will be owned in substantially the same proportion by the persons who held the Company’s securities immediately before such transaction;

(v) “Retirement”, unless otherwise defined by the Plan Administrator from time to time for purposes of the Plan, means retirement on or after the individual’s normal retirement date under the Company’s 401(k) plan or other similar successor plan applicable to salaried employees;

(w) “Securities Act” means the United States Securities Act of 1933, as amended;

(x) “Successor Corporation” has the meaning set forth in Article 11.3.1 hereinbelow; and

(y) “Vesting Commencement Date” means the Grant Date or such other date selected by the Plan Administrator as the date from which the Option begins to vest for purposes of Article 7.4 hereinbelow.

ARTICLE 3. ADMINISTRATION

3.1Plan Administrator

The Plan shall be administered by the Board or a committee appointed by, and consisting of two or more members of, the Board (the “Plan Administrator”). If and so long as the Common Shares are registered under Section 12(b) or 12(g) of the Exchange Act, the Board shall consider in selecting the members of any committee acting as Plan Administrator, with respect to any persons subject or likely to become subject to Section 16 of the Exchange Act, the provisions regarding: (a) “outside directors”, as contemplated by Section 162(m) of the Code and (b) “nonemployee directors”, as contemplated by Rule 16b-3 under the Exchange Act. Committee members shall serve for such term as the Board may determine, subject to removal by the Board at any time. At any time when no committee has been appointed to administer the Plan, then the Board will be the Plan Administrator.

3.2Administration and Interpretation by Plan Administrator

Except for the terms and conditions explicitly set forth in the Plan, the Plan Administrator shall have exclusive authority, in its discretion, to determine all matters relating to Options under the Plan, including the selection of individuals to be granted Options, the type of Options, the number of Common Shares subject to an Option, all terms, conditions, restrictions and limitations, if any, of an Option and the terms of any instrument that evidences the Option. The Plan Administrator shall also have exclusive authority to interpret the Plan and the terms of any instrument evidencing the Option and may from time to time adopt and change rules and regulations of general application for the Plan’s administration. The Plan Administrator’s interpretation of the Plan and its rules and regulations, and all actions taken and determinations made by the Plan Administrator pursuant to the Plan, shall be conclusive and binding on all parties involved or affected.

The Plan Administrator may delegate administrative duties to such of the Company’s officers as it so determines.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

ARTICLE 4. STOCK SUBJECT TO THE PLAN

4.1Authorized Number of Shares

Subject to adjustment from time to time as provided in Article 11.1 hereinbelow, the number of Common Shares available for issuance under the Plan shall be 7,500,000 shares.

4.2Reuse of Shares

Any Common Shares that have been made subject to an Option that cease to be subject to the Option (other than by reason of exercise or settlement of the Option to the extent it is exercised for or settled in shares) shall again be available for issuance in connection with future grants of Options under the Plan. In the event shares issued under the Plan are reacquired by the Company pursuant to any forfeiture provision or right of repurchase, such shares shall again be available for the purposes of the Plan; provided, however, that the maximum number of shares that may be issued upon the exercise of Incentive Stock Options shall equal the share number stated in Article 4.1 hereinabove, subject to adjustment from time to time as provided in Article 11.1 hereinbelow; and provided, further, that for purposes of Article 4.3 hereinbelow, any such shares shall be counted in accordance with the requirements of Section 162(m) of the Code.

4.3Limitations

Subject to adjustment from time to time as provided in Article 11.1 hereinbelow, not more than an aggregate of 7,500,000 shares shall be available for issuance pursuant to grants of Stock Options under the Plan.

ARTICLE 5. ELIGIBILITY

An Option may be granted to any officer, director or employee of the Company or a Related Company that the Plan Administrator from time to time selects. An Option may also be granted to any consultant, agent, advisor or independent contractor who provides services to the Company or any Related Company (a “Consultant Participant”), so long as such Consultant Participant: (a) is a natural person or an alter ego entity of the natural person providing the services; (b) renders bona fide services that are not in connection with the offer and sale of the Company’s securities in a capital-raising transaction; and (c) does not directly or indirectly promote or maintain a market for the Company’s securities.

ARTICLE 6. OPTIONS

6.1Form and Grant of Options

The Plan Administrator shall have the authority, in its sole discretion, to determine the type or types of Options to be granted under the Plan. Options may be granted singly or in combination.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

6.2Settlement of Options

The Company may settle Options through the delivery of Common Shares, the granting of replacement Options or any combination thereof as the Plan Administrator shall determine. Any Option settlement, including payment deferrals or payments deemed made by way of the settlement of pre-existing indebtedness from the Company, may be subject to such conditions, restrictions and contingencies as the Plan Administrator shall determine. The Plan Administrator may permit or require the deferral of any Option payment, subject to such rules and procedures as it may establish, which may include provisions for the payment or crediting of interest, or dividend equivalents, including converting such credits into deferred stock equivalents.

ARTICLE 7. GRANTS OF OPTIONS

7.1Grant of Options

The Plan Administrator shall have the authority, in its sole discretion, to grant Options as Incentive Stock Options or as Nonqualified Stock Options, which shall be appropriately designated.

7.2Option Exercise Price

The exercise price for shares purchased under an Option shall be as determined by the Plan Administrator.

7.3Term of Options

Subject to earlier termination in accordance with the terms of the Plan and the instrument evidencing the Option, the maximum term of an Option (the “Option Term”) shall be as established for that Option by the Plan Administrator or, if not so established, shall be ten years from the Grant Date.

7.4Exercise of Options

The Plan Administrator shall establish and set forth in each instrument that evidences an Option the time at which, or the installments in which, the Option shall vest and become exercisable, any of which provisions may be waived or modified by the Plan Administrator at any time.

The Plan Administrator, in its sole discretion, may adjust the vesting schedule of an Option held by a Participant who works less than “full-time” as that term is defined by the Plan Administrator or who takes a Company-approved leave of absence.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

To the extent an Option has vested and become exercisable, the Option may be exercised in whole or from time to time in part by delivery to the Company of a written stock option exercise agreement or notice, in a form and in accordance with procedures established by the Plan Administrator, setting forth the number of shares with respect to which the Option is being exercised, the restrictions imposed on the shares purchased under such exercise agreement, if any, and such representations and agreements as may be required by the Plan Administrator, accompanied by payment in full as described in Article 7.5 hereinbelow. An Option may be exercised only for whole shares and may not be exercised for less than a reasonable number of shares at any one time, as determined by the Plan Administrator.

7.5Payment of Exercise Price

The exercise price for shares purchased under an Option shall be paid in full to the Company by delivery of consideration equal to the product of the Option exercise price and the number of shares purchased. Such consideration must be in accordance with the requirements of the Chapter 78 of the Nevada Revised Statutes and the Articles of Incorporation and Bylaws of the Company, must be paid before the Company will issue the shares being purchased and must be in a form or a combination of forms acceptable to the Plan Administrator for that purchase. As set forth in Article 6.2 hereinabove, any Option settlement, including payment deferrals or payments deemed made by way of the settlement of pre-existing indebtedness from the Company, may be subject to such conditions, restrictions and contingencies as the Plan Administrator shall determine.

7.6Post-Termination Exercises

The Plan Administrator shall establish and set forth in each instrument that evidences an Option whether the Option shall continue to be exercisable, and the terms and conditions of such exercise, if the Participant ceases to be employed by, or to provide services to, the Company or a Related Company, which provisions may be waived or modified by the Plan Administrator at any time. If not so established in the instrument evidencing the Option, the Option shall be exercisable according to the following terms and conditions, which may be waived or modified by the Plan Administrator at any time:

(a) Except as otherwise set forth in this Article 7.6 hereinbelow, any portion of an Option that is not vested and exercisable on the Employment Termination Date shall expire on such date.

(b) Any portion of an Option that is vested and exercisable on the Employment Termination Date shall expire on the earliest to occur of:

(i) if the Participant’s Employment Termination Date occurs for reasons other than Cause, Retirement, Disability or death, the day which is three months after such Employment Termination Date;

(ii) if the Participant’s Employment Termination Date occurs by reason of Retirement, Disability or death, the one-year anniversary of such Employment Termination Date; and

(iii) thelast day of the Option Term (the “Option Expiration Date”).

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

Notwithstanding the foregoing, if the Participant dies after his or her Employment Termination Date but while an Option is otherwise exercisable, the portion of the Option that is vested and exercisable on such Employment Termination Date shall expire upon the earlier to occur of (c) the Option Expiration Date and (d) the one-year anniversary of the date of death, unless the Plan Administrator determines otherwise.

Also notwithstanding the foregoing, in case of termination of the Participant’s employment or service relationship for Cause, all Options granted to that Participant shall automatically expire upon first notification to the Participant of such termination, unless the Plan Administrator determines otherwise. If a Participant’s employment or service relationship with the Company is suspended pending an investigation of whether the Participant shall be terminated for Cause, all the Participant’s rights under any Option shall likewise be suspended during the period of investigation. If any facts that would constitute termination for Cause are discovered after the Participant’s relationship with the Company or a Related Company has ended, any Option then held by the Participant may be immediately terminated by the Plan Administrator, in its sole discretion.

(c) A Participant’s transfer of employment or service relationship between or among the Company and any Related Company, or a change in status from an employee to a consultant, agent, advisor or independent contractor or a change in status from a consultant, agent, advisor or independent contractor to an employee, shall not be considered a termination of employment or service relationship for purposes of this Article 7. Unless the Plan Administrator determines otherwise, a termination of employment or service relationship shall be deemed to occur if a Participant’s employment or service relationship is with an entity that has ceased to be a Related Company.

(d) The effect of a Company-approved leave of absence on the application of this Article 7 shall be determined by the Plan Administrator, in its sole discretion.

(e) If a Participant’s employment or service relationship with the Company or a Related Company terminates by reason of Disability or death, the Option shall become fully vested and exercisable for all the shares subject to the Option. Such Option shall remain exercisable for the time period set forth in this Article 7.6.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

ARTICLE 8. INCENTIVE STOCK OPTION LIMITATIONS

Notwithstanding any other provisions of the Plan, and to the extent required by Section 422 of the Code, Incentive Stock Options shall be subject to the following additional terms and conditions:

8.1Dollar Limitation

To the extent the aggregate Fair Market Value (determined as of the Grant Date) of Common Shares with respect to which Incentive Stock Options are exercisable for the first time during any calendar year (under the Plan and all other 2005 Stock Option Plans of the Company) exceeds $100,000, such portion in excess of $100,000 shall be treated as a Nonqualified Stock Option. In the event the Participant holds two or more such Options that become exercisable for the first time in the same calendar year, such limitation shall be applied on the basis of the order in which such Options are granted.

8.2Eligible Employees

Individuals who are not employees of the Company or one of its parent corporations or subsidiary corporations may not be granted Incentive Stock Options.

8.3Exercise Price

The exercise price of an Incentive Stock Option shall be at least 100% of the Fair Market Value of the Common Shares on the Grant Date, and in the case of an Incentive Stock Option granted to a Participant who owns more than 10% of the total combined voting power of all classes of the stock of the Company or of its parent or subsidiary corporations (a “Ten Percent Stockholder”), shall not be less than 100% of the Fair Market Value of the Common Shares on the Grant Date. The determination of more than 10% ownership shall be made in accordance with Section 422 of the Code.

8.4Exercisability

An Option designated as an Incentive Stock Option shall cease to qualify for favorable tax treatment as an Incentive Stock Option to the extent it is exercised (if permitted by the terms of the Option):

(a) more than three months after the Employment Termination Date if termination was for reasons other than death or disability;

(b) more than one year after the Employment Termination Date if termination was by reason of disability; or

(c) after the Participant has been on leave of absence for more than three months, unless the Participant’s reemployment rights are guaranteed by statute or contract.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

8.5Taxation of Incentive Stock Options

In order to obtain certain tax benefits afforded to Incentive Stock Options under Section 422 of the Code, the Participant must hold the shares acquired upon the exercise of an Incentive Stock Option for two years after the Grant Date and one year after the date of exercise.

A Participant may be subject to the alternative minimum tax at the time of exercise of an Incentive Stock Option. The Participant shall give the Company prompt notice of any disposition of shares acquired on the exercise of an Incentive Stock Option prior to the expiration of such holding periods.

8.6Code Definitions

For the purposes of this Article 8, “parent corporation”, “subsidiary corporation” and “disability” shall have the meanings attributed to those terms for purposes of Section 422 of the Code.

ARTICLE 9. WITHHOLDING

9.1General

The Company may require the Participant to pay to the Company the amount of any taxes that the Company is required by applicable federal, state, local or foreign law to withhold with respect to the grant, vesting or exercise of an Option. The Company shall not be required to issue any shares Common Shares under the Plan until such obligations are satisfied.

9.2Payment of Withholding Obligations in Cash or Shares

The Plan Administrator may permit or require a Participant to satisfy all or part of his or her tax withholding obligations by:

(a) paying cash to the Company;

(b) having the Company withhold from any cash amounts otherwise due or to become due from the Company to the Participant;

(c) having the Company withhold a portion of any Common Shares that would otherwise be issued to the Participant having a value equal to the tax withholding obligations (up to the employer’s minimum required tax withholding rate); or

(d) surrendering any Common Shares that the Participant previously acquired having a value equal to the tax withholding obligations (up to the employer’s minimum required tax withholding rate to the extent the Participant has held the surrendered shares for less than six months).

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

ARTICLE 10. ASSIGNABILITY

Neither an Option nor any interest therein may be assigned, pledged or transferred by the Participant or made subject to attachment or similar proceedings other than by will or by the applicable laws of descent and distribution, and, during the Participant’s lifetime, such Options may be exercised only by the Participant. Notwithstanding the foregoing, and to the extent permitted by Section 422 of the Code, the Plan Administrator, in its sole discretion, may permit a Participant to assign or transfer an Option or may permit a Participant to designate a beneficiary who may exercise the Option or receive payment under the Option after the Participant’s death; provided, however, that any Option so assigned or transferred shall be subject to all the terms and conditions of the Plan and those contained in the instrument evidencing the Option.

ARTICLE 11. ADJUSTMENTS

11.1Adjustment of Shares

In the event, at any time or from time to time, a stock dividend, stock split, spin-off, combination or exchange of shares, recapitalization, merger, consolidation, distribution to stockholders other than a normal cash dividend, or other change in the Company’s corporate or capital structure, including, without limitation, a Related Party Transaction, results in (a) the outstanding Common Shares, or any securities exchanged therefor or received in their place, being exchanged for a different number or kind of securities of the Company or of any other corporation or (b) new, different or additional securities of the Company or of any other corporation being received by the holders of Common Shares of the Company, then the Plan Administrator shall make proportional adjustments in (i) the maximum number and kind of securities subject to the Plan and issuable as Incentive Stock Options as set forth in Article 4 hereinabove and the maximum number and kind of securities that may be made subject to Options and to Options to any individual as set forth in Article 4.3 hereinbelow, and (ii) the number and kind of securities that are subject to any outstanding award and the per share price of such securities, without any change in the aggregate price to be paid therefor. The determination by the Plan Administrator as to the terms of any of the foregoing adjustments shall be conclusive and binding. Notwithstanding the foregoing, a dissolution or liquidation of the Company or a Corporate Transaction shall not be governed by this Article 11.1 but shall be governed by Articles 11.2 and 11.3, respectively, hereinbelow.

11.2Dissolution or Liquidation

To the extent not previously exercised or settled, and unless otherwise determined by the Plan Administrator in its sole discretion, Options shall terminate immediately prior to the dissolution or liquidation of the Company. To the extent a forfeiture provision or repurchase right applicable to an Option has not been waived by the Plan Administrator, the Option shall be forfeited immediately prior to the consummation of the dissolution or liquidation.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

11.3Corporate Transaction

(a) In the event of a Corporate Transaction, except as otherwise provided in the instrument evidencing an Option (or in a written employment or services agreement between a Participant and the Company or Related Company) and except as provided in subsection (b) hereinbelow, each outstanding Option shall be assumed or an equivalent option or right substituted by the surviving corporation, the successor corporation or its parent corporation, as applicable (the “Successor Corporation”).

(b) If, in connection with a Corporate Transaction, the Successor Corporation refuses to assume or substitute for an Option, then each such outstanding Option shall become fully vested and exercisable with respect to 100% of the unvested portion of the Option. In such case, the Plan Administrator shall notify the Participant in writing or electronically that the unvested portion of the Option specified above shall be fully vested and exercisable for a specified time period. At the expiration of the time period, the Option shall terminate, provided that the Corporate Transaction has occurred.

(c) For the purposes of this Article 11.3, the Option shall be considered assumed or substituted for if following the Corporate Transaction the option or right confers the right to purchase or receive, for each share of Common Shares subject to the Option immediately prior to the Corporate Transaction, the consideration (whether stock, cash, or other securities or property) received in the Corporate Transaction by holders of Common Shares for each share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares); provided, however, that if such consideration received in the Corporate Transaction is not solely Common Shares of the Successor Corporation, the Plan Administrator may, with the consent of the Successor Corporation, provide for the consideration to be received upon the exercise of the Option, for each share of Common Shares subject thereto, to be solely Common Shares of the Successor Corporation substantially equal in fair market value to the per share consideration received by holders of Common Shares in the Corporate Transaction. The determination of such substantial equality of value of consideration shall be made by the Plan Administrator and its determination shall be conclusive and binding.

(d) All Options shall terminate and cease to remain outstanding immediately following the Corporate Transaction, except to the extent assumed by the Successor Corporation.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

11.4Further Adjustment of Options

Subject to Articles 11.2 and 11.3 hereinabove, the Plan Administrator shall have the discretion, exercisable at any time before a sale, merger, consolidation, reorganization, liquidation or change of control of the Company, as defined by the Plan Administrator, to take such further action as it determines to be necessary or advisable, and fair and equitable to the Participants, with respect to Options. Such authorized action may include (but shall not be limited to) establishing, amending or waiving the type, terms, conditions or duration of, or restrictions on, Options so as to provide for earlier, later, extended or additional time for exercise, lifting restrictions and other modifications, and the Plan Administrator may take such actions with respect to all Participants, to certain categories of Participants or only to individual Participants. The Plan Administrator may take such action before or after granting Options to which the action relates and before or after any public announcement with respect to such sale, merger, consolidation, reorganization, liquidation or change of control that is the reason for such action.

11.5Limitations

The grant of Options shall in no way affect the Company’s right to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

11.6Fractional Shares

In the event of any adjustment in the number of shares covered by any Option, each such Option shall cover only the number of full shares resulting from such adjustment.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

ARTICLE 12. AMENDMENT AND TERMINATION

12.1Amendment or Termination of Plan

The Board may suspend, amend or terminate the Plan or any portion of the Plan at any time and in such respects as it shall deem advisable; provided, however, and only if applicable, that to the extent required for compliance with Section 422 of the Code or any applicable law or regulation only, stockholder approval shall be required for any amendment that would:

(a) increase the total number of shares available for issuance under the Plan;

(b) modify the class of employees eligible to receive Options; or

(c) otherwise require stockholder approval under any applicable law or regulation.

Any amendment made to the Plan that would constitute a “modification” to Incentive Stock Options outstanding on the date of such amendment shall not, without the consent of the Participant, be applicable to such outstanding Incentive Stock Options but shall have prospective effect only.

12.2Term of Plan

Unless sooner terminated as provided herein, the Plan shall terminate ten years after the earlier of the Plan’s adoption by the Board and approval by the stockholders.

12.3Consent of Participant

The suspension, amendment or termination of the Plan or a portion thereof or the amendment of an outstanding Option shall not, without the Participant’s consent, materially adversely affect any rights under any Option theretofore granted to the Participant under the Plan. Any change or adjustment to an outstanding Incentive Stock Option shall not, without the consent of the Participant, be made in a manner so as to constitute a “modification” that would cause such Incentive Stock Option to fail to continue to qualify as an Incentive Stock Option. Notwithstanding the foregoing, any adjustments made pursuant to this Article 12 shall not be subject to these restrictions.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

ARTICLE 13. GENERAL

13.1Evidence of Options

Options granted under the Plan shall be evidenced by a written instrument that shall contain such terms, conditions, limitations and restrictions as the Plan Administrator shall deem advisable and that are not inconsistent with the Plan.

13.2No Individual Rights

Nothing in the Plan or any Option granted under the Plan shall be deemed to constitute an employment contract or confer or be deemed to confer on any Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Related Company or limit in any way the right of the Company or any Related Company to terminate a Participant’s employment or other relationship at any time, with or without Cause.

13.3Issuance of Shares

Notwithstanding any other provision of the Plan, the Company shall have no obligation to issue or deliver any Common Shares under the Plan or make any other distribution of benefits under the Plan unless, in the opinion of the Company’s counsel, such issuance, delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act), and the applicable requirements of any securities exchange or similar entity.

The Company shall be under no obligation to any Participant to register for offering or resale or to qualify for exemption under the Securities Act, or to register or qualify under state securities laws, any Common Shares, security or interest in a security paid or issued under, or created by, the Plan, or to continue in effect any such registrations or qualifications if made. The Company may issue certificates for shares with such legends and subject to such restrictions on transfer and stop-transfer instructions as counsel for the Company deems necessary or desirable for compliance by the Company with federal and state securities laws.

To the extent the Plan or any instrument evidencing an Option provides for issuance of stock certificates to reflect the issuance of Common Shares, the issuance may be effected on a noncertificated basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange.

13.4No Rights as a Stockholder

No Option or Stock Option denominated in units shall entitle the Participant to any cash dividend, voting or other right of a stockholder unless and until the date of issuance under the Plan of the shares that are the subject of such Option.

-- 2005 Stock Option Plan --

-- Uranium Energy Corp. --

13.5Compliance With Laws and Regulations

Notwithstanding anything in the Plan to the contrary, the Plan Administrator, in its sole discretion, may bifurcate the Plan so as to restrict, limit or condition the use of any provision of the Plan to Participants who are officers or directors subject to Section 16 of the Exchange Act without so restricting, limiting or conditioning the Plan with respect to other Participants. Additionally, in interpreting and applying the provisions of the Plan, any Option granted as an Incentive Stock Option pursuant to the Plan shall, to the extent permitted by law, be construed as an “incentive stock option” within the meaning of Section 422 of the Code.

13.6Participants in Other Countries

The Plan Administrator shall have the authority to adopt such modifications, procedures and subplans as may be necessary or desirable to comply with provisions of the laws of other countries in which the Company or any Related Company may operate to assure the viability of the benefits from Options granted to Participants employed in such countries and to meet the objectives of the Plan.

13.7No Trust or Fund

The Plan is intended to constitute an “unfunded” plan. Nothing contained herein shall require the Company to segregate any monies or other property, or Common Shares, or to create any trusts, or to make any special deposits for any immediate or deferred amounts payable to any Participant, and no Participant shall have any rights that are greater than those of a general unsecured creditor of the Company.

13.8Severability

If any provision of the Plan or any Option is determined to be invalid, illegal or unenforceable in any jurisdiction, or as to any person, or would disqualify the Plan or any Option under any law deemed applicable by the Plan Administrator, such provision shall be construed or deemed amended to conform to applicable laws, or, if it cannot be so construed or deemed amended without, in the Plan Administrator’s determination, materially altering the intent of the Plan or the Option, such provision shall be stricken as to such jurisdiction, person or Option, and the remainder of the Plan and any such Option shall remain in full force and effect.

13.9Choice of Law

The Plan and all determinations made and actions taken pursuant hereto shall be governed by the laws of the State of Nevada, U.S.A., without giving effect to principles of conflicts of law.

ARTICLE 14. EFFECTIVE DATE

The effective date is December 19, 2005 and as amended on April 10, 2006, being the date on which the Plan was adopted by the Board. If the stockholders of the Company do not approve the Plan within 12 months after the Board’s adoption of the

Plan, any Incentive Stock Options granted under the Plan will be treated as Nonqualified Stock Options.

This Plan is dated and made effective on this 19^th day of December, 2005 and as amended on April 10, 2005.

BY ORDER OF THE BOARD OF DIRECTORS OF

URANIUM ENERGY CORP.

Per:

“Amir Adnani”

Amir Adnani

President, CEO and a director

__________

EX-10.2

CONSULTING AGREEMENT

AGREEMENT, made this day ____ of __________, 2006 by and between Uranium Energy Corp., having its principal place of business at #401 318 Homer Street, Vancouver, B.C., V6B 2V2 (hereinafter the "Company") and EurXchange Consulting Ltd., having its principal place of business at #534, 34A-2755 Lougheed Hwy, Port Coquitlam, B.C., V3B 5Y9, Canada (hereinafter the "Consultant).

WHEREAS, the Company desires to retain the Consultant for consulting services in connection with financial and investor public relations and related matters in the Federal Republic of Germany and the Consultant desires to provide such services as set forth herein.

NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:

A. CONSULTATION

1. Consultant. The Company hereby retains the Consultant to render to the Company the consulting services as described in Section B hereof, and the Consultant hereby accepts such assignment upon the terms and conditions hereinafter set forth.

2. Independent Relationship. The Consultant shall provide the consulting services required to be rendered by it hereunder solely as an independent contractor and nothing contained herein shall be construed as giving rise to an employment or agency relationship, joint venture, partnership or other form of business relationship.

3. No Authority to Obligate the Company. Without the consent of the board of directors or appropriate officer of the Company, the Consultant shall have no authority to take, nor shall it take, any action committing or obligating the Company in any manner, and it shall not represent itself to others as having such authority.

4. Term. The term of the Consultant's consultation to the Company hereunder shall commence as of the date hereof and shall extend for a term of one (1) year.

B. OBLIGATIONS OF THE CONSULTANT

1. Consulting Services. During the term of this Agreement, Consultant will render advice and assistance to the Company on public and investor relations related matters, and in connection therewith the Consultant shall perform and render the consulting services enumerated in Schedule A hereto.

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ALL OF THE FOREGOING CONSULTANT PREPARED DOCUMENTATION CONCERNING THE COMPANY, INCLUDING, BUT NOT LIMITED TO, DUE DILIGENCE REPORTS, CORPORATE PROFILE, FACT SHEETS, AND QUARTERLY NEWSLETTERS, SHALL BE PREPARED BY THE CONSULTANT FROM MATERIALS SUPPLIED TO IT BY THE COMPANY AND SHALL BE APPROVED BY THE COMPANY IN WRITING PRIOR TO DISSEMINATION BY THE CONSULTANT.

2. Nonexclusive Engagement; Extent of Services.

a. The parties agree that the consultation contemplated by this Agreement is a nonexclusive engagement and that the Consultant now renders and may continue to render consulting services to other companies which may or may not conduct activities similar to those of the Company.

b. The Consultant will devote such time and effort to the affairs of the Company as the Consultant deems reasonable and adequate to render the consulting services contemplated by this Agreement. The Consultant's work will not include any services that constitute the rendering of any legal opinions or performance of work that is in the ordinary purview of certified public accountants.

3. Confidentiality. The Consultant will not, either during its engagement by the Company pursuant to this Agreement or at any other time thereafter, disclose, use or make known for its or another's benefit, any confidential information, knowledge, or data of the Company or any of its affiliates in any way acquired or used by the Consultant during its engagement by the Company. Confidential information, knowledge or data of the Company and its affiliates shall not include any information which is or becomes generally available to the public other than as a result of a disclosure by the Consultant or its representatives.

C. OBLIGATIONS OF THE COMPANY.

1. Compensation.

a. Cash Retainer. The Company will pay according to Schedule A the amount of 290,000 EUR in total. The first installment of 130,000 EUR is due on the date hereof. The second and third installment of each 80,000 EUR are payable on the 30th day of April and May 2006.

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b. Issuance of Stock. Subject to the provisions of Section b, below, in consideration of the services to be rendered by the Consultant hereunder, the Company shall issue to the Consultant or his designees an aggregate of 200,000 fully paid and non-assessable shares (the “Shares”) of the common stock of the Company, par value $0.01 per share.

b. In connection with, and in consideration of, the issuance of the Shares to the Consultant, the Consultant hereby agrees with and represents and warrants to the Company as follows:

i. The Consultant is acquiring the Shares for the undersigned's own account, for investment purposes only and not with a view toward their resale or distribution.

ii. The Consultant understands that the Shares are not freely transferable and will not be freely transferable for an extended period of time and that, as a consequence thereof, the undersigned may have extremely limited opportunities to dispose of the Shares. The Consultant understands that Rule 144 of the Securities Act of 1933, as amended (the “Act”) permits the transfer of "restricted securities" of the type herein involved under certain conditions, but the Company may not in the future meet the conditions to the application of Rule 144, including, inter alia, the condition that current detailed information concerning the Company be publicly available.

iii. The Consultant will not transfer any of the Shares either (a) in the absence of an effective registration under the Act and state securities laws (“Laws”), or (b) without obtaining an opinion of an counsel reasonably acceptable to the Company, which opinion shall be addressed, and satisfactory in form and substance, to the Company and its counsel, stating that the transaction is exempt from the registration requirements of the Act and Laws.

iv. Until freely transferable, the Company may refuse to authorize any transfer by the Consultant of any of the Shares if the proposed transferee does not make written representations and agreements to the Company and the undersigned in form and substance similar to those contained herein, or if any circumstances are present which reasonably indicate that such transferee's representations are not accurate.

v. A stop transfer order will be entered on the Company's records respecting the Shares and a restrictive legend will be affixed to the certificate evidencing the Shares substantially in the following form:

 (A) "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS."

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(B) In addition, the Company shall be entitled to imprint the certificate evidencing the Shares with any State legend, if required.

vi. The Consultant agrees to save, hold harmless, defend and indemnify the Company from any claims, liabilities, or nonperformance by the undersigned of any representation, warranty or agreement contained in this letter.

vii. The Consultant understands and acknowledges that the Company is under no obligation to prepare a registration statement covering the public resale of the Shares nor does the undersigned have a right to include the Shares in any registration statement that the Company may prepare in the future.

2. Reimbursement of Expenses.

a. Out-of-Pocket Expenses. The Company shall reimburse the Consultant for actual out-of-pocket expenses including, but not limited to, facsimile, postage, printing, photocopying, and entertainment, incurred by the Consultant without the prior consent of the Company and in connection with the performance by the Consultant of its duties hereunder in amounts up to one-thousand dollars (S1,000) per month. The prior consent of the Company shall be required for reimbursement of expenses in excess of one-thousand dollars ($1,000) per month.

b. Travel and Related Expenses. The Company shall reimburse the Consultant for the costs of all travel and related expenses incurred by the Consultant in connection with the performance of its services hereunder, provided that all such costs and expenses have been authorized, in advance, by the Company.

c. General. Expenses shall be due and payable when billed and after they have been incurred.

D. MISCELLANEOUS.

1. Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the engagement of Consultant by the Company as a consultant and supersedes and replaces any and all prior understandings, agreements or correspondence between the parties relating to the subject matter hereof.

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2. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both the parties hereto. No waiver of any other provisions hereof (whether or not similar) shall be binding unless executed in writing by both the parties hereto nor shall such waiver constitute a continuing waiver.

3. Governing Law. This Agreement has been made in and shall be interpreted according to the laws of the State of _________________ without any reference to the conflicts of laws rules thereof. The parties hereto submit to the jurisdiction of the courts of the State of ______________ for the purpose of any actions or proceedings which may be required to enforce any of the provisions of this agreement.

4. Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns and upon the Consultant and the Consultant's successors and assigns.

5. Severability. If any provision or provisions of this agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever:

a. the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and

b. to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this agreement containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.

6. Further Assurances. From and after the execution and delivery of this Agreement, upon request of either party, the other shall do, execute, acknowledge and deliver all such further acts, assurances and other instruments and papers as may be required to carry out the transactions contemplated by this agreement.

7. Headings. The headings of the paragraphs of this agreement are inserted for convenience only and shall not be deemed to constitute part of this agreement or to affect the construction hereof.

8. Notices. Any notice to be given hereunder shall be given in writing. All notices under this Agreement shall be either hand delivered receipt acknowledged, or sent by registered or certified mail, return receipt requested as follows:

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(a) If to the Company, to:	Uranium Energy Corp. #401 - 318 Homer Street. Vancouver, B.C., V6B 2V2 Attn.: Mr. Adnani Facsimile No.: (604) 682-3591
(b) If to the Consultant, to:	EurXchange Consulting Ltd. #534, 34A-2755 Lougheed Hwy Port Coquitlam, B.C, V3B 5Y9 Facsimile No.: (604) 949-1004 Attn: Mr. Kay Jessel

All such notices shall be deemed given when delivered, if personally delivered as aforesaid, or within five business days after mailing, as aforesaid.

9. Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such facsimile signature page were an original thereof.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first written above.

URANIUM ENERGY CORP.:

By:   _______________________

Amir Adnani, President

EURXCHANGE CONSULTING, LTD.

By: _______________________    

Kay Jessel, Director

SCHEDULE “A”

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Investor Awareness Program for URANIUM ENERGY CORP.

The Consultant is responsible for the program coordination within the six month term. The Consultant will arrange in addition to the suggested program elements Face-to-Face-Meetings with European specialists and strategic investors, arranged to generate a substantial interest for the Client’s stock in major European equity markets. Maximizing results will be achieved by handpicking the audience for each meeting, thus ensuring the best possible fit between the investor attendees and the Client. (Focus on GERMANY and SWITZERLAND)

Corporate finance consulting in connection with a debt or equity financing in order to raise funds for the Client including introduction to the Consultant’s investors’ network and their investment advisors plus various potential private investors capable of financing public companies.

Information on loans, credit lines, debts and other forms of financing or funding against equity as an asset which could function as a bridge financing in connection with the aforementioned fund raising services.

Introduction to various journalist of the leading press in Germany such as Focus Money, Financial Times Germany, Euro am Sonntag and reporters from CNBC, Bloomberg TV and N-TV, wholly owned subsidiary of CNN.

It shall be expressly understood that the Consultant shall have no power to bind Client to any contract or obligation or to transact any business in Client’s name or on behalf of Client in any manner.

 Listing on Frankfurt Exchange and electronic Xetra System    10,000 EUR

In order to get listed in Germany, the Client needs a “Makler” (equivalent to a market maker) who applies to the exchanges for a listing on behalf of Client. The listing procedure takes somewhere between 4 and 6 weeks. The above mentioned costs cover the fees for the exchanges and the costs for the market maker for his work. There are no additional costs and no annual fees as this is a secondary listing.

 Market Making contract with Fleischacker AG  20,000 EUR

Fleischhacker AG guarantees for a period of 1 year an active market making program which results in a very narrow spread between “bid” and “ask”. The market maker guarantees a minimum bid size of 5,000 shares rising to 20,000 shares depending on the liquidity of the stock. Deutsche Börse automatically groups the shares into one out of five liquidity classes each month based on the actual trading behavior.

 Translations of Webpage, Business Plan and News Releases   15,000 EUR

All of Client ´s materials made available to the public will be translated into German. Primarily there is the website (powered by EquityStory AG and available on over 25 financial portals), the business plan and various brochures which should be combined in a professional investors package (see below).The text would be not just translated but also be transformed in an easy-to-understand German to introduce Client to potential German investors. Corporate news will be sent out in German using the state-of-the-art services of DGAP (now a subsidiary of EquityStory AG)

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 Phone & Location Service  20,000 EUR

In order to establish communication during central European business hours, Client would have a German business address and active phone & fax lines. German investors have therefore an opportunity to speak in German with someone representing the Client, without any time difference.

Therefore, Consultant offers the following services for a six month term:

· answering of phone calls, faxes and mailings on Client´s behalf

· e-mail response center;

· building a data-base of all persons and institutions inquiring regarding the company;

· sending out information brochures/mailings/investor packages upon request (costs w/o packing & postage);

· preparing & updating an investors package based on the existing investors package (max. 2,000 pieces)

 Chat line Coordination  5,000 EUR

The Consultant offers the service of two professional “chat line hackers” specialized in coordinating and streamlining the chat lines. We suggest a one month term boosting the corporate story.

 Telephone Hotline   50,000 EUR

We are affiliated with Germany’s most successful “Stock Hotline”. The Stock Hotline will produce a five minute spot which will be posted in the 1-900 Call-In-Center which advertises regularly on German TV and German press.

The program lasts for four months upon signing with regular updates in case of important Corporate news.

 Web Portal Presence through Wallstreet Online    40,000 EUR

The Client will receive the marketing support of Germany’s most powerful web portal for stock related information, wallstreet-online.de. They have some 500,000 registered users who can sign up for areas of special interest. With five of their newsletters we will have a tremendous reach into the German financial community. Wallstreet Online guarantees a 3 month coverage of client’s story in their various stock letters, banners, stock-tickers and recommendation features. Furthermore the client will be posted as stock of the month, including the cover story. The average coverage will be twice a week. We suggest Mondays and Thursdays.

 MIDAS Research Report    20,000 EUR

This service will include production and distribution of:

· 1 basic research report (minimum 12 pages) (German/English)

· 1 update (minimum 5 pages)

· up to 4 research flashes (1-2 pages) covering news releases and filings during the following 6 months

· 1 analyst interview featuring the Client using the “Analyst Corner” format on Cortal Consors (the leading German Online Broker)

· 1 CEO interview

· All research (except CEO interview) will be published on the website of Cortal Consors and will be sent out via email to our own database of 600 institutions and private asset managers in Germany and Switzerland. This will be published in German and available as PDF or HTML file.

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 Penny Stock Report      50,000 EUR

This service will include production and distribution of:

· 1 basic research report 4 pages)

· 3 update (2 pages)

· 6 HTML research flashes (1-2 pages) covering news releases and filings during the following 6 months.

All research will be published on Penny Stock Report’s website and disseminated via email to over 400,000 opt-in email addresses for each report, including updates and research flashes.

 Additional News Letter Presence   30,000 EUR

The Consultant offers a wide range of very efficient News Letters throughout the whole German-speaking area (Germany, Austria and Switzerland). We recommend Der Goldreport, Oberbayerischer Boersenbrief, Frankfurt Finance and Money Radar. All of these news letters come with their own proprietary data base.

The 12 weeks package contains:

§ one recommendation in one of the next issues of the above stock-letters

§ one retrospect two weeks after the first recommendation

 Hard Copy Mailer by EURAMS   30,000 EUR

EURAMS (EURO AM SONNTAG) is a weekly financial newspaper issued each Sunday. EURAMS has 160,000 subscribers and is Germany’s leading stock magazine for venture capital. The Consultant suggests the creation of a company flyer, which will be added to the magazine when the trading volume peaks during the program.

Summary of Expenditures:

Listing on Frankfurt, Stuttgart and Berlin Stock Exchanges	10,000	EUR
Market Making, Fleischhacker	20,000	EUR
Translations / Web Site / News releases	15,000	EUR
Phone & Location Service	20,000	EUR
Chat-Line Coordination	5,000	EUR
Telephone Hotline	50,000	EUR
w:o Web Portal Presence	40,000	EUR
MIDAS Research Report	20,000	EUR
Penny Stock Report	50,000	EUR
Additional News Letters	30,000	EUR
EURAMS (Newspaper sublement)	30,000	EUR
Total costs	290,000	EUR

Conclusion

From our experience, for each EUR spent on IR (specifically with this type of program) for such a great story as Uranium Energy Corp., up to 50 EUR of buying should be created. We recommend that the initial offering should be at 1.25 EUR per share, which has the possibility to be doubled until the end of our program, if conducted as outlined above.

Since most of the indicated costs are up-front costs for us, we have to ask to be paid in several installments up front as part of our contract following the attached timeline. Once the money is in the bank for each program segment we can commence immediately.

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